Full and honest financial disclosure is one of the fundamental obligations in financial remedy proceedings. Where a spouse refuses to engage with that obligation, either by ignoring requests for information or by deliberately providing incomplete or inaccurate disclosure, it creates serious difficulties. Understanding what can be done about it is one of the most important practical questions in these cases.
Both parties in financial remedy proceedings are required to provide complete and honest information about their financial position. This is not simply a procedural requirement. It is a duty owed to the court, and breach of that duty is treated seriously. The obligation covers all assets, income, liabilities, and financial interests, whether held in England and Wales or elsewhere, whether in the party's sole name or jointly with others.
Financial disclosure is provided initially through Form E, the standard financial statement used in financial remedy proceedings. Each party completes their own Form E and exchanges it with the other party.
Where a spouse refuses to complete Form E or provides disclosure that is clearly incomplete, the first step is usually to make requests for further information and to raise the concern formally. If voluntary compliance is not forthcoming, an application can be made to the court for an order compelling disclosure.
The court has power to make orders requiring a party to provide specific financial information, to answer questionnaires about their finances, and to produce documentation from third parties. Non-compliance with such orders is treated as contempt of court and carries serious potential consequences.
Our family law barristers regularly deal with cases where disclosure has been resisted or is incomplete.
In some cases, the necessary financial information can be obtained from third parties rather than relying on the other party to provide it voluntarily. Banks, pension providers, Companies House, and HMRC can all be sources of financial information that supplements what the other party has disclosed.
The court can make orders for disclosure by third parties where this is necessary to establish the true financial picture. These applications add time and cost to the proceedings but can be essential where a party is concealing assets or income.
A particular concern arises where there are reasons to believe that assets have been transferred to other people or hidden in preparation for the financial proceedings. The court has powers to set aside transactions entered into with the intention of defeating a financial claim. Where there is evidence that assets have been moved or dissipated, a barrister can advise on whether an application to recover those assets or protect against further dissipation is appropriate.
Injunctive relief is available in cases where there is a real risk that assets will be disposed of before the case is resolved. Acting quickly is important in these situations, as delays may limit what can be recovered.
Courts in England and Wales take a robust approach to non-disclosure in financial remedy proceedings. Where a party has failed to provide honest and complete disclosure, the court may draw adverse inferences about the assets they hold. In practical terms, this means that a judge may assume that the undisclosed assets are more substantial than the other party has claimed, and may make a financial order on that basis.
This is one of the reasons why non-disclosure tends not to work in the long run. The short-term benefit of concealing assets is often outweighed by the risk of the court making assumptions that are unfavourable to the party who has failed to disclose.
You can find more about the disclosure process in our article on completing Form E.
If you would like to speak with a direct access barrister about the financial disclosure in your divorce proceedings, get in touch with us today.