On February 26, 2024, the California Supreme Court issued its opinion in Tricoast Builders, Inc. v. Fonnegra, No. S273368 (Cal. Feb. 26, 2024). For employers, the most important takeaway from this case is that the court held a litigant’s waiver of the right to a jury trial can be conclusive if a party seeking reversal of the waiver cannot demonstrate it caused prejudice to the party. The decision makes it more difficult for a party to convince a court to let it back out of a jury trial waiver in a civil case.

Background

Fonnegra, an individual, hired TriCoast, a company, to repair a portion of his house after a fire. He was not satisfied with the quality of the work and, as a result, terminated the contract. TriCoast then sued Fonnegra for damages resulting from the contract termination. The defendant demanded a jury trial at the outset of litigation but later waived this right on the day of the trial. TriCoast did not demand a jury trial originally, and so it had not paid a jury fee. However, TriCoast changed its mind after defendant’s waiver and requested a jury. The trial court denied this request, held a bench trial and found in favor of defendant Fonnegra. The company appealed the judgment, arguing that the trial court erred in denying its late request for a jury trial. The Supreme Court of California eventually affirmed the judgment, concluding that the company had not established prejudice necessary to justify reversal based on denial of a jury trial.

Legal Impact

The California Constitution provides that all civil litigants have the right to trial by jury, but they may waive that right in accordance with rules laid out by statute.¹  Code of Civil Procedure section 631 (section 631), describes various acts and omissions that constitute jury waiver, including failure to make a timely jury demand and failure to pay a jury fee on time in accordance with statutory requirements.²  However, and importantly, waiver does not completely extinguish the opportunity for trial by jury because a litigant that has waived their right to a jury trial may seek relief from the waiver. In California, if there is just cause for granting such relief, a trial court maintains discretion to grant relief from the waiver.³

There are two main questions raised by TriCoast about the adjudication of requests for relief from jury waiver under section 631(g). The first concerns proceedings in the trial court: Is a trial court required to grant relief from a jury waiver if proceeding with a jury would not cause hardship to other parties or to the trial court?  The Supreme Court concluded that the answer is “no.”  It explained that “the presence or absence of hardship is always a primary consideration, and it is often dispositive in cases where the litigant has given timely notice that it desires a jury trial and seeks relief from mere technical statutory waiver, such as failure to post the required jury fee at the correct time or in the correct amount.”  However, the Court further explained that “a request for relief from jury waiver always calls for consideration of multiple factors in addition to hardship, including the timeliness of the request and the reasons supporting the request.”

The second question raised by TriCoast relates to appeal:  If a party challenges the denial of relief from jury waiver for the first time on appeal, does the party have to demonstrate actual prejudice to obtain reversal, or is prejudice presumed?  The Court concluded that, “where the constitutional right of jury trial has been validly waived, prejudice from the denial of section 631(g) relief will not be presumed but must be shown.” The Court noted that a pre-trial writ petition in the Court of Appeal is “the preferred method” for challenging relief denial, but absent a writ, prejudice must be shown by appellant.

As noted above, the plaintiff initially waived its own right to a jury trial, but unsuccessfully sought relief from that waiver when the defendant dropped his jury demand on the day of trial.  After the trial court ruled against the plaintiff, it appealed, with its only claim of prejudice the time and money it “wasted” in preparing for a jury trial that had been requested but was then waived by the defendant at the eleventh hour. The Supreme Court held, however, that these costs could never be recovered, even if TriCoast was granted a “do-over.” Furthermore, these costs had nothing to do with the fairness of the trial.  Because TriCoast failed to establish the prejudice necessary to justify reversing the trial court, the California Supreme Court affirmed the intervening judgment of the Court of Appeal, which had reached the same conclusion on this issue.

Takeaway for Employers

Bench trials are typically viewed as more favorable to an employer because they are (1) generally faster; (2) often less expensive than a jury trial; and (3) can be a better forum for discrimination and harassment claims because a judge on the bench may be less likely to be influenced by emotions and personal beliefs.

This ruling could benefit employers because it increases the likelihood that employees who validly waive their right to a jury trial will be bound by that waiver even if they try to avoid it at the trial level or on appeal. Conversely, the case reminds employers that if they initially fail to claim a jury trial themselves because their opponent has opted for a jury, that waiver may be enforced against them, as it was against TriCoast, if the opponent changes their mind. Essentially this case places the heavy lifting of proving that prejudice occurred by the waiver of a jury trial on the appellant and, at the same time, demonstrates that relief from waiver of jury trial is in no way guaranteed at the trial court level. Indeed, it will be difficult to show prejudice from a jury trial waiver because there is a presumption that a bench trial will be fair and impartial.