Lenders Must Authenticate Business Records Florida Appellate Court:

MAY 16, 2014BY JOHN CHILES AND COURTNEY OAKES

In Hunter v. Aurora Loan Services, LLC, Case No. 1D12-6071 (Fla. 1st DCA March 4, 2014), the First
District Court of Appeals found that a lender must lay the necessary foundation under the business
records exception to admit documentation from a prior servicer into evidence.
Florida Statutes, 90.803(6) states that the party seeking admission of hearsay under the business
records exception must establish four things. First, that the record was made at or near the time of the
event; second, that the record was made by or from information transmitted by a person with knowledge;
third, that the record was kept in the ordinary course of a regularly conducted business activity; and
finally, that it was a regular practice of that business to make such a record. See Yisrael v. State, 993 So.
2d 952, 956 (Fla. 2008); King v. Auto Supply of Jupiter, Inc., 917 So. 2d 1015, 1018 (Fla. 1st DCA 2006).
In this case, Aurora Loan Services, LLC (Aurora) sought to introduce two computer generated
documents. The first, entitled Account Balance Report, indicated that the borrowers (Hunters) loan was
sold to Lehman brothers, of which Aurora is a subsidiary, prior to the commencement of the foreclosure
action. The second, entitled consolidated notes log, indicated that the physical note and mortgage were
sent via two-day UPS prior to the commencement of the foreclosure action. Neither document specifically
indicated who generated it, although Aurora asserted these documents originally came from MortgageIT.
Auroras witness, Mr. Martin, testified to MortgageITs business practice which he claimed to be standard
across the mortgage industry although he never worked for MortgageIT. He further had no knowledge
about who generated the notations in the above referenced consolidated notes log or Account Balance
Report or where that individual obtained that information. However, he was able to state that a records
custodian typically input notes into the consolidated notes log and the accounts payable department
typically creates the Account Balance Report.
The Court found that Mr. Martins knowledge regarding these documents was insufficient to lay the
necessary foundation to admit them as evidence of Auroras standing under the business records
exception. The Court seemed to focus on the fact that Mr. Martin was neither a current or former
employee of MortgageIT and was unable to testify with particular knowledge of MortgageITs recordkeeping procedures. The Court stated that without this knowledge, Mr. Martin was unable to substantiate
when the records were made, whether the information they contain derived from a person with
knowledge, whether MortgageIT regularly made such records, or, indeed, whether the records belong to
MortgageIT in the first place. In other words, the Court found that Mr. Martin was unable to satisfy all four
of the necessary requirements to establish either the consolidated notes log or the Account Balance
Report as a business record.