Q. I am representing myself in my divorce. My husband is self-employed. I know he earns more than he claims. We have two children, and I haven't worked in seven years. I feel so stupid now, but I don't know any of the details of his business. How do I get the information to prove his true income, and what should I ask for?
It is entirely common that the "out-spouse" knows little about the community property business or estate, or even the family's true income. Within the web of trust, why would you need to know specifics? Families survive and thrive when one partner is the primary wage-earner, and the other is in charge of managing everything else. You aren't stupid, your just acted honorably.
If "his" business" came into being during your marriage, it is "your" business; if not, the community estate may nonetheless be entitled to participate in increases in its value during the marriage.
The answer to your question depends upon who or what has the information you need. Is some information likely to be in the hands of his CPA, a bookkeeper, his customers, a corporation, or someone else?
There are three common methods for obtaining documents in divorce litigation. They are sometimes referred to as "inspection demands":
- A "Demand for Production" directed to a party to the proceedings per California Code of Civil Procedure (CCP) Section 2031.010, et seq.
- A "Subpoena Duces Tecum" directed to a party, or another person or entity per CCP § 1987, et seq., that seeks only properly "authenticated" records.
- A "Deposition Subpoena" together with a production demand directed to a party or another person or entity (i.e., the "PMK" - person most knowledgeable) per CCP § 2025.010, et seq., where live testimony and cross-examination about the records will occur.
In this Blog I discuss "Demands for Production," but the suggestions below may give you some ideas as to subpoenas to third parties.
Drafting Inspection Requests In Family Law Proceedings
Don't take a shot-gun approach to requesting information - be surgical. You can always make subsequent requests for information. Use the 80-20 principle in deciding what you really need by way of discovery.
I find that the quality and thoroughness of responses to production demands, particularly those directed to the parties themselves, is inversely proportional to how burdensome they are to respond to. Production requests cause a lot of resentment in the responding party because it takes a lot of time to track documents down, and one rightly feels as if they are under a microscope. Similarly, the more questions the greater the likelihood of objections. There is an increasing risk that the responding party will "blow you off" by doing a cursory and incomplete search and/or production.
Avoiding Motions and Commotions
I remember an experienced attorney against whom I cut my teeth in the early 1980's, David Franklin CFLS. He would caution me against making "motions and commotions," which as I recall meant avoiding situations where I might whine to the court about some perceived unfairness or lack of cooperation on the part of the other side (usually his) - because whining only works before age 11. Discovery disputes typically involve a lot of grumbling that judges find unseemly.
You don't want to be forced to file a Motion to Compel a party to comply with their discovery obligations - these are expensive and time-consuming, and discovery motions can stall getting the documents for months. You do not want to get bogged down in motions to compel full compliance with your inspection demands, so you should consider how to make it easier for the other party to comply. This includes not asking for 50 different categories of items.
For instance, there is no limit on the number of requests you can make in a Demand for Production, while you are limited to asking not more than 35 special interrogatories (although you need only serve a proper declaration stating why you need more). This doesn't mean that it is therefore okay to make 50 production requests. If you are forced to file a motion to compel further production, consider that family court bench officers hear them on their "short-cause" calendars. If you demand 50 categories of items and you get 45 objections or refusals, the court is going to have to rule on 45 different questions. This may generate dissonance on the part of a judge, particularly if - as a self-represented party - your questions aren't crafted clearly. While courts can sanction non-complying parties by awarding attorney fees, you are only entitled to fees for the work actually performed by a lawyer. You may recover Family Code section 271 sanctions, however, but this type of sanction requires fairly egregious misconduct.
If the court believes your questions are oppressive or have an improper purpose, you could be the one who gets spanked. By the way, if you've already caused your judge to feel that you are a difficult litigant, be even more wary about over breadth - and be able to formulate a reason why you need what you want.
My practice is to try very hard to avoid requesting more than fifteen or so categories at once.
