Content

An occasional review of fascinating matters in New Jersey law – by Justin Marcus Smith

The Paper Chase: Get it in Writing

Sunday 6 March 2011 - Filed under Evidence + Going to Court + Record Retention

With the advent of all kinds of new ways of communicating, whether through e-mail, SMS text messages, or social-networking accounts, it is becoming all-too-common for people and even business entities to find themselves in a legal dispute without hard evidence. This is happening everywhere and seemingly more and more often, from the average consumer in a dispute with his or her phone or cable company, to large, traditionally disciplined, and traditionally competent enterprises such as banks.

“Paperless” billing, “paperless” bank statements, and even “paperless” contracts are a great convenience to all beyond reducing our consumption of the earth’s precious resources. However, these “paperless” modes of doing business lack the type of permanence that ordinary people of average discipline and even businesses of average professionalism need most to protect their rights and preserve potential claims and defenses over the long haul.

Another common issue is the failure to document a dispute appropriately and responsibly as it unfolds. You probably won’t be able to convince a judge that a dispute is not your fault on the basis of having had 18 months of phone conversations with the other side if all you have to show for it is your own testimony: “But I called customer service about 50 times!” Document your interactions. Write old-fashioned hardcopy letters whenever possible that say something like, “Per my phone conversation with your call center agent [NAME] on [DATE], I informed you that I do not owe this money because….” Be sure to state specifically why you think you are right, e.g., the account is closed, or you never ordered the product or service, or what-have you. Include how the other side responded after the prior interaction. Keep and attach their letters to you. Send your letters by certified mail, return receipt requested, or by FedEx, or by some means that offers a verifiable and accepted way to track and document the fact that you communicated with the other side. If you send e-mails, preserve the e-mails, possibly as PDFs, but remember that an e-mail is not quite as convincing and probably less effective than an old-fashioned letter sent through the mail and addressed to the most responsible party to the dispute such as a department manager or business officer.

Most human beings are simply lousy at record-keeping. An individual person’s lack of discipline keeping old-fashioned hardcopy documents is likely to translate into even worse large-scale loss of electronic documents or complete failure to keep any electronic documents at all. Electronic statements or other electronic representations of your dealings and interactions with other people and businesses are simply more likely than old-fashioned paper documents to become misplaced, misfiled, intentionally deleted, or accidentally destroyed by virus or user error, especially with the passage of time and the accompanying replacement and upgrading of computer equipment.

Remember the old adage: “Out of sight, out of mind.” Electronic documents are simply more “out of sight” than the hardcopies you used to keep in your home or office, and therefore they are more “out of mind” when it comes to exercising the discipline required to retain and preserve them over time.

Further contrast the situation with old-fashioned paper documents stored in various locations in an ordinary house or at a brick-and-mortar business premise and the modern, “virtual” alternative. It is far less common for a person or business to lose all of their hardcopy documentation through theft, fire, or other loss of the entire building than to lose all such electronic materials through the loss or destruction of a single computing or smart-phone device.

Although a comprehensive records retention and disaster recovery plan appropriate to your needs is beyond the scope of this article, the following tips may serve as a basic starting point:

1. Capture it: Develop a personal or business plan for retaining important records. Make a list of every business entity you deal with including banks, insurers, cell phone service providers, and so forth. If you get statements or other documents from such entities on a regular basis, make a note of the day of the month the statement is usually issued. Establish some standard electronic filename convention that works for you, such as, “[BUSINESS NAME]_[DATE]_statement”.

2. Convert it: If you have a document in hardcopy form to begin with, consider keeping that original hardcopy in addition to scanning it into a standard electronic format such as the Adobe Acrobat PDF file format. In general, if you have hardcopy documents, it is a bad idea to discard them. Many people have intentionally discarded hardcopy documents after converting them to electronic form, only to lose the electronic copies later, whether by accident or because the conversion was not done properly in the first place. Convert your electronic records, for example, e-mails, to Adobe Acrobat PDF files if they are not already in that form. Adobe Acrobat PDFs are relatively difficult to alter and it is a file format that is likely to remain popular and accessible for many years to come.

3. Preserve it: Make back-ups of your important electronic records on an ongoing basis. Online backup services such as Mozy and Carbonite offer the ability to backup large amounts of data with the added advantage that the backup is off-site. So if a fire, flood, earthquake, or other natural disaster destroys your house or business, your off-site data will probably be unaffected by the catastrophe. Some services provide “snap-shots” of your data over time, so that if your data becomes damaged or corrupted, you may be able to go back to an older copy of the same data. This “snap-shot” feature may also be useful for “version control” and for referring to older versions of the data that are also different from the newer versions in some meaningful or important way.

The key takeaway is that if you find yourself in a Civil court case, you need to prove what you say with something more solid than the mere words that come out of your mouth, reliable as those words may be. Judges find it very difficult to decide cases where it boils down to one person’s word against the other person’s word with no signed written contract, no bills, no letters sent from one party to another, and no other independent evidence of any kind to decide the case. Make sure you can go to court with hard proof that backs up what you say.

Again, the above are only very general recommendations. In some situations, an individual or organization may appropriately choose to discard certain kinds of information on a regular basis as a matter of policy. The recommendations here may not be suited to your particular circumstances and are not intended to be legal advice suited to your particular circumstances. Please consult professionals such as information systems consultants, tax professionals, accountants, or lawyers to develop and execute records retention procedures appropriate to your specific business and legal needs.

See the following IRS and State of New Jersey pages and publications for more information on record keeping and retention:

http://www.irs.gov/businesses/small/article/0,,id=98575,00.html

http://www.irs.gov/publications/p552/index.html

http://www.irs.gov/publications/p583/index.html

http://www.state.nj.us/treasury/taxation/taxtips2011/taxtip0201.shtml

If you are a resident of New Jersey or do business in NJ, including Morris County (e.g., Morristown, NJ; Madison, NJ; Chatham, NJ; Florham Park, NJ, Harding Township, NJ), Somerset County, Union County (e.g., Summit, NJ), Essex County, Passaic County, Bergen County, or Hudson County, seek local legal counsel (an attorney or lawyer) to be certain you are aware of local data retention rules and laws.

The author is not responsible for any errors of the IRS or State of New Jersey in their respective publications. The IRS and the State of New Jersey may update their publications periodically. Be certain to refer to the most recently published information. The author has no business interest in Mozy or Carbonite or any other product or service vendor mentioned by name, and does not endorse or recommend such product or service over competing services.

2011-03-06  »  admin

  • Browse in category: Evidence - Going to Court - Record Retention -