Presenting Business Records As Evidence in Federal Court Tom Arnold

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1986 Presenting Business Records as Evidence in Federal Court Tom Arnold

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Recommended Citation 32 Practical Lawyer 19-34 (1986).

This Article is brought to you for free and open access by TU Law Digital Commons. It has been accepted for inclusion in Articles, Chapters in Books and Other Contributions to Scholarly Works by an authorized administrator of TU Law Digital Commons. For more information, please contact [email protected]. Presenting Business Records as Evidence in Federal Court M. Thomas Arnold A business record is admissible as evidence if the court is as justified as its maker in relying upon it.

admission. Conversely, the attorney A N ATIDRNEY OFFERING BUSINESS RECORDS into evidence must seeking to prevent the acceptance of have a basic understanding of the re- these records into evidence must be quirements for and the mechanics of able to point out to the court any defi- 20 THE PRACTICAL LAWYER (Vol. 32-No. 4) JUNE

ciencies in the laying of the ground- o The records were made by a regu- work for admission, or any reasons larly conducted business activity; why the records are untrustworthy or e They were kept in the regular otherwise inadmissible. course of that business; The rules governing the use of business records in court conform with o It was the regular practice of that common sense and business practical- business to make such records; and ities. Businesses regularly rely on their * The records were made by a person and accept them as accurate records with knowledge or from information in making important decisions. The transmitted by a person with knowl- law as well now has come to recognize edge. Rule 803(6); Clark v. City of these records as generally accurate Los Angeles, 650 E2d 1033, 1036-7 and to permit their introduction as ev- (9th Cir. 1981), cert. denied, 456 U.S. idence of the matters recorded in 927 (1982). them provided certain requirements are met. Of course, if business records are The modern theory is that business not offered as evidence of the truth of records are admissible because they the matters recorded, then they are are inherently reliable. N.L.R.B. v. not hearsay and need not meet the re- First Termite Control Co., 646 E2d quirements of Rule 803(6). See United 424, 427 (9th Cir. 1981). The prerequi- States v. Rangel, 585 E2d 344, 346 sites for the admission of business rec- (8th Cir. 1978) (vouchers and attach- ords as evidence under the federal ments were introduced to show delib- rules are meant to ensure that only erate act of alteration and not for pur- records with a high probability of ac- pose of establishing truth of state- curacy are admitted. Records will be ments in them). excluded if indicia of reliability are absent. Thistworthiness "To merit judicial reliance on the A DMISSIBILITY • In federal prac- contents of records, it is necessary tice, the admissibility of business that the proponent of particular rec- records is governed by the Federal ords establish the trustworthiness of Rules of Evidence ("Rules")-to those records." United States v. Rich, which all Rule references are made 580 E2d 929, 938 (9th Cir.), cert. de- unless otherwise indicated. Under nied, 439 U.S. 935 (1978). The Rules these Rules, business records made at provide that the prerequisites for or near the time of the matter re- business records are to be established corded are not excluded by the hear- "by the testimony of the custodian [of say rule if they meet certain basic re- the records] or other qualified wit- quirements: ness." Yet the Rules will exclude the PRESENTING BUSINESS RECORDS AS EVIDENCE 21 records if "the method or circum- these rights were affected. Liner v. J.B. stances of preparation indicate lack of Talley & Co., Inc., 618 E2d 327, 329 trustworthiness." Rule 803(6). (5th Cir. 1980); Fed. R. Civ. P. 61; Rule 103(a). Thus a trial court's deci- Relevant and Probative sion to admit or exclude proferred rec- In addition, the Rules do not pro- ords, even if erroneous, stands a good vide that business records which meet chance of being affirmed on appeal. the requirements of Rule 803(6) are necessarily admissible. These records Time of the Matter Recorded will not be excluded by the hearsay A business record will be admissi- rule, but they may be excluded for ble only if made at or near the time of other reasons. United States v. Cain, the matter recorded. See, e.g., United 615 F2d 380, 381 (5th Cir. 1980) ("ex- States v. Kim, 595 E2d 755, 760 (D.C. ceptions ...in Rules 803 and 804 are Cir. 1979) (record made over two not affirmative rules of admissibility; years after the event did not meet the they are couched in [terms ofl cautious "at or near" time requirement). Rule negation of inadmissibility"); Forward 803(6) does allow records made "near" Communications Corp. v. United the time of the event to be admitted. States, 608 E2d 485, 510 (Ct. Cl. Thus some delay in recording matters 1979). Thus, business records that are in business records will not be fatal if not relevant or that are substantially the record is still contemporaneous. In more prejudicial than probative may addition, the fact that entries are out of be excluded. See Rules 402 and 403. chronological sequence will not pre- If a business's records meet the re- vent admission if all entries are made quirements of Rule 803(6) and are at or near the time of the matters re- otherwise admissible, they may be in- corded. United States v. Foster, 711 troduced into evidence by any party. F2d 871, 882 (9th Cir. 1983), cert. de- "There is no basis for limiting Rule nied, 465 U.S. 1103 (1984). 