Have you been asked to provide financial disclosure documents to your former spouse in your family law matter? It may feel like an invasion of privacy, particularly if you separated some time ago or were conducting your financial affairs separately during your relationship.
What Is Duty of Disclosure And How Does It Affect Me?
Many people wonder, is financial disclosure required in a divorce? Duty of Disclosure requires all parties to a family law dispute to provide to the other party all information relevant to an issue in the case.
Your Duty of Disclosure begins from the start of your matter and continues until your matter has been finalised, irrespective of when you separated or how your financial affairs were conducted throughout your relationship. The total net assets available for division are considered at either the time of the agreement reached, or when the Court determines your matter. It is not the date of separation, which is a common misconception.
All parties involved in a family law dispute are required to make financial disclosure of their documents to each other, including information recorded digitally and physically, and information that your ex-partner may not know about.
Financial Cases – A Higher Threshold
There are specific rules in property and financial cases, which demand full and frank financial disclosure in addition to general disclosure requirements. When reporting your financial circumstances, you must include information of your assets, liabilities and superannuation. Your full and frank disclosure obligations extend to property, earnings, and financial resources that are:
- Owned by you;
- Come to you directly;
- Go to some other person or beneficiary, such as your child; and
- Held in trusts, companies, corporations, or other structures.
You are also required to disclose information regarding any sale, transfer, gift, or assignment of any property disposed of in the year immediately before your separation or in the period after your separation.
If there is reason to believe either party has purposely depleted assets or funds, known as wastage, the Court may Order the wasted amount be ‘added back’ into the pool as if it hadn’t been spent, and attributed to the party that has spent the funds.
What Exactly Do I Need To Disclose?
Our team will provide a Documents Checklist that sets out the documents you are required to provide to meet your Duty of Disclosure in a financial matter. This includes (but is not limited to) documents relating to:
- Bank Account Statements
- Cash
- Investments
- Employment
- Trusts and Entities
- Superannuation
- Asset and Property Valuations
- Market Appraisals and Valuations
- Other Assets, Liabilities and Financial Resources
Even though you may not currently hold the documents you are asked to provide, any documents in your possession, power or control (i.e. in your name and you are entitled to request them) are required to be produced.
What If I Don’t Make Full & Frank Disclosure?
Failing to disclose an asset or debt may have a serious impact on your property settlement. In some cases, non-disclosure may be recognised as contempt of court, attracting severe penalties. The Court may:
- Dismiss all or part of your case;
- Order costs against you;
- Refuse your use of the information or document as evidence in your case; or
- Fine or imprison you for not disclosing a document or for breaching your disclosure obligations.
Where a Court Order has already issued, the Court is able to set aside or vary the Orders and issue a new one in its place.
Contact Us
It is important you understand your legal rights, interests, and obligations in a family law matter, especially when dealing with complex financial disclosure requirements. Contact us today for an initial consult, and let us help you navigate your disclosure obligations.
