Ontario Court of Appeal orders tobacco exporter to disclose financial records in estate case

The documents were necessary for valuating the deceased co-founder's estate

Ontario Court of Appeal orders tobacco exporter to disclose financial records in estate case

The Ontario Court of Appeal upheld an order requiring a tobacco exporter to produce financial records in an estates litigation case, finding the documents necessary for valuating the deceased co-founder’s estate, despite the company's concerns about confidentiality and prejudice.

Kenneth Ryan Hill, the deceased, was a prominent businessman and co-founder of Grand River Enterprises Six Nations Ltd.(GRE), one of Canada's largest tobacco exporters. GRE, an Indigenous-owned company, employs over 500 people, primarily from the Six Nations of the Grand River reserve.

Hill passed away on January 18, 2021. Following his death, a group comprising Hill's adult children, representatives of his minor children, and former partners sought the production of GRE's financial records. They argued that these records were crucial as GRE shares constituted the largest asset of Hill's estate, which was necessary for accurate dependency claims and assessing the estate's value.

GRE opposed the motion, asserting that disclosing its financial information would be detrimental and prejudicial, given that this data had never been publicly shared. However, the motions judge ruled in favour of the moving parties. She ordered GRE to produce financial statements and other necessary documents for valuators to assess Hill's 12.5 per cent interest in the company. A confidentiality protocol was also established to ensure the produced documents remained confidential.

The appellant, GRE, argued that the motions judge misapplied the test under Rule 30.10 regarding relevance and fairness. However, the Court of Appeal emphasized the discretionary nature of the motions judge's decision, which is entitled to deference. The court noted that the motions judge found the documents relevant to a material issue and that it would be unfair for the moving parties to proceed to trial without them.

The Court of Appeal also dismissed GRE's concerns about potential violence towards its stakeholders and the order's alleged overbreadth. The motions judge had carefully considered these issues and tailored the production order to include stringent confidentiality measures. The order restricted document access to the moving parties, counsel, estate trustees, and valuators without permission for document copies. The motions judge also allowed GRE to seek a sealing order before any disclosure became public in court.

The Court of Appeal also found no error in the order allowing a valuator to determine which documents were necessary, provided they acted reasonably. As a result, the court dismissed the appeal and awarded the respondents with costs for the appeal.

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