803(6)'s operation to introduction of one's own business records." United Regularly Conducted States v. Consolidated Edison Co. of Business Activity N.Y, Inc., 580 E2d 1122, 1131, n. 18 The term "business," as used in (2nd Cir. 1978) (emphasis in original). Rule 803(6), is defined as including "business, institution, association, Errors of Admission or Exclusion profession, occupation, and calling of Trial court errors in the admission or every kind, whether or not conducted exclusion of evidence will be over- for profit." Thus "the records of such turned only if substantial rights of a institutions and associations as hospi- party are affected, and the party as- tals, churches, and schools would be serting error must demonstrate that admissible.... "See Read, The Busi- 22 THE PRACTICAL LAWYER (Vol. 32-No. 4) JUNE ness Records Exception: Something v. Commissionerof InternalRevenue, Less Than Revolutionary,2 Litigation 713 E2d 496, 499-500 (9th Cir. 1983) 25, 27 (Fall 1975). See also Hall v. (regularly kept diary of tip income re- Commissioner of Internal Revenue, ceived by casino employee). Personal 729 E2d 632 (9th Cir. 1984) (church business records may be found to be records admissible as business records trustworthy because "[a] man has a if proper foundation laid by qualified direct financial interest in keeping ac- witness); Stone v. Morris, 546 F2d curate accounts in his personal busi- 730 (7th Cir. 1976) (prison is clearly a ness." Sabatino v. Curtiss Nat'l Bank, "business"). 415 E2d 632, 636 (5th Cir. 1969), cert. denied, 396 U.S. 1057 (1970) (check licit Enterprise records). The Rules do not require that the business be licit. The records of an il- The Regular Course of Business licit enterprise may be admissible if the When records are kept in the regu- requirements of the rule, including reg- lar course of business the person fur- ularity of the activity, are met. See, nishing the information to be record- e.g., United States v. Baxer,492 E2d ed has motivations to be accurate. 150, 164 (9th Cir. 1973), appeal dis- These would include the knowledge missed, 414 U.S. 801 (1973), cert. de- that the employer may rely on the in- nied, 416 U.S. 940 (1974) (records formation in the records and the duty "were prepared pursuant to an inher- to give accurate information as part ently reliable standard operating proof a continuing employment. cedure" and were admissible under former Federal Business Records as Records Preparedin Evidence Statute). See also United Anticipation of Litigation States v. Foster, 711 E2d 871, 882-3, The requirement that business rec- cert. denied, 465 U.S. 1103 (1984) (records be kept in the regular course of ords of large drug transactions), and business excludes records prepared in United States v. Hedman, 630 E2d anticipation of litigation from admis- 1184, 1197-8 (7th Cir. 1980), cert. de- sion as business records. Clark v. City nied, 450 U.S. 965 (1981) (diary kept of Los Angeles, 650 E2d 1033, 1037 by employee detailing payoffs to Chi- (9th Cir. 1981), cert. denied, 456 U.S. cago Building Inspection Supervisors). 927 (1982) (216-page diary begun at the suggestion of a legal aid attorney PersonalRecords and made expressly for purpose of lit- A number of cases have admitted igation); Southern Pac. Com. Co. v. personal records or even diaries as American Tel. & Tel. Co., 556 E Supp. business records if the records were 825, 1041 (D.D.C. 1983), aff'd, 740 regularly maintained. See, e.g., Keogh E2d 980 (D.C. Cir. 1984), cert. denied, 1986 PRESENTING BUSINESS RECORDS AS EVIDENCE 23

former Federal Business Records Act If information is provided in and holding that personal injury re- aicipation of or inprqxmation port and inspection report were admissible). for litigation, the motion to be accurte may be lacking. Investigative Reports In addition, investigative reports are not per se inadmissible as business records. For example, the report of a 105 S. Ct. 1359 (1985) (reports rou- law officer investigating an accident tinely sent to corporate legal depart- may be admissible. The accident re- ment pursuant to instructions from port may be a routine part of the law that department and prepared to sup- officer's employment; the officer has port legal activities). a motive to be accurate. See Notes to If information is provided in antici- Rule 803(6), at 310-11. pation of or in preparation for litiga- Several cases have held, however, tion, the motivation to be accurate that investigative reports that are in- may be lacking. The typical enterprise admissible as public records under is not in the business of litigating, and Rule 803(8) are also