In property settlements, one of the first things we address is disclosure. Some of our clients are familiar with the assets, liabilities and financial circumstances of their partner or spouse, others are not. We have acted in cases where the other side has made a concerted effort to conceal their true financial position and to hide assets such as cash or investments.
If you or your spouse do not make a full and frank disclosure of the financial position, there is a risk that your property settlement could be set aside in the future.
Consequence of not disclosing:
For example, if you later discover that your spouse owns a property in Vaucluse that they did not disclose when you agreed to the settlement, you may be able to revisit the settlement to take that property into account. Failure to disclose has serious consequences.
However, you should also be aware of the consequences of not following up your concerns or suspicions about your spouse’s disclosure. If you know or suspect that your spouse has assets that they are not disclosing, but you proceed with your settlement anyway and then find out about these assets later, but decide to leave the settlement intact and do nothing you may be prejudice later.
Consequence of not investigating a disclosed asset:
In a recent case, the wife was a beneficiary under a trust. When the husband and wife first agreed on their settlement, the wife said that the value of her interest under this trust was “not known”. In the settlement documents it was also valued at “not known”. Three years later, that interest came to be worth $1 million. The husband then tried to revisit the property settlement.
The court dismissed the husband’s application. At the time of the settlement, the husband knew that the wife’s interest under the trust was worth a substantial amount, but decided not to have it valued or to ask for proper disclosure about how much it was worth. As such, the Court said that the husband had lost his chance to obtain disclosure. He was not entitled to revisit the settlement.
If you find out or suspect that your spouse has not fully disclosed their assets, liabilities and financial resources, seek legal advice as soon as possible. We assist our clients to manage their disclosure obligations and we advise about proper disclosure from the other side.