[Cite as Motorists Mut. Ins. Co. v. Roberts,

.]

IN THE COURT OF APPEALS

TWELFTH APPELLATE DISTRICT OF OHIO

WARREN COUNTY

MOTORISTS MUTUAL INSURANCE CO., : CASE NO. CA2013-09-089 Plaintiff-Appellee, : OPINION : 5/5/2014 - vs - :

CODY ROBERTS, et al., :

Defendants-Appellant. :

CIVIL APPEAL FROM WARREN COUNTY COURT Case No. 2010CVE00315

Zeehandler Sabatino & Associates, LLC, Stephen J. Zeehandelar, 471 East Broad Street, Suite 1200, Columbus, Ohio 43215-0069, for plaintiff-appellee

Thomas G. Eagle Co., L.P.A., Thomas G. Eagle, 3386 North State Route 123, Lebanon Ohio 45036, for defendant-appellant

M. POWELL, J.

{¶ 1} Defendant-appellant, Cody Roberts, appeals a decision from the Warren

County Court denying his motion for relief from and to vacate a default judgment entered in

favor of plaintiff-appellee, Motorists Mutual Insurance Company, Inc. (Motorists Mutual). For

the reasons discussed below, we affirm in part, reverse in part, and remand this matter to the

trial court. Warren CA2013-09-089

{¶ 2} On or about January 31, 2009, a motor vehicle owned by an insured of

Motorists Mutual was stolen. The vehicle was later recovered, but it was damaged. On

March 29, 2010, Motorists Mutual filed a complaint in the Warren County Court against

Roberts and a co-defendant, Leslie Andrew Shaw, asserting its subrogation rights to recover

funds it paid to its insured.1 The complaint alleged that Roberts and Shaw, "while on a joint

venture * * * stole a 1997 Mercury Mystique off of the Insured's lot and engaged in the

unauthorized use of said vehicle." Thereafter, as Roberts had not answered or appeared,

Motorists Mutual moved for default judgment. On September 15, 2010, default judgment was

entered against Roberts in the amount of "$1,932.05, plus costs and interest at the statutory

rate of 4%."

{¶ 3} Over two years later, on March 12, 2013, Roberts filed a motion for relief from

and to vacate default judgment. In his motion, Roberts claimed the judgment against him

was void as he had never been served with the summons and complaint and that he was

entitled to relief under Civ.R. 60(B)(5), for "any other reason justifying relief from judgment."

In support of the motion, Roberts attached his affidavit, wherein he averred he was not

involved in the theft or damage of the insured's vehicle. He indicated that he had been

charged criminally for his alleged involvement in the theft of the vehicle but that the charges

were dismissed by the state and never refiled. See State v. Roberts, Warren C.C. No. 2009-

CRA-00116 (Mar. 5, 2009). Roberts further claimed he was never aware of the default

judgment entered against him. According to Roberts, he did not discover the September 15,

2010 judgment had been rendered against him until January 23, 2013, when he was pulled

over and informed that his license was under suspension due to a "judgment suspension."

As to the issue of service, Roberts stated he never received "notice or summons of the

1. Shaw is not a party to the present appeal. -2- Warren CA2013-09-089

complaint in this case," and if he had, he "would have defended it on the merits."

{¶ 4} Motorists Mutual filed a memorandum in opposition claiming that service was

perfected by ordinary mail, and that Roberts' affidavit was insufficient to overcome the

presumption of proper service. Motorists Mutual also claimed Roberts' motion for relief from

judgment was not filed within a reasonable time as he had "spoken with personnel in the

office of [Motorists Mutual's] counsel" about the judgment and license suspension on

numerous occasions. Attached to the memorandum were unauthenticated copies of an

"Accurint" report, listing contact information for "Cody Roberts" and the Springboro Police

Department's investigative notes as to the theft of the insured's vehicle.

{¶ 5} Based on the filings by the parties, the trial court scheduled an evidentiary

hearing on the limited issue of Roberts' contact with counsel's office in 2010, 2011, 2012, and

2013 concerning the judgment. At the hearing, Motorists Mutual presented the testimony of

Kris Stephenson, a 15-year employee and accounting manager for Zeehandelar, Sabatino &

Associates, LLC, the law firm representing Motorists Mutual in the present action.

