Within a Divorce, an agreement is often reached on the basis of both parties disclosing their financial situation to the other in full and a Consent Order being agreed and ratified by the Court. When it has subsequently been discovered that one person has been fraudulent in respect of their financial disclosure it has often been difficult to persuade the Court that such non-disclosure would have made a material difference to the outcome of the case, because this point can be very difficult to prove.
However, a recent Supreme Court Judgment dealing with two cases where fraudulent non-disclosure was discovered after a Consent Order was made, means that such cases can be reopened and the financial situation reassessed, without the need to prove this particular point. Instead the Court should focus on whether the fraud would have affected the outcome of the case at the time it was originally agreed – ie would the “innocent” party have agreed the original Order if he or she had known about the fraud?
This is a very important Judgment and, although the cases the Court was looking at dealt with very high values, the lesson for all parties within any Divorce is that they should be open and transparent in relation to their finances from the beginning, otherwise they run a high risk of having the Order overturned once their fraudulent non-disclosure has been discovered!