Ohio Receivables, L.L.C. v. DallarivaOhio Receivables, L.L.C. v. Dallariva
Rendered on July 12, 2012
Cheek Law Offices, LLC, Parri J. Hockenberry and Jackson T. Moyer, for appellee.
Bradley E. Sherman, for appellant.
APPEAL from the Franklin County Municipal Court.
BRYANT, J.
{¶ 1} Defendant-appellant, Jdomenic Dallariva, appeals from a judgment of the Franklin County Municipal Court granting the summary judgment motion of plaintiff-appellee, Ohio Receivables, LLC. Because (1) the documents submitted to support plaintiff‘s summary judgment motion satisfy the business records exception to the hearsay rule and reflect an account, (2) the cardmember agreement provided for a legal interest rate, and (3) defendant did not raise the issue of untimely service in the trial court, we affirm.
I. Facts and Procedural History
{¶ 2} Plaintiff filed a complaint against defendant on September 27, 2010. Alleging it was the legal owner of the account through purchase, plaintiff sought judgment
{¶ 3} Plaintiff responded with a
{¶ 4} Plaintiff‘s motion for summary judgment alleged no genuine issue of material fact existed, as the evidence demonstrated Chase Bank issued defendant a credit card, defendant used the credit card to purchase goods and services, defendant failed to make рayments to Chase Bank as agreed, and plaintiff owned the account through purchase. Plaintiff sought the outstanding balance on the account of $10,118.61, $6,366.67 in accrued interest through July 15, 2011, and further interest at the rate of 24 percent per annum since November 30, 2008.
{¶ 5} Defendant filed a combined memorandum opposing plaintiff‘s motion for summary judgment and cross-motion for summary judgment. Defendant alleged he was entitled to summary judgment because plaintiff failed to establish a contract between defendant and plaintiff, failed to present a proper accounting, and failed to authenticate the purported bills of sale. Defendant supported his summary judgment motion with plaintiff‘s responses and objections to defendant‘s interrogatories and requests for production of documents, as well as letters between plaintiff‘s counsel and defendant‘s attorneys during discovery.
{¶ 7} On October 20, 2011, the trial court filed a decision and entry granting plaintiff‘s and denying defendant‘s respective motions for summary judgment. The trial court determined the credit card statements attached to plaintiff‘s motion established the existence of a contract between Chase Bank and defendant, and the bills of sale demonstrated plaintiff was the valid assignee of defendant‘s account. The court further concluded the bills of sale were admissible business records under
II. Assignments of Error
{¶ 8} Defendant appeals, assigning the following errors:
[I.] The trial court erred by finding that the Plaintiff-Appellee‘s [sic] satisfied the requirements of
Civil Rule 10(D)(1) .[II.] The Trial Court erred in finding that there was a valid contract as the existence of a contract was disputed and this is an issue of fact.
[III.] The Trial Court erred in considering the credit card statements provided by Plaintiff-Appellee as they are inadmissible hearsay and are not business records.
[IV.] The Trial Court erred in considering the improper accounting provided by Plaintiff-Appellee. The accounting providеd was not in accordance with Ohio law. The alleged balance owed is disputed by the Defendant-Appellant and this is an issue of fact.
[V.] The Trial Court erred by finding that the Plaintiff-Appellee is a valid assignee of the alleged contract underlying the alleged account. To wit: the alleged account was not properly assigned and has not been authenticated as there were multiple assignments by multiple entities. [VI.] The Trial Court erred when it overruled Defendant-Appellant‘s Motion for Summary Judgment.
[VII.] The Trial Court abused its discretiоn when it granted the Plaintiff-Appellee‘s Motion for Summary Judgment.
[VIII.] The Trial Court erred in assessing interest as the interest charges were usurious, against the statutory limit and against public policy.
[IX.] The Trial Court erred in failing to require Plaintiff-Appellee to show cause and dismiss Plaintiff-Appellee‘s Complaint due to failure to obtain service in 6 months pursuant to
Civil Rule 4(E) .
