Nat'l Collegiate Student Loan Trust 2006-2 v. Gimple

• Decision Date: 06 April 2022
• Docket Number: A169887
• Parties: NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-2, a Delaware Statutory Trust, Plaintiff-Appellant, v. Courtney N. GIMPLE, aka Courtney N. Butler, Defendant-Respondent.
• Court: Oregon Court of Appeals

318 Or.App. 672

508 P.3d 561

NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-2, a Delaware Statutory Trust, Plaintiff-Appellant,

v.Courtney N. GIMPLE, aka Courtney N. Butler, Defendant-Respondent.

A169887

Court of Appeals of Oregon.

Argued and submitted December 1, 2020.

April 6, 2022

James Schultz, Florida, argued the cause for appellant. On the briefs were Ashley N. Wydro, Dayle M. Van Hoose, and Sessions, Fishman, Nathan & Israel LLC, and Julie A. Smith and Cosgrave Vergeer Kester LLP.

Nadia H. Dahab, Portland, argued the cause for respondent. Also on the brief were Innovation Law Lab and Christopher J. Mertens and Mertens Law LLC.

Before Mooney, Presiding Judge, and Egan, Judge, and Pagán, Judge.^*

EGAN, J.

Plaintiff, the National Collegiate Student Loan Trust 2006-2, appeals a general judgment in favor of defendant after the trial court granted defendant's cross-motion for summary judgment on plaintiff's claims for breach of contract and quantum meruit . Plaintiff assigns four errors. We affirm without discussion plaintiff's third assignment. We write only to address plaintiff's second assignment, in which plaintiff contends that the trial court erred in excluding two pieces of evidence that plaintiff asserts should have been admitted as business records under OEC 803(6). We conclude that the trial court did not err as to plaintiff's second assignment. Given that resolution, plaintiff's first and fourth assignments also fail. Accordingly, we affirm.

Generally, when reviewing the trial court's ruling on cross-motions for summary judgment, "we examine whether there are any disputed issues of material fact and whether either party was entitled to judgment as a matter of law." Providence Health Plan v. Allen , 299 Or. App. 128, 135, 449 P.3d 504 (2019), rev. den. , 366 Or. 257, 458 P.3d 1125 (2020). Here, that determination turns on the admissibility of certain hearsay statements. "We review the court's legal conclusions regarding the admissibility of a hearsay statement under an exception to the hearsay rule for legal error." Morgan v. Valley Property and Casualty Ins. Co. , 289 Or. App. 454, 455, 410 P.3d 327 (2017), adh'd to on recons. , 290 Or. App. 595, 415 P.3d 1165 (2018).

In 2006, defendant applied for and obtained a loan from JPMorgan Chase Bank, N.A. Bank One (Bank One). In November 2007, defendant filed a Chapter 7 bankruptcy petition in the United States Bankruptcy Court. Defendant's debt was discharged in March 2018. The parties contest whether the loan at issue here was discharged as a part of defendant's bankruptcy.

Approximately 10 years after defendant filed for bankruptcy—in February 2018—plaintiff filed a complaint against defendant in Clackamas County Circuit Court for breach of contract and quantum meruit . Plaintiff claimed that, pursuant to "an assignment agreement," it owned defendant's Bank One loan and that defendant had failed to make monthly payments under the terms of the loan agreement. Defendant responded to plaintiff's complaint with several affirmative defenses. As relevant here, defendant claimed that plaintiff had "failed to allege facts" sufficient "to show [that plaintiff was the] party in interest entitled to enforce the contract."

Subsequently, after the parties sought admissions and both parties responded to those admissions, plaintiff filed a motion for summary judgment arguing that there was no genuine issue as to any material facts, because defendant "admitted to borrowing, without timely repaying, the funds in question." However, in making that motion, plaintiff acknowledged that defendant had not "admitted * * * that Plaintiff is the correct party to whom she owes repayment of the loan." In support of its motion, plaintiff submitted an affidavit of Jacqueline Jefferis, who explained in her affidavit that she was an employee of Transworld Systems Inc., the Subservicer for plaintiff regarding the educational loan at issue. There were several exhibits attached to the affidavit. To establish that plaintiff was the party that owned defendant's loan, plaintiff attached Exhibit B—the "loan request/credit agreement"—and Exhibit C—the "deposit and sale agreement."¹

Exhibit B stated that the original lender was Bank One and that defendant "promise[d] to pay to [the lender's] order, upon the terms and conditions of [the] credit agreement."

