469 P.3d 271
Or. Ct. App.2020Background
- Fasching took out student loans from Citibank; Discover Bank later acquired those loans and the associated Arrowood insurance policy interest.
- Fasching defaulted; Discover submitted proof-of-loss documents to Arrowood and Arrowood paid Discover’s claim.
- Arrowood sued Fasching in subrogation for reimbursement and moved for summary judgment, attaching the lender-originated proof-of-loss records and an affidavit from Arrowood’s program director (McGough) laying OEC 803(6) foundation.
- Fasching cross-moved for summary judgment and contended the lender records were hearsay because Arrowood did not produce sworn foundation from Citibank/Discover.
- The trial court admitted the records under OEC 803(6), granted Arrowood’s summary judgment, and entered judgment for Arrowood; Fasching appealed.
Issues
| Issue | Arrowood's Argument | Fasching's Argument | Held |
|---|---|---|---|
| Admissibility of lender proof-of-loss under OEC 803(6) | Lender records are admissible as Arrowood’s business records because Arrowood adopted and relied on them | Lender records are third-party hearsay and require foundation from the lender itself | Court: Admissible — third-party records may be admitted if reliability shown by a duty-to-record/report and adoption by the proponent |
| Sufficiency of Arrowood’s affidavit foundation | McGough’s affidavit established custodian qualifications, adoption, reliance, and regular course of business | Affidavit insufficient because it did not include sworn testimony from Citibank/Discover about record creation | Court: Sufficient — affidavit plus legal duties on lenders met the three-part test for third-party records |
| Whether admissible records support summary judgment | Records prove loans, default, claim payment, and Arrowood’s subrogation entitlement | Without admissible records, Arrowood failed to carry its summary judgment burden | Court: No genuine issue of material fact; Arrowood entitled to judgment as a matter of law |
Key Cases Cited
- Johnson v. Lutz, 253 N.Y. 124 (police report containing voluntary third-party statements inadmissible under business-records exception)
- Morgan v. Valley Property & Casualty Ins. Co., 289 Or. App. 454 (third-party information in adjuster spreadsheet lacked requisite reliability)
- State v. Cain, 260 Or. App. 626 (third-party records admissible where provider had legal duty to report accurately and proponent showed adoption/reliance)
- Palmer v. Hoffman, 318 U.S. 109 (regular course of business reliability standard for business records)
- Snyder v. Portland Traction Co., 182 Or. 344 (police report exclusion for voluntary third-party statements)