inadmissible as the "[a]bsence of routineness raises business records under Rule 803(6). lack of motivation to be accurate." See, e.g., United States v. Cain, 615 Advisory Committee's Notes to E2d 380, 382 (5th Cir. 1980) (business Rules, 56 ER.D. 183 (1972) ("Notes"); records exception does not open a Rule 803(6), at 310 (released 1972, ef- back door for evidence excluded by fective 1973). public records exception); United The mere fact that a report or rec- States v. Oates, 560 E2d 45 (2d Cir. ord might ultimately be useful or 1977). This approach would deny ad- valuable in litigation or that it is fa- mission of investigative reports by law vorable to the employer should not, enforcement personnel against the de- however, automatically warrant its fendant in a criminal case. These re- exclusion. The decisive question ports might still be admissible in civil should be the trustworthiness of the cases or against the government in record. Thus, if an accident or injury criminal cases. report is made pursuant to a governmental reporting requirement or for Records Required by Law the purpose of determining how fu- Records that businesses are re- ture accidents might be avoided, a quired by law to keep or reports busi- motive to be accurate would be pre- nesses are required by law to file may sent. See, e.g., Lewis v. Baker, 526 be admissible as business records. E2d 470 (2d Cir. 1975) (interpreting Business records are not inherently 24 THE PRACTICAL LAWYER (Vol. 32-No. 4) JUNE untrustworthy solely because they are Regular Practice of Recordkeeping required by law to be kept. A business If it is not the regular practice of the may have incentives to keep these rec- business to make records of the type ords or file these reports accurately. sought to be admitted, then the rec- One incentive may be the desire to ords should be excluded. Evidence of comply with the law. See Pacific Ser- a standardized method of record- vice Stations Co. v. Mobil Oil Corp., keeping can strengthen the case for 689 E2d 1055, 1061 (Temp. Emerg. admission of business records. Evi- Ct. of App. 1982) (monthly reports dence of haphazard recordkeeping required by Department of Energy, can be fatal. subject to possible audit); United States v. Veytia-Bravo, 603 E2d 1187, Indicia of Rel"ability 1191 (5th Cir. 1979), cert. denied, 444 U.S. 1024 (1980) (records of sales of Systematic checking of business firearms and ammunition kept pursu- records and habits of precision pro- ant to federal regulations; business duced by regularity of recordkeeping that made records had incentive to are reasons that business records are keep records with precision to show it considered to be generally trustwor- had not made unlawful sales). thy. When these indicia of reliability are not present, the records are A record made pursuant to a spe- not trustworthy and it is less likely that the cial request or made for something business itself will rely on the other than a regular business purpose records. The justification for admitting those is likely to be excluded. See e.g., Pan- records has dissipated. Cf. Islamic Trade Corp. v. Exvon Corp., State v. Perniciaro,374 So. 2d 1244, 1247 (La. 632 F2d 539, 560 (5th Cir. 1980), cert. 1979) (records of job descriptions denied, 454 U.S. 927 (1981) (memo- were not within common law business randum drafted in most optimistic light to prevent another from breach- records exception since they "were not kept and checked with a degree of ing a contract); United States v. Kim, habit, system, regularity and continu- 595 E2d 755, 761-2 (D.C. Cir. 1979) ity which would prevent casual inac- (telex prepared by foreign bank in re- curacies and counteract the sponse to a governmental subpoena); possible Johnson & Johnson v. W.L. Gore & temptation to misstatements."). Assocs., Inc., 436 F Supp. 704, 714 On the other hand, "[t]he fact that (D. Del. 1977) (memo prepared in re- a regular practice is occasionally bro- sponse to specific request for the writ- ken is not enough to avoid applica- er's version of the events in question). tion of the business records rule; oth- Such a record is, simply, not kept in erwise, the rule would be swallowed the regular course of the business. up by an exception for less-than- PRESENTING BUSINESS RECORDS AS EVIDENCE 25 perfect business practices." United by customers for decision to termi- States v. Patterson,644 E2d 890, 901 nate electrical power service). (1st Cir. 1981). A number of cases have limited the One can argue that the requirement requirement that the person making of regular recordkeeping should be the statement be acting in the regular given a liberal construction. If so, a course of the business if the records of record of a single meeting or other im- those statements are integrated into a portant item might satisfy the require- company's records and relied upon in ment if the business involved regu- its day-to-day operations. See Matter larly recorded other important meet- of Ollag Const. Equip. Corp., 665 ings or matters. See In re Japanese F2d 43 (2d Cir. 1981) (financial state- Elec. Prods.Antitrust Litigation, 723 ments prepared by customers of a F2d 238, 289 (3rd Cir. 1983), rev'd on bank