Commercial Division Blog
Posted: September 19, 2017 / Categories Commercial, Jurisdiction
Defendant Cannot Amend Answer to Assert Defense of Lack of Personal Jurisdiction
On September 11, 2017, Justice Scarpulla of the New York County Commercial Division issued a decision in REDF-Organic Recovery, LLC v. Rainbow Disposal Co., Inc., 2017 NY Slip Op. 31935(U), holding that a defendant cannot amend its answer to assert a defense of lack of personal jurisdiction, explaining:
CPLR 3025[b] provides that leave to amend shall be freely given upon such terms as may be just. Upon a motion for leave to amend, plaintiff need not establish the merit of its proposed new allegations, but simply show that the proffered amendment is not palpably insufficient or clearly devoid of merit. Leave should be denied only if there is prejudice or surprise resulting directly from the delay.
Rainbow moves to amend its answer to assert a defense of lack of personal jurisdiction. Rainbow argues that its amendment should be permitted because its proposed defense of personal jurisdiction is presumptively valid, and REDF cannot show prejudice or surprise from Rainbow's delay in raising it. In response, REDF argues that Rainbow failed to raise lack of personal jurisdiction in its first responsive pleadings to either the original or amended complaints, and therefore has waived the defense. Further, REDF points out that Rainbow has raised the issue of lack of personal jurisdiction at various times during this litigation since 2014, and has never sought leave to amend its answer until now. In addition, because the statute of limitations has now run on REDF's claim, REDF argues it will be prejudiced if the court allows Rainbow to assert a personal jurisdiction defense.
CPLR 3211(a)(8) provides that a party may move to dismiss a claim asserted against it where the court has not jurisdiction of the person of the defendant. CPLR 3211 (e) provides that such a defense is waived if a party moves on any of the grounds set forth in subdivision (a) without raising such objection. Rainbow does not deny that it failed to raise the defense of personal jurisdiction in its motions to dismiss the original and amended complaints, or in the answer to the amended complaint. Accordingly, Rainbow has waived the defense of lack of personal jurisdiction pursuant to the plain language of CPLR 3211(e).
Further, Rainbow has actively participated in this case for more than three years, for almost two of which Rainbow argued that the court had no personal jurisdiction over it without seeking to amend its answer. Rainbow has thus consented to jurisdiction, an additional ground for finding waiver. Accordingly, Rainbow's motion for leave to amend is denied.
(Internal quotations and citations omitted).