How to Proceed When Facing Demands for Legal Documents
Family law litigation involving one or both spouses’ family members is becoming more common. Unfortunately, until recently, document disclosure in this context had not been considered by the court (or at least there were no reported decisions). However, recently in Etemadi v Maali, 2021 BCSC 1003, the court had occasion to consider this very issue. In that case, the concept of the “Etemadi family” had been relied upon by the wife throughout the proceedings in the Supreme Court as the basis for various claims against property the husband’s parents said belonged to them. In making her very broad claims against almost every asset she was aware of, regardless of ownership, the wife cast the net wide in the demand for documents she made.
The wife seemed to base her claims against the parents’ assets on the fact that the parents were generous to the parties while they were married. The parents argued that they should not be “looped in” with the parties to justify an order for production of documents for which no basis has been provided.
Throughout the litigation, the wife’s strategy had been to make claims to any assets that she had knowledge of, regardless of ownership or use, and require the husband’s parents to disprove her interest in these assets. Her claims continued to expand with time despite the lack of legal basis in the pleadings, as did her demand for documents.
The parents had made full disclosure relating to all real property, which the wife had claimed an interest in; however, many of the requests dated back up to 18 years. Some of the documents requested were not available as a result but despite being advised of this, the wife persisted with her demands.
She demanded a “complete” Form 8 Financial Statement, listing all of the parents’ “global assets”.
She also demanded the parents’ bank records without any basis for those claims. In fact, the wife’s own evidence was that she believed the husband’s parents have purposely abstained from disclosing their true net worth, because in doing so it would show not only that they have the assets or funds needed to lend funds to the husband for an interim distribution, but “potentially that the husband had an interest in these properties”.
The case law is clear about this approach to demands for disclosure – a party cannot demand documents simply because he or she is suspicious of wrongdoing: Mossey v. Argue, 2013 BCSC 2078.
Master Keighley considered each category of document requested from the parents and in refusing to order production found that the wife’s evidence in support of various claims was either non-existent or “confusing and inconsistent”. He also held that the pleadings did not provide the basis for the claims and where clarity was needed, examinations for discovery may be used to clarify matters before further document requests would be ordered.
With respect to the expansive Form 8 Financial Statements sought from the parents, the court noted that “the pleadings establish the parameters of the litigation. The parents are not obliged to list assets which are not the subject of claims made against them”. As such, the wife’s application in this regard was dismissed.
Given the increasing frequency with which parents are loaning or gifting money to their children to purchase real property or even just assisting them financially, and the claims that often arise as a result, this decision provides helpful guidance to parties facing expansive demands for documents from the third party family members. Orders for document production will be limited by the pleadings and the evidentiary basis for the claims made. Overly broad document productions demands based on mistrust and/or an effort to find assets against which a party may lay claim to will not be countenanced by the court.
If you are facing demands for documents from third party family members, or looking for help with any family law issues, please reach out to any member of our LK Law family group.
This article is intended to be an overview of the law and is for informational purposes only. Readers are cautioned that this article does not constitute legal or professional advice and should not be relied on as such. Rather, readers should obtain specific legal advice in relation to the issues they are facing.