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Significant increase in set-aside divorce cases since Sharland and Gohil

Non-disclosure and set-aside still key divorce issues two years on

Two years after the Supreme Court handed down its Judgment in the Sharland and Gohil cases the issue of non-disclosure and setting aside a previously agreed financial divorce settlement remains a growing trend.

In October 2015 the Supreme Court heard the cases of Alison Sharland and Varsha Gohil who both argued successfully that during their divorces they were misled about their partner’s wealth leading to them accepting a lower financial settlement than they might be entitled to. The judges agreed that they could set-aside their settlements to agree a new deal based on the true value of the assets involved.

Expert family and divorce Partner Ros Bever from Irwin Mitchell Private Wealth acted for the women in both cases and says that around a third of her new enquiries since that Judgment have been similar cases related to non-disclosure and potential set-asides including many multi-million pound settlements.

Ros said: “Ultimately the important thing for everyone going through a divorce to remember is to be honest otherwise you will be found out. The majority of enquiries on set-aside and non-disclosure are wives who have found out that their divorce settlement may not have been fair and wish to challenge them.

“We have also had other people ask us to defend them from ex-partners who are just chancing their arm and coming back for more money because they think they can.

“It’s important to note that there has been no precedent set on the time-limits for when a divorce settlement could be set-aside. I think over the next few years we will see some settlements challenged and the issue of when time limits set in may need to be agreed.”

Ros says the issue of trying to avoid hefty maintenance payments or a large up-front payout is not new, but shows no sign of letting up despite the courts showing their teeth in recent years in several high profile cases.

She added: “We’re also increasingly working with our insolvency team in cases where one party has declared themselves bankrupt to avoid paying maintenance or reduce their settlement. We’ve had cases where trustees have asked us to set aside financial court orders in divorces where the parties appear to have acted in collusion to transfer properties to their partner during the divorce to avoid losing it to creditors when later being declared bankrupt.”

However Ros says there are things people can do if they are worried about divorce to avoid costly court battles.

“Asset protection is a major worry for many people, particularly with political uncertainty around at present,” she said. “Post-nuptial agreements are becoming much more common now, particularly for people whose business interests have become more valuable or are likely to increase in value significantly in the near future. Some couples sign them after having a rocky period and recognise that their relationship might not survive and take a practical approach to resolving any financial decisions before any future separation.

“Others have particular interests that they want to protect which could be family heirlooms, property or business interests. These may have developed since the relationship began. The important factors are that there is full and frank disclosure of assets and intentions and that both parties are able to seek independent advice with no coercion involved. This helps protect both parties’ interests.”

Published: 25 October 2017

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October 2017

Key Contact

Ros Bever