at bank's request, on bank's othergrounds, 106 S. Ct. 1348 (1986). form, and regularly relied upon by the bank in deciding whether to ex- Information Given tend credit are admissible to show that by a Person with Knowledge bankrupt was insolvent and that bank If a business record is prepared by should have been aware of it); United one employee from information pro- States v. Ullrich, 580 E2d 765, 772 (5th vided by another employee, the lack Cir. 1978) (records prepared and trans- of personal knowledge on the part of mitted by person with knowledge in the person preparing the business rec- one business and then used in the regu- ord does not affect its admissibility. lar course of another business). However, if the observer, or person If counsel is seeking admission of supplying the information, is not act- records made by one business and ing in the regular course of the busi- used by another, testimony establish- ness activity, then the observer's state- ing the reliability of those records ment must fall within another hearsay should show, if possible: exception to be admissible. The non- employee is not acting under the duty * The method of preparation of the of accuracy to which an employee record; would be subject, and the presump- tion of accuracy accorded to state- * That the record was prepared in the ments made during the regular course regular course of the first business; of the business would not pertain. United States v. Baker, 693 E2d 183, * That the first business had a motive 188 (D.C. Cir. 1982); City of.Cleve- to be accurate; land v. Cleveland Elec. Illuminating Co., 538 E Supp. 1257, 1269-71 (N.D. * That the second business verified Ohio 1980) (reports of reasons given the accuracy of these records; and 26 THE PRACTICAL LAWYER (Vol. 32-No. 4) JUNE

o That the second business relied on mony showing that it was the regular the records in the conduct of its busi- practice of the business to make rec- ness. See, e.g., United States v. Pfeif- ords of the type in question from in- fer, 539 E2d 668, 671 (8th Cir. 1976), formation transmitted by an em- in which a persuasive case was made ployee with knowledge. that the records at issue were reliable. M ECHANICS OF ADMISSION AND Although the recordmaker's lack AUTHENTICATION * For busi- of personal knowledge of an item in ness records to be accepted into evi- the record or, as discussed below, sim- dence the proponent of admission ilar ignorance of the witness laying the must both: foundation for admission of the record will not prevent admission of the * Establish that the prerequisites for record into evidence, lack of evidence admission as business records are as to the source of the information met; and can. Thus a statement in a hospital record regarding the severance of a * Authenticate the records. nerve was not admissible when the in- The prerequisites for the admission formation related to something that of business records must be estab- had occurred six months earlier at an- lished through the testimony of the other hospital, and there was no evi- custodian of the records or another dence as to whether the notation was qualified witness. The witness laying the opinion or diagnosis of the doctor the foundation need not be the person recording it or merely part of the who made the record nor even be medical history provided to the re- aware of who made it. United States corder by the patient or his spouse. v. Jones, 554 E2d 251, 252 (5th Cir.), See Petrocelli v. Galison, 679 E2d cert. denied, 434 U.S. 866 (1977); 286, 289-91 (1st Cir. 1982) (The "dis- United States v. Page, 544 E2d 982, trict court could reasonably conclude 987 (8th Cir. 1976) ("The absence or that the notations were simply too in- extent of personal knowledge regard- scrutable to be admitted .... "). See ing preparation of a business record also Meder v. Everest & Jennings, affects the weight rather than the ad- Inc., 637 F2d 1182, 1186-7 (8th Cir. missibility of the evidence."). More- 1981) (statement in police report re- over, the witness need not have been garding cause of accident inadmissi- employed by the business at the time ble since source of statement was un- the record was made, nor need he be known; the evidence was considered employed by the business at the time inherently untrustworthy). that he testifies. United States v. In many cases the source of the in- Evans, 572 E2d 455, 490 (5th Cir.), formation can be established by testi- cert. denied, 439 U.S. 870 (1978). PRESENTING BUSINESS RECORDS AS EVIDENCE 27

