STATE OF NORTH CAROLINA
v
.
JEFFREY B. FRIERSON
Attorney General Roy A. Cooper, III, by Assistant Attorney
General Daniel S. Johnson, for the State.
Causey Law Offices, by Ames C. Chamberlin for defendant-
appellant.
HUNTER, Judge.
Jeffrey B. Frierson (“defendant”) appeals from a judgment
sentencing him to a suspended term of five to six months in prison
upon his conviction of embezzlement. Defendant claims the trial
court erred in admitting certain records into evidence under the
business records exception to the hearsay rule because the State
failed to lay a proper foundation. For reasons stated herein, we
find no error.
Defendant was charged with embezzling money belonging to J.T.
Enterprises, Inc., a management company that runs several
McDonald's restaurants, including the one at issue in this case
located at the intersection of South Elm-Eugene Street and Lee
Street in Greensboro, North Carolina. Evidence at trial tended to
show that defendant was promoted to manager of this McDonald's inJanuary 1999. As manager, defendant's responsibilities included
overseeing the day-to-day operations of the restaurant. Johnny
Tart (“Mr. Tart”) is the owner of this McDonald's and President of
J.T. Enterprises, Inc.
At trial, Mr. Tart explained the procedure for handling and
depositing cash receipts for the restaurant where defendant was
employed. According to Mr. Tart, each shift manager takes the cash
receipts from the registers for that shift's sales, counts the
money and fills out a deposit slip for the checking account. The
deposit slip and the money are then put into a bag, sealed, placed
in a safe and locked up. After placing the money and deposit slip
in the safe, the shift manager logs into the restaurant's computer
system using an identifying code and enters the deposit amount.
Thereafter, the money and deposit slips are taken from the safe to
the bank for deposit. According to Mr. Tart, at the particular
McDonald's where defendant was employed, defendant was the only
manager who had a car to drive to the bank, so he was given
permission to take all of the deposits from the safe to the bank.
Mr. Tart further testified that the only other person who could
have taken deposits to the bank from that McDonald's was Mike
Teeple, an operations manager in charge of four McDonald's
restaurants and employed by J.T. Enterprises, Inc.
Once the bank deposit is made and a receipt of the deposit
from the bank is received, the deposit is “validated” in the
restaurant's computer. According to Mr. Tart, defendant was the
only manager at the McDonald's restaurant where he was employed whowas able to validate deposits. This validating procedure is merely
a way of confirming that the cash has gone from the safe to the
bank and that the total amount on the deposit slip from the bank
matches the amount that was supposed to have been deposited.
After a deposit slip is validated, a cash sheet for that day
is printed showing the amount of total sales, receipts and
deposits. The deposit slips are then stapled to the cash sheet and
validation sheet. The cash sheet, validation sheet, and deposit
slips are then sent to the J.T. Enterprises, Inc. office where the
deposits are entered into the checkbook so that a running balance
can be kept for check writing purposes.
The State offered evidence in the form of validation reports,
alleged counterfeit deposit slips, and First Union Bank CAP account
statements to show that defendant validated deposits that the State
alleged were never deposited into J.T. Enterprises, Inc.'s account
at First Union Bank. Mr. Tart discovered that certain deposits
that were supposed to have been made, according to the alleged
counterfeit deposit receipts and validation sheets, were never
made, when a check bounced on the J.T. Enterprises, Inc. account
and when he reviewed bank statements which failed to show some
deposits for which he had alleged counterfeit deposit receipts.
Mr. Tart testified that when he reviewed the bank statements, he
noticed that he was missing deposits for $958.45, $645.87,
$2,128.65, $1,288.24, $933.17, and $936.02. These cash amounts
were supposed to have been deposited on 30 August 1999, 19September 1999, 25 September 1999, 8 October 1999, 12 October 1999,
and 16 October 1999, respectively.
Angie Barnett (“Ms. Barnett”), a commercial teller at First
Union Bank where the McDonald's deposits were made, recognized
defendant at trial since he was in the bank on a daily basis to
make deposits for McDonald's. She testified that on 18 October
1999, defendant entered the bank, broke into her line, looked
fidgety and nervous, handed her a folded deposit slip and asked
her to drop it in the drop box, where the deposit receipts were
kept for deposits made after the bank had closed. Later that day,
Ms. Barnett inspected the folded deposit slip dated 16 October 1999
for $936.02 and noticed that this deposit slip did not look like
other deposit slips used by First Union _- the boldness of the
print of the stamp was different and it was torn instead of
perforated.
The defense presented evidence that other employees besides
defendant would travel to the bank and make deposits for the
restaurant. Defendant testified that occasionally Mike Teeple, the
operations manager, would make deposits, call defendant at the
restaurant, and tell him to validate the deposit when defendant had
not seen the receipt from the bank.
Defendant was charged in a true bill of indictment with
embezzlement. On 28 March 2001, a jury found him guilty as
charged. Defendant appeals from the judgment entered upon the
verdict. Defendant contends the trial court erred in admitting into
evidence the McDonald's franchise's deposit slips (both allegedly
counterfeit and valid), validation reports, and First Union CAP
account statements under the business records exception to the
hearsay rule because the State failed to lay a proper foundation
for the records' admission. For the following reasons, we conclude
that these exhibits were either offered for a non-hearsay purpose
or were properly admitted under the business records exception to
the hearsay rule after the State laid a proper foundation for their
admission.
