Court Opinion

ID: 4445775
Source: CourtListenerOpinion
Date Created: 2019-10-10 15:03:29.432329+00
Date Added: 2024-06-11T13:33:31.619522
License: Public Domain

FILED
                                                                      Oct 10 2019, 6:47 am

                                                                          CLERK
                                                                      Indiana Supreme Court
                                                                         Court of Appeals
                                                                           and Tax Court

ATTORNEY FOR APPELLANT
Jason R. Delk
Muncie, Indiana

                                            IN THE
    COURT OF APPEALS OF INDIANA

Diana F. Zelman,                                           October 10, 2019
Appellant-Defendant,                                       Court of Appeals Case No.
                                                           19A-CC-989
        v.                                                 Appeal from the Delaware Circuit
                                                           Court
Capital One Bank (USA) N.A.,                               The Honorable Thomas A.
Appellee-Plaintiff                                         Cannon Jr., Judge
                                                           Trial Court Cause No.
                                                           18C05-1609-CC-714

Bailey, Judge.

Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019                           Page 1 of 11
                                            Case Summary
[1]   Diana Zelman (“Zelman”) appeals the trial court’s order granting summary

      judgment to Capital One Bank (USA) N.A. (“Bank”) on its claim against

      Zelman for nonpayment of credit card debt. Zelman raises one issue on appeal

      which we restate as whether the trial court erred when it concluded that Bank

      had satisfied its burden of proof under Indiana Trial Rule 56.

[2]   We reverse and remand.

                             Facts and Procedural History
[3]   On September 30, 2016, Bank filed a complaint alleging that Zelman had an

      unpaid credit card balance owed to Bank. On December 15, 2016, Zelman filed

      an answer in which she denied all the allegations of the complaint. On January

      3, 2019, Bank filed a motion for summary judgment in which it designated the

      following evidence in support: the complaint and exhibits; Zelman’s answer;

      Bank’s memorandum in support of summary judgment; and Bank’s “Affidavit

      of Debt,” attached to the memorandum as Exhibit A. The latter document

      stated, in relevant part:

              PERSONALLY APPEARED before the undersigned officer.
              duly authorized to administer oaths, Jamie Williams, who states
              under oath as follows:

              l.    I am over 18 years old and competent to testify to the
              matters set forth herein. I am an employee of Capital One
              Services, LLC, (“COSLLC”), an agent and affiliate of Plaintiff

      Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019       Page 2 of 11
        CAPITAL ONE BANK (USA), N.A. (“Capital One”).
        COSLLC provides services to Capital One in connection with its
        credit card and related banking practices and my job
        responsibilities as Litigation Support Representative provide me
        with access to all relevant systems and documents of Capital One
        needed to validate the below information. I am authorized by
        Capital One to testify to the matters set forth herein. As a result
        of the scope of my job responsibilities, I have personal knowledge
        of the manner and method by which Capital One creates and
        maintains certain business books and records, including
        computer records of customer accounts.

        2.      The Capital One books and records are made in the course
        of Capital One’s regularly conducted business activity and it is a
        regular practice-of Capital One to make these books and records.
        Each of the Capital One books and records reviewed are made:
        (l) at or near the time the events they purport to describe
        occurred, by a person with knowledge of the acts and events; or,
        (2) by a computer or other similar digital means, which
        contemporaneously records an event as it occurs.

        3.     The books and records of Capital One show that
        Defendant(s) opened a credit card account with Capital One on
        03/01/1997 for the purpose of obtaining an extension of credit
        and did thereafter use or authorize the use of the account for the
        acquisition of goods, services, or cash advances in accordance
        with the Customer Agreement governing use of that account.
        The last payment attempt in the amount of $141.00 on
        03/13/2015 did not satisfy the outstanding balance and thus
        created a default on the account.

