Court Opinion

ID: 4266781
Source: CourtListenerOpinion
Date Created: 2018-04-23 23:59:26.302851+00
Date Added: 2024-06-11T14:31:19.027759
License: Public Domain

TD Bank, N.A. v. Burke, No. 563-12-14 Wmcv (Wesley, J., June 12, 2015).
[The text of this Vermont trial court opinion is unofficial. It has been reformatted from the original. The accuracy of the text
and the accompanying data included in the Vermont trial court opinion database is not guaranteed.]

                                               STATE OF VERMONT
SUPERIOR COURT                                                                                     CIVIL DIVISION
Windham Unit                                                                           Docket No. 563-12-14 Wmcv

                        TD Bank, N.A. f/k/a TD Banknorth vs. Burke et al

                                        ENTRY REGARDING MOTION

Click here to enter text.

Title:              Motion to Strike Jury Demand (Motion 2)
Filer:              TD Bank, N.A. f/k/a TD Banknorth
Attorney:           Elizabeth A. Glynn
Filed Date:         April 23, 2015

Response filed on 05/04/2015 by Attorney Lawrin P. Crispe for Defendant M & M Holdings, LLC
Response filed on 05/11/2015 by Attorney James B. Anderson for party 1 Co-counsel

The motion is GRANTED.

Procedural History

        In 2003 Plaintiff TD Bank extended a commercial loan for Defendant M&M Holding Co.,
LLC (M&M Holding) and on January 23, 2003 M&M Holding executed a promissory note (“the
Note”), which was eventually increased to reflect a principal of $352,054.78. See Pl’s Compl.
Ex. A. M&M Holding pledged the title and rents of several real properties in New Hampshire
and Vermont as security for the loan. See id. In addition, Defendants Robert M. Burke and
Michael R. Momaney executed and delivered to Plaintiff commercial guaranties, promising to
pay Plaintiff any indebtedness of M&M Holding. See Pl’s Compl. Ex. B and C. Sometime before
2008, the note went into default and Plaintiff foreclosed on the real property. After foreclosure,
a deficiency of over $135,000 remained. On Dec. 18, 2014, Plaintiff filed a complaint relying on
the commercial guaranties against Defendants M&M Holding, Robert M. Burke, and Michael R.
Momaney, seeking to recover the deficiency that remained after foreclosure. On January 22,
2014, Defendant Momaney responded denying Plaintiffs claim and raising several
counterclaims. Defendants Robert M. Burke and M&M Holding responded on January 26, 2015,
denying that Plaintiff could recover the deficiency, raising eight affirmative defenses as well as a
single counterclaim. As part of their response, Defendants Burke and M&M Holding demanded
a jury trial. On February 13, 2015, Plaintiff answered the counterclaim but did not address
Defendants’ request for a jury trial. On April 23, 2015, Plaintiff filed the motion to strike
Defendants’ jury demand now before the Court for decision.

Discussion
        Plaintiff contends that Defendants have waived their right to a jury trial by signing the
Note, which provides: “Jury Waiver. Lender and Borrower hereby waive the right to jury trial in
any action, proceeding, or counterclaim brought by either Lender or Borrower against the
other.” See Pl’s Compl. Ex A, p. 1.1 Further, Plaintiff argues Defendants again waived their right
to a jury trial by signing the commercial guaranties which state: “Waive Jury. Lender and
Guarantor hereby waive the right to any jury trial in any action, proceeding, or counterclaim
brought by either Lender or Borrower against the other.” See Pl’s Compl. Ex. B and C.

        Defendants Burke and M&M Holding oppose the motion, arguing Plaintiff waived its
right to enforce the jury waiver provision by not raising the issue in Plaintiff’s answer to
Defendants’ counterclaim. Defendants also claim that the law disfavors contractual jury waivers
and Plaintiff’s motion seeks to deprive Defendants of their “long established Constitutional
rights,” thus Plaintiff’s motion should be dismissed. Defendants’ claims are legally unsupported
and fail to challenge the valid contractual jury waiver, and thus Plaintiff’s motion to strike the
jury demand is GRANTED.

        The Seventh Amendment to the United States Constitution and Chapter II, § 38 of the
Vermont Constitution ensures litigants the right to a jury in civil trials. That right, however, may
be waived. See V.R.C.P. 38(d); Vt. Const. ch. II, § 38 (“Trials . . . shall be by Jury, except where
parties otherwise agree.”). Despite Defendants’ suggestion, pre-litigation contractual jury
waivers are a valid and binding method of waiving one’s right to a jury trial. See Merryl Lynch &
Co., Inc. Allegheny Energy, Inc., 500 F.3d 171, 188 (2d Cir. 2007). In fact, a contractual waiver of
the right to a jury trial is common in many contracts, and can take the form of an agreement to
arbitrate, a bench trial agreement, or as in the contract here, an express waiver of the right. See
L&R Realty v. Connecticut Nat. Bank, 715 A.2d 748, 753 (Conn. 1998) (discussing the various
ways the right to a jury trial may be waived).

