Member Article

The short answer is yes. Each of the parties to a divorce are under a duty to provide full, frank and clear disclosure of their financial circumstances. However, there are some circumstances where parties can, rightly or wrongly, get around this rule.

The so-called “millionaire’s defence” allows a party who is extremely wealthy to sidestep the requirement to provide financial disclosure on the basis that their wealth is such that they could satisfy any award which is reasonably made to the other party.

The “defence” is not, however, appropriate in the vast majority of cases involving millionaires as the bulk of their wealth is often tied up in their home, savings or pensions, which may need to be taken into consideration when looking at how to meet the needs of each party moving forward.

Further, it is not appropriate in cases where the principle of sharing will be the main consideration for the court. If each of the parties is entitled to, for example, an equal share of the matrimonial assets, the court would be unable to ascertain what that share would look like and how to give effect to this without full disclosure.

Finally, there is of course a potential sting in the tail when advancing the “millionaire’s defence”. If there is a dispute as to what one party should pay to the other, effectively saying “I can pay anything” gives the court far more freedom to make an order in line with what the receiving party is seeking than may otherwise be the case.

While the “millionaire’s defence” does allow some people to get around the requirement to provide disclosure of their financial circumstances, this option is likely to remain out of reach for all but the wealthiest of individuals.                                                                                                                                                                                                                                                                                                                                                                        

 

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