Exhibit C put forth the terms of the sale between Bank One and plaintiff. As a part of that exhibit, plaintiff attached a document titled "Pool Supplement." That supplement, which described the transaction between Bank One and plaintiff stated:

"In consideration of the Minimum Purchase Price, [Bank One] hereby transfers, sells, sets over and assigns to The National Collegiate Funding, LLC * * * each student loan set forth on the attached [transferred Bank One loans]. * * * [The National Collegiate Funding, LLC] in turn will sell the Transferred Bank One loans to The National Collegiate Student Loan Trust 2006-4."

Defendant then filed a cross-motion for summary judgment pursuant to ORCP 47 B. Defendant maintained that plaintiff failed to allege facts sufficient to prove that it was the party in interest entitled to enforce the contract. In doing so, defendant asserted that the documents that might support that plaintiff is the party in interest, specifically Exhibit B and Exhibit C, were "inadmissible hearsay not qualifying as business records" because they were "without competent foundation." The court held a hearing on those motions.

Plaintiff, in response to defendant's evidentiary argument, asserted that Exhibit B and Exhibit C were business records, admissible as exceptions to the rule against hearsay under OEC 803(6). To establish those exhibits as business records, plaintiff attached a personal affidavit from an employee—Jacqueline Jefferis—of Transworld Systems Incorporated (TSI). In the affidavit, Jefferis stated that TSI is the subservicer for plaintiff's loan. As the subservicer, TSI was the "designated custodian of records for Defendant's education loan. Additionally, TSI maintains the dedicated system of record for electronic transactions pertaining to the Defendant's educational loan, including, but not necessarily limited to, payments, credits, interest accrual and any other transactions that could impact the Defendant's educational loan." Jefferis's affidavit additionally stated:

"5. I am familiar with the process by which TSI receives prior account records, including origination records from the time the loan was requested and/or disbursed to the Defendant and/or the student's school on their behalf.

"6. As custodian of records[,] it is TSI's regularly-conducted business practice to incorporate prior loan records and/or documentation into TSI's business records.

"7. I am further competent and authorized to testify regarding this educational loan through personal knowledge of the business records maintained by TSI as custodian of records, including electronic data provided to TSI related to the Defendant's educational loan, and the business records attached to this Affidavit.

"8. This lawsuit concerns an unpaid loan owed by Defendant * * * to Plaintiff. Specifically, Defendant entered into an educational loan agreement at Defendant's special instance and request. A loan was extended for Defendant to use pursuant to the terms of the loan agreements. Defendant has failed, refused, and/or neglected to pay the balance pursuant to the agreed terms.

"9. Educational loan records are created, compiled and recorded as part of regularly conducted business activity at or near the time of the event and from information transmitted from a person with personal knowledge of said event and a business duty to report it, or from information transmitted by a person with personal knowledge of the accounts or events described within the business record. Such records are created, kept, maintained, and relied upon in the course of ordinary and regularly conducted business activity.

"10. I have reviewed the educational loan records * * *. No payment has been received on this account. * * *. Attached hereto and incorporated as Exhibit ‘B’ is a true copy of the underlying Credit Agreement/Promissory Note and Note Disclosure Statement. In the event the Defendant(s) faxed the executed Credit Agreement/Promissory Note, per its terms they agreed their facsimile/electronic signature is deemed to be an original.

"11. The Defendant opened an educational loan with [Bank One] * * *. The Defendant's educational loan was then transferred, sold and assigned to National Collegiate Funding LLC, who in turn transferred, sold and assigned the Defendant's educational loan to Plaintiff, * * * for valuable consideration, in the course of the securitization process. The Defendant's educational loan was in good standing and not in default * * *. Attached hereto and incorporated as Exhibit "C" is a true and correct copy of the Agreement(s) described herein. Said Exhibit contains a redacted copy of the Schedule of transferred loans referenced within the Pool Supplement."

After the court considered the parties’ arguments about the affidavit and exhibits, the trial court admitted the affidavit of Jefferis, but rejected plaintiff's argument that Exhibit B and Exhibit C were admissible. The court reasoned that Jefferis was able to "attest to what she's able to attest to." In essence, the court reasoned that, because Jefferis worked for TSI "to perform the duties of subservices," she has knowledge of how TSI "maintains the dedicated system of record for [its] electronic transactions." Specifically, the court explained, she can attest to her "firsthand knowledge" of "[p]ayments, credits, [and] interest accruals." The court stated that what Jefferis did not have firsthand knowledge of was whether the "loan was extended for defendant to use pursuant to the terms of the loan agreements." Thus, her affidavit could not be used to "introduce the contract, because she has no firsthand knowledge of the...