Familiarity with 1982); Rosenberg v. Collins, 624 E2d the Recordkeeping Process 659 (5th Cir. 1980); United States v. What is crucial is that the witness be Evans, 572 E2d 455, 490 (5th Cir.), familiar with the manner in which the cert. denied, 439 U.S. 870(1978). The records are made and kept. Capital trial court, however, must require Marine Supply, Inc. v. M/V Roland some minimal foundation for admis- Thomas, II, 719 F2d 104, 105-6 (5th sion of the records. Cf United States Cir. 1983); N.L.R.B. v. FYrst ernite v. Blake, 488 E2d 101 (5th Cir. 1973) Control Co., Inc., 646 E2d 424, 427- (witness was not an employee of the 428 (9th Cir. 1981). Such a witness company whose records were at issue, should be able to establish that the rec- and had no knowledge as to the prep- ords were made in the regular course aration of these records). Testimony of business and to explain the steps that merely establishes that the docu- taken to insure the accuracy of the rec- ment or record was found in the files ords. The witness need not, however, of a business during discovery will not be able to attest to the actual accuracy suffice. Coughlin v. Capitol Cement of the information contained in the Co., 571 E2d 290, 307 (5th Cir. 1978) records. Rosenberg v. Collins, 624 F2d (testimony of plaintiff's attorney that 659, 665 (5th Cir. 1980). Lack of per- the document was found in files of sonal knowledge of the information in the association was insufficient). the record goes to the weight and not the admissibility of the evidence. See Authentication Meder v. Everest & Jennings, Inc., 637 In addition to showing that the re- E2d 1182, 1187 n. 6 (8th Cir. 1981) quirements for admission have been (dicta); United States v. Morton, 483 met, the proponent of admission is re- F2d 573, 577 (8th Cir. 1973). quired to authenticate business records by showing that they are what Trial Court Detenmination the proponent claims. Rule 901(a). The admissibility of business rec- Generally business records can be ords is decided by the trial court, identified as in fact being the records which is not bound by the rules of evi- of a particular business through the dence other than privilege in making testimony of the same witness whose its determination. Rule 104(a). The testimony is used to show that the re- trial court has wide discretion in de- quirements of Rule 803(6) are met. termining whether a proper founda- See Rule 903(b)(1) (authentication by tion has been established for the intro- testimony of witness with knowl- duction of business records into edge). In other cases it might be possi- evidence. Pacific Service Stations Co. ble to authenticate records through v. Mobil Oil Corp., 689 F.2d 1055, the use of circumstantial evidence. 1061 (Temp. Emerg. Ct. of App. See, e.g., In re JapaneseElec. Prods. 28 THE PRACTICAL LAWYER (Vol. 32-No. 4) JUNE

Antitrust Litigation, 723 E2d 238, 286 otherwise useful to the opposing (3d Cir. 1983), rev'd on other grounds, party." Notes to Rule 1003, at 343. 106 S. Ct. 1348 (1986) (prima facie Computer records can be business case of authenticity was established records under Rule 803(6) and are ad- by fact that minutes had the appear- missible, subject to the same prerequi- ance, content, and substance of typi- sites as other records. CapitalMarine cal minutes, were produced pursuant Supply, Inc. v. M/V Roland Thomas, to discovery order, and came from a II, 719 E2d 104, 106 (5th Cir. 1983); source that was likely to keep such Rosenberg v. Collins, 624 E2d 659, minutes). 665 (5th Cir. 1980). See generally Comment, Admitting Computer Gen- eratedRecords A Presumptionof Re- P HOTOCOPIES AND COMPUTER RECORDS * The best evidence rule liability, 18 J. Mar. L. Rev. 115 (1984); generally does not prevent the admis- Annot., Admissibility of Computer- sion of photocopies of business rec- ized Private Business Records, 7 ords into evidence. Photocopies are A.L.R. 4th 8 (1981). "duplicates" that are usually admissi- If data is stored in a computer, any printout from the computer that is same extent as the "origi- ble to the shown to reflect accurately the data is nals." Rule 1003; Wright v. Farmers considered an "original" under Rule Co-op of Arkansas and Oklahoma, 1001(3). Computer printout records 681 E2d 549, 553 n.5 (8th Cir. 1982). can be authenticated by testimony de- The Rules recognize that "the best evi- scribing the process used to produce dence rule is of little practical value, at the printout and establishing that the least where there is no serious issue as printout is an accurate reflection of to the accuracy or authenticity of a the data stored in the computer. See duplicate." Edwards v. Sears, Roe- Rule 901 (b)(9). buck & Co., 512 E2d 276, 294 (5th Cir. 1975). L ACK OF TRUSTWORTHINSS * The If a genuine doubt is raised as to the trial judge has broad discretion to authenticity of the original or in the exclude business records if there are circumstances it would be unfair to reasons to doubt the trustworthiness admit the duplicate in lieu of the origi- of the records. Doubt as to the trust- nal, then the original may be re- worthiness of records can arise from quired. Rule 1003. "(R)easons for re- many sources. These would include: quiring the original may be present when only a part of the original is re- e Evidence that the records were kept in a haphazard fashion; produced and the remainder is needed for cross-examination or may disclose * Lack of evidence as to the source of matters qualifying the part offered or the information - no reason to be- PRESENTING BUSINESS RECORDS AS EVIDENCE 29 lieve that the informant was an em- 238, 288 (3d Cir. 1983), rev'don other ployee of the business with knowledge grounds, 106 S. Ct. 1348 (1986); Cf. of the information recorded; Kehm v. Procter& Gamble Mfg. Co., * Evidence that the records were pre- 724 E2d 613, 618 (8th Cir. 