Navigating a divorce is an emotionally and financially challenging process. Everyones aim is to reach a settlement that both parties are comfortable with, whilst having as little argument and cost as possible.
Its not uncommon for parties to try to jump straight into thewho gets what upon divorce and overlook possibly one of the most critical aspects of reaching an agreement which is full and honest financial disclosure. Whether you are agreeing something between you, negotiating via solicitors or by mediation, this should be the first step and should not be missed.
What is financial disclosure?
Financial disclosure is the process of exchanging details of your financial situation which includes income, assets, liabilities, pension, business interests etc.
If the parties are in a formal court process, they will be ordered to complete a Form E which is a financial statement setting out all their financial information to be supported by documentation, such as bank statements, pay slips etc.
Where financial disclosure is done on a voluntary basis, the process can be flexible and altered to meet the needs of the separating parties. Often the best option available to the parties is to complete and exchange a Form E, on a voluntary basis. This is because the form provides a good level of information and supporting documentation. This means parties will be able to make informed decisions about the finances and protect themselves against any agreements later being undone. Being able to demonstrate you have given full, frank and clear disclosure offers protection against the other party later making any suggestion of not knowing the position (whether legitimately or otherwise) and attempting to undo any agreements.
We already have an agreement that we need to submit to court; do we have to provide financial disclosure?
Some parties do not wish to complete a Form E because they have reached an agreement without financial disclosure, on the basis that they already know the marriage finances well enough to make an informed decision.
Whilst couples will not be compelled to complete the Form E if they are not in the court process for financial remedies, they will be required to complete a Statement of Information (D81 Form) when submitting their agreement to court. The Statement of Information is not as in depth as the Form E and does not require any supporting documentation to be provided. The D81 form provides a snapshot of the finances for the judges knowledge so that they can check that the agreement reached is broadly fair based on the financial information.
If you and your spouse are separating and you are unsure of where to start with financial disclosure, or maybe you are having trouble getting your spouse to provide their disclosure then we can help. Our specialist Family Law team can advise you in detail about financial disclosure, the best options for you and what to do if your spouse will not engage with you about it.