{¶ 9} Defendant fails to separately argue his assigned errors as
III. Second, Third, Fifth, Sixth, and Seventh Assignments of Error - Summary Judgment Properly Granted
{¶ 10} Defendant‘s second, third, fifth, sixth, and seventh assignments of error collectively assert the trial court erred both in granting plaintiff‘s summary judgment motion and denying defendant‘s summary judgment motion, as the documents plaintiff relied on to establish defendant‘s obligation on the delinquent credit card account are inadmissible hearsay.
A. Standard of Review
{¶ 11} An appellate court‘s review of summary judgment is conducted under a de novo standard. Coventry Twp. v. Ecker, 101 Ohio App.3d 38, 41 (9th Dist.1995); Koos v. Cent. Ohio Cellular, Inc., 94 Ohio App.3d 579, 588 (8th Dist.1994). Summary judgment is
{¶ 12} Pursuant to
B. Business Records Under Evid.R. 803(6)
{¶ 13} The trial court relied on the credit card statements attached to plaintiff‘s motion to find defendant used a credit card that Chase Bank issued so he could purchase goods and services, and so created a contract with the bank. The court further relied on the bills of sale attached to plаintiff‘s motion to find plaintiff was the valid assignee of the contract between defendant and Chase Bank. Defendant contends the credit card statements and bills of sale are inadmissible hearsay and thus improper
{¶ 14} To prove a breach of contract claim, a plaintiff must demonstrate the existence of a contract, plaintiff‘s performance, defendant‘s breach, and damage or loss to the plaintiff. Discover Bank v. Poling, 10th Dist. No. 04AP-1117, 2005-Ohio-1543, ¶ 17 (internal quotations omitted). Pursuant to Ohio law, credit card agreements are contracts
{¶ 15}
{¶ 16} Affidavits submitted to suppоrt or oppose a summary judgment motion “shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated in the affidavit.”
{¶ 17}
{¶ 18} Defendant alleges that the documents attached to Cheek‘s affidavit are hearsay because Chase Bank and Turtle Creek created the documents, and plaintiff failed to present a qualified witness from Chase Bank or Turtle Creek to authenticate them. Defendant thus contеnds plaintiff failed to prove it was the valid assignee of a contract involving defendant. See Hudson & Keyse, LLC v. Carson, 10th Dist. No. 07AP-936, 2008-Ohio-2570, ¶ 11 (noting the appellee “could not prevail on the claims assigned by the bank without proving the existence of a valid assignment agreement“).
{¶ 19} Pursuant to
{¶ 20} Rather,
{¶ 21} “Numerous federal courts have addressed whether documents may be admitted as business records of an entity other than the maker” and “have permitted admission of documents incorporated into a business‘s records, although prepared by third parties.” Anders at ¶ 17-24, citing United States v. Ullrich, 580 F.2d 765, 771-72 (5th Cir.1978) (deciding automobile dealership could introduce documents originating from financier of dealership and automobile manufacturer as dealership‘s business records, since the documents were “transmitted by persons with knowledge and then confirmed and used in the regular course of the dealership‘s business“); United States v. Jakobetz, 955 F.2d 786, 801 (2d Cir.1992) (concluding documents that another entity originally created may constitute the business record of a subsequent entity if “the document ha[d] been incorporated into the business records of the testifying entity“); Air Land Forwarders, Inc. v. United States, 172 F.3d 1338, 1343 (Fed.Cir.1999). Such courts have reaffirmed “the adoptive-business-records doctrine and its rejection of the ‘anarchronistic rule’ that once required foundational testimony to be given by the preparer of a business record.” Anders at ¶ 19, quoting United States v. Irvin, 656 F.3d 1151, 1161 (10th Cir.2011), citing United States v. Carranco, 551 F.2d 1197, 1200 (10th Cir.1977).