Stephenson testified regarding the firm's electronic recording-keeping practices. Stephenson

explained that the firm uses a program called, "Collection Partner" which permits the person

handling a debtor's account to place typewritten notes in the electronic file under the debtor's

name. Over Roberts' objections, Motorists Mutual entered as an exhibit a printout from

"Collection Partner" which pertained to Roberts' account at the firm. Based on this exhibit,

Stephenson testified Roberts engaged in a series of conversations with several account

handlers from November 19, 2010 through January 29, 2013 regarding the judgment against

him. The record indicated Roberts' license was suspended on November 2, 2010, and on

November 19, 2010, "D" or "DB", which referred to Roberts, contacted the firm and indicated

that he was going to contact an attorney. Stephenson further testified that an entry on

October 22, 2012, indicated Roberts called the office and spoke with an account

-3- Warren CA2013-09-089

representative, stating he was "tired of fighting, he just wanted to get his driver's license

back." Several of the entries also indicated that the account representatives had provided

Roberts with a case number during the conversation.

{¶ 6} Roberts also testified at the hearing. He denied ever contacting the law firm

representing Motorists Mutual. He acknowledged that the exhibit reflected his name, date of

birth, and social security number, but otherwise denied several of the facts contained in the

record. For instance, Roberts denied recognizing any of the phone numbers where these

calls allegedly originated, and he also denied ever working at AK Steel, the place of

employment listed in the record.

{¶ 7} After the parties submitted post-hearing briefs, the magistrate denied Roberts'

motion finding he was properly served by ordinary mail. The magistrate further found

Roberts had notice of the judgment based upon his various contacts with the law firm, and

therefore concluded the Civ.R. 60(B)(5) motion was not brought within a reasonable time.

Roberts filed objections to the magistrate's decision with the trial court. Upon review, the trial

court affirmed and adopted the magistrate's decision to deny Roberts' motion for relief from

and to vacate the default judgment.

{¶ 8} Roberts appeals the decision of the trial court, presenting three assignments of

error for our review. For ease of discussion, we address Roberts' assignments of error out of

order.

{¶ 9} Assignment of Error No. 1:

{¶ 10} THE TRIAL COURT ERRED IN ADMITTING EVIDENCE OF PLAINTIFF'S

LAWYER'S EMPLOYEES' NOTES.

{¶ 11} In his first assignment of error, Roberts argues the trial court erred in admitting

into evidence Exhibit 1, records of Roberts' alleged contacts, including telephone

conversations, with the attorneys representing Motorists Mutual. Roberts contends the -4- Warren CA2013-09-089

records were not admissible under Evid.R. 803(6) because they were prepared in anticipation

of litigation, rather than in the ordinary course of business.

{¶ 12} The admission or exclusion of relevant evidence rests within the discretion of

the trial court. League v. Collins, 12th Dist. Butler No. CA2013-03-041,

.

An appellate court will not disturb a decision of the trial court to admit or exclude evidence

absent a clear and prejudicial abuse of discretion. Cottrell v. Cottrell, 12th Dist. Warren No.

CA20120-10-105,

. An abuse of discretion is more than an error of

judgment; it means that the trial court was unreasonable, arbitrary, or unconscionable in its

ruling. Blakemore v. Blakemore,

(1983).

{¶ 13} Generally, out-of-court statements offered to prove the truth of the matter

asserted are inadmissible hearsay. Evid.R. 801(C). However, Evid.R. 803(6) provides an

exception to this general rule of inadmissibility for certain business records. To qualify for

admission under Evid.R. 803(6):

a business record must manifest four essential elements: (i) the record must be one regularly recorded in a regularly conducted activity; (ii) it must have been entered by a person with knowledge of the act, event or condition; (iii) it must have been recorded at or near the time of the transaction; and (iv) a foundation must be laid by the custodian of the record or by some other qualified witness.

