Summary
holding that RPAPL 1302–a did not "disturb well-settled case law holding that a party's lack of standing does not constitute a jurisdictional defect, and that the defense of standing should not be raised by a court, sua sponte"
Summary of this case from 21st Mortg. Corp. v. RudmanOpinion
2017–08030 Index No. 29971/08
11-25-2020
GMAC MORTGAGE, LLC, Respondent, v. WINSOME COOMBS, Appellant, et al., Defendants.
Chidi Eze, Brooklyn, NY, for appellant. Ras Boriskin, LLC, Westbury, NY, for respondent.
Chidi Eze, Brooklyn, NY, for appellant.
Ras Boriskin, LLC, Westbury, NY, for respondent.
SHERI S. ROMAN, J.P., ROBERT J. MILLER, JOSEPH J. MALTESE, ANGELA G. IANNACCI, JJ.
OPINION & ORDER
MILLER, J.
This appeal requires us to address a new statute, RPAPL 1302–a (as added by L 2019, ch 739, § 1), and consider its impact on the affirmative defense of lack of standing and the operation of the waiver provisions contained in CPLR 3211(e). We conclude that, in this case, the Supreme Court should have permitted the defendant to raise the affirmative defense of lack of standing and to amend his answer to include that defense, even though he failed to affirmatively plead it in his answer. However, since the plaintiff nevertheless established its entitlement to summary judgment on the issue of standing and on the complaint, we affirm the order appealed from.
In February 2007, the defendant Winsome Coombs (hereinafter the defendant) executed a note in the sum of $419,225 in favor of Quicken Loans, Inc. The note was secured by a mortgage on residential property in Brooklyn. In November 2008, the plaintiff commenced this action against the defendant, among others, to foreclose the mortgage. The defendant interposed a verified answer, but did not assert that the plaintiff lacked standing to commence this action.
In October 2012, the defendant moved to dismiss the complaint, inter alia, on the ground that the plaintiff lacked standing to commence this action. The plaintiff separately moved, among other things, for summary judgment on the complaint insofar as asserted against the defendant.
In an order dated December 18, 2013, the Supreme Court denied the defendant's motion and the plaintiff's motion. The plaintiff subsequently moved for leave to reargue its prior motion. The defendant opposed the plaintiff's motion for leave to reargue, contending, among other things, that the plaintiff lacked standing to commence this action.
In an order dated June 19, 2017, the Supreme Court granted the plaintiff's motion for leave to reargue and, upon reargument, granted the plaintiff's prior motion. The court did not address the merits of the standing defense that had been raised by the defendant in opposition to the plaintiff's motion for leave to reargue, finding that the defense had been waived by the defendant's failure to include it in the verified answer. The defendant appeals from the order dated June 19, 2017. We affirm.
" CPLR 3018, which governs responsive pleadings, draws a distinction between denials and affirmative defenses" ( US Bank N.A. v. Nelson, 169 A.D.3d 110, 113, 93 N.Y.S.3d 138 ). "Denials generally relate to allegations setting forth the essential elements that must be proved in order to sustain the particular cause of action" and "[t]hus, a mere denial of one or more elements of the cause of action will suffice to place them in issue" ( id. at 113, 93 N.Y.S.3d 138 ).
Conversely, a defendant must plead, as an affirmative defense, "all matters which if not pleaded would be likely to take the adverse party by surprise or would raise issues of fact not appearing on the face of a prior pleading" ( CPLR 3018[b] ; see U.S. Bank N.A. v. Nelson, 169 A.D.3d at 113, 93 N.Y.S.3d 138 ). Accordingly, where a defendant seeks to inject into the litigation "matters [that] are not the plaintiff's burden to prove as part of the cause of action," those matters must be affirmatively pleaded as defenses (Siegel & Connors, N.Y. Prac § 223 [6th ed July 2020 Update]; see CPLR 3014 ; US Bank N.A. v. Nelson, 169 A.D.3d at 113, 93 N.Y.S.3d 138 ; see also 5 Weinstein–Korn–Miller, N.Y. Civ Prac: CPLR ¶ 3018.02).
"Failure to plead a defense that must be pleaded affirmatively under CPLR 3018(b) is a waiver of that defense, unless it is raised by a motion under CPLR 3211(a)" (5 Weinstein–Korn–Miller, N.Y. Civ Prac: CPLR ¶ 3018.18; see Munson v. New York Seed Improvement Coop., 64 N.Y.2d 985, 986–987, 489 N.Y.S.2d 39, 478 N.E.2d 180 ; DeLuca v. Pecoraro, 109 A.D.3d 636, 637, 970 N.Y.S.2d 822 ; Rooney v. Slomowitz, 11 A.D.3d 864, 867, 784 N.Y.S.2d 189 ; Counties of Warren & Washington Indus. Dev. Agency v. Boychuck, 109 A.D.2d 1024, 1026, 487 N.Y.S.2d 139 ; De Lisa v. Amica Mut. Ins. Co., 59 A.D.2d 380, 382, 399 N.Y.S.2d 909 ; A.A. Sutain, Ltd. v. Montgomery Ward & Co., 22 A.D.2d 607, 609–610, 257 N.Y.S.2d 724, affd 17 N.Y.2d 776, 270 N.Y.S.2d 626, 217 N.E.2d 674 ). However, "[s]uch a waiver can be retracted by amendment of the answer" so as to include the omitted defense ( Surlak v. Surlak, 95 A.D.2d 371, 383, 466 N.Y.S.2d 461 ; see CPLR 3025 ; cf. Furlo v. Cheek, 20 A.D.2d 939, 940, 248 N.Y.S.2d 947 ; see generally 5 Weinstein–Korn–Miller, N.Y. Civ Prac: CPLR ¶ 3018.18).
