G.M. McKelvey Co. v. General Casualty Co. of America
166 Ohio St. 401, O.O.2d 345, 142 N.E. 854 (1957)
- McKelvey had fidelity insurance. That means that if an employee embezzled money, McKelvey could recover from its insurer.
- McKelvey suffered a loss, and was able to obtain written confessions by two employees that admitted misappropriation of funds.
- After making the confessions, the employees left town in a hurry, and the police were unable to find them.
- General refused to pay. McKelvey sued.
- At trial, McKelvey attempted to introduce the signed confessions. General objected on the grounds that they were hearsay.
- General argued that the employees were not available for cross-examination, so their out of court statements were hearsay.
- The Trial Judge excluded the statements.
- The Trial Court found for General. McKelvey appealed on the grounds that the evidence had been improperly excluded.
- The Appellate Court reversed and found the written confessions to be admissible.
- The Ohio Supreme Court affirmed the Appellate Court.
- The Ohio Supreme Court looked to the common law and found that when a witness is unavailable, and where such witness is the only source from which his evidence can be obtained, then as a matter of necessity a declaration by such witness against his interest should be admitted into evidence.
- Because no one would make a statement against their interest unless they believed it to be true. Therefore there isn’t an absolute need for cross-examination.
- Interestingly, under the old common law, the only statements that were admissible were those against pecuniary interest (aka $$$). Statements against penal interest were not admissible. So copping to a crime that will get you jail time was treated differently than copping to something that is going to cost you money.
- In this case, the Court found that since McKelvey could have sued the employees for reimbursement, their statements were theoretically against pecuniary interest even though they hadn’t been sued yet.
- This case as decided under the common law. Today, it would be governed by FRE 804(b)(3).