Financial discovery is the fact finding/document gathering part of the divorce process. Financial discovery can be time consuming and may be the most expensive part of a divorce process for a wealthy family. Financial discovery will most likely happen over time. The amount of time depends on whether or not the parties are being cooperative. It is a process, not an event, and requires ongoing document requests until all necessary information is gathered.
For the most part, discovery takes place outside the courtroom, with parties exchanging written information and sitting through face-to-face questioning sessions (called “depositions”). However, if the parties can’t agree on what should be handed over in discovery, a judge may have to resolve the dispute.
The kind of information that a party can force someone else to reveal — is generally very broad, though there are some limits. A party may ask for facts about the case, for the identity of others who may know something about the case, for documents relating to the case, and for inspection of physical objects or property connected to the dispute. Discovery can be used to seek information not only from the other party, but also from people and businesses that aren’t involved in the legal proceedings.
There are four types of formal tools that are frequently used in financial discovery during divorce. They are:
- In a deposition, one party or that party’s lawyer conducts face-to-face questioning of the other party or a witness to the dispute. The person being questioned (the “deponent”) must answer under oath, and the answers are recorded for later use at trial. If the deponent cannot testify at trial, the questions and answers might be read to the jury as evidence. If the deponent does testify and gives different answers at trial from those he gave during the deposition, the questions and answers can be used to show the jury that the witness changed his story.
- Requests for production of evidence.In a request for production of evidence, one party asks the other for physical evidence related to the dispute. Requests for production are usually used to gather pertinent documents, such as contracts, employment files, billing records, or documents related to real estate. However, these requests can also be used to inspect physical objects or property — for example, in a dispute about whether a contractor properly repaired a homeowner’s roof, the contractor’s lawyer might ask to have a roofing expert inspect the work.
- Interrogatories are written questions one party sends to the other to be answered under oath. The answers can be used at trial in the same way as deposition answers — to challenge a party who changes her story later.
- Requests for admission.In a request for admission, one party asks the other party to admit, under oath, that certain facts are true or certain documents are genuine. These requests are generally used to save time and to narrow the issues that have to be proved at trial.
We work with our clients to identify and collect the financial data pertinent to the divorce. From the original data gathering we evaluate any key financial concerns related to divorce – such as income and deductions, living expenses, assets, and liabilities. This process will likely tip us to other information we will need to request.
Wellspring Advisors work with the attorney to compile complete and comprehensive document requests, interrogatories and depositions to insure no stone goes unturned and the right questions are asked to help level the playing field. Good financial discovery will give you the peace of mind that no assets were hidden. Knowledge is power in the financial negotiations of divorce and formal discovery may be the only way to gain the knowledge you need.