Court Opinion

ID: 4575978
Source: CourtListenerOpinion
Date Created: 2020-10-13 15:03:49.266531+00
Date Added: 2024-06-11T08:47:26.983816
License: Public Domain

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be                                      FILED
regarded as precedent or cited before any                              Oct 13 2020, 8:51 am

court except for the purpose of establishing                               CLERK
                                                                       Indiana Supreme Court
the defense of res judicata, collateral                                   Court of Appeals
                                                                            and Tax Court
estoppel, or the law of the case.

ATTORNEY FOR APPELLANT                                   ATTORNEY FOR APPELLEE
Thomas G. Bradburn                                       Nicole D. Barker
Bradburn Law Firm                                        Weltman, Weinberg & Reis Co., LPA
Noblesville, Indiana                                     Cincinnati, Ohio

                                           IN THE
    COURT OF APPEALS OF INDIANA

Victoria M. Jones,                                       October 13, 2020
Appellant-Defendant,                                     Court of Appeals Case No.
                                                         20A-CC-553
        v.                                               Appeal from the Lake Superior
                                                         Court
Shenandoah Funding Trust,                                The Honorable Thomas W. Webber,
Appellee-Plaintiff.                                      Sr., Judge Pro Tempore
                                                         Trial Court Cause No.
                                                         45D10-1810-CC-3746

Bailey, Judge.

Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020                Page 1 of 12
                                          Case Summary
[1]   Victoria Jones (“Jones”), the co-signer on Ian Gill’s (“Gill”) student loan,

      appeals the denial of her motion to correct error, which challenges the trial

      court judgment in favor of Shenandoah Funding Trust (“SFT”) for the amount

      of the loan, plus costs and interest. Jones raises several issues which we

      consolidate and restate as the following dispositive issue: whether there was

      sufficient evidence that SFT owned the debt, so as to support the judgment.

[2]   We reverse.

                            Facts and Procedural History
[3]   In the fall of 2007, Gill completed a Signature Student Loan application and

      promissory note (“Gill/Jones Loan”) with Sallie Mae Education Trust. Jones

      was a co-signer on the Loan. Thereafter, the Gill/Jones Loan was purportedly

      transferred multiple times as part of a large bundle of similar loans.

[4]   On October 16, 2018, SLM Private Education Loan Trust 2012-E (“SLM

      PELT 2012-E”) filed a collection lawsuit against Jones and Gill, alleging that

      SLM PELT 2012-E was the owner of the Gill/Jones Loan and was owed

      $12,891.11 plus interest. Jones and Gill filed an answer and affirmative

      defenses, which included SLM PELT 2012-E’s alleged lack of standing. On

      January 7, 2019, SLM PELT 2012-E filed a motion for summary judgment

      which was accompanied by an Affidavit of Debt and designated supporting

      documentation. Gill and Jones filed their response in opposition and, on May

      Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020   Page 2 of 12
      2, 2019, the trial court held a hearing on the summary judgment motion.

      Following the hearing, the trial court denied the motion.

[5]   On July 25, 2019, SLM PELT 2012-E filed a motion to substitute SFT as the

      plaintiff, and the trial court granted that motion. On October 1, 2019, the trial

      court held a bench trial at which SFT’s sole witness was Mary Kay Mauer

      (“Mauer”), a litigation supervisor employed by Navient Solutions, LLC.

      Through Mauer, SFT introduced its Exhibit A, the original loan application

      between Sallie Mae Education Trust and Gill and Jones, and it was admitted

      over Jones’s foundation and hearsay objections.1 SFT also introduced Exhibit

      B, a Bill of Sale (“BOS”) dated January 23, 2006, between Sallie Mae

      Education Trust and SLM Education Credit Finance Corporation (“SLM

      ECFC”). Exhibit B—which was admitted without objection—included an

      “attached schedule” consisting of a printout of a computer report purporting to

      list the transferred loans included in the January 23, 2006 BOS. Ex. at 10, 13.

      All purported loan references on the schedule are blacked out except the last

      loan, which states Gill’s name, the last four digits of his Social Security

      Number, and the principal and interest due on his loan. Id.

