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).