“What will I get from the division of the matrimonial assets?” – Stefan Donnelly explains Financial Disclosure in Divorce and the use of Form E.
What is Financial Disclosure?
One of the first questions solicitors are often asked when initially meeting with clients is: “what will I get from the division of the matrimonial assets?” It is impossible however to give comprehensive advice as to what a fair and reasonable financial settlement would be, without seeing the other party’s full and complete financial disclosure.
Financial disclosure is the process where you provide details of your income, assets and liabilities, (supported by relevant documentation), to the other party using a Financial Statement known as a Form E. It enables a solicitor to establish the value of the ‘matrimonial pot’ as well as the needs of the parties.
Using a Form E is mandatory when Court proceedings (known as ‘Financial Remedy Proceedings’) have been issued but it is also commonly used for voluntary financial disclosure. Voluntary financial disclosure takes place by agreement between the parties when they are trying to negotiate a financial settlement – usually with the assistance of their solicitors or at mediation. This avoids the need of having to go through a formal court process, where a Judge may order how the matrimonial assets will be distributed instead.
What is a Form E?
The Form E is a very detailed form, and on first glance, completing it can appear a daunting process. However, it is often the case that not all sections of the Form E apply. It covers all assets and liabilities, as well as providing some background information about the parties – including details of their marriage and any children that they may have. To assist in completing the Form, each section outlines what documentation is required in support (for example bank statements for the last 12 months, a recent mortgage statement, wage slips, P60 etc). There is also a helpful checklist at the end.
Once you have completed the form you are required to sign a Statement of Truth, confirming that the information you have provided is true and accurate to the best of your knowledge. It is therefore essential to obtain assistance from an appropriately experienced family law solicitor, to ensure that the form is completed correctly and accurately.
Once the Form E has been finalised and signed it will be exchanged with the other party. Your solicitor will then look through their Form E and documents and discuss the contents with you.
What happens after Financial Disclosure in divorce?
Once financial disclosure has been exchanged (whether that is voluntarily or within Court proceedings), your solicitor will review the financial disclosure with you and will send a list of questions to the other party about their Form E. This list of questions is known as a Questionnaire.
The Questionnaire could be questions about anything that has been missed from the other parties Form E, or questions about any income, assets or liabilities that have been disclosed but need to be clarified or that require more information. Once satisfied that full and complete financial disclosure has been provided, discussions can then take place as to settlement and your solicitor will discuss settlement offers with you.
Can I refuse to provide Financial Disclosure?
Failure to provide full and complete financial disclosure makes it very difficult for there to be any meaningful negotiations as to settlement, and creates delay and added costs at what is already a stressful time. If full and complete financial disclosure is not provided within the voluntary financial disclosure process, then there may be no option other than to apply to the Court for Financial Remedy Proceedings.
If, within the Court proceedings, full and complete financial disclosure is not provided, there can be serious consequences for the non-disclosing party which include:
- The Court drawing adverse inferences against the non-disclosing party.
- If the non-disclosure is discovered after a Financial Order has been made, then in some circumstances, the Order can be challenged which may lead to it being set aside.
- Cost Orders can be made against the non-disclosing party.
- The party that has failed to provide full and complete financial disclosure could be found to be in contempt of Court, which can result in them either being fined or possibly imprisoned.
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at June 2022.