Be quick with disclosure of financial documents amid divorce: Gelman
By Mia Clarke, Associate Editor
To put it mildly, divorce is never fun, says Toronto family lawyer Lisa Gelman.
Your life is in turmoil, the children are upset, and your finances are in limbo, says Gelman, principal of Gelman & Associates.
And when she asks her clients for their monthly bank and credit card statements in order to prepare their divorce documents, they are frequently incensed: “You want me to turn over financial documents to make it even easier for my crazy ex to get their hands on my money?” they tell her.
Clients often feel like they’re playing into their ex-spouse’s hands by caving in to requests for financial information, she says.
But holding out on principle, or for revenge, is just going to needlessly complicate and prolong the process, Gelman tells AdvocateDaily.com.
“The courts require those documents to make decisions, and you’ll inevitably have to turn them over anyway,” she explains.
While turning over requested documents may be a painful move, Gelman says freedom is the end game.
“There's freedom after breaking through to the other side with as minimal collateral damage as possible. The ‘other side’ means re-establishing your life after settling the issues of custody, access, child support, spousal support and property division,” she says.
The “collateral damage” is the financial and emotional cost of going through the process, says Gelman.
“The sooner one gets to the other side, the better,” she says.
And to do it as quickly as possible, Gelman says, a good rule of thumb is “more is better.”
“In other words,” she says, “the more disclosure you provide, can only help you because there's often suspicion and mistrust — especially if there's adultery involved or things of that nature. When you don’t provide full disclosure, it gives more fodder to say, 'Oh, he cheated on me with a secretary. What else is he trying to cheat me out of?'”
The courts have established repercussions for not providing a clear picture of one’s finances, says Gelman.
In this 2018 case, for example, where the husband failed to produce financial disclosure in a timely manner, the judge wrote, “At best, the failure to disclose by [the husband] was both an inconvenience and a distraction; at worst his failure to disclose was contemptuous of the court process, resulting in both delay and the failure of these parties to settle their issues, as most of the 2017 conferences concentrated on disclosure rather than settlement and the respondent’s disclosure was not substantially complete until the trial scheduling conference.”
And in this 2018 case, the wife claimed the husband failed to produce reasonable disclosure to back up his position. The judge said the husband “has been less than forthright in his disclosure obligations. He has delayed in producing a financial statement … The difficulty with [his] position is that it is not backed up with convincing paperwork or documentation. The Court is left simply being asked … to believe him … I have no convincing basis on which to do so.”
“The wife didn’t believe the husband, and neither did the court,” says Gelman.
And those are just the recent cases, she says.
“Every month, there's case after case where couples have wasted their money because of insufficient disclosure,” says Gelman. “It wasn't hard to find these cases because they’re a dime a dozen.”
She says it’s important to remember that "time is money" — every phone call and email to one’s lawyer is logged.
“That lawyer has to talk to the person, email or fax the other lawyer, respond, read the response to their letter, call their client back and talk to them for a while — that's all billable time.”
All that extra time and money is spent for the same result in the end — the documents inevitably have to be turned over anyway, says Gelman.