Missouri Pacific Railroad Co. v. Austin

Citation: Missouri Pacific Railroad Co. v. Austin, 292 F.2d 415 (5th Cir. 1961).

Austin's company, Western Wood Product, was awarded a claim for $2,500 against the railroad in an ICC hearing. The railroad refused to pay the claim, contending that Western Wood had assigned all of its assets, including the claim, to Aviation Corp. of Texas. Since the railroad had previously received a judgment of $5,000 against Aviation Corp. for unpaid freight, the railroad simply deducted the claim as a set off against the judgment from Aviation. Austin claimed that, while Western Wood had assigned some of its assets to Aviation, it did not assign that claim.

As proof of their contention, the railroad offered into evidence an electronically prepared Dun & Bradstreet report, quoting Austin as stating that Aviation had purchased all of the assets and had assumed all of the liabilities of Western Wood. Since Dun & Bradstreet was engaged in the business of compiling these types of reports upon which other companies relied, these reports were held to be kept in the regular course of business. It was also established that the investigator who interviewed Austin was unknown. Austin objected to the report on hearsay grounds, and his objection was sustained. The trial court concluded that, since the source of the information was not before the court, the evidence could not be admitted.

The Fifth Circuit affirmed, holding that even if the report was made in the regular course of business, there was no evidence of how or when the information was recorded. To be admissible, the court noted, the act in question must be recorded at or near the time it occurred. Here, the interview took place in June 1953, and the report did not come out until August 1954. Without evidence as to the method of preparation or nature of the record, the fourteen months between the interview and the release of the report was too long a period to guaranty reliability. The evidence was therefore properly excluded.