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In re Mco Management, L.L.C.

Court of Appeals of Texas, Fifth District, Dallas

March 27, 2018

IN RE MCO MANAGEMENT, L.L.C., Relator

          Original Proceeding from the 101st Judicial District Court Dallas County, Texas Trial Court Cause No. DC-15-08810

          Before Justices Lang, Evans, and Stoddart

          MEMORANDUM OPINION

          CRAIG STODDART, JUSTICE.

         In this original proceeding, relator MCO Management, L.L.C. (MCO) complains of the trial court's refusal to enforce a contractual jury waiver. We conditionally grant the writ.

         Background

         The underlying case is a landlord-tenant dispute involving a commercial lease. Pursuant to the lease, relator is the Landlord and real party in interest Fortress Iron, L.P. (Fortress) is the Tenant. After Fortress vacated the premises, MCO sued Fortress for breach of contract and conversion alleging Fortress failed to pay sums due under the lease, damaged the premises, and improperly removed fixtures from the premises. In its original answer, Fortress asserted several affirmative defenses, including first material breach, estoppel, and waiver. Fortress also filed counterclaims for breach of contract, breach of the implied warranty of suitability, and unjust enrichment.

         Fortress subsequently filed a demand for a jury trial. MCO moved to quash the demand based on a jury waiver in the lease. Specifically, article 19, paragraph 19.4 of the lease provides:

If, on account of any breach or default by Tenant in Tenant's obligations under the terms and conditions of this Lease, it shall become necessary or appropriate for Landlord to employ or consult with an attorney or collection agency concerning or to enforce or defend any of Landlord's rights or remedies arising under this Lease or to collect any sums due from Tenant, Tenant agrees to pay all costs and fees so incurred by Landlord, including, without limitation, reasonable attorneys' fees and costs. TENANT EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY.

         In its response to MCO's motion, Fortress did not dispute that the jury waiver was enforceable or that it applied to the dispute. However, it argued the waiver only applied to MCO's claims against Fortress because it was located in the portion of the lease that addressed MCO's remedies for Fortress's breaches. It asserted its remedies for MCO's breaches were contained in article 42 of the lease, which did not contain any jury waiver language. Article 42 provides:

LANDLORD'S DEFAULT. If Landlord fails to perform any of its obligations hereunder within thirty (30) days after written notice from Tenant specifying such failure (or if the nature of Landlord's obligation is such that more than thirty (30) days are required for its performance, if Landlord fails to commence such performance within such thirty (30) day period or thereafter to diligently prosecute the same to completion), Tenant shall at its option be entitled to (i) institute an action for damages or (ii) seek specific performance of Landlord's obligations under this Lease. The liability of Landlord under this Article 42 shall be limited as set forth in Article 43 below.

         Thus, according to Fortress, its jury waiver applied only to MCO's claims. The trial court agreed. As a consequence, the trial court granted MCO's motion to quash as to its claims against Fortress, determining it would act as the factfinder on those claims. The trial court otherwise denied MCO's motion to quash. This original proceeding followed.

         Law & Analysis

         1. Mandamus Standard

         To be entitled to mandamus relief, a relator must show both that the trial court has clearly abused its discretion and that relator has no adequate appellate remedy. In re Prudential Ins. Co.,148 S.W.3d 124, 135-36 (Tex. 2004) (orig. proceeding). A trial court has no discretion in determining what the law is or in applying the law to the facts, and a clear failure by the court to correctly analyze or apply the law will constitute an abuse of discretion. In re Cerberus Capital Mgmt, L.P.,164 S.W.3d 379, 382 (Tex. 2005) (orig. proceeding); In re Tex. Am. Express, Inc.,190 S.W.3d 720, 723 (Tex. App-Dallas 2005, orig. proceeding). A trial court's refusal to enforce a contractual jury waiver cannot in any "real sense . . . ever be rectified on appeal." In re Prudential Ins. Co. of Am., 148 S.W.3d at 138. Thus, mandamus relief is ...


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