If a defendant fails to amend the answer within the time prescribed by CPLR 3025(a), the defendant may amend the answer to include a new defense pursuant to CPLR 3025(b) "at any time by leave of court or by stipulation of all parties" ( CPLR 3025[b] ). The statute directs that "[l]eave shall be freely given upon such terms as may be just including the granting of costs and continuances" ( CPLR 3025[b] ; see Murray v. City of New York, 43 N.Y.2d 400, 404–406, 401 N.Y.S.2d 773, 372 N.E.2d 560 ).
CPLR 3211(e), however, places important limitations on a defendant's ability to retract a waiver of certain affirmative defenses through the amendment of an answer pursuant to CPLR 3025(b) (see generally Siegel, N.Y. Prac § 275 at 473 [5th ed]). Although this subdivision uses the same term—"waived" —in three separate sentences, the various types of waivers occasioned by CPLR 3211(e) are not uniformly applied. Indeed, as the case law illustrates, the effect of such a waiver may vary depending on the nature of the defense that was waived.
For example, CPLR 3211(e) provides that
"[a]n objection based upon a ground specified in [ CPLR 3211(a)(8) or (9) ] is waived if a party moves
on any of the grounds set forth in [ CPLR 3211(a) ] without raising such objection or if, having made no objection under [ CPLR 3211(a) ], he or she does not raise such objection in the responsive pleading."
CPLR 3211(a)(8) and (9) include defenses relating to personal and in rem jurisdiction.
The Court of Appeals has held that once a jurisdictional defense listed in CPLR 3211(a)(8) or (9) has been "waived" under CPLR 3211(e), the resulting waiver may not be retracted through subsequent amendment to the answer pursuant to CPLR 3025(b) (see Addesso v. Shemtob, 70 N.Y.2d 689, 690, 518 N.Y.S.2d 793, 512 N.E.2d 314 ; Boulay v. Olympic Flame, 165 A.D.2d 191, 194, 565 N.Y.S.2d 905 ; cf. Iacovangelo v. Shepherd, 5 N.Y.3d 184, 186, 800 N.Y.S.2d 116, 833 N.E.2d 259 ; Ficorp, Ltd. v. Gourian, 263 A.D.2d 392, 392–393, 693 N.Y.S.2d 37 ). Accordingly, "[w]hile permission to amend an answer is to be freely given pursuant to CPLR 3025(b), the waiver of a jurisdictional defense [listed in CPLR 3211(a)(8) or (9) ] cannot be nullified by a subsequent amendment to a pleading adding the missing affirmative defense" ( McGowan v. Hoffmeister, 15 A.D.3d 297, 297, 792 N.Y.S.2d 381 ; see Addesso v. Shemtob, 70 N.Y.2d at 690, 518 N.Y.S.2d 793, 512 N.E.2d 314 ).
The "objections of personal or [in] rem jurisdiction ... are deemed so fundamental" that they are irretrievably waived if the defendant makes a motion pursuant to CPLR 3211(a) without raising those threshold jurisdictional defenses (Siegel & Connors, N.Y. Prac § 274 [6th ed]; see CPLR 3211[e] ; Competello v. Giordano, 51 N.Y.2d 904, 905, 434 N.Y.S.2d 976, 415 N.E.2d 965 ). Indeed, "[t]he purpose of [this] waiver provision of [ CPLR 3211(e) ] is to prevent the defendant from wasting both the ‘court's or the plaintiff's time on any 3211 motion on any ground at all unless on that motion [she or] he joins [those] jurisdictional [defenses]’ " ( Competello v. Giordano, 51 N.Y.2d at 905, 434 N.Y.S.2d 976, 415 N.E.2d 965, quoting David D. Siegel, Practice Commentaries, McKinney's Cons Laws of NY, Book 7B, CPLR C3211:59 at 63). The purpose underlying that provision would obviously be frustrated if a defendant could retract a waiver of these jurisdictional defenses "at any time" by amending its answer to include them ( CPLR 3025[b] ).
Similarly, another provision of CPLR 3211(e) provides that
"an objection that the summons and complaint ... was not properly served is waived if, having raised such an objection in a pleading, the objecting party
does not move for judgment on that ground within sixty days after serving the pleading, unless the court extends the time upon the ground of undue hardship"
(cf. Goldenberg v. Westchester County Health Care Corp., 16 N.Y.3d 323, 327, 921 N.Y.S.2d 619, 946 N.E.2d 717 ). The purpose of the 1996 amendment to CPLR 3211(e), which added the 60–day time limit, was " ‘to require a party with a genuine objection to service to deal with the issue promptly and at the outset of the action ... ferret out unjustified objections and ... provide for the prompt resolution of those that have merit’ " ( Wade v. Byung Yang Kim, 250 A.D.2d 323, 325, 681 N.Y.S.2d 355, quoting Senate Introducer's Mem in Support, Bill Jacket, L 1996, ch 501 at 5; see U.S. Bank N.A. v. Roque, 172 A.D.3d 948, 951, 101 N.Y.S.3d 165 ; Deutsche Bank Natl. Trust Co. v. Acevedo, 157 A.D.3d 859, 861, 69 N.Y.S.3d 693 ).