        For a contractual jury waiver to be valid and binding many courts require the waiver be
made knowingly and voluntarily. See Merryl Lynch, 500 F.3d 171, at 188; see also Medical Air
Technology Corp. v. Marwan Inv., Inc., 303 F.3d 11, 19 (1st Cir. 2002). Defendants have made
no assertion that the waiver here, executed in the context of a commercial lending relationship
between two business entities, was not made knowingly and voluntarily. Rather, Defendants
claim that Plaintiff has waived its right to contest Defendants’ demand for a jury. Defendants
assert that Plaintiff’s claim amounts to an affirmative dense and because Plaintiff did not timely
assert the defense, it was waived. See V.R.C.P. 8(c).

         Defendants provide no authority for the proposition that a contractual waiver of the
right to a jury comes within the procedural requirements associated with an affirmative
defense. A jury waiver has no impact on the legal claims a party may bring, the parties may
assert the same defenses and claims whether the matter is tried before a judge or jury. The
Court does recognize, however, that the jury waiver found in the Note and the guaranties is a
contract right that may be waived like any other contract right, and such a waiver may be
implied by a party’s failure to assert the contractual right. See Union School Dist. No. 45 v.

1
 A later change in terms agreement that increased the amount on the Note, which was signed by both individual
defendants, contained the same jury waiver provision.
                                                      2
Wright & Morrissey, Inc., 2007 VT 129, ¶ 9, 183 Vt. 555; see also Brennan v. Kenwick, 425
N.E.2d 439, 441 (Ill. App. 1981). Even so, there is no set amount of time after which delay will
constitute a waiver of a contractual right.

        The Vermont Rules of Civil Procedure establish a deadline by which parties must request
a jury trial, see V.R.C.P. 38, but the procedural requirements of Rule 38 do not govern the
assertion of a right established under a valid pre-litigation contract to protest a jury demand.
Rather, like the waiver of an arbitration clause, the waiver issue here is a question of fact to be
resolved under the circumstances. See Lamell Lumber Corp. v. Newstress Intern, Inc., 2007 VT
83, ¶ 11, 182 Vt. 282. Courts addressing whether a party has waived a right to enforce an
arbitration agreement consider whether “under the totality of the circumstances, the
defaulting party acted inconsistently with the [right].” Home Gas Corp. of Massachusetts, Inc. v.
Walter’s of Hadley, Inc., 532 N.E.2d 681, 683 (Mass. 1989). Moreover, courts that have
specifically considered whether a party has waived a right to assert a contractual jury waiver
provision often find no waiver unless unfair prejudice will result to the party arguing for the
jury. See National Westminster Bank, U.S.A. v. Ross, 130 B.R. 656, 688 (S.D.N.Y. 1991) (rejecting
defendant’s argument that the bank had waived its right to enforce jury waiver by failing to
timely move to strike, finding bank had not been dilatory and defendant would not suffer any
prejudice).

         Here, the two month delay between Plaintiff’s answer and motion to strike jury demand
was not dilatory. See id. Further, the Court cannot conclude that Plaintiff has acted
inconsistently with its right to a bench trial. See Quinn Const., Inc. v. Skanska USA Bldg., Inc, No.
07-406, 2010 WL 4909587 at *2–3 (E.D.Pa. 2010) (finding that a party that demanded a jury
trial in answer and then over a year later withdrew demand, did not waive its contractual rights
to a bench trial); see also Allaway v. Prospect Mortg., No. 13 c 3004, 2013 WL 6231382 at *1
(N.D.Ill. 2013)(finding plaintiff did not waive right to a bench trial by joining a collective action
where representatives of the class demanded a jury trial). Moreover, no prejudice to
Defendants will result by granting Plaintiff’s motion to strike. See Ross, 130 B.R. 656 at 688.
The case is not on the eve of trial and further pre-trial development will be unaffected by the
designation of the matter as lying within the Court’s bench docket, as opposed to its jury
docket.

Electronically signed on June 12, 2015 at 02:24 PM pursuant to V.R.E.F. 7(d).

______________________________________
John P. Wesley
Superior Court Judge

 Notifications:
Elizabeth A. Glynn (ERN 1594), Attorney for Plaintiff TD Bank, N.A. f/k/a TD Banknorth
Lawrin P. Crispe (ERN 2383), Attorney for Defendant Robert M. Burke
Lawrin P. Crispe (ERN 2383), Attorney for Defendant M & M Holdings, LLC
Defendant Michael R. Momaney
Mark L. Zwicker (ERN 3625), Attorney for party 2 Co-counsel
                                                  3
Mark L. Zwicker (ERN 3625), Attorney for party 4 Co-counsel
Michael J. Marks (ERN 4944), Attorney for Neutral Mediator/Arbitrator/Evaluator Michael J.
Marks
James B. Anderson (ERN 3794), Attorney for party 1 Co-counsel

wesley

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