Glarum (Fla.) - Motion for Rehearing

8/3/2019 Glarum (Fla.) - Motion for Rehearing

http://slidepdf.com/reader/full/glarum-fla-motion-for-rehearing 1/16

STATE OF FLORlDA

FOURTH DISTRlCT COURT OF APPEAL

GARY GLARUM and ANITA

GLARUM, CASENO.: 4DIO-1372L.T. CASE NO.

502008CA028930XXXXXMB

Appellants,

v.

LASALLE BANK NATIONAL

ASSOCIATION, as Trustee for

Merrill Lynch Mortgage Investors

Trust, Mortgage Loan Asset-Backed

Certificates, Series 2006-FFI, et al.,

Appellees.

APPELLEE'S MOTION FOR REHEARING

AND CLARIFICATION, OR REHEARING ENBANe

Appellee LaSalle Bank National Association, as Trustee for Merrill Lynch

Mortgage Investors Trust, Mortgage Loan Asset-Backed Certificates, Series 2006-

FFI ("LaSalle"), pursuant to Fla. R. App. P.,9.030, 9.330, and 9.331, moves this

Court for rehearing and clarification, or rehearing en bane, in this case which

potentially affects all pending mortgage foreclosure and other cases in Florida.

LaSalle seeks clarification, either through rehearing by the Panel or by this Court

en bane, of the Panel's September 7, 2011 Opinion ("Opinionlt) reversing summary

judgment. LaSalle does not challenge this Court's reversal of summary judgment.



Introduction

The Opinion raises significant questions regarding Florida's rules of

evidence and injects calamitous confusion into the hundreds of thousands pending

foreclosure cases in Florida, as well as cases in virtually every other legal context.

Through the Opinion, this Court may have inadvertently undermined Florida's

long-standing rules for the admission of business records and affected all types of

civil and criminal cases, not just mortgage foreclosures. As such, this Court should

take the opportunity to clarify its holding and quell the widespread uncertainty and

confusion that exists today.'

This appeal followed a foreclosure summary judgment entered after the

Glarums admittedly defaulted on their mortgage loan. See Opin. 1. Neither party

cited Florida's business record statute in the briefs. Instead, they focused on

whether the affiant from LaSalle's loan servicer, Ralph Orsini of Home Loan

Services, Inc., had sufficient personal knowledge of the G1arums' indebtedness.

See Ini. Br. 35-39; Ans. Br. 31-36. Mr. Orsini's affidavit of indebtedness was

1 By separate motion, LaSalle has asked this Court to take judicial notice of the

widespread uncertainty and confusion for businesses in Florida and nationwide,

particularly those using computerized business records. Certain state and national

media are touting its holding as forever changing the "business records exception,"

codified at Fla. Stat. § 90.803(6)(a), by requiring banks to produce or identify

every person inputting data into their computerized loan servicing systems.

2



based upon information derived from the .loan servicer's computer database. See

Opin.2.

The Panel reversed summary judgment, holding that Mr. Orsini's affidavit

constituted inadmissible hearsay. Opin.2. The Opinion noted that Mr. Orsini: (i)

"did not know who entered the data into the computer, and he could not verify that

the entries were correct at the time they were made," (ii) "did not know who, how,

or when the data entries were made into Home Loans Service's computer system"

and "could not state if the records were made in the regular course of business,"

(iii) "relied on data supplied by [prior loan servicer] Litton Loan Servicing ... ";

and (iv) "could state that the data in the affidavit was accurate only insofar as it

replicated the numbers derived from the company's computer system." Id. These

statements have been read by some to require that an affiant relying on

computerized bank records must either be the records custodian who actually

entered the data or created the data or must be able to identify who entered the data

into the computer. They have also been read by some to preclude the admission of

computerized business records acquired from a prior loan servicer. As explained

below, such a reading is directly contrary to long-standing law applying Florida's

"business records exception" in section 90.803(6)(a).