In contrast to the two provisions noted above, a third waiver provision contained in CPLR 3211(e) provides that "[a]ny objection or defense based upon a ground set forth in [ CPLR 3211(a)(1), (3), (4), (5), and (6) ] is waived unless raised either by such motion or in the responsive pleading" (see McLean v. Sachem Cent. Sch. Dist., 186 A.D.3d 470, 126 N.Y.S.3d 391 ; M & E 73–75, LLC v. 57 Fusion LLC, 189 A.D.3d 1, 128 N.Y.S.3d 200 [1st Dept.] ; Bonanni v. Horizons Invs. Corp., 179 A.D.3d 995, 1001, 118 N.Y.S.3d 137 ; Pace v. Perk, 81 A.D.2d 444, 461–462, 440 N.Y.S.2d 710 ). The specifically enumerated defenses that are subject to this portion of the subdivision include "legal capacity" ( CPLR 3211[a][3] ), "arbitration and award, collateral estoppel, discharge in bankruptcy, infancy or other disability of the moving party, payment, release, res judicata, statute of limitations, [and] statute of frauds" ( CPLR 3211[a][5] ).
Unlike a waiver of the jurisdictional defenses listed in CPLR 3211(a)(8) and (9), which cannot be retracted through amendment to the pleadings (see Addesso v. Shemtob, 70 N.Y.2d at 690, 518 N.Y.S.2d 793, 512 N.E.2d 314 ; McGowan v. Hoffmeister, 15 A.D.3d at 297, 792 N.Y.S.2d 381 ), a waiver of the defenses listed in CPLR 3211(a)(1), (3), (4), (5), and (6) may generally be retracted through amendment to the answer pursuant to CPLR 3025 to include the waived defense (see e.g. Barrett v. Kasco Constr. Co., 56 N.Y.2d 830, 831, 452 N.Y.S.2d 566, 438 N.E.2d 99 ; Fahey v. County of Ontario, 44 N.Y.2d 934, 935, 408 N.Y.S.2d 314, 380 N.E.2d 146 ; Congregation B'nai Jehuda v. Hiyee Realty Corp., 35 A.D.3d 311, 313, 827 N.Y.S.2d 42 ; Town of Webster v. Village of Webster, 280 A.D.2d 931, 932–933, 720 N.Y.S.2d 664 ; Henderson v. Gulati, 270 A.D.2d 308, 309, 705 N.Y.S.2d 54 ; Ficorp, Ltd. v. Gourian, 263 A.D.2d at 392, 693 N.Y.S.2d 37 ; Endicott Johnson Corp. v. Konik Indus., 249 A.D.2d 744, 744–745, 671 N.Y.S.2d 557 ; Marks v. Macchiarola, 221 A.D.2d 217, 218, 634 N.Y.S.2d 56 ; Armstrong v. Peat, Marwick, Mitchell & Co., 150 A.D.2d 189, 190, 540 N.Y.S.2d 799 ; A.J. Pegno Constr. Corp. v. City of New York, 95 A.D.2d 655, 656, 463 N.Y.S.2d 214 ; Pace v. Perk, 81 A.D.2d at 461–462, 440 N.Y.S.2d 710 ).
A waiver under this portion of CPLR 3211(e) is therefore consistent with the general waiver that results from a failure to affirmatively plead a defense in accordance with CPLR 3018(b), which, as already observed, may generally be retracted through amendment to the pleadings (see CPLR 3025 ; Surlak v. Surlak, 95 A.D.2d at 383, 466 N.Y.S.2d 461 ; see generally 5 Weinstein–Korn–Miller, N.Y. Civ Prac: CPLR ¶ 3018.18). A waiver of these defenses may also be retracted by raising the defense in a motion for summary judgment, or in opposition to a motion for summary judgment, under which circumstances a court may, in the provident exercise of its discretion, "deem[ ][the] defendant's answer amended to include the affirmative defense ... on [the] motion for summary judgment" ( Barrett v. Kasco Constr. Co., 56 N.Y.2d at 831, 452 N.Y.S.2d 566, 438 N.E.2d 99 ; see Seaboard Sur. Co. v. Nigro Bros., 222 A.D.2d 574, 574, 635 N.Y.S.2d 296 ; Adsit v. Quantum Chem. Corp., 199 A.D.2d 899, 900, 605 N.Y.S.2d 788 ; Creary v. Davie, 188 A.D.2d 1033, 1033–1034, 592 N.Y.S.2d 1003 ; Armstrong v. Peat, Marwick, Mitchell & Co., 150 A.D.2d at 191, 540 N.Y.S.2d 799 ; Ballen v. Aero Mayflower Tr. Co., 144 A.D.2d 407, 409, 533 N.Y.S.2d 1007 ; McIvor v. Di Benedetto, 121 A.D.2d 519, 521–522, 503 N.Y.S.2d 836 ; see also Dampskibsselskabet Torm A/S v. Thomas Paper Co., 26 A.D.2d 347, 352, 274 N.Y.S.2d 601 ).
Finally, CPLR 3211(e) lists an additional set of defenses which may be raised in a motion "made at any subsequent time or in a later pleading, if one is permitted." These defenses include lack of subject matter jurisdiction (see CPLR 3211[a][2] ), failure to state a cause of action (see CPLR 3211[a][7] ), and "the absence of a person who should be a party" ( CPLR 3211[a][10] ).