        4.      The books and records of Capital One show that at the
        time Defendant’s(s’) account, XXXXXXXXXXXX7308, charged
        off in the ordinary course of business, the just and true sum of
        $6292.34 remained due and owing as of 10/17/2015. There
        have been no late fees assessed after 10/17/2015.
Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019          Page 3 of 11
              5.     The books and records of Capital One show that credit has
              been given to Defendant(s) for all just and lawful offsets,
              payments, and credits as of the date hereof, and there now
              remains due and owing on account number
              XXXXXXXXXXXX7308 the just and true sum of $6292.34 as of
              07/14/2016. This balance is comprised of Defendant’s(s’)
              outstanding debt on the date the account charged off (including
              any pre-charge-off transactions, interest, and/or fees) less any
              offsets, payments, or credits applied to the account after the
              charge-off date.

      App. at 28-29. Bank’s memorandum in support of summary judgment also had

      as an attachment Exhibit B, which the memorandum alleged to be “copies of

      the account statements for account #************7308.” Id. at 26.

[4]   Zelman opposed summary judgment on the grounds that Bank had failed to

      designate admissible evidence in support of its motion and moved to strike the

      designated evidence from the record. At the March 4 hearing, the trial court

      took the pending motions under advisement and gave Bank ten days to file a

      response to Zelman’s motion to strike. On March 14, Bank filed its

      “Supplement to Motion for Summary Judgment” and supporting memorandum

      in which it argued that its previously-filed designated evidence was admissible

      and supported its motion for summary judgment. On April 2, 2019, the trial

      court granted Bank’s motion for summary judgment. Specifically, the trial

      Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019     Page 4 of 11
      court held that Bank’s designated evidence was admissible1 and supported its

      motion. Zelman now appeals.

                                  Discussion and Decision
[5]   Our standard of review for summary judgment is well settled. When

      reviewing a grant or denial of summary judgment, we apply the same

      standard as the trial court.

              The party moving for summary judgment has the burden of
              making a prima facie showing that there is no genuine issue
              of material fact and that the moving party is entitled to
              judgment as a matter of law. Once these two requirements
              are met by the moving party, the burden then shifts to the
              non-moving party to show the existence of a genuine issue
              by setting forth specifically designated facts. Any doubt as
              to any facts or inferences to be drawn therefrom must be
              resolved in favor of the non-moving party.

      Daviess-Martin Cty. Joint Parks and Recreation Dep’t v. Estate of Abel by Abel,

      77 N.E.3d 1280, 1285 (Ind. Ct. App. 2017) (citations omitted), trans.

      denied.

[6]   However, Bank has not filed an appellee’s brief. Therefore, we apply a less

      stringent standard of review and may reverse the grant of summary judgment if

      1
         By holding the Bank’s designated evidence was admissible, the court, in effect, denied Zelman’s motion to
      strike.

      Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019                              Page 5 of 11
      Zelman has shown prima facie error. Ind. Appellate Rule 45(D); see also, e.g.,

      First Am. Title Ins. Co. v. Calhoun, 13 N.E.3d 423, 430-31 (Ind. Ct. App. 2014).

      “Prima facie error” is error at first sight, at first appearance, or on the face of it.

      Calhoun, 13 N.E.3d at 431.

[7]   Zelman contends that summary judgment was not warranted because Bank

      failed to support its summary judgment motion with admissible designated

      evidence. To support its motion for summary judgment, Bank was required to

      show that Zelman had opened a credit card account with Bank and that Zelman

      owed Bank the amount alleged in the complaint. See Seth v. Midland Funding,

      LLC, 997 N.E.2d 1139, 1140 (Ind. Ct. App. 2013) (discussing designated

      evidence necessary to make prima facie case in support of summary judgment

      in favor of creditor claiming breach of credit card contract). Zelman alleges

      Bank failed to make that showing because: (1) Bank failed to attach to its

      Affidavit of Debt copies of documents to which the Affidavit refers, as required

      by Indiana Trial Rule 56(E); (2) the Affidavit of Debt was not based on personal

      knowledge as required by Trial Rule 56(E); and (3) Bank failed to lay a proper

      foundation as to its Exhibit titled “Capital One Customer Agreement”

      (“Customer Agreement”) and its Exhibit B, as required to authenticate those

      documents under the business record exception to hearsay, Indiana Evidence

      Rule 803(6).

