Shareholder as Spouse

As family law attorneys, we tend to focus on the statutes and laws that focus primarily on family law, such as Titles 36 and 37 of the Tennessee Code, but family law attorneys can and should look to other statutes to craft arguments that could benefit their clients.   

For example, a spouse could be a shareholder in a corporation.  In the discovery process of a divorce, family law attorneys should widen their requests to encompass documents to request from the other spouse.  Pursuant to T.C.A. § 48-26-102(b) [Shareholders right to inspect and copy records],

(b)   A shareholder of a corporation is entitled to inspect and copy, during regular business hours at a reasonable location specified by the corporation, any of the following records of the corporation, if the shareholder meets the requirements of subsection (c) and gives the corporation written notice of the shareholder's demand at least five (5) business days before the date on which the shareholder wishes to inspect and copy:

(1)   Excerpts from minutes of any meeting of the board of directors, records of any action of a committee of the board of directors while acting in place of the board of directors on behalf of the corporation, minutes of any meeting of the shareholders, and records of action taken by the shareholders or board of directors without a meeting, to the extent not subject to inspection under subsection (a);

(2)   Accounting records of the corporation; and,

(3)   The record of shareholders.

(c) A shareholder may inspect and copy the records described in subsection (b) only if:

(1) The shareholder's demand is made in good faith and for a proper purpose;

(2)  The shareholder describes with reasonable particularity the shareholder's purpose and the records the shareholder desires to inspect; and

(3) The records are directly connected with the shareholder's purpose.

Relying on the statute above, a spouse who happens to be a shareholder of a corporation, even if a minority shareholder, has the right to inspect and copy various documents, including, but not limited to, accounting records of the corporation.  Such requests directly to a shareholder spouse could limit a client’s expenditures and not force him or her to issue a subpoena to obtain the records that could be requested by the shareholder spouse.

Therefore, looking outside of the typical “family law” statutes allows attorneys to better represent their clients.