Business records exception
Encyclopedia
The business records exception to the U.S. hearsay rule
is based on Rule 803(6) of the Federal Rules of Evidence
(FRE). It is sometimes referred to as the business entry rule.
Business is used in Rule 803(6) to mean any business, institution, association, profession
, or occupation, regardless of whether or not it is conducted for profit
. Therefore, such records could conceivably include those of religious
and charitable organization
s, hospital
s, school
s, and even criminal organizations.
or other penalty). The exception functions to allow the record to substitute for the in-court testimony of the employees, but it can only substitute for what the employee could testify about. The availability of the declarant
(the employee whose testimony is being replaced by the record) is immaterial for the purposes of this exception.
This last point was contested in the case of Johnson v. Lutz, 253 N.Y. 124, 170 N.E. 517 (1930), which held that record is admissible only when it is made by an employee on information obtained by him from an informant who himself was under a business duty to impart that information. The Johnson case, which dealt specifically with the admissibility of police reports, set a limitation on the use of such reports in court. Even though the police officer was under a duty to properly record the statements of an informant
, the informant himself was under no duty to report the events correctly, and therefore the informant's statement was still inadmissible hearsay. The Johnson case is noted prominently in the Advisory Committee Notes to the Federal Rules of Evidence, and is frequently studied in U.S. law school
courses on the Law of Evidence.
ruled that an accident report created by a railroad company which was prepared in anticipation of a lawsuit
by the victim was inadmissible, because it was not prepared in the regular course of business. Railroad travel, and not litigation, was the primary business of the railroad, and therefore the report was not considered sufficiently reliable to be admitted into evidence.
, directories, and other published compilations are considered generally admissible if they are generally used and relied upon by the public or by persons in particular occupations. Such information is considered admissible separate and apart from privately-made business records described above.
Hearsay in United States law
Hearsay is the legal term for testimony in a court proceeding where the witness does not have direct knowledge of the fact asserted, but knows it only from being told by someone. In general the witness will make a statement such as, "Sally told me Tom was in town," as opposed to "I saw Tom in...
is based on Rule 803(6) of the Federal Rules of Evidence
Federal Rules of Evidence
The is a code of evidence law governing the admission of facts by which parties in the United States federal court system may prove their cases, both civil and criminal. The Rules were enacted in 1975, with subsequent amendments....
(FRE). It is sometimes referred to as the business entry rule.
Scope of exception
Business records, for the purposes of the exception, are any writings or records of acts, events, conditions, opinions, or diagnosis, made at or near the time by, or from information transmitted by, a person with knowledge are admissible if kept in the regular course of business and if it was the regular course of business to make that record, unless the source of information or circumstances of preparation indicate a lack of trustworthiness.Business is used in Rule 803(6) to mean any business, institution, association, profession
Profession
A profession is a vocation founded upon specialized educational training, the purpose of which is to supply disinterested counsel and service to others, for a direct and definite compensation, wholly apart from expectation of other business gain....
, or occupation, regardless of whether or not it is conducted for profit
Profit (economics)
In economics, the term profit has two related but distinct meanings. Normal profit represents the total opportunity costs of a venture to an entrepreneur or investor, whilst economic profit In economics, the term profit has two related but distinct meanings. Normal profit represents the total...
. Therefore, such records could conceivably include those of religious
Religion
Religion is a collection of cultural systems, belief systems, and worldviews that establishes symbols that relate humanity to spirituality and, sometimes, to moral values. Many religions have narratives, symbols, traditions and sacred histories that are intended to give meaning to life or to...
and charitable organization
Charitable organization
A charitable organization is a type of non-profit organization . It differs from other types of NPOs in that it centers on philanthropic goals A charitable organization is a type of non-profit organization (NPO). It differs from other types of NPOs in that it centers on philanthropic goals A...
s, hospital
Hospital
A hospital is a health care institution providing patient treatment by specialized staff and equipment. Hospitals often, but not always, provide for inpatient care or longer-term patient stays....
s, school
School
A school is an institution designed for the teaching of students under the direction of teachers. Most countries have systems of formal education, which is commonly compulsory. In these systems, students progress through a series of schools...
s, and even criminal organizations.
