Monday, November 1, 2010

Is Standing a Waivable Defense in the Second Department?

In Aurora Loan Services, LLC v. Thomas, 70 A.D.3d 986, 897 N.Y.S.2d 140 (2d Dep't 2010), the Second Department appears to have clarified its position regarding the waivability of the defense of standings--i.e. that standing is not a waivable defense as contrasted from a defense based on personal jurisdiction.  The Supreme Court, Suffolk County, allowed Defendant Thomas to amend his answer to include a standing defense.  On appeal, the Second Department affirmed and held that the Defendant did not waive a defense based on the Plaintiff's lack of standing notwithstanding the fact that the Defendant omitted to include this defense in his initial answer.  The Second Department justified its holding by noting that the proposed amendment was "not palpably insufficient or patently devoid of merit."  This decision seems to contradict the Second Department's deeply unpopular decision in Wells Fargo Bank Minnesota, Nat. Ass'n v. Mastropaolo,  42 A.D.3d 239, 244, 837 N.Y.S.2d 247, 251 (2d Dep't 2007) whereby the Second Department held that standing is a waivable defense. 

The judges on the appellate panel were Hon. John M. Leventhal, Hon. Plummer E. Lott and Hon. Reinaldo E. Rivera.

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