Commercial Division Blog
Posted: April 5, 2018 / Categories Commercial, Jurisdiction, Motion to Dismiss; Motion for Judgment on the Pleadings
Defendant Waived Personal Jurisdiction Defense by Not Moving to Dismiss Within 60 Days of Answer
On March 28, 2018, the Second Department issued a decision in Wells Fargo Bank, N.A. v. Cajas, 2018 NY Slip Op. 02159, holding that a defendant waived his personal jurisdiction defense by failing to move to dismiss the complaint within 60 days of serving his answer, explaining:
In June 2013, the plaintiff commenced this action against, among others, the defendant Miguel Chiriboga (hereinafter the homeowner) to foreclose a mortgage. The homeowner, together with other defendants, timely interposed an answer asserting, inter alia, the affirmative defense of lack of personal jurisdiction. By notice of motion dated May 20, 2014, the plaintiff moved, inter alia, for summary judgment on the complaint and for an order of reference. Insofar as is relevant to this appeal, the plaintiff argued that the homeowner had waived the defense of lack of personal jurisdiction by failing to move to dismiss the complaint on this ground within 60 days of service of his answer, and that service of the summons and complaint had been properly made. The homeowner opposed the plaintiff's motion on the grounds, among others, that the plaintiff lacked standing and had unclean hands, but did not raise the defense of lack of personal jurisdiction.
The plaintiff and the homeowner appeared in the Supreme Court for a settlement conference on March 4, 2015, while the plaintiff's motion was pending. During that conference, the court, sua sponte, directed a hearing to determine whether the homeowner had been properly served. Over the plaintiff's objection, such a hearing was held on June 10, 2015, during which the court, sua sponte, purported to dismiss the complaint for lack of personal jurisdiction, with prejudice. In an order dated July 23, 2015, the court, in effect, sua sponte, directed dismissal of the complaint and, in effect, denied the plaintiff's motion, inter alia, for summary judgment on the complaint and for an order of reference as academic. The plaintiff appeals, and we reverse.
The Supreme Court erred in sua sponte raising and considering the defense of lack of personal jurisdiction. The homeowner waived this defense by failing to move to dismiss the complaint on this ground within 60 days of serving his answer. As the homeowner waived this defense, it was error for the court, sua sponte, to direct dismissal of the complaint on this basis.
(Internal citations omitted).
Whether the defendant is located on the other side of the world or across the Hudson in New Jersey, a New York court cannot assert jurisdiction over the defendant (that is, hear a case against it) unless there is a proper connection between the defendant and New York. But, as this decision shows, a defendant who fails properly and promptly to raise a defense of lack of personal jurisdiction loses it. Contact Schlam Stone & Dolan partner John Lundin at firstname.lastname@example.org if you or a client face a situation where you are unsure whether there is jurisdiction over you, or over a party with which you are having a dispute, in New York.