3



Absent rehearing or clarification, the Opinion could significantly impact not

only the hundreds of thousands of pending foreclosure cases, but every type of

civil or criminal case involving computerized business records. Because the

Opinion creates uncertainty for every business or industry in the State of Florida,

LaSalle asks for the Opinion to be replaced with an Opinion confirming that

Florida's business records exception: (i) permits a "records custodian or other

.qualified witness" to lay a foundation for computerized business records; (ii) does

not require the "custodian or other qualified witness" to have personal knowledge

of the matter recorded; (iii) does not require the person(s) who actually prepared or

input the computerized data to testify or to be identified; and (iv) does not preclude

a financial institution's use and admission of a prior institution's computerized

business data incorporated within the current institution's business records and

systems. Further, LaSalle asks for the Opinion to be clarified to make clear that,

under the specific facts of this case only, Mr. Orsini's affidavit, taken together with

his deposition testimony, did not set forth a sufficient foundation to satisfy the

business records exception.

4



Motion For Rehearing And/Or Clarification

Rehearing and clarification are appropriate where there are "points of law or

fact ... in need of clarification" and where there are "points of law or fact ... the

court has overlooked or misapprehended." Fla. R. App. P. 9.330(a).2

A. The Opinion Has Been Read by Some to Require that an Affiant

Relying Upon Computerized Bank Records Must Either be the Records

Custodian Who Actually Entered or Created the Data or Must Be Able

to "Identify Who Entered the Data into the Computer"

LaSalle asks for the' Opinion to be clarified to make clear it: (i) does not

limit the witnesses permitted to authenticate business records to the records

custodian or the persons who generated the data or inputted the data into the

computer system; {ii) does not require the "custodian or other qualified witness" to

have personal knowledge of the matter recorded to satisfy the requirements of the

business records exception; and (iii) does not require the person(s) who actually

prepared or input the computerized data to testify or be identified.

First, while the Opinion recognizes a "records custodian" may authenticate

computerized business records, it does not recognize that "other qualified

witnessjes]" also may authenticate computerized business records as expressly

provided in section 90.803(6)(a). Opin, 2. While there is no reason to believe the

2 Clarification is appropriate where an appellate decision might be interpreted

more than one way. See Philip Padovano, Motion Practice in Florida Appellate

Courts, 32 Stetson L. Rev. 309, 341 (2003).

5



Panel intended to hold that only the actual records custodian -- to the exclusion of

other qualified witnesses -- may lay a foundation for the admission of

computerized business records, the Opinion has been read by some this broadly.

Section 90.803(6)(a) expressly provides that a business record may be

established by the "custodian or other qualified witness." Fla. Stat. § 90.803(6)(a).

This bedrock evidentiary rule "makes it possible to introduce relevant evidence

without the inconvenience of producing all persons who had a part in preparing the

documents during the trial." Nordyne, Inc. v. Fla. Mobile Home Supply, Inc., 625

So. 2d 1283, 1288 (Fla. 1st DCA 1993) (internal citation and quotation omitted).

To satisfy the hearsay exception, "[i]t is not necessary to call the person who

actually prepared the document. The records custodian or any qualified witness

who hasthe necessary knowledge to testify as to how the record was made can lay

the necessary foundation." Twilegar v. State, 42 So. 3d 177, 199 (Fla. 2010)

(internal citation and quotation omitted); Baber v. State, 775 So. 2d 258, 261 nA

(Fla. 2000) (lab technician who actually performed blood test not necessary to

establish test as a business record); see also Cooper v. State, 45 So. 3d 490, 492-93

(Fla. 4th DCA 2010).3

3 If the Opinion is not clarified, it would also potentially create uncertainty as tothe ability of any business to certify its computerized records pursuant to

§§ 90.803(6)(c) and 90.901(11). See generally Yisrael v. State, 993 So. 2d 952,

957 (Fla. 2008).

