07th July 2016
Disclosing assets in divorce proceedings
When couples decide to divorce, the financial assets will also need to be dealt with. Often there is a worry that the other person will not provide a true picture of their finances to try and change the outcome of any settlement.
When you separate both people need to provide full and frank disclosure of their assets. This information is usually contained in 'Form E' (the court form used in financial remedy proceedings) and evidence is required such as bank statements, mortgage statements, wage slips and P60s. This means that each person is required to give an honest and accurate account of what they own. The Form E must be signed confirming that the information provided is correct. The Court cannot make any order without this information being given.
Completion of this Form E is extremely important. It forms the basis of any claim and will be referred to any hearings. It is advisable to seek legal advice as to the completion of this and to check the information disclosed by your spouse.
What if one person lies or fails to disclose all their assets which is later discovered?
By signing the Statement of Truth on the Form E you are confirming that the information provided is correct and that all assets have been disclosed. Failure to comply is contempt of court and can be punished by way of a prison sentence or a fine. Whilst this may punish the other person it does not provide any remedy to the deceived person by way of awarding them a larger share of the assets.
Previously if one party later discovered assets that had not been disclosed or misinformation provided upon which an order made, the agreement would not necessarily have been changed. Any order would only be changed if it was shown that it would have changed the outcome of any agreement. This was often difficult to show and placed a substantial burden on the person who sought to claim that they should have received a greater share. This was challenged in the Supreme Court recently in the cases of Sharland and Gohil. In these two cases the women had both agreed a financial settlement with their former husband and had sought to conclude the financial arrangements between them. In the case of Mrs Sharland, her former husband had shortly after the agreement, sold his interest in his company for substantially more than he had said it was worth. In the case of Mrs Gohil, she believed her former husband had not provided evidence of all his assets but agreed a settlement on the basis of the information provided to the Court. She later learned during a criminal trial for money laundering and fraud that her former husband had been worth millions of pounds. Both women took their case to the Supreme Court in the hope that the original agreement would be overturned. They were successful in getting the Court to allow them a chance to vary the orders and to seek further sums.
The outcome is now that the Courts will not tolerate non-disclosure of assets and it is now easier to challenge an order where one person has not given an honest account of their true worth. If you are seeking to challenge an order previously made or believe that you have not been provided with the full picture of the other person's financial circumstances, it is important to seek legal advice.
At Cartwright King we have a team of family solicitors across the country who can assist with divorce proceedings involving assets. Please feel free to contact our team on freephone 0808 168 5550 or email email@example.com and we'll call you back.