Today, the Supreme Court unanimously allowed both eagerly awaited appeals in the cases of Sharland and Gohil. Both wives appealed to the Supreme Court following non-disclosure by their respective husbands in the context of the financial proceedings consequent upon their divorce. In both of these cases, the wives accepted lower settlements than they would have done if their husbands had fulfilled the established requirement of full and frank disclosure.
Harriet Errington, a solicitor in the Family team at Boodle Hatfield said: “The Supreme Court reversed the Court of Appeal's decisions and emphasised the necessity of full and frank disclosure in financial proceedings. In cases of non-disclosure, as Lord Wilson, who gave the lead judgment in the unanimous decision in Gohil, said "fraud unravels all". It follows that a financial settlement reached on the basis of fraudulent information will be set aside if the Court would otherwise have made a substantially different order.
“These cases will provide welcome relief to many spouses who have genuine evidence that they have suffered from their spouse's non-disclosure in divorce proceedings and may go a considerable way towards redressing what has colloquially become known as the "cheat's charter". False representations made, often by the financially stronger party, in the context of financial applications can sometimes lead to substantially lower awards to the weaker party, leaving them in an unfair position.”
Harriet adds: “The Supreme Court has made it clear that dishonesty in legal proceedings will not be tolerated. The effect going forward will be to re-affirm the established position that any award made or settlement arrived at on the basis of fraudulent or dishonest representations will be built on sand. This means that if it transpires that such representations have been made in previous proceedings, these judgments re-affirm that the Court will open the doors for the aggrieved spouses to re-open their cases. Many spouses may be sleeping less soundly tonight.”