6



Second, the "custodian or other qualified witness" need not have personal

knowledge of the matter recorded to satisfy the requirements of section

90.8Q3(6)(a). See, e.g., King v. Auto Supply of Jupiter, Inc., 917 So. 2d 1015,

1018-19 (Fla. 1st DCA 2006); United States v. Langford, 647 F.3d 1309, 1327

(lith Cir. 2011) ("To satisfy Rule 803(6), ... the proponent must establishthat it

was the business practice of the recording entity to obtain such information from

persons with personal knowledge and the business practice of the proponent to

maintain the records produced by the recording entity.") (internal citation and

quotation omitted).4

Any person with the requisite knowledge to testify as to the method by

which particular records are generated or maintained may be a "qualified witness."

See, e.g., Cooper, 45· So. 3d at 492-93 (telephone records admissible where

Verizon store manager testified concerning procedures for creating and

maintaining records); WAMCO XXVIII, Ltd. v. Integrated Elec. Env'ts, Inc., 903

So. 2d 230, 232-33 (Fla. 2d DCA 2005) (loan servicing records admissible to

establish amount owed where servicer's representative testified concerning bank

accounting systems); see also United States v. Kneapler, 733 F.Supp.2d 1308,

1315 (S.D. Fla. 2010) ("As the IRS officer who reviewed the records and

4 Federal Rule of Evidence 803(6) is virtually identical to Section 90.803(6)(a) and

thus federal decisions constitute persuasive authority. See Yisrael, 993 So. 2d at

958 n.7; Jackson v. State, 877 So. 2d 816, 818 n.l (Fla. 4th DCA 2004).

7



computed the balances, she is undisputedly competent to testify as to the balances

of tax liabilities for 1995 and 2004 because her computations and examinations are

based on her personal knowledge."),"

As the Southern District of Florida Bankruptcy Court cautioned:

To interpret Rule 803(6) as requiring that affiants be permitted to

testify only to those bits of information to which they, personally,

have borne witness would be to turn Rule 803(6) on its head and

would create numerous substantive proof problems, especially for

large enterprises. Allowing evidence from employees who have

reviewed business records is what keeps corporate entities from.

having to track down former employees every time a subpoena is

served regarding some menial aspect of their respective prior work;

more broadly, review of records is what keeps major national entities

from having to locate and produce the employees who personally put

a subject bill or document in the mail to a customer.·

In re Trafford Distrib. Ctr., Inc., 414 B.R. 858,862 (Bankr. S.D. Fla. 2009).

Third, the custodian or other qualified witness need not identify the person

who prepared the document to satisfy the exception. See, e.g., WAMCO, 903 So.

2d at 232-33. As the Eleventh Circuit recently explained, the "person with

knowledge" requirement for the business records exception "is not intended to

imply that the party seeking to introduce the memorandum, report, record, or data

compilation must be able to produce, or even identify, the specific individual upon

5 It also is well-settled that "[c]omputer printouts, like business records, are

admissible if the custodian or other qualified witness is available to testify as to themanner of preparation, reliability and trustworthiness of the product." Christie v.

State, 951 So. 2d 1029, 1030 (Fla. 4th DCA 2007) (internal citations and quotation

omitted) (emphasis in original); see also Jackson, 877 So. 2d at 817.

8



whose first-hand knowledge the memorandum, report, record or data compilation

was based." Langford, 647 F.3d at 1326-27 (quoting 1974 advisory committee

notes to Fed. R. Evid. 803(6»; see also United States v. Atchley, 699 F.2d 1055,

1058 (11th Cir. 1983) ("It is not essential that the offering witness be the recorder

or even be certain of who recorded the item. It is sufficient that the witness be able

to identify the record as authentic and specify that it was made and preserved in the

regular course of business.") (internal citation omitted).

Itseems clear this Court did not intend the Opinion to fundamentally change

existing Florida business records law. LaSalle asks for the Opinion to be clarified

as stated above to make clear its holding is limited to the specific facts of the case -

- Mr. Orsini's affidavit taken together with his deposition testimony -- did not

satisfy the existing requirements under Florida's business records exception.

