Legal Definitions - simulation

In a legal context, simulation refers to the act of creating a false appearance or engaging in a pretended action, often with the intention of deceiving others or masking the true nature of an agreement or situation. It involves presenting something as real or genuine when, in fact, it is feigned, fabricated, or intended to have a different effect than what is publicly displayed.

Here are some examples to illustrate this concept:

• Example 1: Asset Protection Scheme

  Imagine a business owner facing significant financial difficulties and potential lawsuits from creditors. To protect a valuable piece of property, such as a commercial building, the owner publicly "sells" it to a close family member for a nominal price. However, there is a secret, unwritten agreement between them that the family member will hold the property in their name only temporarily, and the original owner will continue to manage it and eventually regain full ownership once the financial troubles subside.

  Explanation: This scenario demonstrates simulation because the public sale of the building is a feigned act. It creates the false appearance of a genuine transfer of ownership to mislead creditors into believing the asset is no longer available to satisfy debts, while the true intent and control remain with the original owner.

• Example 2: Contractual Agreement Disguise

  Consider two parties who wish to transfer ownership of a rare antique. To avoid certain taxes associated with a direct sale or gift, they publicly sign a "loan agreement" stating that one party is merely lending the antique to the other for an extended period, with a clause for its eventual return. However, they secretly agree that the antique is actually being permanently transferred, and the "loan" document is merely a facade to circumvent tax obligations or other regulations.

  Explanation: The "loan agreement" in this case is a simulated contract. It is a pretended act designed to create a false appearance of a temporary arrangement, while the parties' true intention is a permanent transfer of ownership. The simulation aims to deceive tax authorities or other third parties about the real nature of the transaction.

• Example 3: Fabricated Evidence in Litigation

  During a dispute over intellectual property, one company presents a series of internal memos and emails as evidence to support its claim that it developed a particular technology first. However, these documents were not genuinely exchanged at the dates indicated; they were digitally altered and backdated by the company's employees specifically to create a false historical record that would strengthen their legal position.

  Explanation: The creation and presentation of these fabricated documents constitute a simulation. The company is feigning the existence of authentic communications and a specific timeline to mislead the court and the opposing party about the true facts of the technology's development, hoping to gain an unfair advantage in the lawsuit.