Financial Disclosure Upon Divorce
Laker Legal Solicitors - 29th January 2017
When dealing with financial matters upon divorce it is important, out of fairness to both parties, that full and frank financial disclosure is provided. This is usually done by Form E exchange which involves the completion of an extensive form and provision of supporting documents including bank statements, wage slips, property details and so in, in order that both sides are able to weigh up the other’s true and complete financial picture and reach a settlement accordingly. In very straightforward cases parties may agree a more straightforward way of disclosing financial information but if your case involves substantial assets or your financial situation is even slightly complicated then Form E disclosure is the best way to proceed.
It may be that one or both parties are not so frank in their disclosure and they try to hide the true extent of their financial position. Reaching settlement on this basis is unjust, particularly as once a financial order has been made, the terms of that settlement are generally deemed final, save for the option to vary periodical payments.
Recently, the breakthrough case of Gohil has shown that in instances of fraud or concealment that a financial order following divorce can be fully amended to reflect the true financial picture.
In this case, Mrs Gohil originally accepted a settlement figure of £270,000. Six years later, her husband was found guilty of fraud and money laundering amounting to approximately £37,000,000. During his trial, the extent to which he’d hidden his financial information during his divorce became apparent and accordingly, eleven years after the initial settlement was reached, Mrs Gohil was awarded a sum more reflective of her former husband’s true financial position by the Supreme Court.
Heard alongside the case of Gohil, the case of Sharland focused on the same key principles. In this case, Mrs Sharland had reached settlement on the basis of a valuation provided by her husband of an IT company in which he was a shareholder. The valuation was found to be much lower than the true value of the company and Mrs Sharland sought amendment of the initial financial order upon discovering this information. The Supreme Court, like in Gohil, adjusted the settlement sum so that it reflected the true financial picture.
These landmark cases will certainly change the way in which all Courts deal with individuals who fail to provide disclosure to the appropriate level, and accordingly the way in which solicitors obtain the same from their clients.
For more information regarding financial matters upon divorce or if you think you may have received an unfair settlement on the basis of the withholding of financial information, please do not hesitate to contact us.