Green Tree Servicing, L.L.C. v. Roberts, 12th Dist. Butler No. CA2013-03-039, 2013-Ohio-

5362, ¶ 29, quoting Cent. Mtge. Co. v. Bonner, 12th Dist. Butler No. CA2012-10-204, 2013-

Ohio-3876, ¶ 13; State v. Davis,

,

, ¶ 171. Even after the

above elements are established, a business record may be excluded from evidence if "the

source of information or the method or circumstances of preparation indicate lack of

trustworthiness." State v. Glenn, 12th Dist. Butler No. CA2009-01-008, ¶ 17, quoting Davis at

¶ 171. Firsthand knowledge of the transaction is not required by the witness providing the

foundation; however, the witness must demonstrate he is sufficiently familiar with the -5- Warren CA2013-09-089

operation of the business and the record's preparation, maintenance, and retrieval such that

he can reasonably testify as to the basis of his knowledge. Glenn at ¶ 19.

{¶ 14} In the case at hand, Stephenson testified that as an accounting manager for

Zeehandelar, Sabatino and Associates, he had personal knowledge of the firm's record-

keeping system. Stephenson identified Exhibit 1 as a "printout copy of [an] * * * electronic file

that is kept during the course of business for our firm for this particular case involving

[Motorists Mutual] and Mr. Roberts." Stephenson explained it is the practice of the firm to

make this type of record for each collection and litigation case in order to keep track of the

history of the case. According to Stephenson, the records are created by a software program

called "Collection Partner," and when activity occurs on a particular file, such as a telephone

conversation or other correspondence with a debtor, notes are entered into the file to reflect

such activity. Stephenson testified these notes are made by the person who actually

engages in the activity reflected in the entry and that such notes are made immediately after

the event or activity takes place. Stephenson further testified that at midnight on the day the

note was entered, the note on the file becomes permanent and can no longer be changed or

edited.

{¶ 15} Based on this testimony, we do not find that the trial court abused its discretion

in admitting the law firm's records. Stephenson's testimony met each of the requirements

under the business records exception to the hearsay rule. Stephenson explained that Exhibit

1 contains records that are regularly made in the course of the law firm's business activity;

the records are made by persons with knowledge of the act and close in time to the event

recorded. Finally, Stephenson as the accounting manager, and an employee who has

created similar records before and reviewed the records presented to the trial court, had the

requisite knowledge to testify regarding these records.

{¶ 16} Roberts, however, asserts Exhibit 1 was still inadmissible as the records were -6- Warren CA2013-09-089

made and kept in anticipation of litigation and therefore indicated a lack of trustworthiness.

Roberts is correct that in some instances, documents made in anticipation of litigation are

excluded because such documents substantially undermine the presumed guarantee of

circumstantial trustworthiness in qualified business records. See Sikora v. Gibbs,

(10th Dist. 1999), citing McCormick v. Mirrored Image, Inc.,

(1st Dist. 1982); see also Weis v. Weis,

(1947). However, we

disagree that simply because these records were prepared at an attorney's office that such

records were created in anticipation of litigation, and therefore were not trustworthy. Rather,

according to Stephenson's testimony, these records served a dual purpose, one was for

litigation, but the other was for the firm's collection business. The records at issue reflected

phone calls between office personnel and debtors who were attempting to resolve the

matters voluntarily. The records had significance separate and apart from the law firm's

litigation business. The records were not evaluative, but instead recorded contacts the firm

had with its clients' debtors. Moreover, as a judgment had already been entered against

Roberts and nothing further in the case was pending before the trial court when these

records were made, it is reasonable to conclude that the records were not created in

anticipation of litigation. Accordingly, under these facts, we do not find the circumstances of

preparation indicate a lack of trustworthiness.

{¶ 17} Based on the foregoing, the trial court did not err in admitting into evidence

records of the law office representing Motorists Mutual, and therefore, Roberts' first

assignment of error is overruled.

{¶ 18} Assignment of Error No. 3:

{¶ 19} THE TRIAL COURT ERRED IN DENYING ROBERTS' MOTION FOR RELIEF

FROM THE JUDGMENT UNDER CIV.R. 60(B).

{¶ 20} In his third assignment of error, Roberts asserts the trial court erred in denying -7- Warren CA2013-09-089

his motion for relief from judgment under Civ.R. 60(B) as there was evidence of "lack of

actual service." Roberts contends he has a meritorious defense if relief is granted, the

motion was timely, and that he was entitled to relief under Civ.R. 60(B)(5) based on the

court's "inherent power to relieve a person from the unjust operation of a judgment."

{¶ 21} Our standard of review of a court's decision as to whether to grant a Civ.R.