The defenses listed in CPLR 3211(a)(2), (7), and (10), implicate fundamental limitations on the power of a court to render an enforceable judgment (see Restatement [Second] of Judgments §§ 11, 62 ). Subject matter jurisdiction, in particular, is "so fundamental to the power of adjudication of a court that [the defense will] survive even a final judgment or order" ( Lacks v. Lacks, 41 N.Y.2d 71, 74–75, 390 N.Y.S.2d 875, 359 N.E.2d 384 ; see generally Restatement [Second] of Judgments §§ 12, 76 ). Under CPLR 3211(e), the defenses listed in subdivisions CPLR 3211(a)(2), (7), and (10) may be raised by motion "at any time" ( M & E 73–75, LLC v. 57 Fusion LLC, 189 A.D.3d 1, 128 N.Y.S.3d 200, 2020 N.Y. Slip Op. 04372, *2 ; see McMahon v. Cobblestone Lofts Condominium, 161 A.D.3d 536, 536–537, 78 N.Y.S.3d 2 ; Chuqui v. Church of St. Margaret Mary, 39 A.D.3d 397, 397, 835 N.Y.S.2d 74 ; Rainbow Hospitality Mgt. v. Mesch Eng'g, 270 A.D.2d 906, 906, 705 N.Y.S.2d 765 ; Pace v. Perk, 81 A.D.2d at 449, 440 N.Y.S.2d 710 ), or by amendment to a pleading, "if one is permitted" ( CPLR 3211[e] ).
The defense of standing is not specifically mentioned in CPLR 3211(a) or (e). In Wells Fargo Bank Minn., N.A. v. Mastropaolo, 42 A.D.3d 239, 242, 837 N.Y.S.2d 247, quoting CPLR 3211[a][3] ), this Court considered "whether a defense based on lack of standing is more akin to the defense that the plaintiff ‘has not legal capacity to sue,’ as set forth in CPLR 3211(a)(3), or to the nonwaivable defense that the court lacks subject matter jurisdiction, as set forth in CPLR 3211(a)(2)."
This Court determined that "[e]ven though the frequently invoked term ‘jurisdictional’ has been used occasionally to refer to standing, a plaintiff's lack of standing affects, at most, a court's power to render a judgment on the merits in the plaintiff's favor" ( Wells Fargo Bank Minn., N.A. v. Mastropaolo, 42 A.D.3d at 243, 837 N.Y.S.2d 247 ). This Court stated that a plaintiff's "alleged lack of standing at the time [the] action was commenced ... [is] not a jurisdictional defect that [is] ‘so fundamental to the power of adjudication of a court’ ( Lacks v. Lacks, [41 N.Y.2d] at 74 [390 N.Y.S.2d 875, 359 N.E.2d 384] ), that it could not be waived" ( id. at 244, 837 N.Y.S.2d 247 ; cf. MacAffer v. Boston & Me. R.R., 268 N.Y. 400, 405, 197 N.E. 328 ). Accordingly, this Court held that "where a defendant does not challenge a plaintiff's standing," the issue may be waived and "the plaintiff may be relieved of its obligation to prove that it is the proper party to seek the requested relief" ( Wells Fargo Bank Minn., N.A. v. Mastropaolo, 42 A.D.3d at 242, 244–245, 837 N.Y.S.2d 247 ). In reaching its conclusion, this Court cited to authority which described standing as " ‘an aspect of justiciability which, when challenged, must be considered at the outset of any litigation’ " ( id. at 242, 837 N.Y.S.2d 247 [emphasis omitted], quoting Society of Plastics Indus. v. County of Suffolk, 77 N.Y.2d 761, 769, 570 N.Y.S.2d 778, 573 N.E.2d 1034 ; see Community Bd. 7 of Borough of Manhattan v. Schaffer, 84 N.Y.2d 148, 154–155, 615 N.Y.S.2d 644, 639 N.E.2d 1 ).
In subsequent case law this Court, citing to Wells Fargo Bank Minn., N.A. v. Mastropaolo, 42 A.D.3d 239, 837 N.Y.S.2d 247 ), used language that may be read to imply that a waiver of the defense of standing should be applied in a manner consistent with a waiver of the threshold jurisdictional defenses listed in CPLR 3211(a)(8) and (9), which may not be retracted by subsequent amendment to a pleading (see e.g. HSBC Bank, USA v. Dammond, 59 A.D.3d 679, 680, 875 N.Y.S.2d 490 ). Of course, this Court has never held that a waiver of the defense of standing could not be retracted in an answer amended by leave of court pursuant to CPLR 3025(b) (see U.S. Bank N.A. v. Laino, 172 A.D.3d 947, 948, 100 N.Y.S.3d 302 ; HSBC Mtge. Servs., Inc. v. Alphonso, 163 A.D.3d 934, 936, 82 N.Y.S.3d 478 ; DLJ Mtge. Capital, Inc. v. David, 147 A.D.3d 1024, 1025, 48 N.Y.S.3d 234 ; HSBC Bank USA, NA v. Halls, 136 A.D.3d 752, 753–754, 24 N.Y.S.3d 752 ; Bank of N.Y. Mellon v. Aquino, 131 A.D.3d 1186, 1187, 16 N.Y.S.3d 770 ; U.S. Bank, N.A. v. Sharif, 89 A.D.3d 723, 724, 933 N.Y.S.2d 293 ).