      1
          Thus, Jones is mistaken when she maintains on appeal that Exhibit A was never admitted into evidence.

      Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020                 Page 3 of 12
[6]   The following exhibits were also introduced through Mauer and admitted over

      Jones’s foundation, hearsay, and/or failure-to-prove-ownership-of-the-loan

      objections2:

               Exhibit C         January 20, 2009, BOS from SLM ECFC to
                                 Rendezvous Funding LLC

               Exhibit D         April 24, 2009, BOS from Rendezvous Funding I3
                                 to Rendezvous Funding LLC

                                 Transferred “in turn” from Rendezvous Funding
                                 LLC to Churchill Funding LLC

                                 Transferred “in turn” from Churchill Funding LLC
                                 to VL Funding LLC

               Exhibit E         July 14, 2009, BOS from VL Funding LLC to SLM
                                 Funding LLC

               Exhibit F         July 14, 2009, BOS from SLM Funding LLC to
                                 SLM Private Education Loan Trust 2009-C (“SLM
                                 PELT 2009-C”)

      2
        Jones stated that she objected to “all of these transfer documents” in SFT’s exhibits on the same grounds
      but later stated that she had no objection to the admission of Exhibit G. Tr. at 40.
      3
       Mauer testified that she was “not sure exactly why” the first transferor in Exhibit D is “Rendezvous
      Funding I” instead of “Rendezvous Funding LLC,” when Exhibit C showed the latter to be the owner of the
      Gill/Jones Loan at the time of the April 24, 2009 transfer. Tr. at 27.

      Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020                  Page 4 of 12
               Exhibit G         October 18, 2012, BOS from SLM PELT 2009-C to
                                 SLM Education Credit Funding LLS (“SLM ECF
                                 LLC”)

               Exhibit H         October 18, 2012, BOS from SLM ECF LLC to
                                 SLM Private Education Loan Trust 2012-E (“SLM
                                 PELT 2012-E”)

               Exhibit I         November 14, 2018, BOS from SLM PELT 2012-E
                                 to Navient Solutions, LLC (f/k/a Sallie Mae, Inc.)
                                 and Navient Credit Funding LLC (f/k/a SLM ECF
                                 LLC) or Navient Credit Finance Corporation4

                                 November 14, 2018, “Additional Purchase
                                 Agreement” from Navient Credit Finance
                                 Corporation to Shenandoah Funding LLC

                                 November 14, 2018, “Additional Purchase
                                 Agreement” from Shenandoah Funding LLC to
                                 Shenandoah Funding Trust (SFT)
Id. at 14-56.

[7]   None of the documents in Exhibits C through I identify any individual loans,

      including the Gill/Jones Loan. Rather, those exhibits attach only documents

      that identify the aggregate purchase price for bundles of loans. For example,

      Exhibit C attaches a document entitled “Loan Transmittal Summary Form”

      4
        Exhibit I lists “Navient Credit Funding, LLC” as the “depositor” on the first page but is signed on the
      second page by “Purchaser” “Navient Credit Finance Corporation.” Ex. at 34-35.

      Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020                    Page 5 of 12
       which only lists the “Aggregate Purchase Price of all Purchased Loans” as

       being over two million dollars and “Additional Loans” as being over one

       million dollars. Id. at 16. Mauer identified all of the transferors and transferees

       in the BOS exhibits as subsidiaries of Navient Solutions LLC, “formerly known

       as Sallie Mae, Inc.” Id. at 34. Mauer testified that the transfers were done in

       order to “open up funds in the prior entity to purchase more student loans …

       [b]ecause there’s only a certain amount of money that is available in each

       [entity].” Tr. at 15.

[8]    When questioned by the court as to how she was able to track the Gill/Jones

       Loan “all the way through these various entities as it traveled to the current

       holder,” Mauer responded as follows:

               By looking at the system of record, yes. We have one particular
               page that lists all of the sale codes and information. And that’s - -
               I work on those daily, pulling this information. So, yes, I would -
               - under oath, I would say these - - this particular loan is included
               in each of these sales, yes.
Id. at 38. Mauer also testified, in response to the court’s further questioning,

       that not all unpaid accounts end up in the same “specific holding.” Id.

[9]    SFT also introduced Exhibit J, which is a payment history of the Gill/Jones

       Loan, and it was admitted over Jones’s objection. The document in Exhibit J

       does not identify who owned the Gill/Jones Loan.

[10]   In an order dated October 7, 2019, the trial court entered judgment in favor of

       SFT. The order did not include findings of fact and conclusions of law. Jones

       Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020   Page 6 of 12
       subsequently filed a motion to correct error which was denied. This appeal

       ensued.

