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Use a small, sharp knife to cut a slit down one side of each pepper. This will enable the brine to fully penetrate the peppers.
Place the garlic, black peppercorns and bay leaves in the bottom of a large jar (half gallon) or divide between two quart-sized jars.
Pack peppers into the jar as tightly as you can.
In a small pot bring the vinegar, water, sugar and salt to a boil.
Pour boiling brine over peppers until they are fully covered by the brine.
Screw lid shut and let them sit until fully cooled.
Transfer to the refrigerator. Let the pickled peppers sit for at least 3 days before using. For the best flavor let them sit for 1-2 weeks to allow the peppers time to fully absorb the flavors.
Store in the refrigerator and make sure the peppers are always submerged under the brine.