At the outset, hearsay is defined as “a statement, other than
one made by the declarant while testifying at the trial or hearing,
offered in evidence to prove the truth of the matter asserted.”
N.C. Gen. Stat. § 8C-1, Rule 801(c) (2001). “If a statement is
offered for any other purpose, it is not hearsay and is
admissible.” State v. Dickens, 346 N.C. 26, 46, 484 S.E.2d 553,
564 (1997). Hearsay is inadmissible unless it falls within a
recognized exception to the hearsay rule. State v. Parker, 140
N.C. App. 169, 539 S.E.2d 656 (2000), appeal dismissed and disc.
review denied, 353 N.C. 394, 547 S.E.2d 37, cert. denied, 532 U.S.
1032, 149 L. Ed. 2d 777 (2001).
Business records are admissible as an exception to the hearsay
rule if “made in the regular course of business, at or near the
time of the transaction involved, and . . . authenticated by a
witness who is familiar with them and the system under which they
were made . . . .” State v. Galloway, 304 N.C. 485, 492, 284S.E.2d 509, 514 (1981). It is unnecessary for the witness who
authenticates the records to be the person who made them. State v.
Wilson, 313 N.C. 516, 330 S.E.2d 450 (1985). Our Supreme Court has
stated that “if the records themselves show that they were made at
or near the time of the transaction in question, the authenticating
witness need not testify from personal knowledge that they were
made at that time.” Id. at 533, 330 S.E.2d at 462.
In the case sub judice, we initially note that the alleged
counterfeit deposit slips were offered to show that they existed so
that the jury could consider them as circumstantial evidence in
determining whether defendant embezzled from his employer and
concealed it by falsifying deposit records. A statement is not
hearsay where it is only offered to show that the statement was
made, and not to prove the truth of the statement. State v.
Mitchell, 135 N.C. App. 617, 620, 522 S.E.2d 94, 95-96 (1999).
Therefore, the alleged counterfeit deposit slips do not constitute
hearsay. Because we conclude the alleged counterfeit deposit slips
were offered for a non-hearsay purpose, we need not address whether
the State laid an adequate foundation for their admission under the
business records exception to the hearsay rule.
The valid deposit slips were offered into evidence for the
purpose of comparing them with the alleged counterfeit deposit slips in
order to show that the latter were in fact fake. Since the valid
deposit slips were offered for their truth, they are hearsay
evidence. Mr. Tart, owner of the McDonald's in question and
familiar with the records and the franchise's system of filling outdeposit slips, testified that the deposit slips were filled out at
the end of each work shift and usually took place three times a
day. Mr. Tart further testified that the deposit slips were made
and kept in the ordinary course of business. These records were
dated and therefore it was unnecessary for a witness to testify
from personal knowledge that they were made at or near the time of
the transaction in question. See Wilson, 313 N.C. 516, 330 S.E.2d
450. We conclude the State laid an adequate foundation for the
deposit slips and the trial court did not err in admitting them.
We now turn to the admission of the validation reports. The
validation reports constitute hearsay since one of the purposes for
which they were offered was to identify the “preparer” (person who
prepared the deposit), “depositor” (person who carried the deposit
to the bank), and “validator” (person who confirmed that the cash
was actually deposited into the bank). Therefore, the validation
reports were being offered to prove the truth of the matters
asserted.
It is undisputed that the validation reports would fall under
the business records exception to the hearsay rule. N.C. Gen.
Stat. § 8C-1, Rule 803(6) (2001). However, defendant argues the
State failed to lay a proper foundation for these records. We
disagree.
In the instant case, Mr. Tart testified that the validation
reports were made in the ordinary course of business and described
in detail the system in which the validation reports are prepared,
including the people who are allowed to prepare such reports. Defendant asserts that since Mr. Tart did not testify as to when
the records were made, the validation reports were improperly
admitted. However, the records in question have dates listed
showing that the records were created at or near the time of the
transactions in question and therefore were self-authenticating as
to the time at which they were made. See Wilson, 313 N.C. 516, 330
S.E.2d 450. There was evidence that the validation reports were
made and kept in the ordinary course of business, were
authenticated by a witness who was familiar with them and the
system in which they were made, and the records were created at or
near the time of the transactions involved. Therefore, the State
laid a proper foundation for these records and the trial court
accordingly, did not err in admitting them.
Defendant finally assigns error to the trial court's admission
into evidence the McDonald's First Union Bank CAP account
statements because defendant claims the State failed to lay a
proper foundation for their admission. The bank statements were
offered into evidence for the purpose of showing the absence of
some of the purported deposits and to show the true status of the
company's deposits. Thus, these bank statements were offered for
the truth of the matters asserted and therefore, constitute
hearsay. The State used Ms. Louise Joyce (“Ms. Joyce”), an
operations consultant with thirty-two years of experience with
First Union Bank, to lay a foundation. Ms. Joyce testified that as
an operations consultant, she was familiar with how the record-
keeping system at First Union works and that the First Union CAPaccount statements were made and kept in the ordinary course of
business. She further testified that the statements being offered
into evidence were made or printed 31 August 1999, 30 September
1999, and 31 October 1999. Thus, we conclude that a proper
foundation was laid and these bank statements were properly
admitted.
Because defendant offers no argument in support of his
remaining assignments of error, they are deemed abandoned. N.C.R.
App. P. 28(a), 28(b)(6).
No error.
Judges GREENE and TIMMONS-GOODSON concur.
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