One of the first requirements in any divorce involving financial claims is that both spouses must give full and honest details of their finances. That includes property, savings, investments, pensions, business interests and other assets.

But what happens if one spouse tries to hide part of their wealth?

The courts take a very dim view of anyone who fails to give full and frank financial disclosure. A leading Court of Appeal case, Moher v Moher, makes it clear that attempting to conceal assets is unlikely to succeed and may leave the court drawing conclusions that are less favourable than if the truth had been told.

The case arose after a husband appealed against an order requiring him to pay his former wife £1.4 million. The judge who heard the original case found that the husband had failed to provide proper disclosure of his financial affairs, making it impossible to establish the full extent of his wealth.

The husband argued that the judge should first have estimated the value of the assets he was believed to have concealed before deciding what financial award to make. Without putting a figure, or at least a range, on those hidden assets, he said the award could not be justified.

The Court of Appeal rejected that argument.

Giving the leading judgment, Lord Justice Moylan said that while judges should normally seek to identify a party’s financial resources, there will be cases where deliberate non-disclosure makes that impossible. In those circumstances, judges are entitled to draw reasonable adverse inferences from the available evidence, but they should not speculate or invent figures that cannot be supported by the evidence.

The court also warned that a spouse should not be allowed to obtain a better outcome simply because they have made it impossible to discover the full extent of their wealth. Where the evidence justifies it, a judge may conclude that sufficient resources exist to support an appropriate financial award, even if the precise value of hidden assets cannot be calculated.

The decision is an important reminder that honesty is not optional in financial remedy proceedings. Anyone who deliberately conceals assets risks damaging their credibility and may find the court drawing adverse inferences that ultimately work against them.

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Case details

Moher v Moher [2019] EWCA Civ 1482

Court of Appeal (Civil Division)

Lord Justice Moylan, Lady Justice King and Lady Justice Rose

Judgment delivered on 21 August 2019