[8]   Indiana Trial Rule 56 permits parties to submit affidavits in support of their

      motions for summary judgment. However, subsection E of that rule imposes

      certain mandatory requirements; it states, in relevant part:

      Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019           Page 6 of 11
              Supporting and opposing affidavits shall be made on personal
              knowledge, shall set forth such facts as would be admissible in
              evidence, and shall show affirmatively that the affiant is
              competent to testify to the matters stated therein. Sworn or
              certified copies not previously self-authenticated of all papers or
              parts thereof referred to in an affidavit shall be attached thereto
              or served therewith.

      T.R. 56(E).

[9]   Thus, in ruling on a motion for summary judgment, the trial court will consider

      only properly designated evidence which would be admissible at trial. E.g.,

      D.H. by A.M.J. v. Whipple, 103 N.E.3d 1119, 1126 (Ind. Ct. App. 2018), trans.

      denied. Such evidence does not include inadmissible hearsay contained in an

      affidavit. See, e.g., Holmes v. Nat’l Collegiate Student Loan Trust, 94 N.E.3d 722,

      725 (Ind. Ct. App. 2018). Nor does it include documents that are unsworn

      statements or unverified exhibits. Greenfield v. Arden Seven Penn Partners, L.P.,

      757 N.E.2d 699, 702 n.3 (Ind. Ct. App. 2001), trans. denied. Moreover, it is well

      settled that “‘if a document is relied upon to support a motion for summary

      judgment, it must be exhibited in full; affidavits as to its substance, effect or

      interpretation are not sufficient.’” Reef v. Asset Acceptance, LLC, 43 N.E.3d 652,

      654 (Ind. Ct. App. 2015) (quoting Marich v. Kragulac, 415 N.E.2d 91, 100 (Ind.

      Ct. App. 1981), disapproved of on other grounds by Presbytery of Ohio Valley, Inc. v.

      OPC, Inc., 973 N.E.2d 1099 (Ind.2012)); see also Lukacs v. Kluessner, 154 Ind.

      App. 452, 456-57, 290 N.E.2d 125, 128 (1972).

      Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019           Page 7 of 11
[10]   Here, neither the “Customer Agreement”2 attached to Bank’s complaint, nor

       Zelman’s purported credit card statements attached to the summary judgment

       motion as Exhibit B were certified or sworn; therefore, they were inadmissible

       hearsay and were not proper Rule 56 evidence. See Seth, 997 N.E.2d at 1140-41

       (holding uncertified, unsworn exhibits consisting of alleged transaction history,

       credit card statement, and terms of credit card agreement were inadmissible and

       not proper Rule 56 evidence).

[11]   Further, the Affidavit of Debt does not authenticate those unsworn and

       unverified documents as records of regularly conducted business activity

       pursuant to the hearsay exception specified in Rule of Evidence 803(6). 3 The

       affiant, a “Litigation Support Representative” employed by Bank’s affiliate,

       stated that she had “access to” the Bank’s “relevant systems and documents …

       needed to verify” the information in the affidavit, but never states what those

       documents are. App. at 28-29. The affiant further states that she has “personal

       2
         We note that the “Customer Agreement” did not anywhere contain Zelman’s name, signature, or credit
       card account number. App. at 11-16.
       3
           A record is an exception to the rule against hearsay under that rule if:

                  (A) the record was made at or near the time by—or from information transmitted by—someone
                  with knowledge;
                  (B) the record was kept in the course of a regularly conducted activity of a business, organization,
                  occupation, or calling, whether or not for profit;
                  (C) making the record was a regular practice of that activity;
                  (D) all these conditions are shown by the testimony of the custodian or another qualified witness …;
                  and
                  (E) neither the source of information nor the method or circumstances of preparation indicate a lack
                  of trustworthiness.
       Evid. R. 803(6).

       Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019                                  Page 8 of 11
       knowledge of the manner and method by which [Bank] creates and maintains

       certain business books and records, including computer records of customer

       accounts.” However, she does not identify the “books and records” to which

       she refers. She also fails to identify the Customer Agreement attached to the

       complaint as “the Customer Agreement governing use of [Zelman’s] account,”

       id. at 29, or identify the Customer Agreement or credit card statements in

       Exhibit B as “computer records of customer accounts,” id. at 28. Similarly, the

       affiant refers to the Bank “books and records reviewed,” but does not identify

       any such documents. Id.

[12]   Thus, the Affidavit of Debt did not lay a proper foundation to authenticate the

       Customer Agreement or credit card statements as business records admissible

       under Evidence Rule 803(6)’s hearsay exception. See, e.g., Williams v. State, 64
N.E.3d 221, 225 (Ind. Ct. App. 2016) (holding that, in order to admit

       documents under the business records exception, “the proponent of the exhibit

       may call a witness who has a functional understanding of the record-keeping

       process of the business with respect to the specific entry, transaction, or declaration

       contained in the document.” (emphasis added)). Rather, the affiant’s knowledge

       of the facts asserted in her affidavit “is limited to what she has gleaned from her

       review of unspecified business records,” and her affidavit is, therefore, “based

       entirely upon hearsay, in violation of Trial Rule 56(E).” Seth, 997 N.E.2d at

       1142; see also Holmes, 94 N.E.3d 722, 725 (“As an exception to the hearsay rule,

       the business record exception must be strictly construed.”). And the affiant’s

       employment as a litigation support representative of Bank’s affiliate does not, in

       Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019              Page 9 of 11
       itself, establish her personal knowledge of any of the facts relating to the

       complaint. Seth, 997 N.E.2d at 1142.

[13]   In addition, because the affiant explicitly states that her affidavit is based upon

       her personal knowledge of facts obtained from Bank’s business records, she was

       required to attach to, or submit with, her affidavit sworn, certified, or self-

       authenticated copies of any such records upon which she relied. Id. at 1143.

       She did not attach to or submit with her affidavit any such records, and her

       failure to do so means we must disregard her affidavit.4 T.R. 56(E); see also Reef,

       43 N.E.3d at 654 (stating documents in support of summary judgment must be

       exhibited, and affidavits as to their substance are not sufficient).

                                                   Conclusion
[14]   Bank failed to designate admissible evidence establishing that Zelman had

       opened a credit card account with Bank and that Zelman owed Bank the

       amount alleged in the compliant. Zelman has shown prima facie error in the

       trial court order granting Bank summary judgment; therefore, we reverse that

       order and remand for further proceedings.

       4
         In reaching the opposite conclusion, the trial court erroneously relied upon Meyer v. Nat’l City Bank, 903
N.E.2d 974 (Ind. Ct. App. 2009). App. at 52. Meyer is inapplicable as it did not involve a challenge to the
       designated evidence or otherwise address admissibility of such evidence under Trial Rule 56(E). Id. Of
       course, in any case, on review of a summary judgment decision we are not bound by trial court findings and
       conclusions. E.g., Webb v. City of Carmel, 101 N.E.3d 850, 861 (Ind. Ct. App. 2018) (“Where a trial court
       enters specific findings and conclusions, they offer insight into the rationale for the trial court’s judgment and
       facilitate appellate review but are not binding upon this court.”).

       Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019                                 Page 10 of 11
[15]   Reversed and remanded.

       Najam, J., and May, J., concur.

       Court of Appeals of Indiana | Opinion 19A-CC-989 | October 10, 2019   Page 11 of 11