PALISADES COLLECTION LLC v. Kalal

• Decision Date: 04 February 2010
• Docket Number: No. 2009AP482.,2009AP482.
• Citation: 2010 WI App 38,781 N.W.2d 503
• Parties: PALISADES COLLECTION LLC, Plaintiff-Respondent, v. Jackie C. KALAL and Ralph A. Kalal, Defendants-Appellants.
• Court: Wisconsin Court of Appeals

781 N.W.2d 503

2010 WI App 38

PALISADES COLLECTION LLC, Plaintiff-Respondent,^† v. Jackie C. KALAL and Ralph A. Kalal, Defendants-Appellants.

No. 2009AP482.

Court of Appeals of Wisconsin.

Submitted on Briefs November 16, 2009.

Opinion Filed February 4, 2010.

COPYRIGHT MATERIAL OMITTED

On behalf of the defendants-appellants, the cause was submitted on the briefs of Jackie C. Kalal and Ralph A. Kalal, Middleton.

On behalf of the plaintiff-respondent, the cause was submitted on the brief of Lisa M. Arent and Edward J. Heiser, Jr., of Whyte Hirschboeck Dudek, S.C., Milwaukee, and Robert Hornik of Rausch, Sturm, Israel, Enerson & Hornik, LLC, Brookfield.

Before DYKMAN, P.J., VERGERONT and HIGGINBOTHAM, JJ.

¶ 1 VERGERONT, J

Jackie and Ralph Kalal appeal the circuit court's judgment that they owe Palisades Collection LLC $27,343.47, plus costs, for the balance due on Jackie Kalal's credit card account with Chase Manhattan Bank. The Kalals contend the circuit court erred in granting summary judgment in favor of Palisades because the affidavit Palisades filed in support of its motion does not show the requisite personal knowledge to establish the admissibility of the attached account statements under the hearsay exception for records of regularly conducted activity. WIS. STAT. § 908.03(6) (2007-08).¹ We agree. We conclude the affidavit does not establish a prima facie case for summary judgment because it does not show that the affiant is a witness qualified, based on personal knowledge, to testify to the elements required for admissibility of the account statements under that exception. Accordingly, we reverse the summary judgment and remand for further proceedings.

¶ 2 Our reversal on this ground makes it unnecessary to rule on the Kalals' contention that the affidavit also fails to establish a prima facie case that there was a valid assignment of the debt by Chase to Palisades.

BACKGROUND

¶ 3 Palisades filed a complaint alleging that Jackie Kalal opened a credit card account with Chase and, despite demand, she had failed to make payments on the balance due of $27,343.47. The complaint alleged that Palisades was the current holder of the credit card account. The answer denied the allegations. Ralph Kalal, Jackie's husband, successfully moved to intervene as a co-defendant in the case.

¶ 4 In support of its motion for summary judgment, Palisades submitted the affidavit of Marie Oliphant, who averred she was "a duly authorized representative of Palisades, the owner of this account through purchase." In addition, Oliphant averred that the attached documents were "a true and correct copy of the credit card statements that were mailed to Jackie C. Kalal on a monthly basis." Each of the attached five pages is entitled "Chase ... Mastercard Account Summary," identifies Jackie Kalal as the cardholder, and states amounts due for the time periods identified. Oliphant averred that "there remains a balance outstanding as of February 26, 2007, in the amount of $27,343.47, plus costs and disbursements."

¶ 5 With respect to the attached account statements, Oliphant further averred:

In my capacity as authorized representative, I have control over and access to records regarding the account of the above referenced Defendant(s), further, the original owner maintained records pertaining to its business; that the records were prepared in the ordinary course of business, at or near the time of the transaction or event, by a person with knowledge of the event or transaction, that such records are kept in the ordinary course of the original creditor's business and that of the Plaintiff; and that based upon my review of the business records of the original creditor, I have personally inspected said account and statements regarding the balance due on said account.

¶ 6 The Kalals opposed the motion, although they did not submit any affidavits or other factual materials. They contended that, with respect to the amount owed, the affidavit did not meet the requirements that it be "made on personal knowledge" and set forth "evidentiary facts as would be admissible in evidence." WIS. STAT. § 802.08(3). Specifically, the Kalals asserted that the affidavit did not show that Oliphant had personal knowledge of the amount owed and the attached documents were inadmissible to show that amount because the affidavit did not establish the foundation requirements of WIS. STAT. § 908.03(6), the hearsay exception for records of regularly conducted activity. They also asserted that, with respect to Palisades' ownership of the accounts, the affidavit contained only a legal conclusion and not evidence to support the conclusion that would be admissible at trial.