Such a holding would be contrary to the language in Wells Fargo Bank Minn., N.A. v. Mastropaolo, 42 A.D.3d 239, 243, 837 N.Y.S.2d 247 ), which indicated that "for purposes of the waiver rule set forth in CPLR 3211(e), standing and capacity to sue are sufficiently related that they should be afforded identical treatment" (see Siegel & Connors, N.Y. Prac §§ 136, 261 [6th ed]; cf. Guiffrida v. Storico Dev., LLC, 60 A.D.3d 1286, 1287, 876 N.Y.S.2d 793 ). As already observed, a waiver of the affirmative defenses listed under CPLR 3211(a)(3) and (5), including capacity to sue, may generally be retracted through the amendment of a pleading pursuant to CPLR 3025 (see Complete Mgt., Inc. v. Rubenstein, 74 A.D.3d 722, 723–724, 903 N.Y.S.2d 439 ; see also Tedesco v. A.P. Green Indus., Inc., 8 N.Y.3d 243, 246, 832 N.Y.S.2d 141, 864 N.E.2d 65 ; Igbara Realty Corp. v. New York Prop. Ins. Underwriting Assn., 63 N.Y.2d 201, 218–219, 481 N.Y.S.2d 60, 470 N.E.2d 858 ; cf. A.A. Sutain, Ltd. v. Montgomery Ward & Co., 17 N.Y.2d at 778, 270 N.Y.S.2d 626, 217 N.E.2d 674 ).
In any event, to the extent that "our past decisions have lacked a precise consistency" on this issue ( Miller v. Miller, 22 N.Y.2d 12, 15, 290 N.Y.S.2d 734, 237 N.E.2d 877 ; see Stukas v. Streiter, 83 A.D.3d 18, 30, 918 N.Y.S.2d 176 ), we now reaffirm that a waiver of the defense of standing pursuant to CPLR 3211(e) should be given the same force and effect as a waiver of the affirmative defenses specifically enumerated in CPLR 3211(a)(3) and (5) (see Wells Fargo Bank Minn., N.A. v. Mastropaolo, 42 A.D.3d at 243, 837 N.Y.S.2d 247 ). Accordingly, a waiver of the affirmative defense of standing pursuant to CPLR 3211(e) may be retracted through the amendment of a pleading pursuant to CPLR 3025 (see e.g. U.S. Bank N.A. v. Laino, 172 A.D.3d at 948, 100 N.Y.S.3d 302 ; DLJ Mtge. Capital, Inc. v. David, 147 A.D.3d at 1025, 48 N.Y.S.3d 234 ; U.S. Bank, N.A. v. Sharif, 89 A.D.3d at 724, 933 N.Y.S.2d 293 ). Case law from this Court should not be read to hold otherwise (cf. US Bank N.A. v. Dorestant, 131 A.D.3d 467, 470, 15 N.Y.S.3d 142 ; Wells Fargo Bank, N.A. v. Combs, 128 A.D.3d 812, 813, 10 N.Y.S.3d 121 ; JP Morgan Mtge. Acquisition Corp. v. Hayles, 113 A.D.3d 821, 822, 979 N.Y.S.2d 620 ; Deutsche Bank Natl. Trust Co. v. Hussain, 78 A.D.3d 989, 990, 912 N.Y.S.2d 595 ; New York Community Bank v. Vermonty, 68 A.D.3d 1074, 1076, 892 N.Y.S.2d 137 ; HSBC Bank, USA v. Dammond, 59 A.D.3d at 680, 875 N.Y.S.2d 490 ).
RPAPL 1302–a adds an additional layer of complexity to the operation of CPLR 3211(e), and to the defense of standing in certain actions. Enacted on December 23, 2019, and effective that same date (see L 2019, ch 739, § 1), the statute, in toto, provides:
"Notwithstanding the provisions of [ CPLR 3211(e) ], any objection or defense based on the plaintiff's lack of standing in a foreclosure proceeding related to a home loan, as defined in [ RPAPL 1304(6)(a) ], shall not be waived if a defendant fails to raise the objection or defense in a responsive pleading or pre-answer motion to dismiss. A defendant may not raise an objection or defense of lack of standing following a foreclosure sale, however, unless the judgment of foreclosure and sale was issued upon defendant's default" ( RPAPL 1302–a ).
The new statute, by its own terms, only applies to residential mortgage foreclosure actions involving a "home loan," as that term is defined in RPAPL 1304(6)(a) ( RPAPL 1302–a ). Accordingly, with the enactment of RPAPL 1302–a, the procedural rules applicable to the defense of standing may vary depending on the substantive nature of the litigation at issue (see RPAPL 1302–a ).
Where applicable, RPAPL 1302–a provides that a failure to raise standing as a defense in a responsive pleading or motion to dismiss does not constitute a waiver pursuant to CPLR 3211(e) (see RPAPL 1302–a ). The purpose of the law is to help assure that issues of standing are resolved on their merits (see Sponsor's Mem, Bill Jacket, L 2019 SB 5160, ch 739 [April 12, 2019]).
Although the new statute provides that the defense of standing is not waived pursuant to CPLR 3211(e) by a defendant's failure to raise it in a responsive pleading or motion to dismiss, it does not thereby absolve a defendant from actually raising the issue before it may properly be considered by a court (see HSBC Bank USA, N.A. v. Szoffer, 149 A.D.3d 1400, 1401, 52 N.Y.S.3d 721 ). Indeed, had the Legislature intended to vest a court with the discretionary authority to raise the issue of standing "on its own initiative," as it has done in several provisions of the CPLR ( CPLR 1003 ; see CPLR 3215[c] ; 3216[a]; 4404[a], [b]), it could have inserted such language into RPAPL 1302–a. It did not do so. Accordingly, we conclude that RPAPL 1302–a does not disturb the well-settled case law holding that "a party's lack of standing does not constitute a jurisdictional defect" ( U.S. Bank, N.A. v. Emmanuel, 83 A.D.3d 1047, 1048–1049, 921 N.Y.S.2d 320 ; see Matter of Fossella v. Dinkins, 66 N.Y.2d 162, 495 N.Y.S.2d 352, 485 N.E.2d 1017 ; HSBC Bank USA, N.A. v. Taher, 104 A.D.3d 815, 817, 962 N.Y.S.2d 301 ), and that the defense of standing should not be raised by a court, sua sponte (see e.g. Matter of Barbeau v. Village of LeRoy, 181 A.D.3d 1155, 1157, 122 N.Y.S.3d 200 ; Emic Corp. v. Barenblatt, 169 A.D.3d 621, 621–622, 92 N.Y.S.3d 883 ; Citimortgage, Inc. v. Gill, 165 A.D.3d 623, 623, 82 N.Y.S.3d 734 ; HSBC Bank USA, N.A. v. Szoffer, 149 A.D.3d at 1401, 52 N.Y.S.3d 721 ).
