Financial Disclosures… Are they Necessary During Divorce?
For some, the path of divorce is uncharted territory. In addition to being a newbie to divorce, there is a lot of information that varies from case-to-case as well as law-to-law on a number of spectrums. Financial regulations, as well as legal regulations, play large roles when defining the outcome of a divorce. At Fairway, one of the most popular questions we receive from clients is regarding the financial disclosures portion of a divorce.
Do I need to disclose my financials? Can my spouse’s financials be hidden? and How can I find out if my partner has hidden their financials? Read the below answers to these questions that touch on the law and ethics to give you a well-rounded understanding.
Do I need to disclose my Financials?
It is important to disclose your financials because:
- If you don’t, you cannot rely on any agreement you make; the agreement is void
- You have an obligation to disclose all financials under these three acts:
- Alberta Rules of Court, Federal Child Support Guidelines and the Supreme Court of Canada
- There can be legal penalties for not providing disclosure
Can my spouse hide information within their disclosure?
The short answer is, yes people can hide details in their disclosure, however, they cannot legally hide it. Each party has an obligation to fully disclose.
If it is not disclosed and if this surfaces the following consequences can occur:
- The agreement can be voided and reviewed, which will cost both parties more money for the review as well as drafting a new agreement
- There can be financial consequences; spousal and/ or child support can change, tax implications, a backlog of payments can be implemented etc.
How can I find out if my partner is hiding anything?
Wanting to find out if your partner is hiding financials is a normal reaction.
You are able to find out if your partner is hiding financial information if:
- Your partner grants you permission to go to the bank and recover the details
- You can go to the court and have the other party served a notice that requires them to voluntarily disclose all details. If they do not, the court will order them to disclose the details.
Divorce is never going to be easy regardless of how amicable you and your partner are. The fact of the matter is that there is a process to complete and regulations to follow that make going through a divorce complicated. Understanding the why of the process is important. So before you find yourself following the advice of friends, family or of a professional source take another step and find responses from more sources because you do not want to be caught in a situation where the advice that you were given was wrong. Seek to understand again, and again and again before you make your decisions.