Within any divorce, it is necessary to consider the need for a Court Order dealing with the family finances and ensuring you achieve a ‘Clean Break’ if possible.
In order to reach an agreement in respect of the matrimonial finances, it is often necessary to seek legal advice, engage in mediation or issue an application to Court. In 99% of cases, financial disclosure will be necessary in order to ensure that both parties reach an agreement that is fair and reasonable in the circumstances.
What is financial disclosure?
Financial disclosure is the process of disclosing all of your assets, liabilities, income, pension and any other relevant financial details, usually on a ‘Form E.’ This is a standard form, used by the Courts which clearly sets out what information is required from both the husband and the wife, and is submitted together with the documentary evidence in support. This document will then be exchanged with your spouse or their legal representatives, in order for them to advise on what is fair and reasonable.
The most important aspect of any financial disclosure is the duty to be full and frank in your disclosure. Ultimately this means that neither husband nor wife can mislead the Court or their spouse as to the true value of their assets, pensions etc.
What if my spouse is dishonest or does not disclose assets?
Unfortunately there are cases where a husband or wife may deliberately hide (or not disclose) assets that they own and that their spouse would otherwise have been entitled to. In these cases, unsuspecting spouses reach an agreement based on what they think is fair and reasonable, only to find out that there is spouse is considerably better off.
Mrs Sharland and Mrs Gohil are two women who experienced this first hand and subsequently returned to Court to renegotiate their financial settlement. The Supreme Court held unanimously that both women had been deliberately misled by their husbands and that the husbands had failed to comply with the duty of full and frank disclosure. The Supreme Court sent out a clear message that dishonesty within financial disclosure will not be tolerated. The court indicated that both claims would return to the High Court.
Linda Jones, Head of Family says, “These two decisions are a vindication that any form of dishonesty in financial proceedings by either the husband or the wife should not be tolerated.”
If you have suspicions about your spouses’ financial disclosure or think that you may have been misled when reaching a financial agreement with your spouse, please contact one of our family law experts.