Going through a divorce comes with significant financial implications, and we are often asked how clients can protect themselves during the process. Alongside the divorce, the joint financial claims that the parties have need to be addressed, and this often feels like a difficult process of untangling the finances.
It may be felt that “protecting” yourself is effectively keeping assets from your spouse, but that is certainly not my advice. It is vital that full disclosure is made. You should not be the one to decide whether or not an asset should be shared with your spouse, and all assets, liabilities, income and debts should be disclosed within a divorce.
It is therefore important to gather your full financial information, to include bank statements, tax returns, property valuations, mortgage statements, etc, and to complete your Form E (the form in which financial disclosure takes place) fully. This enables your lawyer to have a good understanding your the assets, and you should also inform your solicitor of all information surrounding an asset. For example, it is crucial to know if there was an inheritance received, when this was received and how it was treated. This should be shared with your legal team as part of the preparation of your Form E. This information will be needed by your legal team so they can properly draft your Form E, so this information will be shared with your spouse upon exchange of Form Es.
If you feel that your spouse is going to conceal assets, then you should inform your Solicitor immediately. This can be a reason to start Court proceedings, as this may give an extra level of scrutiny to matters, and the Court can make a range of directions and orders against a spouse, if they feel there is no cooperation, or incorrect disclosure being made.
The Court have the power to make a Freezing Injunction against a party, which freezes assets and protects them to enable the Court to consider them as part of the overall case. The threshold for the Court to make a Freezing Injunction is high, and certain steps must be taken beforehand. They are therefore rare, and ought to be sought in exceptional circumstances.
The Court have the power to make orders against third parties. For example, the Court can make an order against a company to provide details as to a pension that may be held by a spouse, or believe to be held by a spouse, and this may be crucial in obtaining information, by circumventing the spouse themselves.
The Court also have the ability to involve experts, such as Accountants, and Actuary’s to investigate information and assets further, if they feel that there is not clarity from the disclosing spouse.
It can often be a temptation, if a client sees paperwork in the family home belonging to their spouse, to take it, or to take a photograph of it, to ensure that that asset is disclosed within proceedings. There was a high profile case a number of years ago which made it very clear that such “self-help” should not be employed as a tactic, and therefore we would always advise clients that she should not take this course of action.
Further, if documents are found in your possession that belong to your spouse, it is important that they are returned to that other person, uncopied, and you may end up in difficulty within proceedings if you are found to be in possession of documents belonging to your spouse.
Therefore the best way to financially protect yourself is to have open dialogue with your solicitor and wider legal team, but to be open, clear and honest in your disclosure. Failures to do so may result in costs orders being made against you, the proceedings taking longer to resolve, and the costs of the proceedings being significantly higher.
Consult our divorce solicitors in Banbury, Bicester and Rugby
If you would like to speak to a solicitor with expertise in guiding individuals through divorce and separation, please get in touch with a member of our team.
We have offices in Banbury, Bicester and Rugby, working with clients across Coventry and Warwickshire, the West Midlands, Oxfordshire and nationwide.
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