Green Tree Servicing, LLC v. Cope, 158 A.3d 931

Green Tree Servicing, LLC filed a 2014 residential foreclosure against Thelma J. Cope but did not own the mortgage and therefore lacked standing to foreclose.
After case scheduling and discovery deadlines, Green Tree sought to amend to cure the standing defect but the court denied the untimely amendment.
One week before trial Green Tree moved to dismiss its complaint without prejudice under M.R. Civ. P. 41(a)(2), acknowledging lack of standing; Cope opposed and sought dismissal with prejudice as a sanction.
The Superior Court initially dismissed the foreclosure complaint with prejudice, finding repeated filings and dilatory conduct (including deposing a 90‑year‑old defendant despite knowledge of the standing defect).
On reconsideration the court concluded it lacked authority to impose dismissal with prejudice because Green Tree lacked standing and amended the judgment to dismiss without prejudice.
Cope appealed; the Law Court considered whether a court may impose dismissal with prejudice as a sanction even when the plaintiff lacks standing, and whether the trial court abused its discretion.

Issue	Plaintiff's Argument (Green Tree)	Defendant's Argument (Cope)	Held
Whether a trial court may dismiss a foreclosure complaint with prejudice as a sanction when the plaintiff lacks standing	Because Green Tree lacked standing, dismissal must be without prejudice; the court cannot adjudicate merits or impose a merits-based bar	Court may impose dismissal with prejudice as a sanction for procedural misconduct even if plaintiff lacks standing	A court retains authority to dismiss with prejudice as a sanction for misconduct; lack of standing does not strip the court of sanctioning power
Whether the trial court abused its discretion by granting reconsideration and amending the dismissal to be without prejudice	Reconsideration appropriate because prior dismissal with prejudice was improper given lack of standing	Trial court exercised discretion to impose sanction; it gave notice and relied on record showing dilatory conduct	Court vacated the amended judgment (dismissal without prejudice) and remanded for the trial court to decide whether a sanction (including dismissal with prejudice) remains appropriate, following the procedural safeguards described

Bank of America v. Greenleaf, 96 A.3d 700 (Maine 2014) (holding a mortgagee that only acquired rights from MERS as nominee lacked standing to foreclose)
U.S. Bank N.A. v. Curit, 131 A.3d 903 (Maine 2016) (stating that dismissal for lack of standing is ordinarily without prejudice)
Bank of New York v. Dyer, 130 A.3d 966 (Maine 2016) (same principle regarding dismissal without prejudice when plaintiff lacks standing)
U.S. Bank v. Tannenbaum, 126 A.3d 734 (Maine 2015) (review of trial court authority is de novo on questions of law)
U.S. Bank v. Sawyer, 95 A.3d 608 (Maine 2014) (affirming dismissal with prejudice as sanction where court gave notice and dismissal was warranted)
Bayview Loan Servicing, LLC v. Bartlett, 87 A.3d 741 (Maine 2014) (discussing dismissal with prejudice for pretrial noncompliance and role of warning)
Willy v. Coastal Corp., 503 U.S. 131 (U.S. 1992) (explaining sanctions address abuse of process and may be imposed even if court lacks subject‑matter jurisdiction over merits)