1983) (in- pared in anticipation of litigation; terpreting identical language in the public records exception to the hear- * Evidence that the records were not say rule). prepared at or near the time of the The admissibility of business rec- act, event, condition, opinion, or di- ords is not always an all-or-nothing agnosis reported, cf.Gilmour v. Stres- proposition. If there are valid reasons con Indus. Inc., 66 ER.D. 146, 150 for doing so, a court can exclude por- (E.D. Pa.), aff'dmem., 521 E2d 1398 tions of a business's records. Thus in (3rd Cir. 1975) (report of employee one case a court excluded handwritten made months after an accident and notations on the report of a commit- after suit was filed was not admissible tee meeting when no testimony was as a business record); presented about the identity of the au- * Evidence that the record had been thor and it was not shown that the no- altered after leaving the control of the tations were made in the regular person preparing or having custody course of the business and that it was of the record; or a regular practice of the business to make these notations. Juneau Square * The records contain the opinion of Corp. v. First Wisconsin Nat'lBank of an expert whose qualifications are Milwaukee, 475 E Supp. 451, 463 subject to serious challenge. United (E.D. Wis. 1979). States v. Licavoli, 604 E2d 613, 622- Sometimes the prejudicial or in- 23 (9th Cir. 1979), cert. denied, 446 flammatory nature of business rec- U.S. 935 (1980). ords outweighs their probative value. In some cases the grounds for un- In such a case the trial court can either trustworthiness will prevent the pro- exclude the records or excise the prej- ponent of the records from laying an udicial portion. See Rule 403; Uitts v. adequate foundation for the admis- General Motors Corp., 411 E Supp. sion of the records. In other cases, 1380, 1382-3 (E.D. Pa. 1974), aff'd however, the admission of otherwise mem., 513 E2d 626 (3rd Cir. 1975) qualified records may be denied be- (involving highly inflammatory letters cause of lack of trustworthiness. The of car owners and police reports deal- burden of showing the untrustworthi- ing with prior accidents) (alternate ness of otherwise admissible records is holding). on the party opposing admission of the records. In re Japanese Elec. A BSENCE OF ENTRY AS EVIDENCE Prods. Antitrust Litigation, 723 F2d *The Rules permit evidence of 30 THE PRACTICAL LAWYER (Vol. 32-No. 4) JUNE the absence of a record of a matter In addition, even though Rule that would ordinarily be recorded in a 803(7), unlike Rule 803(10) (dealing business's record to be introduced as with the absence of entries in a public proof of nonoccurrence or nonexist- record), does not expressly require a ence of the matter. Rule 803(7). Often "diligent search," evidence that the this will be the only method of prov- search was merely casual or partial ing a negative fact. United States v. would call into question the trustwor- 34.60 Acres of Land, More or Less, in thiness of the evidence. Cf. United the County of Camden, 642 F2d 788, States v. Robinson, 544 E2d 110 (2nd 790 (5th Cir.), cert. denied, 454 U.S. Cir. 1976), cert. denied,434 U.S. 1050 830 (1981). Again, the trial judge has (1978) (testimony regarding absence discretion to exclude the evidence if of entry in public agency's records; there are indications that the evidence records were incomplete; no testi- lacks trustworthiness. Id. mony concerning the manner in Rule 803(7), unlike Rule 803(6), which search was made; testimony in- does not expressly require the testi- admissible under Rule 803(10) as mony of the custodian of the records proof of nonoccurrence). or other qualified witness. It only per- mits, however, the inference of non- S UMMARIES OF BUSINESS RECORDS occurrence of nonexistence of a mat- * The Rules permit the contents of ter from records that are kept in voluminous documents that cannot accordance with Rule 803(6). Thus it be examined conveniently in court to appears that the foundation for the be presented in the form of a chart, a admission of evidence of absence of summary, or a calculation. For a sum- an entry in business records is the mary to be admissible, the originals or same as for the admission of the rec- duplicates thereof must be made ords themselves. It must be shown available for examination or copying that the records searched would qual- or both by the other parties. Rule ify as business records under Rule 1006. 803(6). Lack of trustworthiness under Rule Discretion in Admitting Summaries 803(7) can arise from a number of the The trial judge, again, has broad same sources as under Rule 803(6). discretion to determine whether or For example, if the records were kept not summaries should be admitted. in a haphazard fashion or were not Needham v. White Laboratories,Inc., made at or near the time of the mat- 639 E2d 394, 403 (7th Cir.), cert. de- ters recorded, then absence of a rec- nied, 454 U.S. 927 (1981). Before per- ord of a matter should not give rise to mitting the introduction of summar- an inference of nonexistence or non- ies of business records, the trial judge occurrence. should determine that the underlying PRESENTING BUSINESS RECORDS AS EVIDENCE 31 documents are admissible under Rule * The jury will treat the summary as 803(6), that they are voluminous, and substantive evidence; and for inspection. that they are available o The summary is unfair to one of United States v. Johnson, 594 F2d the parties. 