The Legislature also could have required a plaintiff to plead and prove standing as an essential element of every applicable residential mortgage foreclosure action. It did not do this either. Although RPAPL 1302–a specifies that its provisions are controlling "[n]otwithstanding the provisions of [ CPLR 3211(e) ]," it makes no reference to any other section of the CPLR. Under basic rules of statutory construction, the express inclusion of CPLR 3211(e) and the omission of any other reference to the CPLR leads to the conclusion that CPLR 3211(e) is the only statute impacted by the enactment of RPAPL 1302–a (see McKinneys Cons Laws of NY, Book 1, Statutes, § 240; Matter of Benjamin v. New York City Empls. Retirement Sys., 170 A.D.3d 714, 716, 96 N.Y.S.3d 333 ).
Accordingly, even where applicable, the new statute does not impact the operation of CPLR 3018(b) or case law holding that "where, as here, standing is not an essential element of the cause of action, under CPLR 3018(b) a defendant must affirmatively plead lack of standing as an affirmative defense in the answer in order to properly raise the issue in its responsive pleading" ( US Bank N.A. v. Nelson, 169 A.D.3d at 114, 93 N.Y.S.3d 138 ; see Citimortgage, Inc. v. Etienne, 172 A.D.3d 808, 810, 101 N.Y.S.3d 59 ; BAC Home Loans Servicing, LP v. Alvarado, 168 A.D.3d 1029, 1030, 93 N.Y.S.3d 127 ). However, it should again be emphasized that the waiver that results from a failure to affirmatively plead a defense in accordance with CPLR 3018(b), including a waiver of the defense of standing, may be retracted through subsequent amendment to the pleadings (see CPLR 3025 ; U.S. Bank N.A. v. Laino, 172 A.D.3d at 948, 100 N.Y.S.3d 302 ; DLJ Mtge. Capital, Inc. v. David, 147 A.D.3d at 1025, 48 N.Y.S.3d 234 ; U.S. Bank, N.A. v. Sharif, 89 A.D.3d at 724, 933 N.Y.S.2d 293 ; Mendrzycki v. Cricchio, 58 A.D.3d 171, 175, 868 N.Y.S.2d 107 ; cf. Nannini & Callahan Excavating v. Park Rd. Constr. Corp., 234 A.D.2d 352, 352, 651 N.Y.S.2d 334 ). Where applicable, RPAPL 1302–a places the defense of standing on a footing comparable with the other defenses that are exempt from the waiver provisions of CPLR 3211(e), to wit, those defenses listed in subdivisions CPLR 3211(a)(2), (7), and (10), which may be raised by motion "at any time" ( M & E 73–75, LLC v. 57 Fusion LLC, 189 A.D.3d 1, 128 N.Y.S.3d 200, 2020 N.Y. Slip Op. 04372, *2 ), or by amendment to a pleading, "if one is permitted" ( CPLR 3211[e] ; see CPLR 3025[b] ). Even where the defense of standing is omitted from a defendant's answer in violation of CPLR 3018(b), the defense may be raised for the first time in opposition to a plaintiff's motion for summary judgment (see First Trust Natl. Assn. v. DeLuca, 284 A.D.2d 494, 494, 728 N.Y.S.2d 51 ; Kelly v. City of New York, 117 A.D.2d 781, 782, 499 N.Y.S.2d 108 ; Village of Port Chester v. Hartford Acc. & Indem. Co., 90 A.D.2d 831, 831–832, 456 N.Y.S.2d 12 ; Jandous Elec. Constr. Corp. v. City of New York, 88 A.D.2d 821, 822, 451 N.Y.S.2d 124, affd 57 N.Y.2d 848, 455 N.Y.S.2d 768, 442 N.E.2d 65 ; Rizzi v. Sussman, 9 A.D.2d 961, 195 N.Y.S.2d 672 ; see generally Curry v. Mackenzie, 239 N.Y. 267, 272, 146 N.E. 375 ). Under such circumstances a court may, in the provident exercise of its discretion, "deem[ ][the] defendant's answer amended to include the affirmative defense ... on [the] motion for summary judgment" ( Barrett v. Kasco Constr. Co., 56 N.Y.2d at 831, 452 N.Y.S.2d 566, 438 N.E.2d 99 ; see Adsit v. Quantum Chem. Corp., 199 A.D.2d at 900, 605 N.Y.S.2d 788 ; cf. Rooney v. Slomowitz, 11 A.D.3d at 867, 784 N.Y.S.2d 189 ; Counties of Warren & Washington Indus. Dev. Agency v. Boychuck, 109 A.D.2d at 1026, 487 N.Y.S.2d 139 ). Where an affirmative defense is raised for the first time in opposition to a motion for summary judgment, new evidence relevant to that defense may generally be submitted in reply papers inasmuch as "the evidence [is] submitted ... in response to allegations raised for the first time in the opposition papers" ( Citimortgage, Inc. v. Espinal, 134 A.D.3d 876, 879, 23 N.Y.S.3d 251 ; see e.g. CitiMortgage, Inc. v. Goldberg, 179 A.D.3d 1006, 1008, 118 N.Y.S.3d 163 ; JPMorgan Chase Bank, N.A. v. Corrado, 162 A.D.3d 994, 995–996, 80 N.Y.S.3d 366 ).
