Adverse Inferences

Evidence Failure

A refusal to disclose internal board minutes during a shareholder dispute often triggers these conclusions. If the tribunal determines the documents were within the control of the party, it may assume the contents were damaging to that party’s position.

Tribunal Discretion

Arbitrators exercise broad power in determining whether the non-production of files warrants such a finding. They evaluate whether the request for disclosure was specific and whether the missing information is material to the outcome of the exit negotiation.

Impact Analysis

The use of these conclusions can shift the burden of proof on specific factual issues. A party facing these findings often sees its probability of a successful defense diminish as the court accepts the version of facts proposed by the opposing side. Because the finder of fact treats the missing evidence as harmful to the withholding party, the strategic cost of non-disclosure often exceeds the risk of revealing the documents.

This outcome prevents participants from benefiting from the suppression of relevant facts.