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Keywords

contractlitigationstatuteappealtrialjury trial
contractlitigationappealtrialjury trial

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Bank South, N.A. v. Howard, 264 Ga. 339, 444 S.E.2d 799, 42 A.L.R.5th 763

Facts

Bank South sued Howard on a guaranty that included a provision where Howard waived his right to a jury trial. The trial court struck Howard's demand for a jury trial based on this waiver. The Court of Appeals reversed this decision, arguing that a valid waiver must be knowing and voluntary, and since Howard could not have anticipated the circumstances of a future claim when he signed the guaranty, his waiver was not valid.

Bank South sued Howard on a guaranty which contained a provision in which Howard purported to waive the right to a jury trial in any action on the guaranty.

Issue

Is a pre-litigation contractual waiver of the right to trial by jury enforceable under Georgia law?

We granted certiorari to consider whether a pre-litigation contractual waiver of jury trial is enforceable under the laws of Georgia.

Rule

The constitutional guarantee of the right to trial by jury in Georgia allows for waiver only in specific circumstances, primarily when litigation is pending. Pre-litigation waivers are not provided for by the Constitution or Code and are not enforceable.

The constitutional guarantee of the right to trial by jury refers to two circumstances in which the right may be waived: when no issuable defense is filed and when the parties fail to demand a jury trial.

Analysis

The court analyzed the nature of the waiver and its implications, concluding that waivers of the right to a jury trial are similar to confessions of judgment, both of which involve relinquishing significant rights. The court emphasized that both types of waivers are governed by statutes that contemplate the existence of litigation at the time of the waiver, thus reinforcing the conclusion that pre-litigation waivers are unenforceable.

Given the similarity of waivers of jury trial and confessions of judgment, and considering the magnitude of the rights involved and the probability of abuse that exists in both situations, waivers of jury trial are sufficiently analogous to confessions of judgment that the same rule should apply.

Conclusion

The Supreme Court of Georgia affirmed the Court of Appeals' decision, holding that pre-litigation contractual waivers of the right to trial by jury are not enforceable.

Judgment affirmed.

Who won?

Howard prevailed in the case because the court found that the waiver of his right to a jury trial was not knowing and voluntary, thus rendering it unenforceable.

The Court of Appeals reversed the trial court's judgment, holding that a valid waiver of jury trial must be knowing and voluntary, and that since Howard could not have known when he signed the guaranty contract what the basis and circumstances of a future claim on the guaranty might be, his waiver could not have been knowing and voluntary.

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