If an amendment to the answer pursuant to CPLR 3025(a) is not possible, leave to amend an answer may be obtained pursuant to CPLR 3025(b). As that subdivision commands, leave to amend should be "freely given upon such terms as may be just including the granting of costs and continuances" ( CPLR 3025[b] ; see Murray v. City of New York, 43 N.Y.2d at 404–406, 401 N.Y.S.2d 773, 372 N.E.2d 560 ). "[L]eave to amend a pleading should be granted where the amendment is neither palpably insufficient nor patently devoid of merit, and the delay in seeking amendment does not prejudice or surprise the opposing party" ( DLJ Mtge. Capital, Inc. v. David, 147 A.D.3d at 1025, 48 N.Y.S.3d 234 ; see Aurora Loan Servs., LLC v. Dimura, 104 A.D.3d 796, 796–797, 962 N.Y.S.2d 304 ; Lucido v. Mancuso, 49 A.D.3d 220, 226–227, 851 N.Y.S.2d 238 ). "Notably, unless coupled with significant prejudice to plaintiff, even inordinate delay is not a barrier to amendment" ( Endicott Johnson Corp. v. Konik Indus., 249 A.D.2d 744, 744, 671 N.Y.S.2d 557 ; see Edenwald Contr. Co. v. City of New York, 60 N.Y.2d 957, 959, 471 N.Y.S.2d 55, 459 N.E.2d 164 ).
The burden of proving prejudice is on the party opposing the motion for leave to amend the pleading (see Kimso Apts., LLC v. Ghandi, 24 N.Y.3d 403, 411, 998 N.Y.S.2d 740, 23 N.E.3d 1008 ; Caceras v. Zorbas, 74 N.Y.2d 884, 885, 547 N.Y.S.2d 834, 547 N.E.2d 89 ). Prejudice, in this context, is more than "the mere exposure of the [party] to greater liability" ( Loomis v. Civetta Corinno Constr. Corp., 54 N.Y.2d 18, 23, 444 N.Y.S.2d 571, 429 N.E.2d 90 ; see Kimso Apts., LLC v. Ghandi, 24 N.Y.3d at 411, 998 N.Y.S.2d 740, 23 N.E.3d 1008 ). Furthermore, prejudice that may be remedied "by the award of costs, or a continuance, or some other sanction" will generally not provide grounds for the outright denial of a motion for leave to amend (5 Weinstein–Korn–Miller, N.Y. Civ Prac: CPLR ¶ 3018.18; see CPLR 3025[b] ; Kalish v. Manhasset Med. Ctr. Hosp., 100 A.D.2d 507, 508, 472 N.Y.S.2d 714 ; Campbell v. LaForgia Oil Co., 81 A.D.2d 824, 824, 438 N.Y.S.2d 597 ). Rather, "there must be some indication that the [party] has been hindered in the preparation of [the party's] case or has been prevented from taking some measure in support of [its] position" ( Loomis v. Civetta Corinno Constr. Corp., 54 N.Y.2d at 23, 444 N.Y.S.2d 571, 429 N.E.2d 90 ; see Kimso Apts., LLC v. Ghandi, 24 N.Y.3d at 411, 998 N.Y.S.2d 740, 23 N.E.3d 1008 ; Federal Ins. Co. v. Lakeville Pace Mech. Inc., 159 A.D.3d 469, 469, 70 N.Y.S.3d 39 ; Armstrong v. Peat, Marwick, Mitchell & Co., 150 A.D.2d at 190, 540 N.Y.S.2d 799 ; A.J. Pegno Constr. Corp. v. City of New York, 95 A.D.2d at 656, 463 N.Y.S.2d 214 ; Surlak v. Surlak, 95 A.D.2d at 383–384, 466 N.Y.S.2d 461 ; cf. Edenwald Contr. Co. v. City of New York, 60 N.Y.2d at 959, 471 N.Y.S.2d 55, 459 N.E.2d 164 ).
In applying the foregoing principles to the facts of this case, we note that "[t]he general rule holds that an appellate court must apply the law as it exists at the time of its decision" ( Matter of Gardiner v. LoGrande, 83 A.D.2d 614, 615, 441 N.Y.S.2d 288 ; see Matter of Boardwalk & Seashore Corp. v. Murdock, 286 N.Y. 494, 498, 36 N.E.2d 678 ; see also Thorpe v. Hous. Auth. of Durham, 393 U.S. 268, 281, 89 S.Ct. 518, 21 L.Ed.2d 474 ). Accordingly, we consider RPAPL 1302–a in connection with the present appeal, even though that statute had not been enacted at the time the order appealed from was decided by the Supreme Court (see L 2019, ch 739, § 1).