                                  Discussion and Decision
[11]   The trial court’s order did not contain any findings of fact or conclusions

       thereon. Therefore, we review the order “as a general judgment and, without

       reweighing evidence or considering witness credibility, affirm if sustainable

       upon any theory consistent with the evidence.” Baxendale v. Raich, 878 N.E.2d
1252, 1257 (Ind. 2008) (quotation and citation omitted).

[12]   To prove its case, SFT was required to show that (1) Gill—and Jones as co-

       signer—executed a contract for the student loan with Sallie Mae Education

       Trust, (2) SFT was the assignee and now owner of that debt, and (3) Gill and

       Jones owed the original owner, Sallie Mae Education Trust, the amount

       alleged. See Holmes v. Nat. Collegiate Student Loan Tr., 94 N.E.3d 722, 724 (Ind.

       Ct. App. 2018) (citing Seth v. Midland Funding, LLC, 997 N.E.2d 1139, 1140

       (Ind. Ct. App. 2013)). Even if we assume, without deciding, that SFT met its

       burden to prove (1) and (3), above, it is clear that it failed to prove (2), i.e., that

       it is the owner of the Gill/Jones Loan.

[13]   SFT’s exhibits C through I purported to show assignments of the Gill/Jones

       Loan between various subsidiaries of Navient Solutions, LLC, and, ultimately,

       to SFT. However, none of those exhibits specifically identified the Gill/Jones

       Loan as included in the transfers. Each BOS in those exhibits states that it is

       Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020   Page 7 of 12
       assigning loans identified in either an attached “Annex,” e.g., Ex. C, Ex. at 14,

       or “Schedule,” Ex. D, Ex. at 17. But none of the exhibits include attachments

       that are titled “Annex” or “Schedule.” And, while Exhibits C through I do

       contain attachments, each such attachment fails to identify any individual loans

       involved in the transaction but refers only to large groups of loans consisting of

       thousands of individual loans. See, e.g., Ex. at 19 (Ex. D.) (including

       attachment entitled “Summary of Loans” that provided only the amount due

       on “463,434” loans). See Williams v. Unified CCR, LLC, 70 N.E.3d 375, 380

       (Ind. Ct. App. 2017) (holding debt assignments between debt collector entities

       that referred to “Receivables” but did not specifically mention defendant’s

       credit card account failed to establish that plaintiff debt collector had been

       assigned or owned the credit card account).

[14]   Nor do the exhibits demonstrate that each transferred bundle of loans is the

       same bundle that included the Gill/Jones Loan in Exhibit B; in fact, Mauer

       testified that all overdue accounts do not end up in the same “holding,” Tr. at

       39, or bundle.5 Cf. Smith v. Nat. Collegiate Student Loan Tr., No. 19A-CC-3041,

       2020 WL 3445834, at *5 (Ind. Ct. App. June 24, 2020) (plaintiff proved

       5
           At trial, the following exchange took place:

                  COURT:            The accounts who [sic] are in jeopardy, by reason of non-paying, do they end up
                                    all in one account?
                  MAUER:            No. You mean to – under a specific holding?
                  COURT:            Yes.
                  MAUER:            No.
       Tr. at 39.

       Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020                   Page 8 of 12
       ownership of debt where it produced documentation that original lender

       transferred a bundle of educational loans in a specified loan program that included

       borrower’s loan to another entity, which then sold the bundle in the same

       specified loan program to the plaintiff).

[15]   Mauer testified that each BOS in exhibits B through I included the Gill/Jones

       Loan within it. She based that testimony entirely upon a recording that she did

       not create and that was not in evidence. Mauer stated that she was able to track

       the Gill/Jones Loan all the way through the “various entities as it traveled to

       the current holder,” SFT, by having reviewed Navient’s “system of record data

       base” which includes “one particular page that lists all of the sale codes and

       information.” Tr. at 38, 53. When asked why Exhibits C through I did not

       include attachments like the one in Exhibit B that listed the Gill/Jones Loan

       specifically, Mauer testified:

               because as it—as the—and not necessarily this loan—as a batch
               of student loans moves through different funds, they just don’t—
               they don’t attach a transmittal page or they don’t attach the—it’s
               listed on the borrower’s account on the system. But I—I don’t
               know that there’s a manifest or a transmittal that goes with
               these—with this particular loan. I haven’t been—I haven’t found
               one. But it’s listed on the system of record on the borrower’s
               account.
Id. Thus, the only record that allegedly proved that the Gill/Jones Loan was

       included in each bundle of loans in Exhibits C through I was a specific page in

       Navient Solutions, LLC’s “system of record” data base that Mauer had

       reviewed prior to the date of the trial but which was not produced at trial. Id. at

       Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020   Page 9 of 12
       47-48. However, Mauer testified that she did not personally input the relevant

       information into that system, and she did not know who did. Id. at 55-56.