Remember, each request is supposed to be full and complete of itself (i.e., not reference other requests) and you should avoid disguising multiple requests by jamming a bunch into one run-on request. Parse through the list below to select those most appropriate to your marital circumstances, and if you are going to break them down into more than one set of requests, prioritize what is most immediately important to you. Early on, in the case these typically are the things that would help you make (or resist) a request for support orders.
Also, you will need to consider what time frames are actually relevant. I do not recommend covering a period that includes the entire length of marriage, unless there is something specific you are investigating. Much of that information isn't important to a court, and it is oppressive to ask for things that have no reasonable value to you. You will always want items from and since the date of separation, however. Whether you go back for the prior three years (or more) depends - for example, if you are tracking transactions relating to a particular asset, the time period may well include everything from its date of acquisition on.
Things You Might Want to Request
- Personal and corporate income tax records, possibly including W-2's, K-1's, and 1099s as applicable
- Personal and business financial statements
- Profit and loss statements
- Loan documents for the family home, other real estate, lines of credit, and cars and the like
- Bank statements. While people commonly ask for canceled checks, and they may be important to a forensic accountant (particularly if they are performing a business valuation as well as a "cash available for support" analysis), unless the checks are attached to the monthly statements it is a real pain for people to copy each check front and back. I will often start with the statements themselves, and then if I find transactions that interest me I'll do a follow-up request as to them. It is extremely expensive to subpoeana these from a bank, since they charge for time and copies. What your ex pays for his cable bill won't be nearly as interesting to the Court as you might find it (because you've had to cancel Showtime)
- Brokerage account statements. I am more likely to ask for canceled checks for these accounts, because transactions tend to be larger and fewer
- Retirement account statements (pension, 401(ks), IRAs)
- Credit card statements
- Gift and loan documentation to and from the other party, and particularly relating to third parties like their family members
- The existence of safe deposit boxes but not if you believe it is stuffed with cash and know where they are held, since your inquiry could trigger the contents being removed. There are better ways to approach those
- Ownership and title documents relating to real property like the family home, and secured debts for automobiles, boats, RVs, etc.
- If the other party has an attorney, that attorney's retainer agreement and billing invoices
- Revocable and other trust related documents
- Expense account reimbursements, if applicable
- Copies of the data contained in bookkeeping software, like Quicken and Quick Books, and any reports that exist
- Real property and jewelry appraisals, and any others as may apply
- Cash receipts books and records
- Proof of child care and medical expenses
- Corporate or company minute books, shareholder and buy-sell agreements, share certificates
- Appointment books and personal calendars
- Photographs of relevant items or circumstances (i.e., photos of injuries or police reports if domestic violence is alleged)
- Work or job applications
- Project bids
- Escrow documents and closing statements
- Bankruptcy filings
- Back-up for documents that were not included in the Declarations of Disclosure
When you frame your requests, don't try to sound like you think a lawyer would - speak like you are talking to a 10 year old, and avoid run-on sentences; complex wording invites objections that may be well-founded.
There is a whole other class of documents that you will want to request, although you might save it for the second go-around: I call this "contention evidence". If you know that your husband makes a specific claim on any point (e.g., that you transmuted your interest in a business or property from community to his separate property), then you will want "all documents that support [his] claim that [you] transferred, waived, or transmuted any interest in real estate from the date of marriage to the present."
You should view drafting a production demand as an opportunity for you to begin to focus on the real issues and disputes of your case - this is quite helpful and, in fact, it can be equally useful for the other party because it forces them to recognize whether evidentiary support exists for their claims and defenses. Do not approach any discovery as a way of driving the other side's costs up, because at a minimum your's will rise in tandem.
If the other party is employed, one of the first things you might consider doing is a subpoena to his employer seeking all wage, benefits, health insurance, and retirement information. It can take up to 40-50 days to receive subpoenaed records, but hearings on Requests for Orders are typically set 25-35 days out, meaning you won't receive these in time for your hearing if you don't act promptly or coordinate your efforts. But that is a Blog for another day.
~ T. W. Arnold, III, CFLS ~