{¶ 22} Defendant responds with Royse v. Dayton, 195 Ohio App.3d 81, 2011-Ohio-3509 (2d Dist.) to refute the adoptive business records doctrine. In Royse, the court determined the city of Dayton could not introduce a report from a medical-review officer, working for the company ASTS, as its own business record since the ” ‘information in reports that a business receives from outside sources is not part of its business records for the purposes of
{¶ 23} In Babb, the Eighth District concluded “that consumers’ unsolicited letters to a car manufacturer, complaining of defects, were not business records of the manufacturer.” Anders at ¶ 26, citing Babb at 177. The court decided the unsolicited
{¶ 24} Here, Cheek explained in his affidavit that he was the custodian of plaintiff‘s records, and he based the affidavit on personal knowledge “gained from a review of business records kept under his care, custody and control,” which reflected “business transactions kept in the ordinary and regular course of business of Plaintiff or its predecessor(s) in interest.” (Cheek Affidavit, at ¶ 1.) Cheek averred that plaintiff received the rights and title to defendant‘s debt by purchase and assignment, referencing and explaining the bills of sale dated and signed by representatives of Chase Bank and Turtle Creek, and accompanying Excel spreadsheets. (Cheek Affidavit, at ¶ 4, 6.) The redacted Excel spreadsheets attached to the bills of sale contain defendant‘s name, account number, address, the date defendant opened the account, and the date Chase Bank charged off the account.
{¶ 25} Cheek indicated that, pursuant to the sales contract with Turtle Creek, Turtle Creek provided plaintiff with 18 months worth of credit card statements, which plaintiff incorporated “into Plaintiff‘s business records” and relied on “in Plaintiff‘s day-to-day business.” (Cheek Affidavit, at ¶ 7.) Cheek stated that plaintiff then subpoenaed additional documentation regarding defendant‘s account from Chase Bank, Chase Bank provided plaintiff with more credit card statements, a copy of the cardmember agreement for defendant‘s account, and copies of defendant‘s checks making payments on the account, all of which plaintiff reviewed, incorporated into its business records, and relied
{¶ 26} Cheek‘s affidavit thus discloses that plaintiff acquired these documents as an assignee, through its contract with Turtle Creek and from subpoenas sent to Chase Bank; Chase Bank and Turtle Creek operated under respective business duties in creating the documents and sending them to plaintiff; and plaintiff relied on the documents in the ordinary course of its own business, incorporating them into its own business records. Defendant responded with no evidence to indicate the documents are not trustworthy. Accordingly, the trial court did not err in finding that the documents satisfied
{¶ 27} By virtue of its
{¶ 28} Based on the foregoing, defendant‘s second, third, fifth, sixth, and seventh assignments of error are overruled.
IV. First and Fourth Assignments of Error – Proper Accounting
{¶ 29} Defendant‘s first and fourth assignments of error assert the trial court erred in granting plaintiff summary judgment, as plaintiff failed to present a proper accounting. Defendant alleges that, in order to constitute a proper account, “[t]he balance should begin at zero and show all charges and credits in chrоnological order.” (Appellant‘s brief, at 8.) Because the first credit card statement attached to plaintiff‘s motion for summary judgment does not start at zero, defendant asserts that he may only be found liable for $2,672.70: the difference between $7,445.91, the beginning balance of the credit card statements, and $10,118.61, the final balance. (Appellant‘s brief, at 9.)
{¶ 31} ” ‘An account rendered by one person to another and not objected to by the latter within a reasonable time becomes an account stated.’ ” Creditrust Corp. v. Richard, 2d Dist. No. 99-CA-94 (July 7, 2000), quoting 1 Ohio Jurisprudence 3d, Accounts and Accounting, Section 27, at 204 (1998). It is “the duty of the one to whom the account is thus rendered to examine the same within a reasonable time and object if he or she disputes its correctness.” Id. (concluding the plaintiff pled a proper account, even though the credit card statement attached to the complaint showed no debits or credits, where the debtor did not timely object to the final balance within 60 days after receiving the statement, as the cardholder agreement required).
