Opinion ID: 1908442
Heading Depth: 1
Heading Rank: 1

Heading: The Open Account

Text: One of the salient features of this case is the conspicuous lack of regular, accurate records of the dealings between the parties, which involved sums in the area of two million dollars over a period of years. Such a lack of records might have been no more than a minor hindrance in another case. It was a critical deficiency here, however, where oral testimony at trial ranged over such specific matters as the sequence of checks and promissory notes, the value and identity of numerous exotic antique automobiles, the timing and nature of multi-faceted negotiations, the interstate transport of automobiles, and questions of their ownership. Adding to the difficulties of the Court and the jury were the abundant conflicts between the parties' respective versions of events. In an effort to clarify certain of the missing details of the case, plaintiff produced the summary noted above, which purported to verify the existence of the open account owed to plaintiff by defendant. Included in the six-page document were such items as parts, labor, travel expenses, commissions, and miscellaneous charges against defendant. Dates, hours of work, and rates per hour for plaintiff's services were not shown. According to plaintiff, the total charges in the open account accumulated incident to his restoration of automobiles prior to delivery to defendant. By plaintiff's view, the charges were separate from the purchase price defendant would pay for each vehicle. Defendant testified that any such expenses of restoration were included in the price of each auto. At trial, both defense counsel and the Court conducted extensive inquiry into the manner of plaintiff's preparation of the summary of the open account. As a result of this inquiry, it became apparent that the summary had been drawn by plaintiff, with the possible assistance of his attorney, based either upon certain notes that plaintiff claimed to have kept, upon his recollections, or upon both. When asked if he could produce contemporaneous records, plaintiff replied that any such records, which he had kept in a fruit cake box, were destroyed in a fire in his office. Despite the patent deficiencies in plaintiff's summary, the presiding Justice permitted its admission into evidence, over objection. [1] Defendant charges that admission of the open account into evidence was error. We agree. In reaching this conclusion, we are not concerned with the validity of the information contained in the summary of the account. Nor have we inquired into plaintiff's bona fides in preparing and introducing it. Rather, we are guided by basic principles of evidence, under none of which would the open account qualify for admission. It is clear that the summary of the account was prepared long after the passing of the events it purports to record. It is equally clear that the summary was not a carbon, photostat, or electronically reproduced copy of any original. [2] We are further convinced, from a careful review of the testimony, that the summary, in the form in which it was admitted, did not exist prior to the initiation of this litigation. Neither case law nor the relevant statute, 16 M.R.S.A. 356, [3] supports admission of the summary as a business record, shop-book, regular entry or any other hearsay rule exception of that genre. [4] While liberalizing to some extent the common law shop-book rule, [5] Section 356 retained the minimum requirements that the record be [A]n entry in an account kept in a book or by a card system or by any other system of keeping accounts, that it be made in good faith, in the regular course of business . . . before the beginning of the civil proceeding. In construing the statute, we have held that it . . . does not apply to entries in a book, or entries in a card or other system, which are simply memoranda made for the convenience or purposes of the one who made them. Entries that cannot fairly be considered as an `account' are not admissible in evidence, except as has been previously permitted under certain circumstances, to refresh recollection or as statements against interest, without supporting proof from those who had personal knowledge of the facts. Hunter v. Totman, Note 5, supra, 80 A.2d at 406; Rodrique v. Letendre, 158 Me. 375, 184 A.2d 777 (1962). By his testimony at trial, plaintiff might be said to have provided supporting proof of the contents of the open account. We may also assume that he had personal knowledge of the facts he alleged. His testimony, however, cannot alone justify admission of the account, since it failed to meet the other requirements of the statute. For the same reason, admissibility does not follow merely because defense counsel had the opportunity to cross-examine plaintiff, the proponent of the open account, as to its contents. In fact, plaintiff's presence in court, his detailed testimony, and his claim that he was able to recall with absolute specificity the transactions in question, militate against, rather than for admission of the dubious summary sheet. [6] Plaintiff contends that the open account was properly admitted under the rule of Penobscot Boom Corp. v. Lamson et al, 16 Me. 224 (1839), which provides that: . . . if a book or document be called for by a notice to produce it, and it be produced, the mere notice does not make it evidence; but if the party giving the notice, takes and inspects it, he takes it as testimony, and it may be used, if material to the issue. 