Sua Sponte Dismissal for Lack of Standing Reversed—Defendants Did Not Raise the Defense and Therefore Waived It—Lack of Standing is Not a Jurisdictional Defect

The Second Department determined Supreme Court should not have, sua sponte, dismissed the foreclosure action for an alleged lack of standing. The defendants did not raise the standing defense and, therefore, waived it. Standing is not a jurisdictional defense warranting sua sponte action by the court:

The Supreme Court improperly, sua sponte, directed the dismissal of the complaint on the ground that the plaintiff lacked standing. “A court’s power to dismiss a complaint, sua sponte, is to be used sparingly and only when extraordinary circumstances exist to warrant dismissal” … . Here, the Supreme Court was not presented with extraordinary circumstances warranting the sua sponte dismissal of the complaint … . Since the defendants … did not raise the defense of lack of standing in their answers and did not make pre-answer motions to dismiss the complaint on that ground, they waived the issue … . Moreover, a party’s lack of standing does not constitute a jurisdictional defect and does not warrant a sua sponte dismissal of the complaint by the court … . Onewest Bank, FSB v Prince, 2015 NY Slip Op 05922, 2nd Dept 7-8-15