Cheaters Do Prosper

The English Court of Appeal in Imerman v. Imerman June 2010 struck a deadly blow to parties in a divorce action who surreptitiously obtain financial documents belonging to their spouse.

In high net worth divorce cases, where assets may be held in several jurisdictions and where a spouse may decline to disclose all of his/her assets, the non-owning spouse’s method of gathering information and documents frequently includes scouring home offices, kitchen drawers and bedroom end tables.

Often this evidence is crucial in providing proof of off-shore bank accounts and other assets including trusts set up in tax haven countries. Once the evidence is obtained and provided to opposing counsel, the practical onus is on the spouse who owns the assets to provide an explanation.

In British Columbia the court has held in Cunha v. Cunha that where there is incomplete disclosure, the court will presume that the hidden assets are as valuable as the disclosed assets. Without a credible explanation the non-owning spouse is often awarded all the disclosed assets, instead of just fifty percent of the assets.

The English Court of Appeal has now blocked that avenue to spouses (usually women) who are seeking their rightful share of family property. Based on this new law, the Court will not admit evidence that has been obtained by subterfuge by a spouse or an agent for a spouse.

This law will be devastating to spouses whose only real chance of obtaining a fair division of assets is to ferret them out themselves. The winners will now be those who perfect the practice of non-disclosure and that is simply wrong.

Lawdiva aka Georgialee Lang

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3 thoughts on “Cheaters Do Prosper

  1. Hello Lawdiva
    Isit all right to ask this question?
    Some wives have gone to great lengths including breaking into spouse private office was the only way to find information that may protect them from the greediness of their spouse during divorce proceedings. What are some of your thoughts on what would constitute “resonable excuse for not disclosing.
    Love reading your posts, “Please Mam, I want more!!”
    Cheers!
    Donna

    1. Donna In the eyes of the court there are no “reasonable excuses” for failing to disclose income and assets in a family law case.

      Sometimes a spouse will inadvertently omit to disclose an asset. For example, a client of mine failed to list several bank accounts in his name. When it was brought to his attention he said “Oh, well there’s nothing in those accounts and there hasn’t been for years.” Nonetheless, the accounts should have been disclosed.

      The most difficult cases are when there is no paper trail but the spouse has often visited tax havens and has bragged in the past that he or she has money off shore. Without documents it is almost impossible to prove the existence of an off shore asset.

      The courts are coming down hard on spouses who don’t reveal all their assets or reveal them but assign a value to them that is much less than their true value.

      I’m glad you are enjoying the posts. Keep reading! Thanks. Lawdiva

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