{¶ 32} The credit card statements attached to plaintiff‘s motion for summary judgment begin with a statement reflecting a due date of February 13, 2004 and a balance on the account of $7,447.17. The statement shows the previous balance was $7,445.91, that defendant charged $183.07 in goods and services, paid $253.08, and incurred $71.27 in finance charges. The statements continue, reflecting almost five years worth of
{¶ 33} As the credit card statements reflect, defendant used the credit card and thus subjected himself to the cardmember agreement. See, e.g., Calvary SPV I, L.L.C. v. Furtado, 10th Dist. No. 05AP-361, 2005-Ohio-6884, ¶ 18 (concluding that although the “cardholder agreement [did] not bear defendant‘s signature, the bank‘s issuance of the card and defendant‘s use of the card create[d] a binding contract“). Moreover, the cardmember agreement required defendant to notify Chase Bank in writing within 60 days after defendant received a bill with any error or problem on it. Defendant failed to submit evidence in his summary judgment motion demonstrating that he at any time objected to the $7,447.17 balance in February 2004. After the February 2004 statement, the statements reflect defendant continued to incur expenses and make payments on the account, indicating his assent to the $7,447.17 balance as an account stated. See Crown Asset Mgt., L.L.C. v. Gaul, 4th Dist. No. 08CA30, 2009-Ohio-2167, ¶ 10, fn. 1 (determining that a party‘s assent to an account stated may be express or “implied when an account is rendered by the creditor to the debtor and the debtor fails to object within a reasonable amount of time“).
{¶ 34} The trial court thus properly cоncluded the billing statements, spanning nearly five years, qualify as an account. The documents reflect defendant‘s name, a sum recited to which defendant did not object, and itemized debits and credits which permit calculation of the final amount due.
{¶ 35} Defendant alternatively contends the trial court erred in failing to dismiss plaintiff‘s complaint for failure to comply with
{¶ 36} Although defendant‘s answer to the complaint alleged as a defense that plaintiff “failed to provide a copy of a contract signed by the Defendant pursuant to
{¶ 37} Accordingly, defendant‘s first and fourth assignments of error are overruled.
V. Eighth Assignment of Error - Usurious Interest
{¶ 38} Defendant‘s eighth assignment of error alleges the interest charges on the credit card account were usurious, against the statutory limit, and against public policy. Defendant fails to separately argue this error, making a single conclusory statement that the charges on the credit card statements “are primarily late fees and usurious interest charges.” (Appellant‘s brief, at 9.)
{¶ 39} The cardmember agreement provided that upon default, defendant could be required to pay “two percent (2%) a month on the unpaid balance.” (R. 26, Cheek Affidavit, Exhibit F, at ¶ 21.)
{¶ 40} Defendant‘s eighth assignment of error is overruled.
VI. Ninth Assignment of Error – Civ.R. 4(E)
{¶ 41} Defendant‘s ninth assignment of error asserts the trial court erred in failing to dismiss plaintiff‘s complaint for failure to obtain service within six months.
{¶ 42} Defendant did not raise any issue regarding the timeliness of service in the trial court and thus waived any argument he may have had regarding untimely service. Gentile v. Ristas, 160 Ohio App.3d 765, 2005-Ohio-2197, ¶ 74 (10th Dist.), citing Estate of Hood v. Rose, 153 Ohio App.3d 199, 2003-Ohio-3268, ¶ 10 (4th Dist.); Everhome Mtge. Co. v. Baker, 10th Dist. No. 10AP-534, 2011-Ohio-3303, ¶ 24.
{¶ 43} Defendant‘s ninth assignment of error is overruled.
VII. Disposition
{¶ 44} Having overruled all of defendant‘s assignments of errors, we affirm the judgment of the Franklin County Municipal Court.
Judgment affirmed.
KLATT and CONNOR, JJ., concur.