Why choose the divorce financial settlement solicitors at Evolve Family Law?
Partners, Louise Halford and Robin Charrot lead an experienced team of dedicated family solicitors who treat every client as an individual. If you have an in-depth understanding of your spouse’s financial circumstances, we won’t waste your time and money in pursuing detailed divorce financial disclosure. However, if you need help in understanding your spouse’s financial disclosure provided in family mediation, we can support you by answering your questions. If you are concerned that your husband, wife or civil partner is hiding assets or bank accounts or is deliberately trying to undervalue business assets and shares then the family law team at Evolve have the experience and tenacity to secure the right level of divorce financial disclosure to help you make informed choices and to represent you in financial Court proceedings to achieve a divorce financial settlement.
Divorce Financial Settlements and Financial Disclosure – Your Questions Answered
Financial disclosure is the backbone to a divorce financial settlement, whether the financial settlement is achieved by agreement, family mediation, solicitor negotiations or financial settlement Court proceedings. That is because if you do not know what assets your partner has and their value you can’t reach a fair financial settlement, either by agreement or Court Order.
Financial disclosure is important to both parties to the marriage or civil partnership. If a financial settlement is reached based on partial or inaccurate financial disclosure any financial settlement or Financial Court Order could be set aside. That’s why it is equally important to both spouses that the financial disclosure is adequate so finality is achieved.
What is divorce financial disclosure?
If you are trying to reach a financial settlement following your separation or divorce then divorce financial disclosure will be required. That is because you can’t reach a fair financial settlement without knowing what your spouse is earning, the amount of their savings or the value of their pension or business.
In financial Court proceedings, the Court requires standard financial disclosure through the preparation of a Court form E supported by documents. If you are engaged in solicitor negotiations or family mediation then form E documents and supporting paperwork can be disclosed on a voluntary basis to help you reach a financial settlement.
Although in financial Court proceedings there is standard financial disclosure that may not be appropriate in every case. There is the provision in the Court rules to ask the judge for permission to ask additional financial questions and to request extra financial paperwork and expert valuation of assets. This is important in cases where you think that your ex-partner has transferred property or money to family members or has deliberately undervalued assets that form part of the company accounts so that the family business has a lower value or where you fear that your ex-partner has not disclosed all of their bank accounts or shareholdings.
If you reach a financial agreement with your spouse or civil partner before financial Court proceedings are started and you want the security of a Financial Court Order you can ask the Court to make an agreed Financial Consent Order. There is normally no need to attend Court but the judge will want to see a summary of financial information so the judge can be satisfied that the Order they are being asked to make is fair to both parties.
Is financial disclosure required in family mediation?
If you are using family mediation to reach a financial settlement or asking your divorce lawyers to negotiate a financial settlement then you and your ex-partner will need to agree on how much financial paperwork you should provide one another. Most couples agree to swap the same financial documents that they would be required to provide if one of them started financial Court proceedings. That way you can be satisfied that the financial settlement is based on accurate information.
If you reach a financial settlement using family mediation then you will normally be advised to convert your financial agreement into a binding financial consent Order. The financial information provided as part of the family mediation financial disclosure can form the basis of the financial summary of the information required by the Court before it will approve a financial consent order.
Is financial disclosure always necessary?
It is often sensible to take early divorce and family law advice to make sure that you both have enough divorce financial disclosure and supporting paperwork. What you think is sufficient may not be or additional key information may be needed. For example, information on housing needs, job prospects or future household outgoings, in order to help you make an informed decision about a suggested financial settlement.
If you can’t reach an agreement on how much financial paperwork should be disclosed either you or your ex-partner could start financial Court proceedings. Within the Court proceedings, a judge will order standard divorce financial disclosure. The judge could also order extra paperwork and reports.
The amount of financial disclosure you think is relevant may be very different to your ex-partner. Ultimately, if you can’t agree on how much paperwork should be provided, the Court can make the decision within financial proceedings.
Some couples decide that they do not need to see historical documents or joint bank account statements as they have already had access to the paperwork. The important thing is that you both feel that you have enough information to make financial decisions. At Evolve we take the time to discuss your financial disclosure requirements and tailor our financial disclosure advice to your circumstances.
What is the standard divorce financial disclosure in financial Court proceedings?
The first stage in the financial Court process is for the husband and wife to exchange divorce financial disclosure on a standard form (called a form E). Often this form is also used when providing documents on a voluntary basis, outside of financial Court proceedings.
