Legal Question in Business Law in Canada

corporate documents

A corporation founded in 1975 sold in 1997 and was resold in 2003. The new owners of the corporation discovered that the corporate books were missing for the years between 1997 and 2003 Request for those documents from the previous owner have been flatly turned down--name removed--Now a new accountant hired by the new owners is telling them that he has discovered a second corporate number but there is no explanation or thread There is a need to see the missing documents--name removed--It should be mentioned that shortly after being asked for the documents, the previous owner sold his portion of the mortgage for 75% of it's worth

I have 2 questions How can the new owners make their vendor give up the corporate documents?

What would be the penalty to the vendor if he has destroyed the papers?


Asked on 10/02/07, 12:02 am

1 Answer from Attorneys
Meldon Ellis Ellis Business Lawyers

Re: corporate documents

First, it will be difficult to get the the vendors to do anything at this stage unless the agreement under which the shares were purchased imposed ongoing obligations on the vendors. However, the new owners may be able to recover some of the corporate documents from either the Corporate Registry or the company's former corporate lawyers or accountants. Also if the purchaser commenced litigation against the vendors the vendors would be required to disclose any relevant documents to the lawsuit. I can't think of a particular penalty that would apply to vendor if it was found that he had destroyed records. In a court case however, the court might draw an adverse inference from a party who fails to deliver records that ought to be in his possession and control.

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Answered on 10/02/07, 1:43 am


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