60(B) motion is abuse of discretion. First Fin. Bank, N.A. v. Grimes, 12th Dist. Butler No.

CA2010-10-268,

, ¶ 14. An abuse of discretion constitutes more than an

error of law or judgment; it requires a finding that the trial court acted unreasonably, arbitrarily

or unconscionably. Blakemore v. Blakemore,

(1983).

{¶ 22} To prevail on a Civ.R. 60(B) motion for relief from judgment, the moving party

must demonstrate that it (1) has a meritorious claim or defense to present if the motion is

granted; (2) is entitled to relief under one of the grounds stated in Civ.R. 60(B)(1) through (5);

and (3) has made the motion within a reasonable time, and, where the grounds for relief are

Civ.R. 60(B)(1), (2) or (3), not more than one year after the judgment, order or proceeding

was entered or taken. Aurora Loan Servs. v. Brown, 12th Dist. Warren Nos. CA2010-01-010

and CA2010-05-041,

, ¶ 35, citing GTE Automatic Elec. v. ARC Industries,

(1976); see also Wilkerson v. Wilkerson, 12th Dist. Butler No.

CA2013-06-089,

. Failing to meet one of the GTE factors is fatal, for all

three must be satisfied in order to gain relief. Grimes at ¶ 14. In the present case, the trial

court denied Roberts' Civ.R. 60(B) motion for relief from judgment on the basis that Roberts

failed to bring the motion within a reasonable time. What constitutes reasonable time

depends upon the facts of the case. L.N.V. Corp. v. Edgar, 12th Dist. Butler No. CA2011-10-

190,

, ¶ 22.

{¶ 23} In response to Roberts' motion for relief, Motorists Mutual asserted Roberts

contacted the law firm representing Motorists Mutual and spoke to personnel at the office in -8- Warren CA2013-09-089

2010, 2011, 2012, and 2013. Based on this allegation, the trial court held an evidentiary

hearing "relating to contact with [Motorists Mutual's attorney's] office by the Defendant." As

mentioned above, Stephenson testified at the hearing regarding the company's records and

explained that entries in those records indicated Roberts had engaged in conversations with

several account handlers over a period of time about the judgment against him. Roberts also

testified at the hearing and denied ever contacting the law firm or being aware of the

judgment against him. In light of Roberts' contact with the law firm, the trial court found

Roberts was aware of the judgment against him. In reaching this conclusion, the trial court

also rejected Roberts' testimony that he had never contacted the law firm and was unaware

of the judgment. Accordingly, the trial court denied Roberts Civ.R. 60(B) motion finding he

did not file the motion within a reasonable time after becoming aware of the default judgment.

{¶ 24} Roberts asserts that even if he had notice of a collection effort, his motion was

timely as it was made "within weeks" of finding out about the judgment against him.

However, the trial court elected to believe the testimony of Stephenson and the records

presented by Motorists Mutual over Roberts' claims. We find no abuse of discretion in this

regard. Accordingly, Roberts' inability to demonstrate the timeliness of his motion is fatal to

his claim for relief under Civ.R. 60(B). See Grimes,

at ¶ 14. It is therefore

unnecessary to determine whether there is a substantive basis for relief from judgment based

upon a failure of actual service of the summons and complaint.

{¶ 25} Roberts' third assignment of error is overruled.

{¶ 26} Assignment of Error No. 2:

{¶ 27} THE TRIAL COURT ERRED IN DENYING ROBERTS' MOTION TO VACATE

THE JUDGMENT DUE TO LACK OF SERVICE.

{¶ 28} In his second assignment of error, Roberts argues the trial court erred in

denying his motion to vacate the default judgment because he was not properly served with -9- Warren CA2013-09-089

the complaint and summons in this matter. Roberts contends that as a result of Motorists

Mutual's failure to perfect service, the trial court did not have personal jurisdiction over him,

and therefore the judgment against him is void.

