Financial disclosure
When a married couple are divorcing and want to resolve their financial matters, the starting point is that there has to be an exchange of financial information. This process is referred to as disclosure. There is a duty for each spouse to provide full and frank disclosure to each other.
The Form E is a court document which spouses are required to complete to show to each other that they have provided full disclosure. The Form E is a comprehensive document which covers your financial position including assets, pensions, income and debts.
When completing the Form E, there is also a requirement to provide documentary evidence in support. The Form E helpfully sets out a list of the documents which are required. This includes but is not limited to the following documents: –
- Property valuation
- Mortgage redemption statement
- Bank statements covering the last 12 months
- Statements for any investments and savings
- Life insurance documentation
- Company accounts if you have an interest in a business
- Pension valuations
- P60 for the last financial year and payslips for the last three months
- Latest tax assessment
If the Form E is completed accurately, it will help resolve your finances quickly and it will also help with reducing legal costs. Once financial disclosure has been provided, it will help family solicitors to advise what is in the ‘matrimonial pot’ so they can advise on an appropriate financial settlement.
Is it compulsory to complete the Form E?
The court will direct you to complete a Form E if financial remedy proceedings have been issued. However, the Form E is commonly used if you and your spouse were to exchange disclosure voluntarily and want to negotiate a settlement outside of the court process.
If you and your spouse have completed Form E on a voluntary basis but are unable to reach an agreement and financial remedy proceedings are later issued, then it will give you and your spouse a head start as the groundwork will have already been done and it will simply be a case of updating the figures.
Failure to provide financial disclosure
You and your spouse are under a duty to provide full and frank disclosure. There can be serious consequences if a court has directed you to complete a Form E and you fail to do so. If you fail to comply with a court order you may be in contempt of court which is a criminal offence. If you are found to have been deliberately untruthful or provide incorrect information, then this may be treated as fraud. The court also has the power to make an order for costs against you if you fail to comply with a court order. Adverse inferences may also be drawn from any non-disclosure which could result in an undesirable outcome for you.
There is no obligation to provide financial disclosure if financial remedy proceedings have not been issued. However, if you are not willing to provide financial disclosure voluntarily then this may lead your spouse to issue financial remedy proceedings and the court will order you to provide financial disclosure.
It is therefore extremely important to provide full and frank financial disclosure. For advice on financial disclosure on divorce, please contact a member of our Team.