1253, 1254-7 (9th Cir.), cert. denied, 444 U.S. 964 (1979). If the summaries A "guarding instruction" may be very are not based entirely on admissible important in these cases. The jury can evidence, then the trial court should be instructed that the summary is exclude the summary. Ford Motor used as a matter of convenience only Co. v. Auto Supply Co., Inc., 661 and is to be disregarded if it conflicts E2d 1171, 1175 (8th Cir. 1981). See with the evidence the jury has heard in also Paddack v. Dave Christensen, the case. See, e.g., Lemire, 720 F2d at Inc., 745 E2d 1254, 1260 (9th Cir. 1348 n. 32. 1984) ("The proponent of the sum- In addition, in appropriate cases a mary of both admissible and inadmis- voir dire examination of the summary sible hearsay is entitled to admission witness outside of the presence of the of only those portions that he can jury can minimize the danger that the demonstrate are entirely admissi- witness' testimony will be too conclu- ble."). If the underlying records are sory, thus invading the function of the admissible, they need not be so volu- jury, or will be unfair to one of the minous that it is impossible to exam- parties. Id. at 1348. In general, trial ine them in court. It is enough that in- courts should be careful that unfair court examination of the records summaries are not presented to the would not be convenient. United jury. United States v. Scales, 594 F2d States v. Scales, 594 E2d 558, 562 (6th 558, 564 (6thCir.), cert. denied, 441 Cir.), cert. denied, 441 U.S. 946 U.S. 946 (1979). (1979). 0 THER CONSIDERATIONS 0 If busi- Danger of Summaries ness records are properly au- While the use of summaries of vo- thenticated and the proper founda- luminous business records can be tion is laid, they can be introduced as helpful, it also presents certain dan- evidence of the truth of the matters re- gers. See United States v. Lemire, 720 corded in them. This may be true even E2d 1327 (D.C. Cir. 1983), cert. de- in criminal cases or of opinions con- nied, 467 U.S. 1226 (1984). The great- tained in the records. Use of oral testi- est dangers in the use of summaries mony to prove matters that could be are that: proven by introduction of business records is also generally permissible, * The summarizing witness will in- as is the use of business records that vade the province of the jury; conflict with other evidence. 32 THE PRACTICAL LAWYER (Vol. 32-No. 4) JUNE

Criminal Cases States v. Keplinger 572 E Supp. 1068, First, business records are generally at 1071 n. 2, aff'd, 776 E2d 678 (7th admissible in criminal as well as civil Cir. 1985). cases. The constitutional right to con- front witnesses is not necessarily Opinions and Diagnoses abridged by the use of these records Second, opinions and diagnoses without affording the defendant an within business records may be admis- opportunity to cross-examine all par- sible. The admission of opinions and ticipants in the recordmaking process diagnoses is, in the first instance, with- or demonstrating their unavailability. in the discretion of the trial judge. United States v. Leal, 509 E2d 122, Miller v. New York Produce Exch., 550 127 (9th Cir. 1975). Since business rec- F2d 762, 769 (2d Cir.), cert. denied, ords are inherently reliable, the utility 434 U.S. 823 (1977). of cross-examination of the person The admissibility of opinions or who actually made the record tends to conclusions in business records may be minimal. United States v. Kep- be the most difficult issue involving linger, 572 E Supp. 1068, 1071 (N.D. business records. The answer in a Ill. 1983), aff'd, 776 E2d 678 (7th Cir. given case might depend on whether 1985). See also Ohio v. Roberts, 448 the court adopts a narrow or a broad U.S. 56, 65 n. 7 (1980) (government view on the question. Several cases need not produce declarant or dem- have expressed a narrow view on the onstrate unavailability if "the utility admissibility of opinions contained in of trial confrontation is remote"). business records. In one case involv- The admission of business records ing nonexpert opinion the court stat- is generally not crucial to the governed: "Expressions of opinion or con- ment's case or, in other words, "devas- clusions in a business record are ad- tating" to the defendant. In addition, missible only if the subject matter business records are not usually calls for an expert or professional "against" the defendant, or accusa- opinion and is given by one with the tory in nature. Keplinger 572 E Supp. required competence." Clark v. City at 1071. If the business records sought of Los Angeles, 650 E2d 1033, 1037 to be introduced in a criminal case are (9th Cir. 1981), cert. denied, 456 U.S. crucial to the government's case or are 927 (1982). This seems inconsistent accusatory in nature, a court might with Rule 701, which would permit find that the confrontation clause of lay opinion testimony based on