The following standard documents accompany the form E:-
- Your most recent P60, last three months’ payslips and P11D.
- If self-employed, a copy of your last tax assessment or, if that is not available, a letter from your accountant confirming your tax liability and your last two years business accounts.
- A list of your current and estimated future monthly outgoings.
- Details of any property you own and, if there is a mortgage on the property, the mortgage statement showing the balance owing together with details of any other loans secured against the property.
- Copies of a personal bank, building society and national savings account statements for the last twelve months for each account that has been held in the last twelve months – either in your own name or in which you had or have had any interest.
- The surrender valuation for each insurance or investment policy and current valuation/statements of all savings and investments including ISAs, PEPs, National Savings Certificates, Premium Bonds, Shares, Stocks, Bonds, Securities, Gilts, Unit Trusts, Trust Funds, Save As You Earn Schemes or any other savings plans.
- Details of any personal belongings individually worth more than £500 (for example, your car, jewellery, antique furniture).
- Details of any monies owed to you.
- The amounts owing, if any, on any bank overdraft, HP loan agreement, credit and store cards or other liabilities, (for example, to friends or family) with documentary evidence in support.
- A recent statement showing the cash equivalent transfer value (known as CETV) provided by the trustees or manager of each pension arrangement that you have.
It is best to get expert family law legal advice before sorting out your divorce financial disclosure as all the information may not be relevant to you. If your finances, or those of your spouse or civil partner, are complicated it may be necessary to ask for additional documents or to make sure that assets are not sold or mortgaged before you sort out a financial settlement.
What are your duties in relation to divorce financial disclosure?
In financial proceedings, the Court requires full, frank and clear financial disclosure. This duty is ongoing and includes a duty to disclose any material change in financial circumstances. This can include disclosing a proposed sale of a family business, sale of a house or shares, or a change in relationship status.
The Court also imposes a duty to disclose any confidential information or documentation that a spouse holds about the other spouse. When deciding whether or not documents are “confidential” the Court considers whether or not the person who states that the documents are confidential had a reasonable expectation of privacy in relation to the confidential paperwork. If you possess confidential information belonging to your spouse or you become aware of any confidential information or documentation a family law solicitor will not be able to discuss the contents with you. To do so could result in the solicitor not being able to represent you or could result in civil action or costs Orders being made against you. If you do come into possession of any confidential information or documentation, the documentation should be delivered to your spouse’s representative.
Can you challenge a Court Order if your spouse did not disclose an asset?
If the Financial Court Order relates to property or a cash settlement and includes a clean break financial settlement it is still possible to challenge the Order at a later date if a spouse can show that there was fraud or a lack of financial disclosure.
As it is difficult to challenge a Financial Court Order it is important that both you and your spouse provide the right level of financial disclosure before the Order is made and the right questions are asked on your behalf and expert reports obtained. If financial disclosure was inadequate and Court proceedings are started to try to unravel the Financial Court Order this can prove expensive. That is why it is best to get the disclosure right from the outset.
If a financial Order includes spousal maintenance, then an application can be made to vary the amount of spousal maintenance payable if there is new financial information.
Do assets, businesses and pensions have to be valued as part of financial disclosure?
Lots of couples think that if they reach an agreement, they do not need to provide financial disclosure or value assets. That approach could mean that you do not receive a fair financial settlement or your spouse could try to challenge the financial Court Order at a later date if a business or pension is found to have a different value to that discussed during family mediation or solicitor negotiations.
A husband or wife will often assume that the value placed on a pension by a pension company or the value placed on shares in a family business by the company accountant is accurate. That isn’t always the case as there are different ways of valuing assets. If assets are not valued accurately and fairly your financial settlement may not be fair. It is therefore important to get expert legal advice on the need for asset valuations and the questions that need to be asked. For example, property in a pension may not have been revalued recently.
It is sensible to take expert advice from divorce and financial disclosure solicitors at an early stage so that you know how much paperwork you and your partner will need to exchange and to make sure that the disclosure is tailor-made to your financial circumstances. Disclosing too little paperwork or trying to hide information and paperwork is likely to drag out the time it will take to reach a financial settlement or make it more likely that court proceedings are required. Disclosing too much paperwork, when you both agree that it is not needed, can increase costs. Evolve financial settlement solicitors can help you strike the right level of divorce financial disclosure to come to a fair financial settlement or we can guide you through the divorce and financial disclosure Court process.