Channell v. Deutsche Bank National Trust Co.
173 So. 3d 1017
| Fla. Dist. Ct. App. | 2015Background
- Deutsche Bank filed foreclosure against Charles H. Channell, Jr. on a 2007 adjustable-rate mortgage; trial on the second amended complaint began April 22, 2014.
- Deutsche Bank called one witness: an Ocwen loan analyst (Ocwen was servicer at trial); no testimony addressed whether Ocwen verified or reviewed records obtained from prior servicer HomeEq.
- Deutsche Bank sought to admit a computerized loan transaction history and other servicer records as business records under the hearsay exception; Channell objected for lack of foundation and hearsay.
- The trial court overruled objections and admitted the records; judgment of foreclosure was entered after the bench trial.
- On appeal, the Second District reviewed admissibility under the business-records exception and the required foundational predicate for computerized successor-servicer records.
Issues
| Issue | Plaintiff's Argument (Deutsche Bank) | Defendant's Argument (Channell) | Held |
|---|---|---|---|
| Admissibility/foundation for loan transaction history (business-records hearsay exception) | Records are admissible as regularly kept business records of successor servicer (Ocwen) after integration of predecessor (HomeEq) records | Records are hearsay and lack foundational proof; no testimony verifying or explaining predecessor records or integration | Foundation was inadequate; records admitted were inadmissible hearsay because no proof they were checked, verified, or that witness knew prior system; admission was error |
| Sufficiency of evidence to establish amount due and owing | Introduced records established outstanding debt amount | Without admissible transaction history, amount due not established | Because inadmissible records were relied on, there is insufficient evidence of amount due; foreclosure judgment affirmed in part but reversed as to amount and remanded for further proceedings |
Key Cases Cited
- Sas v. Fed. Nat’l Mortg. Ass’n, 112 So.3d 778 (Fla. 2d DCA 2013) (standard of review and remand guidance on sufficiency after bench trial)
- Bank of N.Y. v. Calloway, 157 So.3d 1064 (Fla. 4th DCA 2015) (successor servicer integration doctrine and required verification to satisfy business-records foundation)
- Yisrael v. State, 993 So.2d 952 (Fla. 2008) (elements required to establish business-records exception predicate)
- Bank of Am., N.A. v. Delgado, 166 So.3d 857 (Fla. 3d DCA 2015) (foundational witness should know computerized record-keeping system)
- Hunter v. Aurora Loan Servs., LLC, 137 So.3d 570 (Fla. 1st DCA 2014) (witness who didn't prepare records must show knowledge of foundational elements)
- WAMCO XXVIII, Ltd. v. Integrated Electronic Environments, Inc., 903 So.2d 230 (Fla. 2d DCA 2005) (successor must independently confirm accuracy of predecessor records to satisfy foundation)
- Kelsey v. SunTrust Mortg., Inc., 131 So.3d 825 (Fla. 3d DCA 2014) (inadmissibility of unestablished business records as hearsay)
- Correa v. U.S. Bank Nat’l Ass’n, 118 So.3d 952 (Fla. 2d DCA 2013) (Rule 1.530(e) discussion on raising sufficiency after non-jury trial)
Affirmed in part; reversed in part; remanded.