[16]   Indiana Rule of Evidence 1002, also known as the best evidence rule, states in

       relevant part, that “[a]n original writing, recording, or photograph is required in

       order to prove its content unless these rules or a statute provides otherwise.”

       (Emphasis added). The purpose of this rule is “to assure that the trier of the

       facts has submitted to it the evidence upon any issue that will best enable it to

       arrive at the truth.” Caesar v. State, 139 N.E.3d 289, 291-92 (Ind. Ct. App. 2020)

       (quotation and citation omitted), trans. denied. The best evidence rule “is

       generally applied with respect to documentary evidence, such as written

       instruments, and it excludes all testimony of the contents of such instruments

       when the instrument itself is available and could be examined by the [fact

       finder].” Crosson v. State, 376 N.E.2d 1136, 1141 (Ind. 1978) (quotation and

       citation omitted); see also Hilligoss v. State, 255 N.E.2d 101, 103 (Ind. 1970)

       (noting the best evidence rule applies only in those situations where parties seek

       to prove a writing for the purpose of establishing its terms).

[17]   Here, Mauer testified about a particular page on the Navient computer “system

       of record” for the purpose of proving the alleged terms of that page of the

       recording; i.e., terms that allegedly showed that the Gill/Jones Loan was

       transferred between the entities identified in Exhibits C through I. Mauer

       testified that she did not scan the information regarding the transfers into that

       system, nor did she know who was responsible for inputting that information.

       She testified that she simply reviewed the information. In addition, there was

       Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020   Page 10 of 12
       no testimony or other evidence establishing that a printout from the computer

       recording was unavailable or could not be examined by the defendants or the

       court. Yet Mauer’s testimony regarding the current owner of the specific

       Gill/Jones Loan was based solely upon her review of the terms of that

       recording that she did not create and that was not produced at trial.6 Mauer’s

       testimony was not the best evidence of the alleged recording. Ind. R. Evid.

       1002.

                                                 Conclusion
[18]   SFT has failed to show that it owns the Gill/Jones Loan; if anything,7 it has

       only proven that it owns a bundle of 9,338 unspecified loans referenced in the

       November 14, 2018, BOS from Shenandoah Funding, LLC, to SFT. Ex. at 53-

       56. Because the documents regarding the assignments of debt failed to provide

       any information regarding the Gill/Jones Loan in particular, that evidence was

       insufficient to prove that SFT owned that loan. And Mauer’s testimony that

       6
         We further note that SFT did not ask that Mauer be qualified as an expert whose opinion about the records
       might be admissible under Indiana Rule of Evidence 703, which provides that “[e]xperts may testify to
       opinions based on inadmissible evidence, provided that it is of the type reasonably relied upon by experts in
       the field.”
       7
         Jones raises the additional issue of whether SFT proved any loans were transferred from Sallie Mae
       Education Trust to, ultimately, SFT. Jones notes that there is an apparent break in the “chain” of
       assignments between Exhibit C and Exhibit D. We also note there appears to be other unexplained problems
       with the assignment documents, such as the discrepancy in Exhibit I relating to who purchased the loans,
       Navient Credit Funding, LLC or Navient Credit Finance Corp. However, we do not address those issues
       because, even if the assignment documents in Exhibits C through I were unambiguous and proper, there was
       nevertheless insufficient evidence that SFT owned the Gill/Jones Loan. For the same reason, we do not
       address Jones’s challenges to Exhibits C through I on foundation and hearsay grounds.

       Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020                 Page 11 of 12
       she reviewed a page of Navient Solutions, LLC’s computer system that showed

       SFT owned the Gill/Jones Loan was not the best evidence of the same and

       was, therefore, also insufficient. Given the lack of evidence that SFT owned the

       Gill/Jones Loan, the trial court judgment for SFT is not sustainable upon any

       theory consistent with the evidence.

[19]   Reversed.

       Vaidik, J., and Weissmann, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 20A-CC-553 | October 13, 2020   Page 12 of 12