Christmas has just gone and New Year is fast approaching. Although many look forward to this time of year, there are those who are currently going through a difficult time in their life. The festive period is a time for families to come together and celebrate. However, for those about to begin, or for those already caught up in divorce proceedings, this can be a very trying time. It is also a time for reflection and I would like to take this opportunity to reflect on a few interesting cases from the outgoing with lessons to be learned for those couples going through a divorce.
- The truth will always come out
The biggest headline grabber of the year was undoubtedly the two appeals to the Supreme Court in the cases of Sharland and Gohil. In each case, the husband had been found out for failing to make full and frank disclosure of their financial circumstances and in each case, the aggrieved wife had then sought to set aside the original settlement. Both wives were successful and the husbands have been left with enormous cost bills to pay.
One cannot help but wonder whether either Mrs Sharland or Mrs Gohil will achieve more valuable financial settlements on their second pass. Mr Sharland hasn’t sold his company and can Mrs Sharland hope to receive more than 30 per cent of the future proceeds? Will Mrs Gohil successfully achieve a higher capital award? These issues may become clearer in 2016 but for now these cases provided a useful reminder that there is a duty on both parties to make full and frank disclosure of their financial circumstances and any changes or foreseeable changes to their financial circumstances, right up until the point when the Court approves a consent order. If you fail to make a ‘material’ (relevant) disclosure, then you run the risk that all that hard work and the costs you have incurred in reaching a settlement will be wasted. I have seen countless people who have tried to be clever by trying to avoid giving full disclosure even in relation to relatively low value assets and have come undone. Why bother? When you get found out, and invariably you will get found out, the Court will regard you as you a non-discloser, and any sympathy they may have had for your legal arguments will be lost.
- Don’t let your heart rule your head
A divorce is often a highly charged process due to the emotions involved. There are many spouses that feel betrayed or incensed at the actions of their ex. Unfortunately, these feelings become so strong that their decisions are often made based on these emotions instead of reason. This appears to have been the case in Work v Gray where the Judge failed to comprehend why an agreement had not yet been reached when there was clearly enough money to meet the needs of both parties. In this case, the Court reprimanded the parties for “haemorrhaging legal costs’ to such an extent that the fees alone could have purchased one of the parties “a nice flat in Clapham”.
Fortunately, in this case “good sense broke out” eventually and a consent order was made without the need for further court intervention. It is a real tragedy when people are so blinded by emotion that they cannot see that an early settlement means that they can move on with their lives and stop the financial and emotional drain. Listen to your lawyers advice but also don’t be afraid to question it and try if you can to also look at it from the other party’s perspective. Ask yourself, why are you arguing? Why can’t you reach an agreement? Is there something in what the other side is saying which is valid, a worry or a concern that needs to be addressed? Keep an open mind and you will reach a solution more quickly.
- Don’t let your mistrust in your partner make you mistrust the judicial system
This year there was a far more stark example of how emotions and suspicion can fuel disastrous litigation. It is very often the case that once one’s trust has been broken by a loved one, that trust does not come back. Betrayed spouses that have been lied to on many occasions simply believe that leopards do not change their spots. This appears to have been the case in MF v SF where the couple had been married for 20 years. The wife in this case became a full time mother and homemaker after the birth of the first of their two children. The husband was the breadwinner and earned a significant salary.
In her pursuit of a financial settlement, the wife was able to incur some £980,000 in legal fees. This was primarily the case because the wife argued that the matrimonial assets were worth £6 million whereas the husband maintained that that they were in fact only worth £3.1million. As a result of the way in which the wife behaved during the litigation, the husband argued that there should be a departure from equality in his favour to reflect the substantial legal costs and the fact that she had rejected his previous offers to settle. The Court was inclined to agree with the husband and stated that “although she was an honest witness” it was clear that “her whole approach to the proceedings had been governed by her suspicion of the husband which developed before the parties separated”. In the Court’s view, she was unable to approach the proceedings with any level of objectivity due to her deep distrust of her husband. As a result she incurred far more costs than she should have and received a smaller settlement than she would have otherwise been entitled to.
- It ain’t over ‘til it’s over.
Another attention-grabbing case over the last 12 months was Vince v Wyatt. In this the couple had been separated since 1984 and divorced since 1992 but no financial order had been made. Since separation the husband had amassed significant wealth and the wife eventually brought a claim for a financial settlement. Though the husband protested that the wife should not be entitled to bring any claims at all as there had been such a long period of time since the divorce, the Supreme Court did not agree, finding that Ms Wyatt’s claims were not an abuse of the Court’s process and were legally recognisable.
I have seen many clients who have come to me either after they have concluded divorce proceedings on their own or with another solicitor. Some have failed to sort out the financial arrangements or thought they had a financial settlement and even paid over money to their spouse but still failed to get a court order and they then found their former spouse is coming back for more. They hoped to save some money on legal fees but sadly found that it ended up costing them more to unravel problems that could have been avoided had they dealt with everything at the time of the divorce. Trust your lawyers when they advise what needs to be done. You wouldn’t ignore the advice of your doctor – at least I hope you wouldn’t!