{¶ 29} "In order to render a valid judgment, a court must have jurisdiction over the

defendant in the action." Beachler v. Beachler, 12th Dist. Preble No. CA2006-03-007, 2007-

Ohio-1220, ¶ 12. A court may acquire personal jurisdiction over the defendant either by

service of process upon the defendant, the voluntary appearance and submission of the

defendant or his legal representative, or by certain acts of the defendant or his legal

representative which constitute an involuntary submission to the jurisdiction of the court.

citing Maryhew v. Yova,

(1984). "If a plaintiff fails to perfect service

on a defendant and the defendant has not appeared in the action or waived service, a trial

court lacks the jurisdiction to enter a default judgment against the defendant." Ohio State

Aerie Fraternal Order of Eagles v. Alsip, 12th Dist. Butler No. CA2013-05-079, 2013-Ohio-

4866, ¶ 10, quoting Bendure v. Xpert Auto, Inc., 10th Dist. Franklin No. 11AP-144, 2011-

Ohio-6058, ¶ 16.

{¶ 30} A judgment rendered by a court that has not acquired personal jurisdiction over

the defendant is void, not merely voidable. Alsip at ¶ 10; see also In re B.P.H., 12th Dist.

Butler No. CA2006-04-090,

("[w]here service of process has not been

accomplished, any judgment rendered is void ab initio"). A party seeking to challenge a void

judgment must file a motion to vacate or set aside the judgment. Beachler at ¶ 18. The trial

court's power to vacate a void judgment does not arise under Civ.R. 60(B), as such motions

only apply to set aside voidable judgments.

Rather, an Ohio court has the inherent power

to vacate a void judgment. BAC Home Loans, LP v. Mapp, 12th Dist. Butler No. CA2013-01-

001,

, citing Patton v. Diemer,

(1988), paragraph four

of the syllabus. "An appellate court reviews the denial of a common law-motion to vacate - 10 - Warren CA2013-09-089

under an abuse of discretion standard." Alsip at ¶ 10.

{¶ 31} As a motion to vacate a void judgment does not need to satisfy the

requirements under Civ.R. 60(B), Roberts was not required to show that his motion to vacate

was timely filed. Rather, what is at issue in the present case is whether the trial court

obtained personal jurisdiction over Roberts by service of process.

{¶ 32} Service of process is consistent with due process standards where it is

reasonably calculated, under the circumstances, to give interested parties notice of a pending

action and an opportunity to appear. Hamilton v. Digonno, 12th Dist. Butler No. CA2005-03-

075,

, citing Samson Sales, Inc. v. Honeywell, Inc.,

(1981). Civ.R. 4.1 outlines the methods of obtaining service of process within the state

of Ohio, and it provides that "service of any process shall be by United States certified or

express mail unless otherwise permitted by these rules." Proper service of process by

certified mail is "[e]videnced by [a] return receipt signed by any person." Alsip at ¶ 11,

quoting Civ.R. 4.1(A). Civ.R. 4.6(D) permits service to be made by ordinary mail if the

attempted service by certified mail is returned unclaimed, and provides that "[s]ervice shall be

deemed complete when the fact of mailing is entered of record, provided that the ordinary

mail envelope is not returned by the postal authorities with an endorsement showing failure of

delivery." HSBC Mtge v. Ballard, 12th Dist. Butler No. CA2011-05-088,

, ¶ 8.

If the ordinary mail envelope is not returned, there is a presumption that service has been

perfected.

. However, such presumption is rebuttable by sufficient

evidence. Id.; see, e.g., Barnhart v. Sonny Emrick Excavating, 12th Dist. Fayette No. CA95-

06-016,

(Dec. 18, 1995); Patterson v. Patterson, 8th Dist. Cuyahoga No.

86282,

.

{¶ 33} In the present case, Motorist Mutual filed its complaint on March 29, 2010. A

copy of the summons and complaint were sent by certified mail to Roberts at 952 Dubois - 11 - Warren CA2013-09-089

Road, Franklin, OH 45005. It was returned "unclaimed." Thereafter, upon request, service

was reissued to Roberts by ordinary mail at the Dubois Road address on May 28, 2010.

There is no evidence in the record that the ordinary mail envelope was returned by the postal

authorities with an endorsement showing failure of delivery. Therefore, there is a rebuttable

presumption that service was perfected.

{¶ 34} Essentially, Roberts asserts that his affidavit presented sufficient evidence of

nonservice. Roberts attached his own affidavit to the motion to vacate, wherein he asserted

"[a]t no time did I receive notice or summons of the complaint in this case and it was

apparently sent to an incorrect address." He further averred that he did not live at the Dubois

Road address at the time, but rather resided on Franklin-Trenton Road until 2011. Roberts

also asserted that the complaint and summons could have been sent to his mother's

residence at 3916 Kenny Lane, Springboro, Ohio, where the criminal complaints were

served.