¶ 7 The circuit court rejected the Kalals' arguments. It concluded that Oliphant's affidavit was based on personal knowledge and the documents attached came within the hearsay exception.² The court also concluded that Oliphant's affidavit established a prima facie case for Palisades' claim and, because the Kalals had submitted no affidavit or other factual material to dispute her affidavit, they had not shown there was a factual dispute that entitled them to a trial.

DISCUSSION

¶ 8 On appeal the Kalal's renew their arguments that Oliphant's affidavit does not establish a prima facie case for Palisades because of the lack of a foundation to bring the attached account statements within the hearsay exception in WIS. STAT. § 908.03(6) and because the statement that Palisades owns the account is an inadmissible legal conclusion. Because we agree with the Kalals on the first issue, it is unnecessary to address the second.

¶ 9 We review de novo the grant of summary judgment, employing the same methodology as the circuit court. Green Spring Farms v. Kersten, 136 Wis.2d 304, 314-16, 401 N.W.2d 816 (1987). A party is entitled to summary judgment when there are no genuine issues of material fact and that party is entitled to judgment as a matter of law. WIS. STAT. § 802.08(2). We examine the moving party's submissions to determine whether they constitute a prima facie case for summary judgment. Gross v. Woodman's Food Market, Inc., 2002 WI App 295, ¶ 30, 259 Wis.2d 181, 655 N.W.2d 718. If they do, then we examine the opposing party's submissions to determine whether there are material facts in dispute that entitle the opposing party to a trial. Id.

¶ 10 Affidavits in support of and in opposition to a motion for summary judgment "shall be made on personal knowledge and shall set forth such evidentiary facts as would be admissible in evidence." WIS. STAT. § 802.08(3). On summary judgment, the party submitting the affidavit need not submit sufficient evidence to conclusively demonstrate the admissibility of the evidence it relies on in the affidavit. Gross, 259 Wis.2d 181, ¶ 31, 655 N.W.2d 718 (citing Dean Med. Ctr. v. Frye, 149 Wis.2d 727, 734-35, 439 N.W.2d 633 (Ct. App.1989)). That party need only make a prima facie showing that the evidence would be admissible at trial. Id. If admissibility is challenged, the court must then determine whether the evidence would be admissible at trial. Id.

¶ 11 In this case, the issue is whether Oliphant's affidavit makes a prima facie case that the attached account statements are admissible under the hearsay exception in WIS. STAT. § 908.03(6) for records of regularly conducted activity.³ To come within this exception, the record must be:

a memorandum, report, record, or data compilation, in any form, of acts, events, conditions, opinions, or diagnoses, made at or near the time by, or from information transmitted by, a person with knowledge, all in the course of a regularly conducted activity, as shown by the testimony of the custodian or other qualified witness. ...

§ 908.03(6).

¶ 12 The parties debate our standard of review on this particular issue, with the Kalals arguing that it is de novo and Palisades arguing that the circuit court's decision on this point was within its discretion. If a circuit court's decision is discretionary, we employ a more deferential standard of review, upholding the decision if the court examined the relevant facts, applied a proper legal standard, and reached a reasonable conclusion using a rational process. Martindale v. Ripp, 2001 WI 113, ¶ 28, 246 Wis.2d 67, 629 N.W.2d 698.

¶ 13 Although it is well established that we employ the summary judgment methodology de novo, there may be a different standard of review for decisions on whether an affidavit meets the requirements that it is "made on personal knowledge and ... sets forth such evidentiary facts as would be admissible in evidence." WIS. STAT. § 802.08(3). These decisions may involve evidentiary rulings that are committed to the circuit court's discretion. Gross, 259 Wis.2d 181, ¶ 32, 655 N.W.2d 718. In other words, the circuit court, in deciding if an affidavit "is made on personal knowledge and sets forth such facts as would be admissible in evidence," is undertaking essentially the same analysis that it would undertake at trial to decide whether the affiant, now witness, testifying exactly as averred in the affidavit, is presenting admissible evidence. For example, in Gross we reviewed as discretionary the circuit court's decisions that an affidavit presented an adequate foundation that the affiant had the knowledge and experience to give an expert opinion on a particular topic, had personal knowledge on another topic, and adequately explained an attached chart so as to make the chart admissible in evidence. Gross, 259 Wis.2d 181, ¶¶ 36-38, 655 N.W.2d 718. See WIS. STAT. §§ 907.02 and 906.02.⁴ Palisades relies on Gross in arguing that we should defer to the circuit court's decision here as an exercise of discretion.

¶ 14 However, not all evidentiary rulings are discretionary. For example, if an evidentiary issue requires construction or application of a statute to a set of facts, a question of law is presented and our review is de novo. State v. Jensen, 2007 WI...