Financial Disclosure on Divorce – No longer a game of hide and seek
28 Apr 2021
It is a fundamental requirement of the Court that when a couple are deciding upon the division of matrimonial assets on divorce, both parties owe an absolute duty to provide full, open and honest financial disclosure.
As an oligarch’s son Temur Akhmedovrecently discovered, when he was ordered to pay his mother £75m for helping his billionaire father hide millions of pounds of assets from the Court to avoid a sizeable £453m divorce settlement! This fundamental requirement of financial disclosure applies to the super-rich too!
Full disclosure could avoid a case proceeding to Court
If both people are fully accommodating and provide complete disclosure of their assets, they can enter into worthwhile negotiations to try and reach a settlement and avoid the case proceeding to Court. It is therefore important to determine with absolute clarity what the parties have in terms of assets, income and earning capacity, how these assets have been acquired and what they may have in the future if the parties stand any chance of reaching an agreement.
New costs rules have also recently been imposed which places a burden on parties to negotiate reasonably. Failure to do so could also result in costs orders against the party who fails to cooperate.
If negotiations should fail however, then the Court will have a comprehensive picture of the matrimonial finances and will be able to undertake an assessment at a final hearing to make a decision for the couple.
What can I expect if I fail to disclose? Is it worth the risk?
If disclosure remains incomplete, questions remain un-answered or documents have simply not been disclosed you can expect the following:
- The Court can order the non-compliant party to pay all unnecessary costs incurred by prolonging the proceedings.
- The Court may infer that the party who is refusing to provide the information has something to hide and depart from a division of equality.
- The Court can re-open a financial settlement if it subsequently emerges that one party was dishonest or that something material was omitted, whether on purpose or by mistake.
- Non-compliance with a Disclosure Order is contempt of Court for which you can expect a fine, an Order to pay the other party’s legal costs or even imprisonment.
We often see situations where one party may have taken control of all the matrimonial finances leaving the other in the dark. The case of the oligarch’s son now shines a big and expensive light on these cases and reminds anyone thinking of hiding assets or presenting only half the financial picture, there is no-where to hide.
Angela Hardman, Solicitor, Sinclair Family Law.
Our friendly and skilled team of family lawyers are here to provide you with guidance, support and understanding during what can be a difficult time. We are committed to providing outstanding service and achieving the best possible outcome for our clients.
To schedule a free consultation with Angela Hardman or one of our other experienced family solicitors, please call 01625 526 222 or contact us using our web form.