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The Supreme Court tackles the stealthy wealthy

Two cases have been reported in the press recently in which the wives have claimed that their estranged husbands have hidden their true wealth from the court. This, they claim, has resulted in them feeling forced to accept divorce settlements that are unfair and substantially below what they are legally entitled to.

Although the two women, Alison Sharland and Varsha Gohil, are represented by the same solicitor, the circumstances of each case are very different. The Sharland case involves significant wealth. Since their divorce, it has transpired that Mr Sharland lied about the value of his company, Appsense, and about plans for its future flotation.   On the back of discovering that Appsense was valued at nearly a billion US dollars, Mrs Sharland contests her £10.3 million settlement. Mrs Gohi settled for £270,000 and a car before finding out that her husband was involved in money laundering £50 million along with a Nigerian politician.

Both cases have come before the Supreme Court and lawyers consider that there will be wide-reaching consequences. Ros Beaver, the women’s lawyer states, “Both cases raise serious issues about how the courts should handle situations where information shared with the court and used to agree a divorce settlement is later found to be false or incomplete… these cases are about a matter of principle and justice. Dishonesty in any legal proceedings should not be tolerated; the family court should not be an exception.”

The starting point for dividing matrimonial wealth in England and Wales is equal division. This is a more likely outcome in cases of longer marriages. The incentive for parties to conceal assets is, therefore, obvious. While the courts have always taken a very dim view of dishonesty in family proceedings, the current law is that only significant, or material non-disclosure could lead to a change in the terms of the financial order. The ruling is expected later in the year and there will be strong guidance as to the implications of failing to disclose true wealth in divorce proceedings.