B. The Opinion Has Been Read by Some to Preclude the Admission of

Computerized Business Records Acquired from a Prior Loan Servicer

in Direct Conflict with the Second District's WAMCO Decision

LaSalle also asks for the Opinion to be clarified to confirm that a plaintiff in

a foreclosure action can satisfy the business records exception if it relies upon and

incorporates the records of a predecessor, affiliate, or prior loan servicer into its

own records and computer systems.

To the extent the Opinion was intended to mean a records custodian or other

qualified witness cannot satisfy the business records exception where the

9



computerized business records of a prior loan servicer have been incorporated into

an existing servicer's computer system, it directly conflicts with the Second

District Court of Appeal's decision in WAMCO,903 So. 2d 230, and other law.

WAMCO involved an action on a series of defaulted bank loans. Through a

series of mergers, the loans came to be owned by Bank of America, which then

sold the loans to WAMCO. Id. At 232. After filing suit against the borrowers and

guarantors, WAMCO submitted testimony of one of its officers, who also was an

officer of WAMCO's loan servicing affiliate. Id. at 232-33. WAMCO's witness

"testified that the beginning numbers on the outstanding balances were the

numbers received from Bank of America at the time WAMCO purchased the

loans. The numbers were put into [WAMCO's loan servicer affiliate's] computer

system, on WAMCO's behalf, and kept in the normal course of business. Entries

related to payments and balance adjustments were made and maintained in the

ordinary course of [WAMCO's servicer affiliate's] business." Id. at 233.

The Second District rejected the contention that WAMCO's loan balance

information was inadmissible hearsay because WAMCO's witness did not know

"the specific person at Bank of America who would have put information into the

Bank of America system. n Id. WAMCO's witness testified that "he knew how

bank loan accounting systems worked and that the procedures were 'bank-

acceptable accounting systems. '" Id. He also testified he reviewed the records

10



received from Bank of America, and described the process used to verify the

accuracy of information. ld. The court concluded this testimony was sufficient to

establish the computerized loan servicing information was admissible under

Florida's business records exception. Id.6

The Opinion's statement that Mr. Orsini "relied on data supplied by Litton

Loan Servicing, with whose procedures he was even less familiar" has been read

by some to require testimony from each prior loan servicer to establish the

foundation for a business record. See Opin. 2. Reading such an onerous

requirement into Florida's business records exception is in direct conflict with

WAMCO and without clarification could create additional delays and unwarranted

procedural hurdles in foreclosure and myriad other types of cases.

6 Other federal and state decisions similarly hold a third party financial

institution's computerized business records can be admissible business records of

another financial institution where that information is incorporated into the second

entity's records. See, e.g., Brawner v. Allstate Indem. Co., 591 F.3d 984, 987-988

(8th Cir. 2010); United States v.Moore, 923 F.2d 910,913 (1st Cir. 1991); Unites

States Bank Nat'! Ass 'n v. Am. Screw & 'Rivet Corp., 2010 U.S. Dist. LEXIS

81428, at * 6-8 (N.D. Ill. Aug.' 10, 2010); Krawczyk v. Centurion Capital Corp.,

No. 06-cv-6273, 2009 U.S. Dist. LEXIS 12204, at*10-12 (N.D. Ill. Feb. 18,2009); Beal Bank, SSB v. Eurich, 831 N.E.2d 909,912-914 (Mass. 2005); Premier

Capital, Inc. v. Grossman, No. CV990334654S, 2000 Conn. Super. LEXIS 3137,

at * 9-11 (Conn. Sup. Ct. Nov. 22, 2000), re'vd in part on other grounds, 789 A.2d

565 (Conn. App. Ct. 2002); cf United States v. Parker, 749 F.2d 628, 633 (LIth

Cir. 1984) (liquor export certificate prepared by Scottish distiller properly admitted

as business record of U.S. importer).

11



Motion For Rehearing En Bane

In the alternative, LaSalle moves this Court for rehearing en bane because:

(i). this case is of "exceptional importance"; and (ii) en bane consideration i s

necessary to maintain uniformity of this Court's decisions. See Rule 9.33l(d)(l).

