Wales Online, 15th October 2015
Divorce lawyer David James says the latest Supreme Court ruling on non-disclosure of assets in divorce cases provides much needed clarity
Two women who say they were misled by their former husbands and should get more money in their divorce settlements have won the right to have their settlements re-examined.
A ruling was made yesterday at the Supreme Court in favour of two wives whose husbands had hidden the extent of their wealth when settling their divorces.
Alison Sharland, who accepted £10m in her divorce, and Varsha Gohil, who received £270,000, argued that their former husbands had previously misled the Court as to how much they were worth.
Both women took their claims to the Supreme Court in London to establish that non-disclosure in divorce settlements required a case to be re-examined.
The Court of Appeal had originally ruled that the misleading evidence would not have led to a significantly different divorce settlement.
However, in a judgment delivered by Lady Hale, in the Sharland case, the Supreme Court said that a duty of full and frank disclosure always arises.
Lady Hale stated that “on the facts of this case it is clear that the judge would not have made the order he did, when he did, in the absence of Mr Sharland’s fraud, and the consent order should have been set aside.”
The case will now go back to re-hearing with the potential for the former wives to increase their settlements.
This is a very significant ruling that means that a division of the parties’ financial assets has to be based on a “valid agreement”.
The decision provides some long overdue clarity and in all likelihood reflects the feelings of most family law practitioners by taking a common sense approach to the need to be completely honest with the financial disclosure.
The judgment sends out a clear message that dishonesty will not be tolerated.
My immediate reaction is that the ruling may be likely to open the floodgates for many previous divorce agreements to be revisited and I anticipate that the decision will be of huge interest to individuals who feel that their partner may have tried to mislead the court within financial proceedings on divorce, although it could have far wider implications on the effects of non-disclosure.
This may therefore precipitate a significant rise in the number of challenges to existing divorce settlements.
David James is a director at Wendy Hopkins Family Law Practice in Cardiff