Opinion ID: 78491
Heading Depth: 2
Heading Rank: 1

Heading: Neither Party Timely Demanded a Jury Trial

Text: The first issue requiring resolution by this Court is whether the district court properly denied Mega's contention it was entitled to a trial by jury upon remand from the first appeal. We address that issue at the outset because if the district court erred, a reversal and remand would be required. Interpretation of the Federal Rules of Civil Procedure presents a question of law subject to de novo review, and denial of a jury trial is reviewed with the most exacting scrutiny. City of Morgantown v. Royal Ins. Co., 337 U.S. 254, 258-60, 69 S.Ct. 1067, 1070, 93 L.Ed. 1347 (1949); Burns v. Lawther, 53 F.3d 1237, 1240 (11th Cir. 1995) (citing McBride v. Sharpe, 25 F.3d 962, 967-68 (11th Cir. 1994)). The right to trial by jury is fundamental, and this Court indulge[s] every reasonable presumption against waiver. LaMarca v. Turner, 995 F.2d 1526, 1544 (11th Cir.1993) (quoting Aetna Ins. Co. v. Kennedy, 301 U.S. 389, 393, 57 S.Ct. 809, 812, 81 L.Ed. 1177 (1937)). Rule 38 of the Federal Rules of Civil Procedure preserves the right of trial by jury as declared by the Seventh Amendment to the Constitution, and provides that: (b) Demand. On any issue triable of right by a jury, a party may demand a jury trial by: (1) serving the other parties with a written demand  which may be included in a pleading  no later than 10 days after the last pleading directed to the issue is served; and (2) filing the demand in accordance with rule 5(d). Fed.R.Civ.P. 38(b). In its complaint, Mega sought a declaration that it was entitled to rescind Kellie Pieniozek's life insurance policy because the annual income stated on her insurance application was a material misrepresentation. This case came before the district court on diversity jurisdiction, and under Alabama law, materiality of a misrepresentation on a policy application is triable by a jury. Bennett v. Mutual of Omaha Ins. Co., 976 F.2d 659, 661 (11th Cir.1992) (citing Federal Kemper Life Assurance Co. v. First Nat'l Bank, 712 F.2d 459, 462 (11th Cir.1983); State Farm Ins. Co. v. Whiddon, 515 So.2d 1266 (Ala.Civ. App.1987)); Alfa Life Ins. Corp. v. Lewis, 910 So.2d 757, 762 (Ala.2005) (citing Bennett, 976 F.2d at 661; Clark v. Ala. Farm Bureau Mut. Cas. Ins. Co., 465 So.2d 1135 (Ala.Civ.App.1984)). Mega could have demanded a jury trial in its complaint for rescission but failed to do so. Pieniozek answered on October 18, 2005 in the form of a general denial and did not make a jury demand. On December 6, 2005, Pieniozek filed, without leave of the district court, an amended answer which included a jury demand. The amended answer was identical to the original answer save for the jury demand. Amendments not introducing new issues do not renew a party's right to demand a jury trial. Guajardo v. Estelle, 580 F.2d 748, 753 (5th Cir.1978) (citing Conn. General Life Ins. Co. v. Breslin, 332 F.2d 928, 931 (5th Cir.1964) (The original answer of the appellant, which did not contain a demand for a jury trial, contained a denial of the allegations of the appellee's complaint .... The amended answer, which contained a demand for a jury trial, ... did not raise any issues which were in any material way different from those presented by the original answer. In such a case the waiver originally made remains effective and the subsequent demand is ineffective.)), abrogated on other grounds by Thornburgh v. Abbott, 490 U.S. 401, 423-24, 109 S.Ct. 1874, 104 L.Ed.2d 459 (1989). Pieniozek's amended answer demanding a jury trial was ineffective because it was outside the time parameters for demanding a jury trial established by Rule 38 and did not raise new issues upon which a party may properly demand a jury trial. Subsequently, with leave of the district court, Pieniozek filed counterclaims for breach of contract and bad faith. The counterclaims included a jury demand. The question that emerges is whether Pieniozek's counterclaim for breach of contract, accompanied by a request for a jury, raised a new issue within the meaning of Rule 38 that would give rise to a renewed right to demand a jury. The term `new issues' has been interpreted to mean new issues of fact, not new theories of recovery. Guajardo, 580 F.2d at 753; see also LaMarca, 995 F.2d at 1545. Mega's obligation to pay the policy and Pieniozek's entitlement to payment under the policy are two sides of the same coin. Defendant's counterclaim for breach of contract is not a new issue for the purposes of Rule 38, but simply a different version of the denial in his answer to plaintiff's claim for rescission. Neither Mega nor Pieniozek made a timely jury demand on the issue of Mega's obligation/Pieniozek's entitlement under the policy. See Lanza v. Drexel & Co., 479 F.2d 1277, 1310 (2d Cir.1973) ( en banc ) (complaint placed defendant on notice of underlying facts and basic legal theory upon which relief was sought and amendment did not raise new issues for purposes of Rule 38). Accordingly, even indulging every reasonable presumption against waiver, we find no error in the district court's determination that the parties were not entitled to a jury trial on the issue of rescission-breach of contract before the district court upon remand from the first appeal.