Arizona Case Law Update-Plaintiff's MSJ Does Not Shift BoP to Defendant
Civil Procedure/Summary Judgment--Plaintiff's Motion for Summary Judgment Does Not Shift Burden of Proof to Defendant Wells Fargo Bank v. Allen, __Ariz. Adv. Rep. __I CA-CV 11-0572 (App. Div. I, December 4, 2012) (J. Swann) PLAINTIFF MUST ESTABLISH RIGHT TO JUDGMENT BY ADMISSIBLE EVIDENCE TO OBTAIN SUMMARY JUDGMENT AND PLAINTIFF IS NOT ENTITLED TO SUMMARY JUDGMENT BASED UPON DEFENDANTS' FAILURE TO ADEQUATELY REFUTE PLAINTIFF'S ARGUMENT IN RESPONSE TO PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
Plaintiff Wells Fargo Bank sued defendants Allen for breach of a credit card agreement. An August, 2010 Consumer Credit Agreement and a November 2010 Statement of Charges were attached to plaintiff's complaint and its motion for summary judgment. Plaintiff argued these documents established that defendants agreed to pay for credit card charges and interest on these charges. Plaintiff also attached an affidavit from its paralegal which stated he had reviewed defendant's file and from that review avowed the defendants were in default and owed plaintiff for charges and interest.
Defendants answered complaint and filed an affidavit in response to plaintiff's motion for summary judgment denying they owed plaintiff and that the August 2010 agreement was not binding on them. Defendants also claimed the November 2010 statement was hearsay and they had not had an opportunity to conduct discovery. The trial court granted plaintiff summary judgment for $23,504.17 in charges and an additional $1,578.40 in interest. The Arizona Court of Appeals reversed and remanded.
The court of appeals held that in a contract action the plaintiff always has the burden of persuasion and that burden never shifts to the defendants. Arizona Rule of Civil Procedure 56(c). This is a heavy burden. It is incumbent upon plaintiff to establish independently by admissible evidence that not only is there no genuine issue of material fact but that it is entitled to summary judgment as a matter of law. The mere absence of a material fact established in the motion does not automatically entitle plaintiff to judgment. This is particularly true in that all reasonable inferences go to the respondent to a motion for summary judgment.
Here the plaintiff failed to establish by admissible evidence that the agreement was binding on the defendants or the amount that defendants were in default. The paralegal stated he had reviewed defendants' file but did not identify what documents he reviewed, how the records were kept, that they were authentic or how they established liability or how the amount owed was calculated. A conclusionary affidavit of this type may be adequate in a default hearing but not where the defendants have answered and denied plaintiff's allegations. Such a conclusionary affidavit does not meet the requirements of the business records exception to overcome the hearsay rule. Rule 803(b) of the Rules of Evidence. Therefore plaintiff failed to meet its burden of proof and summary judgment was inappropriate.
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