Making an application for financial relief – your duty to give full and frank disclosure

Making an Application for Financial Relief – Your Duty to Give Full and Frank Disclosure

When dealing with a couple’s financial provisions on divorce, there are two ways in which you can proceed. The first being voluntarily and the second being an application to the Royal Court for ancillary relief/financial provision.

It is important to note that an application for ancillary relief can only be filed once a petition for Jersey divorce or judicial separation is before the Royal Court. Either party may apply for child maintenance, interim maintenance, spousal maintenance, secured provision, a lump sum, variation of a settlement or the transfer, sale or settlement of property.

Duty of full and frank disclosure

Once an application for financial relief has been made, both parties are under a duty to give full and frank disclosure of his or her finances. This is usually in the form of an Affidavit of Means, which is a sworn document requiring a comprehensive account of each party’s financial circumstances.

An Affidavit of Means is a document which lists information in respect of an individual’s financial situation. The document covers a wide range of circumstances which could apply in any given case, for example; details of any property owned, details of all bank accounts held, any pensions, shares or investment policies, details of any loans and liabilities, any personal belongings of a particular value and details of that person’s individual needs and the needs of the children (where applicable).

The Affidavit of Means is then accompanied by supporting disclosure; the usual documentation provided are the following:

  • Proof of any maintenance being paid, whether spousal or child contributions
  • Details of any mortgages and their repayment terms for any properties owned
  • An up-to-date valuation of any properties owned
  • Details of your individual borrowing capacity from a bank provider
  • Twelve months’ worth of bank statements for all accounts held; depending on the circumstances, three years’ worth may be sought
  • Details of any life insurance policies
  • Valuations of any pensions held; the usual information sought is the ‘cash equivalent transfer value’ (CETV)
  • Details of any debts, loans and credit cards
  • Documentation to support monthly outgoings, where applicable
  • Six months’ worth of wage slips, and proof of the previous year’s December wage slip

The Court’s function is inhibited if one or other of the parties does not provide full and frank disclosure of their financial circumstances, and lawyers cannot properly advise their clients in the absence of all relevant information in relation to financial relief. Of course, the courts have the case management powers to make orders regarding disclosure and the opposing party may file Questionnaires and Schedules of Deficiencies, which the Court can order must be answered. The parties themselves are expected to raise Questionnaire and Schedules of Deficiencies, rather than obtain information by illegal or immoral means.

Financial relief | Obtaining information by illicit means

However, there are still occasions when one spouse, for whatever reason, takes it upon themselves to obtain information relating to the other party’s financial affairs by illicit means.

Previously under the authority of the case Hildebrand v Hildebrand, a party could use such documents, provided that they were not taken by force (for example by either hacking into a computer or breaking open a locked filing cabinet). If the documents had not been obtained by force, it was acceptable for the party who had obtained the documentation to make copies. The Hildebrand Rules provided that once the documents were in the opposing party’s possession, that party had to notify their spouse that they had the document(s) and the originals had to be returned to the other party as soon as possible.

The Hildebrand Rules were, however, turned on their head by the case of Tchenguiz v Imerman [2010] EWCA Civ 908. The case concerns a wife whose two brothers downloaded a significant amount of documents and information from her husband’s computer in an office they all shared. The husband claimed that this was an illegal act and sought the immediate return of those documents without them being disclosed in the proceedings. The wife argued that she was afraid that her husband would not provide full and frank financial disclosure and that he would attempt to hide assets from her and from the Court, so that these documents should be disclosed in the financial proceedings in order to ensure that full and frank financial disclosure had been achieved.

The Court of Appeal found in favour of the husband and granted an injunction to the husband, requiring his wife’s solicitors to deliver up the documents without retaining copies and preventing his wife from relying on any of the information that had been inappropriately obtained.

The English Court of Appeal has said that it will not condone the ‘illegality of self-help’, in the form of copying documents or the removal of another’s property or in relation to company assets simply on the basis of a fear that the other party may conceal information, which should otherwise be disclosed in the proceedings. The Court of Appeal was keen that parties who fear that their spouse will not provide full financial disclosure, or may seek to hide assets or income, should approach the Court for a court-sanctioned order including Mareva injunctions (freezing orders), disclosure orders and Anton Pillar (search) orders.

Given this decision, parties need to be cautious as to how they obtain documents belonging to another party in relation to financial relief. The Imerman decision stresses the need for caution before engaging in ‘self help’. Please speak with a member of our family law team before taking any action.

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