06 October 2015, by Taylor King Family Law Solicitors
In the case of Sharland, Mrs Sharland’s appeal centred on the impact of fraudulent non-disclosure. The valuation of Mr Sharland’s shareholding in his software business and its distribution between the parties was the main area of dispute. After a valuation on the basis that the company was not going to be floated on the stock market Mrs Sharland was to receive 30% of the net sale proceeds, whenever it was sold, together with other assets.
After the consent order was drawn up Mrs Sharland became aware, through the press, that Mr Sharland’s company was being prepared for an initial public offering and a substantially higher figure that it had been valued within the financial remedy proceedings.
The Court of Appeal upheld the judge’s refusal to set aside the consent order as he would not have made a substantially different order. The Supreme Court have now allowed the appeal and returned the case to the High Court.
In the case of Gohil, the consent order was agreed despite Mrs Gohil’s belief that there had not been full disclosure. She applied to set aside the order on the basis that Mr Gohil had failed to disclose all his assets. The court found that there had been material non-disclosure by Mr Gohil and that if there had been full disclosure a different order would have been made.
There is a now, therefore, a much stronger emphasis on the requirement to provide full and drank disclosure throughout the proceedings.
The two judgments addressed how a case should be reopened if material non-disclosure is identified:
1. A fresh action to set aside the order;
2. An appeal against the order; or
3. An application to a first instance judge in the matrimonial proceedings.
Permission is required for an appeal but not the other two and an appeal may not be the most appropriate venue for hearing new evidence and resolving factual issues that may often arise.
A Family Procedure Rules committee working party is currently considering whether the Family Procedure Rules or a Practice Direction should specify criteria for choosing between the different applications.