The full Court should rehear this matter to address the potential for the Opinion to

be misread as imposing new requirements that will make it exceedingly difficult -~

if not impossible-- to admit computerized business records.

Application of Florida's business records exception to computerized records

presents an issue of "exceptional importance" because the Opinion may directly

affect a large percentage of pending Florida foreclosure cases or potentially any

other civil or criminal case involving business records. See In re D.JS., 563 So. 2d

655, 657 n.2 (Fla. 1st DCA 1990) ("exceptional importance" standard includes

"cases that may affect large numbers of persons"). En bane review of the Opinion

also is necessary to maintain the uniformity of Fourth District decisions as it

potentially conflicts with Cooper v. State, 45 So. 3d 490 (Fla. 4th DCA 2010), and

Hungerford v. State, 972 So. 2d 303 (Fla. 4th DCA 2008).7

.7 Cooper held the exception was satisfied where a Verizon store manager testified

concerning maintenance in the ordinary course of business of cell phone records

although he had not prepared them. 45 So. 3dat 493. Hungerford held a company

officer established a store log prepared by a store manager was a business record

because the officer testified that the log was prepared daily and maintained in the

ordinary course of business. 972 So. 2d at 304.

12



To the extent the Opinion is construed to mean only a records custodian or

the actual preparer of a document must testify to satisfy the business record

exception (instead of an otherwise qualified witness), there is a potential intra-

district conflict that should be addressed by en bane review.

WHEREFORE, for all the foregoing reasons and authorities, LaSalle

respectfully requests that this Court grant its Motions for Rehearing and

Clarification, or for Rehearing En Bane.

13



Attorney's Certification Pursuant To Rule 9.331(D)(2)

Pursuant to Fla. R. App. P. Rule 9.33 I(d)(2), we express a belief, based on a

reasoned and studied professional judgment, that the Opinion is of exceptional

importance.

In addition, we express a belief, based on a reasoned and studied

professional judgment, that the Opinion is contrary to the following decisions of

this Court, and that a consideration by the full Court is necessary to maintain

uniformity of decisions in this Court: Cooper v. State, 45 So. 3d 490 (Fla. 4th

DCA 2010), and Hungerford v. State, 972 So. 2d 303 (Fla. 4th DCA 2008).

Respectfully submi tted,

McGUIREWOODS LLP

By

' - \ 2 - Z _h_:::

R. Eric Bilik

Florida Bar No. 0987840

Jeffrey S. York


Sara F. Holladay-Tobias


50 N. Laura Street, Suite 3300

Jacksonville, Florida 32202

(904) 798-3200

(904) 798-3207 (fax)

14



AKERMAN SENTERFITT

Katherine E. Giddings


Nancy M. Wallace

Florida Bar No. 65897106 E. College Avenue, 12th Floor

Tallahassee, Florida 32301

(850) 224-9634

(850) 222-0103 (fax)

AKERMAN SENTERFITT

William P. Heller


William C. Crenshaw


350 E. Las Olas Boulevard

Suite 1600

Fort Lauderdale, Florida 33301

(954) 463-2700 .

(954)463-2224 (fax)

BUTLER &HOSCH, P.A.

Thomasina F. Moore

Florida Bar No. 57990Dennis W. Moore


3185 South Conway Road, Suite E

Orlando, Florida 32812

(407) 381-5200

(407) 381-5577 (fax)

ATTORNEYS FOR APPELLEE

LASALLE BANK NATIONAL

ASSOCIATION, as Trustee for

Merrill Lynch Mortgage Investors

Trust, Mortgage Loan Asset-Backed

Certificates, Series 2006-FFI

15



CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a copy of the foregoing has been furnished on

October 6,2011 by U.S. Mail to the following:

Thomas E. Ice, Esquire

Enrique Nieves III, Esquire

Theresa A. Savona, Esquire

Ice Legal, P.A.

1015 N. State Road 7, Suite 0

Royal Palm Beach, FL 33411

ATTORNEY

\33918138.6

Documents

Glarum (Fla.) - Motion for Rehearing