first- the United States Constitution is ap- hand knowledge or observation if it is plicable and require production of the helpful in resolving a fact issue. declarant or a demonstration of his In a case involving expert testi- unavailability See Dutton v. Evans, mony, another court held that "unless 400 U.S. 74, 87-89 (1970); United Rule 803(6) is deemed to override the PRESENTING BUSINESS RECORDS AS EVIDENCE 33 opinion rules, it should not be con- of its reliability. United States v. Li- strued to allow the introduction of ex- cavoli, 604 F.2d 613, 622-23 (9th Cir. pert opinions without opportunity to 1979), cert. denied, 446 U.S. 935 ascertain the qualifications of the (1980). See also Sabol v. Snyder, 524 maker, the extent of his study or for E2d 1009, 1011-12 (10th Cir. 1975) other reasons to cross-examine him." (upholding trial court decision to ad- Forward Communications Corp. v. mit, as evidence of the success of a United States, 608 E2d 485, 510 (Ct. workshop, evaluations containing the Cl. 1979) (appraisal of newspaper's opinions of participants). tangible assets by appraisal company inadmissible as business record). One DistinguishingFact from Opinion author has opined that at least part of The difficulty of distinguishing fact this court's holding is clearly wrong. from opinion can lend support, in He states: "The court's requirement some cases, to the argument that the that the declarant be made available trial judge should exercise his discre- for cross-examination has the effect tion to admit records with conclusory of eliminating expert opinions from statements. Cf.Miller v. New York the scope of the business records ex- Produce Fxch., 550 F2d 762, 769 (2d ception to the hearsay rule, a result Cir.), cert. denied, 434 U.S. 823 (1977) obviously inconsistent with congres- (it was not error for trial court to admit sional intent." Pierce, Admision of records containing statements con- Expert Testimony in Hearsay Form: cermng a commodity squeeze; "It is of- Federal Rules of Evidence 803(6), ten difficult to distinguish between 803(8)(c), and 803(18), 17 Forum 500, what is fact and what is opinion."). 506(1981). Other cases exhibit a more gener- Best Evidence ous view on the admissibility of opin- Third, the best evidence rule is gen- ion testimony. In one case involving erally not violated by oral testimony expert testimony the court stated: "We regarding a matter that has been re- see no reason to adopt an inflexible corded in a business's records. The rule that every case requires the pro- best evidence rule only bars attempts ponent of a business record contain- to use oral testimony to prove the ing expert opinion to affirmatively es- contents of a document if the original tablish the qualifications of the per- is available. See Rules 1002 and 1004. son forming the opinion." The court Thus earnings may be proved through noted that the trial judge could have parol testimony without producing excluded the opinion if indications of the books of account in which the untrustworthiness were present, and earnings are recorded. See Sayen v. that the reliance of the company on Rydzewski, 387 E2d 815, 819 (7th Cir. the opinion was affirmative evidence 1967) (trial court did not err inpermit- 34 THE PRACTICAL LAWYER (Vol. 32-No. 4) ting witness to testify as to his income; resolved by the trier of fact. See, e.g., "Courts do not bar oral proof of a Ascher v. Gutierrez, 533 E2d 1235, matter merely because it is also prov- 1237 (D.C. Cir. 1976) (conflict be- able by a writing."). But if the books tween records and other evidence on of account are to be used to prove question of whether doctor was in op- earnings, the best evidence rule would erating room). apply. The original must be produced if it is available. See Notes to Rule C ONCLUSION * An understanding 1002, at 342. As discussed previously, of the rules governing the admis- generally the Rules will permit a pho- sibility and use of business records tocopy to qualify as an original. Rule can be valuable to both the proponent 1003. and the opponent of admission. In Finally, the fact that business rec- general, the approach adopted by the ords are contradicted by either parol Rules is both reasonable and work- testimony or other documentary evi- able. If shown to be reliable, business dence will not necessarily justify their records will be admitted; if indica- exclusion. In most cases this would tions of unreliability are present, they simply raise a question of fact to be will be excluded.

For Further Study ALI-ABA Books Resource Materials: Civil Practice and Litigation in Federal and State Courts (3d ed. 1985). Trial Advocacy: A Systematic Approach, by Leonard Packel and Do- lores B. Spina (1984). Course of Study Transcript: Trial Guide for the General Practitioner, Leonard Packel, Editor (1981). Civil Trial Manual 2, by Ralph C. McCullough 11 and James L. Un- derwood, Reporters, (2d ed. 1980 & 1984 Supp.). The Practical Lawyer's Manual of Trial and Appellate Practice No. 2 (1979). Basic Problems of State and Federal Evidence, by Edmund B. Mor- gan and Jack B. Weinstein (5th ed. 1976). The Practical Lawyer's Manual of Trial and Appellate Practice No. 1 (1973).