Rationale
The basic rationale for the exception is that employees are under a duty to be accurate in observing, reporting, and recording business facts. The underlying belief is that special reliability is provided by the regularity with which the records are made and kept, as well as the incentive of employees to keep accurate records (under threat of terminationTermination of employment
-Involuntary termination:Involuntary termination is the employee's departure at the hands of the employer. There are two basic types of involuntary termination, known often as being "fired" and "laid off." To be fired, as opposed to being laid off, is generally thought of to be the employee's...
or other penalty). The exception functions to allow the record to substitute for the in-court testimony of the employees, but it can only substitute for what the employee could testify about. The availability of the declarant
Declarant
A declarant, generally speaking, is anyone who composes and signs a statement or declaration alleging that the information he has given therein is true...
(the employee whose testimony is being replaced by the record) is immaterial for the purposes of this exception.
Reliability of the statements in the record
It must be apparent to the judge that the record was made in the regular course of business, i.e., that it was customary practice to make such an entry and that the entrant had a duty to record it (either by law or by the terms of his employment). The record must have been made at or near the time of the act, event, or transaction at issue. Furthermore, the record must consist of matters either within the personal knowledge of the entrant or within the personal knowledge of someone with a duty to transmit the information to the entrant.This last point was contested in the case of Johnson v. Lutz, 253 N.Y. 124, 170 N.E. 517 (1930), which held that record is admissible only when it is made by an employee on information obtained by him from an informant who himself was under a business duty to impart that information. The Johnson case, which dealt specifically with the admissibility of police reports, set a limitation on the use of such reports in court. Even though the police officer was under a duty to properly record the statements of an informant
Informant
An informant is a person who provides privileged information about a person or organization to an agency. The term is usually used within the law enforcement world, where they are officially known as confidential or criminal informants , and can often refer pejoratively to the supply of information...
, the informant himself was under no duty to report the events correctly, and therefore the informant's statement was still inadmissible hearsay. The Johnson case is noted prominently in the Advisory Committee Notes to the Federal Rules of Evidence, and is frequently studied in U.S. law school
Law school in the United States
In the United States, a law school is an institution where students obtain a professional education in law after first obtaining an undergraduate degree.Law schools in the U.S...
courses on the Law of Evidence.
Limitation on admissibility of records prepared for litigation
In the case of Palmer v. Hoffman, , the Supreme Court of the United StatesSupreme Court of the United States
The Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
ruled that an accident report created by a railroad company which was prepared in anticipation of a lawsuit
Lawsuit
A lawsuit or "suit in law" is a civil action brought in a court of law in which a plaintiff, a party who claims to have incurred loss as a result of a defendant's actions, demands a legal or equitable remedy. The defendant is required to respond to the plaintiff's complaint...
by the victim was inadmissible, because it was not prepared in the regular course of business. Railroad travel, and not litigation, was the primary business of the railroad, and therefore the report was not considered sufficiently reliable to be admitted into evidence.
Lack of record as evidence
FRE 803(7) states the negative counterpart of the business records exception: the use of the lack of a record to prove that a transaction or occurrence had not taken place, if it was the regular practice of the business to record such events if they had actually occurred.Other types of business records
Under FRE 803(17), market reports and quotationsFinancial quote
A financial quotation refers to specific market data relating to a security or commodity. While the term quote specifically refers to the bid price or ask price of an instrument, it may be more generically used to relate to the last price which the security traded at...
, directories, and other published compilations are considered generally admissible if they are generally used and relied upon by the public or by persons in particular occupations. Such information is considered admissible separate and apart from privately-made business records described above.