by David E. Nemeth, Jr., Associate

In an effort to avoid the uncertainty of jury trials in construction disputes, owners and contractors have included provisions in their contracts waiving the right to a jury trial.  The California Supreme Court, however, recently held that such waivers violate the California Constitution, and are therefore unenforceable, except under very limited circumstances.

In Grafton Partners LP v. Superior Court (2005) 36 Cal. 4th 944, the parties’ contract contained a provision providing that, in order to “save time and expense of both parties, [the parties] agree not to demand a trial by jury in any action.”  The trial court upheld the contract, and found that the parties had contractually agreed to waive the right to a jury trial.  This decision was reversed on appeal, however, and the California Supreme Court confirmed that any pre-dispute, contractual waiver of jury trial is unenforceable.  The Court ruled that the California Constitution only permits waivers of jury trials under specific circumstances, and that a waiver contained in a contract, such as a construction contract, is not such a circumstance.

Importantly, however, the Court’s decision in Grafton does not apply where parties to an ongoing lawsuit agree to waive a jury.  Therefore, once a lawsuit is filed, parties are free to agree to waive their respective rights to a jury trial.  Additionally, although a contractual provision providing for binding arbitration of any dispute effectively results in a waiver of a jury trial, the court in Grafton determined that arbitration provisions are valid and enforceable.  As a result, contractual arbitration agreements are not affected by the Grafton decision, and remain a viable and enforceable option for parties seeking to avoid jury trials under California law.

Therefore, based upon the Court’s holding in Grafton, if parties to a construction agreement wish to avoid a jury trial of any litigated disputes arising out of the contract, the options under California law are to (a) include a binding arbitration provision in the contract, or (b) wait until any lawsuit is filed before seeking an agreement to waive a jury trial of the dispute.


The information or opinion provided in this article is the author's own and not necessarily that of Watt, Tieder, Hoffar & Fitzgerald, LLP. The author is solely responsible for the information and opinion that he or she has provided. The information contained herein does not replace seeking specific legal counsel to directly address individual client needs.

Watt, Tieder, Hoffar & Fitzgerald is one of the largest construction law firms in the world, with a practice that encompasses all aspects of construction contracting, claims and disputes resolution, and transactional legal services. WTHF principally represents large general contractors, design firms, and sureties throughout the country and internationally.