When a married couple are going through divorce proceedings it is often the resolution of financial issues that causes the most difficulties.
Almost invariably where there is a divorce of the marriage it is also necessary to separate the financial assets of that marriage. Whereas the divorce procedure is relatively straightforward it is the process of carving up the assets of the marriage that can be more complex, time consuming and expensive. You can learn more about the financial procedure here.
When considering what the appropriate financial settlement upon a divorce should be, the starting point is for both parties to provide full and frank financial disclosure. It is a requirement where court proceedings are issued to deal with financial matters that both parties provide full disclosure but, even where there are no court proceedings, invariably the starting point is for both parties to provide financial disclosure.
It is impossible for a family law solicitor to provide informed and detailed advice to their client as to the appropriate financial settlement without first having had sight of the other parties’ financial disclosure. This makes financial disclosure fundamental to the entire process of assisting a client to reach a satisfactory financial settlement.
Such disclosure often includes the production of
- 12 months bank statements;
- evidence of income such as payslips, P60s and / or tax returns;
- pension information;
- details of investments, shares and other policies;
- details of all liabilities;
- disclosure of business interests;
- details of any trusts or offshore investments.
The Starting Point…
Often the starting point is to request such financial disclosure on a voluntary basis. It can, at times, be a good indicator of the other party’s intentions as to whether they provide good quality financial disclosure or prove to be evasive or uncooperative in providing what has been requested.
However, it is imperative that both parties have full visibility of their respective spouse’s financial assets, income and liabilities so that they can consider what the appropriate settlement should be. It should be a ‘cards on the table’ approach.
On occasions one party will put forward proposals for settlement without having provided full disclosure. That situation is akin to being offered a slice of cake and being told what proportion of the total cake the particular slice is. However, without seeing the remaining part of the cake it is impossible to say how big the slice actually is.
Ultimately, where financial disclosure is requested on a voluntary basis and that disclosure is not forthcoming or is incomplete, then this should ring alarm bells. In such cases, court proceedings often follow. Then, if the party continues to be uncooperative in terms of the disclosure then the court can impose sanctions on that person in the form of an adverse cost order. In extreme circumstances the non-compliant spouse can also be sent to prison by the court. This indicates the seriousness of non-disclosure of financial assets during divorce proceedings.