A fair property settlement depends on knowing what is actually in the property pool. After all, you cannot divide what has not been identified.
After separation, both parties need to be open about their financial circumstances, however, disclosure is not always provided easily. In some matters, one party delays, provides incomplete documents, or refuses to disclose information altogether. This can be stressful and frustrating, particularly if you believe your former partner is hiding assets or trying to control the process.
If your former partner is refusing to provide financial disclosure, there are steps you can take to move your matter forward.
What is financial disclosure?
In family law property matters, both parties are required to provide full and frank financial disclosure.
This means each person must provide relevant information and documents about their financial circumstances, including their income, assets, liabilities, superannuation, businesses, trusts and other financial resources.
Importantly, financial disclosure is an ongoing obligation. It does not end once initial documents have been exchanged. If your financial circumstances change, or if further relevant documents become available, those documents should be disclosed. This obligation continues until the property settlement is finalised.
Financial disclosure may include documents such as:
- bank statements;
- credit card statements;
- mortgage and personal loan statements;
- payslips;
- tax returns and notices of assessment;
- superannuation statements;
- property appraisals or valuations;
- business financial records;
- company or trust documents; and
- cryptocurrency.
Disclosure is not limited to assets held in someone’s personal name. Depending on the circumstances, it may also include information about companies, trusts, businesses or other financial structures connected to that person.
Why is disclosure so important?
Before a property settlement can be negotiated, both parties need to understand the asset pool.
Without proper disclosure, it is difficult to know whether a proposed settlement is just and equitable. You may not know whether all assets have been included, whether debts are accurate, or whether money has been moved or spent without explanation.
Proper disclosure allows both parties and their lawyers to:
- identify assets and liabilities;
- assess financial contributions;
- consider future needs; and
- reduce the risk of the agreement being challenged later.
What if my former spouse refuses to provide documents?
If your former partner refuses to provide disclosure, there are several steps that may be taken.
Usually, the first step is for your lawyer to write to the other party or their solicitor requesting the missing documents. If documents are still not provided, the matter may need to progress to mediation, or court proceedings. In court proceedings, orders can be sought requiring a party to provide disclosure.
Can there be consequences for not disclosing?
Yes. A failure to provide proper financial disclosure can have serious consequences.
The Court can take non-disclosure into account when determining a matter. In some circumstances, a party who refuses to provide documents may face costs orders, delays, or other penalties.
A property settlement reached without proper disclosure may also be vulnerable if important information later comes to light. This is why it is risky to sign an agreement if you believe documents are missing or assets have not been properly disclosed.
What should I do if I think assets are being hidden?
If you suspect your former partner is hiding assets, transferring money, delaying disclosure or refusing to cooperate, you should obtain legal advice before agreeing to any settlement.
You should also start gathering your own records, including bank statements, tax records, loan statements, superannuation information and any documents showing major purchases, transfers or withdrawals.
It can also be helpful to write down what you believe is missing. For example, if you know your former partner had a particular bank account, business, investment, loan, vehicle or property, let your lawyer know.
Do not ignore your own disclosure obligations
Even if your former partner is being difficult, it is important that you comply with your own disclosure obligations. Failing to provide your documents can delay your matter and may weaken your position.
Providing your disclosure early can also put pressure on the other party to do the same.
Moving forward with confidence
Financial disclosure is a fundamental part of the property settlement process. While it can be frustrating when a former partner refuses to provide documents or delays the process, there are steps available to obtain the information needed and move your matter forward.
If you are concerned that disclosure is incomplete, assets are being hidden, or you are unsure whether you have received all relevant financial information, obtaining legal advice early can help you understand your options and protect your position before any agreement is reached.
The information provided in this article is general advice only. Given that each situation is unique, we recommend that you contact our family law team if you would like to discuss your matter. Our team can be contacted on (03) 9311 8911.
