State v. Phillips
| Decision Date | 12 October 2021 |
| Docket Number | WD 83458 |
| Parties | STATE of Missouri, Respondent, v. Candy M. PHILLIPS, Appellant. |
| Court | Missouri Court of Appeals |
Michael K. Hill, Kansas City, for appellant.
Michael A. Trapasso, Jefferson City, for respondent.
Before Division One: Alok Ahuja, Presiding Judge, Lisa White Hardwick and Anthony Rex Gabbert, Judges
Candy Phillips appeals from her conviction of two counts of stealing. Phillips contends the circuit court erred in admitting hearsay evidence because the State failed to lay an adequate foundation under the business records exception. Phillips also contends the circuit court erred in submitting a jury instruction that violated her due process rights. For reasons explained herein, we affirm.
Phillips was previously employed as the property manager of the Chatsworth Apartments ("Chatsworth"). Robert Jenkins ("Father") was a part-owner of Chatsworth, and his son, Trevor Jenkins ("Son"), managed payroll. While Son has no ownership interest in Chatsworth, Father and Son communicated often about Chatsworth's business and Son estimated that he visited Chatsworth for business purposes around once a quarter. Son owns other, separate, apartment complexes and is familiar with general apartment management.
In the summer of 2017, Chatsworth was underperforming financially, so, on July 13, 2017, Father and Son agreed to visit the property and review it for shortcomings. After surveying the building for maintenance and repair purposes, they entered Phillips's office and asked her to print a report of rents paid and owed. Phillips logged into Chatsworth's logistics program, Property Boss, and printed the report. Upon review, Father and Son found that, according to the report, large amounts of rent owed from various tenants were reported as unpaid and were written-off as discounts or concessions. Phillips admitted to altering the record of one tenant for Father's benefit. Father and Son decided to reconvene with Phillips the next morning to take a deeper look at Chatsworth's financial situation and to decide on the appropriate course of action. The next morning, on July 14, 2017, Father and Son met in Phillips's office, but Phillips did not show. Son eventually gained access to Property Boss on Phillips's computer and printed a report of rents owed and received. After an investigation, the State charged Phillips with two counts of stealing based on the missing rent money.
At trial, the State sought to admit the July 14, 2017 reports that Son had generated under the business records exception to the rule against hearsay enumerated in Section 490.680.1 As foundation for the evidence, Son testified that he was aware that Property Boss was used at Chatsworth as the record keeping software; that he had witnessed Phillips access and generate a report from Property Boss on July 13, 2017; that he generated the report to be admitted into evidence on July 14, 2017; that Phillips was responsible for record keeping at Chatsworth; and that Property Boss should be timely updated with new rents received as part of the ordinary course of business at Chatsworth. The circuit court admitted the evidence on this foundation.
After the close of evidence, the court submitted a jury instruction on Count II, which read, in relevant part, that, "on or between February 1, 2017 and July 1, 2017," Phillips met the elements for the conviction of stealing under Section 570.030. The jury convicted Phillips of both counts of stealing, and the court sentenced her to respective four-year and three-year prison terms, to run consecutively. Phillips appeals.
In her first two points on appeal, Phillips contends the circuit court erred in admitting into evidence the reports that Son pulled from Property Boss on July 14, 2017. Phillips contends that the reports are inadmissible hearsay and do not fall under the business records exception. Specifically, she argues that the State failed to lay an adequate foundation that Son was an "other qualified witness" to give the evidence probity and that Property Boss was updated in the ordinary course of business.
We review the circuit court's decision regarding the admissibility of evidence for an abuse of discretion. State v. Taylor , 466 S.W.3d 521, 528 (Mo. banc 2015). "The court abuses its discretion only if its decision is ‘clearly against the logic of the circumstances and is so unreasonable as to indicate a lack of careful consideration.’ " Id. (quoting Mitchell v. Kardesch, 313 S.W.3d 667, 675 (Mo. banc 2010) ). "Evidentiary error is reviewed ‘for prejudice, not mere error,’ and error is only prejudicial if the court's error affected the outcome of the trial with ‘reasonable probability’ and deprived the defendant of a fair trial." Id. (quoting State v. Clark, 364 S.W.3d 540, 544 (Mo. banc 2012) ). "We review the evidence presented at trial in the light most favorable to the verdict." State v. Johns , 34 S.W.3d 93, 103 (Mo. banc 2000).