16 Me. 224, 233. At trial, defense counsel questioned plaintiff on the open account, asked that he be given the summary, received it, and then continued questioning while referring to it. As plaintiff correctly points out, all of this occurred prior to any other mention of the open account at trial, and prior to plaintiff's introduction of the account into evidence. As noted in Blake v. Russ, 33 Me. 360 (1851), the Penobscot Boom case represented this State's adoption of the English rule on the particular evidentiary point. In Merrill v. Merrill, 67 Me. 70 (1877), the rule was applied to admit a book of accounts which the defendant received and examined in the courtroom, after previously serving timely notice on the plaintiff to produce the book, and after having called for it during trial. In its most stringent application, the English rule has operated to permit admission of evidence when the evidence was called for and examined at trial by the opposing party, even when such evidence would have been incompetent if it had not been called for and examined, and even if, as in the instant case, no notice to produce the document was given before the trial. Leonard v. Taylor, 315 Mass. 580, 53 N.E. 2d 705 (1944). We are now called upon to consider the vitality and wisdom of the rule in light of what we regard to be the more enlightened discovery rules of our modern practice, [7] and . . . the ideal of a lawsuit as an instrument for ascertaining the true facts. Field, McKusick & Wroth, Maine Civil Practice, Sec. 34.6 (1970). Adding its voice to the severe criticism by Wigmore, [8] the Second Circuit rejected the English rule in Hoffman v. Palmer, 129 F.2d 976 (2 Cir. 1942), affd. 318 U.S. 109, 63 S.Ct. 477, 87 L.Ed. 645, rehearing den. 318 U.S. 800, 63 S.Ct. 757, 87 L.Ed. 1163 (1945). Writing for the Court, Judge Frank placed the rule in historical perspective, and stated in words which we find compelling, the reasons for its demise: It grew up as a branch of what was once a `fixed principle' of the common law `that a party was to be kept in the dark as to the tenor of evidence in his opponent's possession.' Several explanations of that `principle' have been given. It is said that it stems from the `sporting theory of justice,' according to which a trial is regarded not as a means of ascertaining the true facts of the case but as a game of wits between opposing counsel. Another explanation is that the `principle' was founded on the belief that to surrender one's evidence before its disclosure at the trial would enable an unscrupluous adversary to fabricate counter-evidence. These explanations like most efforts to explain habits and customsare, probably, alone or together, only partially correct. . . . . At any rate, the old `fixed principle' of keeping the opponent in the dark as to the tenor of the evidence in one's possession is now out of date. The appendant rule here in question is equally so. It is as anachronistic as the buttons on the sleeve of a man's coat; but such a legal rule is more important than coat-sleeve buttons. As it cannot be reconciled with the liberality as to depositions and discovery contained in the new Rules [Federal Rules of Civil Procedure], we reject it. (Footnotes omitted) 129 F.2d 976, 996, 997. We likewise reject the rule, and to the extent that it is embodied in Penobscot Boom Corp. v. Lamson et al, Blake v. Russ, and Merrill v. Merrill, those cases are now overruled. Plaintiff, therefore, takes nothing by his claim that the cases support admission of the open account into evidence. We are left with the question whether erroneous admission of the open account is harmless error. Although plaintiff also testified orally on the contents of the open account, its reduction to writing imparted to the figures and alleged facts an aura of veracity and accuracy not normally attached to spoken words. [9] As we have already noted, the factual dispute over the existence and nature of the open account goes to the very heart of this case. Certainly, given the centrality of the issue, the production by one party of a specific, written record would likely influence the minds of the jurors, however subtly or subconsciously, and notwithstanding the questionable means of the record's formulation. By admission of the account into evidence, plaintiff had a great deal to gain, and defendant, a great deal to lose. We accordingly find that admission of the open account was inconsistent with substantial justice, and therefore not cognizable as harmless error. Rule 61, M.R. C.P.