What is the difference between voluntary and court disclosure in financial remedy, what are the benefits and why do I need to do it?

When navigating the complexities of financial remedy proceedings in the context of divorce or civil partnership dissolution, understanding the disclosure process is crucial. Disclosure involves providing a full and frank account of your financial circumstances to ensure a fair and equitable division of assets.

There are two primary types of disclosure: voluntary and court ordered. This blog will explore the differences between these two types, their benefits, and why it is essential to comply with disclosure obligations.

From the outset, it is important to understand that fairness does not always mean equality. See our blog here for more information on this difficult area.

Voluntary Disclosure

What is Voluntary Disclosure?

Voluntary disclosure occurs when both parties agree to exchange financial information without the need for a court order. This process is typically initiated by mutual consent and aims to facilitate a quicker and less adversarial resolution.

Benefits of Voluntary Disclosure

1. Cost-Effective: Voluntary disclosure can significantly reduce legal costs as it avoids the need for court intervention.
2. Timesaving: By agreeing to disclose financial information voluntarily, parties can expedite the settlement process.
3. Less Stressful: The process is generally less contentious, fostering a more amicable environment for negotiations.
4. Flexibility: Parties have more control over the timeline and the extent of the information disclosed.

Why Do It?

Voluntary disclosure is often seen as a cooperative approach that can lead to a more satisfactory outcome for both parties. It demonstrates a willingness to negotiate in good faith and can set a positive tone for the entire settlement process.

BWS Law can advise you what you need and help you to gather the necessary information for voluntary disclosure, as well as communicate with your ex or their Solicitor, and seek to secure a settlement for you.

Court-Ordered Disclosure

What is Court-Ordered Disclosure?

Court-ordered disclosure, on the other hand, is mandated by the court when parties cannot agree to disclose their financial information voluntarily. This process is governed by the Family Procedure Rules 2010 and involves a more formal and structured approach.

Benefits of Court-Ordered Disclosure

1. Comprehensive: The court ensures that all relevant financial information is disclosed, leaving no room for omissions.
2. Enforceable: Court orders are legally binding, and failure to comply can result in serious consequences, including penalties and adverse inferences.
3. Impartial: The court acts as an impartial arbiter, ensuring that the disclosure process is fair and transparent.

Why Do It?

Court-ordered disclosure is essential when there is a lack of trust between parties or when one party is unwilling to disclose their financial information voluntarily. It ensures that both parties have a clear understanding of each other’s financial positions, which is crucial for a fair settlement.

BWS law will represent you in financial remedy proceedings to ensure that the court orders the necessary information be disclosed, which sometimes may include orders disclosures against third parties such as banks to identify undisclosed assets.

We can also advise and assist you in securing costs orders where this is required. These orders are difficult to achieve, and it is vital to secure representation in these circumstances. See the BWS blog here for further information about costs orders.

The Importance of Full and Frank Disclosure

Regardless of whether disclosure is voluntary or court-ordered, it is imperative to provide full and frank disclosure of your financial circumstances. This includes details of all income, assets, liabilities, and any other relevant financial information. Failure to do so can have serious consequences, such as:

• Adverse Inferences: The court may draw negative conclusions about your financial position, leading to a less favourable settlement.
• Set Aside Settlements: Any settlement reached can be set aside if it later transpires that there was a failure to disclose relevant financial information.
• Legal Costs: You may be liable for the legal costs of the other party if you are found to have withheld information.
• Criminal Charges: In extreme cases, non-disclosure can lead to criminal charges for contempt of court.

If you would like further information or advice about finances on divorce/dissolution, please contact us here or on 01509 232611.