Hearsay is an out of court statement admitted to prove the truth of the matter asserted. State v. Douglas , 131 S.W.3d 818, 823 (Mo. App. 2004). "Not all out-of-court statements are hearsay in that to constitute hearsay the statement must be offered for the truth of the matter asserted." Id. "Thus, an out-of-court statement that is not offered for the truth of the matter asserted is not hearsay and is, therefore, admissible even though it does not fall within a recognized exception." Id. at 823-24. One such exception is the business records exception, where a hearsay business record may be admitted when:
the custodian or other qualified witness testifies to [the record's] identity and the mode of its preparation, and if it was made in the regular course of business, at or near the time of the act, condition or event, and if, in the opinion of the court, the sources of information, method and time of preparation were such as to justify its admission.
Here, Phillips's statement, the Property Boss records, were not admitted to prove their truth. Specifically, the reports indicate that various tenants at various times failed to pay rent, but received credits or discounts on their rent totals to balance the ledger. The State did not admit the reports to prove that the various tenants actually failed to pay rent and instead received credits and discounts, but rather to demonstrate Phillips's consciousness of guilt in that she altered the ledger to conceal her thefts. Because the records are not hearsay, they are admissible as general statements by Phillips that are clearly relevant to the principal issue of the case. As a result, the business records exception need not apply at all, and the court did not err in admitting the Property Boss reports.
Even if the Property Boss reports were hearsay statements, they were properly admitted under the business records exception. First, Phillips contends that Son was not an "other qualified witness" who could lay adequate foundation for the record's admission. To be an "other qualified witness," a witness need not be employed at the time the record's creation or have "personal knowledge of their origins." In re Estate of Newman , 58 S.W.3d 640, 647 (Mo. App. 2001). Rather, "[a]ll that is required under the statute as to the sponsoring witness is that he or she has ‘sufficient knowledge of the business operation and methods of keeping records of the business to give the records probity.’ " Id. (quoting Estate of West v. Moffatt , 32 S.W.3d 648, 653 (Mo. App. 2000) ).
Phillips contends Son was not an "other qualified witness" because: (1) he was not an owner of Chatsworth, (2) he was not familiar with Property Boss specifically, and (3) he had never accessed Property Boss prior to the events of this case. Phillips argues that Son lacked sufficient knowledge of the business and Property Boss to give the records probity. To support this argument, he relies on CACH, LLC v. Askew , 358 S.W.3d 58, 64 (Mo. banc 2012), in which our Supreme Court found that a witness lacked sufficient knowledge to give probity when she neither worked for the business whose records were to be admitted nor had any tangible connections to the business that would give her cause to know when or how the records were prepared. Phillips insists that, because Son was not employed by Chatsworth and was not specifically familiar with Property Boss, he could not know when and how the records were entered.
The record demonstrates that Son has far more knowledge about the business at issue than the witness in CACH , however. First, Son has a direct connection to the business, as he manages Chatsworth's payroll. Second, he and Father, who owns Chatsworth, discuss the business at Chatsworth frequently during their daily phone calls. Indeed, Son was so involved with Chatsworth that he personally examined the physical condition of the property and assessed its financial shortcomings with Father. Additionally, Son has ample experience in the field, as he owns his own apartment complexes, where he utilizes a record keeping program similar to Property Boss. Therefore, we do not find CACH dispositive and do not find that the circuit court abused its discretion in finding that Son was an "other qualified witness."
Phillips next argues that Son merely testified as to how Chatsworth's property managers "should" keep financial records near in time to recordable events occurring but did not testify specifically as to the actual mode and manner of record keeping at Chatsworth. Phillip's argument relies on the following direct examination of Son:
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