This article is for information only and does not constitute legal/financial advice. Please contact us for advice tailored to your specific position.
Without a full and accurate picture of each parties financial circ*mstances on divorce, it is difficult for any family lawyer to advise their client about a financial settlement in their best interests. Without knowing about everything in the “matrimonial pot” it is impossible to determine how it should be divided.
Even if you are trying to reach an agreement outside of Court proceedings, the importance of both parties being open and honest about their financial circ*mstances is overriding.
Form E and financial disclosure
In Court proceedings, the parties will be ordered to complete a Form E, a financial statement that provides detailed information about all of the assets, liabilities, pensions, income and business assets of each party along with their income and capital needs.
Outside of the Court arena, it is good practice for solicitors to encourage their clients to prepare a Form E when it is hoped that separating spouses will be able to reach an agreement as to the division of the marital wealth. Once these forms have been completed, they are exchanged simultaneously
A Form E is a complex document that needs to be completed carefully. It can be time-consuming to collect together all of the information that is required but it is important that the form is completed properly to avoid time and money being wasted when additional information has to be requested.
Form E – avoiding common pitfalls
Here is how to avoid the most common pitfalls:
- Don’t bury your head in the sand. Whether you are asked to provide your financial disclosure voluntarily or by Court order, it is important that you comply. Failure to provide a voluntary Form E could lead to your spouse making an application to the Court for a financial remedy which will incur significant cost and time in paying for legal representation and attending Court hearings. If you have been ordered by the Court to prepare a Form E and fail to do so, there are consequences including orders for costs being made against you and imprisonment if you consistently fail to co-operate.
- Make sure that you spend time completing Form E and pay attention to what is being asked of you. Make sure you provide the documentation required by the form. Only partially completing the form or failing to provide supporting documentary evidence will lead to further questions being asked by your spouse. Serious omissions, providing incomplete or obscure information could well mean that your ex-spouse, their solicitor or the Court come to doubt your honesty which could impact on the outcome of your case. The worst case scenario is that you could be held in contempt of Court and face charges as a result.
- Be realistic when completing the form. Do not over or underestimate the value of your assets or your needs. This will not help you in the long term, will again increase your costs and lead to queries over the accuracy of the information that you have provided.
- Be consistent in providing the most up-to-date information available to you. Try to make sure that the information you provide covers a similar period. For example, you will have to provide at least 12 months’ bank statements for each account you hold. Ensure that the period covered by those statements is similar so that transfers between the accounts can be easily identified preventing further questions from being asked.
- Start tackling the form at an early stage. Pension valuations and other documentation can take time to obtain. Leaving the form until the last minute could mean that it is incomplete and this will lead to further delays.
- If you have complex financial circ*mstances, it is important that you are as clear as possible and provide supporting documentation that goes to explaining the position. Remember that whilst you may be familiar with your own finances, the Court, lawyers and even your ex-spouse may not be.
- Take time to ensure that you have made full disclosure. Are there pensions that you have forgotten about? Do you receive dividends, rentals or other income that you have not included in the form?
- If you are not sure, take advice from a solicitor specialising in divorce and financial matters.
There is an ongoing duty to be full and frank in your financial disclosure, even once Forms E have been exchanged. This means that if your financial circ*mstances change in any relevant way you must tell your ex-spouse.
Although financial disclosure may seem like an onerous and invasive task, remember that providing all of the relevant information at an early stage will significantly improve the chances of resolving the finances of your divorce quickly and amicably in the most cost-effective way.
How can we help?
Emma Davies is a Partner in our expert Family Law team, which is ranked in Tier One in the independently researched publication, The Legal 500. Emma advises on divorce andfinancial settlementswhich involve complex issues and substantial assets.
If you have any questions in relation to Form E and/or financial disclosure or any related subjects, please contact Emma or another member of our expert Family Law team for more information, advice and assistance.
Emmacan be contacted on0800 024 1976 or via our online form.
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