Financial disclosure is a fundamental aspect of property settlements in family law matters in Australia. It ensures that both parties have a clear and accurate understanding of each other’s financial circumstances – including real and personal properties, investments, bank accounts, superannuation entitlements, debts and loans. The disclosure is essential for enabling fair and equitable division of assets and liabilities.
We will discuss below what financial disclosure is, why it is required and the consequences of failing to comply.
What is Financial Disclosure?
Financial disclosure is an obligation in family law, requiring each party to provide full and frank information about their financial position. This includes details of all assets, liabilities, income, superannuation, and financial resources, whether held individually, jointly, or through companies, trusts, or other entities. The duty of disclosure applies equally to married couples and those in a de facto relationship, and it is ongoing and continues until the property settlement is finalised.
Why do I need to provide my financial information to my ex and their lawyer?
You need to provide your financial disclosure to your former de facto partner/spouse because it is one of the legal requirements in the family law property proceedings. As per Federal Circuit and Family Law Rules 2021 and Family Law Act 1975 (Cth), the parties are required to provide complete and accurate financial information. The purpose is to ensure transparency and fairness in negotiations, either through the court proceedings or a binding financial agreement. Without full disclosure, it is not possible to determine a just and equitable division of property.
What Must Be Disclosed?
You are required to disclose a wide range of financial information, including but not limited to:
- Bank statements, including transaction accounts and account balances
- Your Employment Contract and your pay slips
- Superannuation entitlements
- Real property and valuations
- Shares, investments, and business interests
- Trusts and company documents
- Liabilities such as home loans, car loans, personal loans, other mortgages, and credit card debts
- Tax returns for individuals and companies
- Notices of Assessment
- Details of any significant financial transactions
- Cryptocurrency
- Jewellery, including Gold
- All other assets and liabilities that you have an interest in
- Other relevant financial circumstances
How is Disclosure Provided?
By way of exchange between the parties, whether they were married or in a de facto relationship, either between themselves or through their Family lawyers. You are also required to answer specific questions or provide further documents if requested by the other party.
When will the disclosure obligation stop?
The disclosure obligation will stop once the matter is finalised, either by final court orders or a binding financial agreement resolving all property and financial issues.
Is the Duty of Disclosure an ongoing obligation until the finalisation of the property matter?
Yes, the obligation to disclose is not a one-off requirement. If a party’s financial circumstances change, or if new information comes to light, updated disclosure must be provided promptly. This ensures that all negotiations and court decisions, guided by a family lawyer, are based on the most current information.
Consequences of Failing to Disclose Your Financial Information
If a party fails to comply with its disclosure obligations, the court may impose serious consequences, including
- Delay or adjournment of your family law proceedings.
- Costs orders against you.
- Setting aside any agreement or court order made based on incomplete or inaccurate information, in other words, a lack of disclosures, including failure to disclose significant assets such as superannuation.
- Findings of contempt of court may result in Penalties such as a fine or imprisonment.
Conclusion
Financial disclosure is an essential step in the property settlement process under the Rules and Legislation. It promotes openness, fairness, and efficiency, and is critical for achieving a fair, just, and equitable outcome. Parties should approach disclosure with honesty and diligence, understanding that the process is designed to protect the interests of all involved.
Contact US
Consulting a legal professional with expertise in family law and financial investigations is highly recommended. If you would like to discuss your unique circumstances, please do not hesitate to contact Shan Lawyers at (+61) 3 8589 2762 or by email info@shanlawyers.com.au
About the Author
Thirumalai Selvi Shanmugam is the founder, Director, and Principal lawyer at Shan Lawyers and is a leading family law specialist in Australia whose expertise is often sought by organisations and the media.