Another money-saving contract provision – waiving a jury trial
We recently wrote an article discussing the high cost of entering into a contract with a binding-arbitration clause and clients have inquired as to other tips that could help save money in litigation. Since most unexpected costs that arise from a contract arise as a result of a dispute, our first thought was a waiver of jury trial, which can result in significant savings should you end up in litigation involving the contract.
Any party to litigation is generally able to demand a jury trial. The demand for a jury trial is routinely made by parties and attorneys in litigation simply because that is what they are used to. However, other than having an opportunity to try your case to a panel of people instead of a single judge, there are very few tactical advantages to doing so. In fact, having presided over numerous trials, most judges are experienced and more capable of correctly evaluating the evidence than a juror with no background of the parties or the relevant law.
Furthermore, electing to have a jury decide your case adds significant time and expense to the litigation. When a jury is involved, the parties and their counsel have additional requirements before trial, such as preparing and agreeing upon instructions for the jurors. In addition, trials last much longer as the attorneys need to select a jury and go into more detail explaining the evidence than they would need to for a judge. As a result, it is common for a simple jury trial to last 33% longer than it would take to try the same case before a judge. The cost associated with this extra trial time and the pre-trial preparation is extensive, both in paying for an attorney and the practical time that you are away from your business.
As a result, we recommend including a provision in your contracts waiving both parties’ right to a jury trial. If both parties agree at the time of entering a contract, neither party can later demand a jury trial and drive up the cost of litigation. Below is a draft provision that you can use in your contracts:
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THE UNDERSIGNED WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OR RELATED TO ANY ASPECT OF THE TRANSACTION IN CONNECTION WITH WHICH THIS DOCUMENT IS BEING GIVEN OR ANY DOCUMENT EXECUTED OR DELIVERED IN CONNECTION WITH SUCH TRANSACTION. THIS WAIVER IS KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE BY THE UNDERSIGNED AND THE UNDERSIGNED ACKNOWLEDGES THAT NO ONE HAS MADE ANY REPRESENTATIONS OF FACT TO INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT. THE UNDERSIGNED FURTHER ACKNOWLEDGES HAVING BEEN REPRESENTED IN CONNECTION WITH THE TRANSACTION WITH RESPECT TO WHICH THIS DOCUMENT IS BEING GIVEN AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED BY THE UNDERSIGNEDS’ OWN FREE WILL, AND THAT THEY UNDERSIGNED HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH SUCH COUNSEL. THE UNDERSIGNED FURTHER ACKNOWLEDGES HAVING READ AND UNDERSTOOD THE MEANING AND RAMIFICATIONS OF THIS WAIVER PROVISION.
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We encourage our construction clients to add this to their formal contracts and their proposals. If our clients use a form “Terms and Conditions,” we also recommend including this language there. You can also add the language to your invoices if you don’t have a contract, proposal or terms and conditions with your customer. All of these methods will assist in lowering the cost of future litigation should a dispute arise out of the contract. If you have any other questions relating to your contracts, contact the construction attorneys at Loren & Kean Law to review your contract or to discuss ways to minimize your risk.
Bruce E. Loren and Kyle W. Ohlenschlaeger of the Loren & Kean Law Firm are based in Palm Beach Gardens and Fort Lauderdale. Loren & Kean Law is a boutique law firm concentrating in construction law, employment law, and complex commercial litigation. Mr. Ohlenschlaeger focuses his practice on construction law and a wide range of commercial litigation disputes. Mr. Loren has achieved the title of “Certified in Construction Law” by the Florida Bar, exemplifying the Bar’s recognition of this expertise. The firm’s construction clients include owners/developers, general contractors, specialty contractors in every trade, suppliers and professional architects and engineers. Mr. Loren and Mr. Ohlenschlaeger can be reached at [email protected] or [email protected] or 561-615-5701.
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