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Penalties for non-disclosure in property cases

Penalties for non-disclosure in property cases

Monday 29th of April 2019
By: Kate Trajcevski and Alexa Segerius, Accredited Family Law Specialists, Coote Family Lawyers

You have all been excellent.

I'm going through a separation and have been asked to disclose my financial documents.  Do I have to?

Family law made the headlines recently when a party was imprisoned by a Federal Circuit Court Judge for failing to properly provide disclosure to his wife during their property division proceedings.

Brisbane-based Judge Vasta made a declaration that the Husband in a family law dispute was “in contempt” of court for failing to disclose financial documents.  The Judge made an order that the husband be sentenced to 12 months imprisonment.  

The husband appealed the order, with the wife’s support.

The declaration and order of Judge Vasta was overturned on appeal by Justices Strickland, Murphy and Kent, however not before the husband was imprisoned for one week during which he was housed in a maximum-security facility and was classified as a risk to himself. 

The decision of Judge Vasta clearly reflects the Court’s frustration at the parties when they fail to make full and frank disclosure in accordance with orders of the Court and brings into focus the need for parties to family law proceedings to properly fulfil their obligations to make full and frank disclosure of their financial circumstances.


What is the duty of disclosure?

The obligation to make full and frank disclosure is set out in rule 13.04 of the Family Law Rules (and rule 24.03 of the Federal Circuit Court Rules).

The Rules require parties to disclose all documents evidencing their income, property and financial resources, whether they are owned by a party directly, or controlled by them through some other person or corporation or trust. This includes information recorded in a paper document or stored by some other means such as computer storage device and also includes documents that the other parties may not know about.  Parties are also required to disclose documents evidencing any property disposed of in the year prior to separation and since. 

The obligation to provide such disclosure starts before the case commences and is ongoing until the matter is finalised. 


What are the consequences of non-disclosure?

The failure for either party to provide full and frank financial disclosure can prevent a case from moving forward or resolving.  It can also result in wasted Court time and great expense to the parties (in time and legal fees) who have instructed their solicitors and counsel to attend hearings to discover that little can be achieved without the production of documents.

Penalties for non-disclosure vary depending upon the seriousness of the failure.  For serious breaches you may be fined or imprisoned for contempt of Court. 

The Court can exclude a document from evidence, for example evidence of a loan or contribution, which can greatly impact a property division.  In some cases, it may be appropriate to dismiss all or part of a party’s case.  Failure to make proper disclosure is also grounds for a costs Order.


Need more help?

Understanding your duty of disclosure can be complex and can vary depending on your specific circumstances.  If you need specific advice about your obligations, you can contact our team of family law specialists on (03) 9804 0035.

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To my dream team.  Many thanks for your support and assistance during this year.  I wont say it's been easy, however it has been made 1000% better with your involvement.  You all rock.

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