Florida trial court abused its discretion by excluding a servicer’s loan payment history as inadmissible evidence

Bank successfully appealed a trial court’s order involuntarily dismissing its foreclosure with prejudice on the grounds that the successor servicer could not rely on the business records of prior servicers to prove-up the bank’s claim at trial. In reaching its conclusion, the appellate court in Bank of New York v. Calloway, No. 4D13-224 (Fla. 4th DCA 2015) held that, so long as a [successor servicer’s] business records obtained from prior servicers establish trustworthiness, the records are cleared for admission and satisfy the business records exception. At trial, the bank attempted to introduce into evidence a copy of a computer generated print-out of the borrower’s payment history under Florida’s business records exception to hearsay. However, the payment history primarily consisted of loan information recorded by the prior servicers for the loan. Borrower objected to the introduction of this information arguing that the payment history was hearsay. The trial court sustained the borrower’s objections and at the conclusion of bench trial granted the borrower’s motion to dismiss the foreclosure with prejudice. In reversing the trial court’s order, the appellate court held that, the law is clear that there is no per se rule precluding the admission of computerized business records acquired from a prior servicer, therefore, the trial court abused its discretion in excluding the proffered evidence at trial. Furthermore, it is well established law that a record custodian, competent to testify under oath, need not be the actual person who prepared the document so long as a foundation for the business record is established. The court pointedly recognized that the problem of proving-up a debt that has been assigned several times is great given the fact that the common practice of lenders is to buy and sale loans. To hold otherwise, would have a profound effect on an assignee’s ability to collect on a debt due as the assignee’s business records are necessarily premised on the payment records of its predecessors. Therefore, so long as the business records requirements are otherwise satisfied, a record created by a prior servicer and integrated into the successor servicer’s records is admissible as the record of the successor servicer.

Download Related Document