{¶ 35} In response, Motorist Mutual filed a printout from "Accurint" which it asserted is

"routinely utilized in this industry to locate persons." The report listed various addresses for

"Cody Roberts" including both the Kenny Road address and the Dubois Road address. This

report was not authenticated by a necessary affidavit. Motorist Mutual argued that this report

indicated Roberts resided at the Dubois address when service was perfected, and therefore

his affidavit failed to rebut the presumption of proper service. However, as the "Accurint"

report was unauthenticated, we find that this document alone was insufficient to refute

Roberts' claims of nonservice. See Whittle v. Davis, 12th Dist. Butler No. CA2013-08-153,

; Evid.R. 104(A).

{¶ 36} In addition, other evidence in the record suggests Roberts may not have

resided at the Dubois address where he was served. Motorists Mutual filed certified copies

of several records from the Ohio Registrar of Motor Vehicles with its post-hearing brief. - 12 - Warren CA2013-09-089

These records indicate that for much of the relevant time period, Roberts reported his

address as 3916 Kenny Lane. In early 2007 and 2008, Roberts did report a Dubois Road

Court address, however, it was a different house number than where the summons and

complaint were sent in this case. Moreover, as noted by Roberts, the notice of the default

judgment hearing, as well as the entry granting default judgment were sent by ordinary mail

to the Dubois Court address, but were later returned by the postal authorities as "not

deliverable." These documents were sent in August and September 2010, just a few months

after service was sent by ordinary mail in May 2010.

{¶ 37} We find that Roberts' affidavit and the documentary evidence in this case

created a factual issue as to whether the court had jurisdiction over Roberts at the time

default judgment was entered. The conflicting evidence should have been resolved by an

evidentiary hearing. See Patterson v. Patterson, 8th Dist. Cuyahoga No. 86282, 2005-Ohio-

5352, ¶ 23 (party's contention that he resides at different address than where summons was

sent warranted hearing on whether rebuttable presumption of proper service arising when

serving party complies with Civ.R. 4.6(D) had been rebutted). The trial court's decision

denying Roberts' motion to vacate the void judgment only found that service was perfected

based on the fact that "certified mail service was returned unclaimed and ordinary mail

service was then perfected and not returned." However, the fact that ordinary mail service

was not returned only created a presumption of perfected service, but such presumption is

rebuttable. The trial court failed to address whether Roberts had rebutted the presumption of

perfected service. Based on the record before us, we find there was conflicting evidence on

the issue of service which should have been resolved by an evidentiary hearing.

{¶ 38} Motorists Mutual contends the trial court's finding that Roberts' testimony at the

hearing was not credible similarly permitted a finding that his affidavit as to service was not

credible. We reject such an argument. As mentioned above, it is clear from the record that - 13 - Warren CA2013-09-089

the court did not decide this issue. Rather, the trial court granted the evidentiary hearing, and

the parties were so notified that the sole purpose of the hearing was to consider evidence of

Roberts' contact with Motorists Mutual's attorneys, and the trial court only heard testimony on

this limited issue. Furthermore, we note a lack of service cannot be overcome by evidence

that Roberts had actual knowledge of the judgment against him. Nicholas v. Deal, 12th Dist.

Butler No. CA2002-10-242,

("It does not matter that a party has actual

knowledge of the lawsuit and has not in fact been prejudiced by the method of service").

{¶ 39} In accordance with the foregoing, we find that the trial court abused its

discretion in overruling Roberts' motion to vacate judgment without holding an evidentiary

hearing. Roberts' second assignment of error is therefore sustained.

{¶ 40} The trial court's decision to deny Roberts' motion for relief from judgment

pursuant to Civ.R. 60(B) is affirmed. However, to the extent the trial court's decision denied

Roberts' motion to vacate a void judgment, the judgment of the trial court is reversed. This

cause is remanded with instructions to hold an evidentiary hearing to determine if Roberts

was properly served at the outset of the original action.

{¶ 41} Judgment is affirmed in part, revered in part, and remanded for further

proceedings.

RINGLAND, P.J., and PIPER, J., concur.

- 14 -