Lease Clause Waiver of Jury Trial Rights Is Enforceable

What Happened: A restaurant tenant sold its business to another operator and her brother, the Marcials, who signed a 10-year lease with the landlord to continue operating the restaurant and bar from its current location at the mall. Problems with the transaction arose, and the original tenant ended up suing the landlord and Marcials for damages. But to get the jury trial it wanted, the tenant had to contend with the following language contained in its original lease, which it had taken over from the previous tenant:

Tenant hereby waives all rights to trial by jury in any litigation involving this Lease or the rights and/or obligations of the parties hereunder.

The tenant claimed that the clause didn’t govern because the dispute wasn’t about the lease. The trial court sided with the defendants and ordered a bench trial—that is, a trial in front of a judge rather than a jury.  

Ruling: The Maryland appeals court upheld the ruling that the waiver of jury trial clause was enforceable.

Reasoning: While trial by jury is a fundamental right, it can also be waived, as long as the waiver agreement is “knowing and intelligent.” The tenant in this case didn’t contend that the lease waiver was not “knowing and intelligent.” Nor did it claim that it was the product of unequal bargaining power or not sufficiently conspicuous in the lease. The fact that the tenant didn’t sign the original lease in which the waiver was contained didn’t impair its enforceability, the court added. Moreover, the case was about lease rights and obligations.

• Crystal LLC v. La Union Ctr., LLC, 2023 Md. App. LEXIS 580, 2023 WL 5524384