Under the circumstances of this case, it is clear that the Supreme Court should have permitted the defendant to raise the affirmative defense of lack of standing and to amend his answer to include it, even though he failed to plead it as an affirmative defense in his answer (see CPLR 3025[b] ; see also RPAPL 1302–a ; cf. HSBC Bank USA, N.A. v. Szoffer, 149 A.D.3d at 1401, 52 N.Y.S.3d 721 ). In addressing this issue, the plaintiff failed to allege, much less demonstrate, that it suffered any prejudice as a result of the defendant's delay in interposing the defense (see DLJ Mtge. Capital, Inc. v. David, 147 A.D.3d at 1025, 48 N.Y.S.3d 234 ; U.S. Bank, N.A. v. Sharif, 89 A.D.3d at 724, 933 N.Y.S.2d 293 ). Under the circumstances, the Supreme Court should have deemed the defendant's answer amended to include the affirmative defense of lack of standing (see Barrett v. Kasco Constr. Co., 56 N.Y.2d at 831, 452 N.Y.S.2d 566, 438 N.E.2d 99 ; Adsit v. Quantum Chem. Corp., 199 A.D.2d at 900, 605 N.Y.S.2d 788 ).
" CPLR 3212(b) requires the proponent of a motion for summary judgment to demonstrate the absence of genuine issues of material fact on every relevant issue raised by the pleadings, including any affirmative defenses" ( Stone v. Continental Ins. Co., 234 A.D.2d 282, 284, 650 N.Y.S.2d 772 ; see Morley Maples, Inc. v. Dryden Mut. Ins. Co., 130 A.D.3d 1413, 1413, 14 N.Y.S.3d 579 ; Aimatop Rest. v. Liberty Mut. Fire Ins. Co, 74 A.D.2d 516, 517, 425 N.Y.S.2d 8 ; see also Sokolow, Dunaud, Mercadier, & Carreras v. Lacher, 299 A.D.2d 64, 70, 747 N.Y.S.2d 441 ). Accordingly, where, as here, a court deems the defendant's answer amended to include the affirmative defense of lack of standing in opposition to a plaintiff's motion for summary judgment, a plaintiff must establish its standing in order to be entitled to summary judgment on the complaint (see CPLR 3212[b] ; see generally M & T Bank v. Barter, 186 A.D.3d 698, 700, 129 N.Y.S.3d 459 ; Nationstar Mtge., LLC v. Medley, 168 A.D.3d 959, 960, 93 N.Y.S.3d 69 ; Security Lending, Ltd. v. New Realty Corp., 142 A.D.3d 986, 987, 37 N.Y.S.3d 327 ).
To establish prima facie entitlement to judgment as a matter of law in an action to foreclose a mortgage, a plaintiff must produce the mortgage, the unpaid note, and evidence of default (see Deutsche Bank Trust Co. Ams. v. Garrison, 147 A.D.3d 725, 726, 46 N.Y.S.3d 185 ; Deutsche Bank Natl. Trust Co. v. Abdan, 131 A.D.3d 1001, 1002, 16 N.Y.S.3d 459 ; Plaza Equities, LLC v. Lamberti, 118 A.D.3d 688, 689, 986 N.Y.S.2d 843 ). A plaintiff establishes its standing in a mortgage foreclosure action by demonstrating that, when the action was commenced, it was either the holder of, or the assignee of, the underlying note (see Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d 355, 361–362, 12 N.Y.S.3d 612, 34 N.E.3d 363 ; Nationstar Mtge., LLC v. Medley, 168 A.D.3d at 960, 93 N.Y.S.3d 69 ). "Either a written assignment of the underlying note or the physical delivery of the note prior to the commencement of the foreclosure action is sufficient to transfer the obligation, and the mortgage passes with the debt as an inseparable incident" ( U.S. Bank, N.A. v. Collymore, 68 A.D.3d 752, 754, 890 N.Y.S.2d 578 ; see Deutsche Bank Natl. Trust Co. v. Adlerstein, 171 A.D.3d 868, 870, 98 N.Y.S.3d 146 ; Nationstar Mtge., LLC v. Rodriguez, 166 A.D.3d 990, 992, 89 N.Y.S.3d 205 ).
Here, in support of its motion, inter alia, for summary judgment on the complaint insofar as asserted against the defendant, the plaintiff produced the mortgage, the unpaid note, and evidence of default. Since the issue of standing was raised for the first time in opposition to the plaintiff's motion for summary judgment, the plaintiff was entitled to submit evidence on that issue for the first time in its reply papers. The plaintiff's submissions demonstrated, prima facie, that it had physical possession of the note and mortgage prior to the commencement of this action. In opposition, the defendant failed to raise a triable issue of fact. The defendant did not dispute the evidence submitted by the plaintiff to establish that it had physical possession of the note and mortgage prior to the commencement of this action. Rather, the standing defense raised by the defendant related solely to the validity of certain assignments of the note and mortgage. "Since the plaintiff does not base its claim of standing on an assignment of the note, but on its purported physical possession thereof, the [defendant's] arguments as to the validity of the assignment of mortgage and the correction assignment of mortgage are irrelevant" and insufficient to raise a triable issue of fact in opposition to the plaintiff's prima facie showing ( Deutsche Bank Natl. Trust Co. v. Dennis, 181 A.D.3d 864, 869, 122 N.Y.S.3d 95 ; see Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d at 361–362, 12 N.Y.S.3d 612, 34 N.E.3d 363 ; Wells Fargo Bank, N.A. v. Davis, 181 A.D.3d 890, 892, 122 N.Y.S.3d 103 ). The defendant's remaining contentions are without merit.
In view of the foregoing, we agree with the Supreme Court's determination to grant leave to reargue and, upon reargument, grant the plaintiff's motion, inter alia, for summary judgment on the complaint insofar as asserted against the defendant. Accordingly, the order appealed from is affirmed.
ORDERED that the order dated June 19, 2017, is affirmed, with costs.
ROMAN, J.P., MALTESE and IANNACCI, JJ., concur.