Two family law finance cases headed for the Supreme Court

The Supreme Court will soon hear an application from two ex-wives to overturn final orders from their ancillary relief hearings – because their husbands lied about their assets.

Varsha Gohil and Alison Sharland have both already lost Appeal Court hearings to have their respective cases reopened.

Ms Gohil’s case, Gohil v Gohil [2014] EWCA Civ 274 , which began in 2004, was complicated because her then husband was also being investigated for fraud at the time. He was eventually convicted and jailed in 2010. Two years later the high Court agreed that he had lied during the ancillary relief proceedings but the Appeal Court later decided that the wife should not be permitted to use evidence that was relied up during her ex-husband’s criminal trial.

Ms Sharland also lost her bid in the Court of Appeal in February to reopen her 2012 divorce settlement in S v S (Financial Remedies: Non-Disclosure: Materiality) [2014] EWCA 95, [2014] 2 FLR. After the settlement she discovered that her husband had been planning to float his company on the NY Stock Exchange for up to 10 times the value he had disclosed when the couple agreed a settlement in 2012. Lord Justice Briggs dissented from the majority view saying that it was a matter of public interest for the Court’s processes to be protected from fraud.

The Courts have long had discretion to rule on whether a divorce settlement should be a “clean break” or not once the assets are divided and if the couple should be freed of further financial obligation to each other. There is no statutory guidance on how to apply section 25A of the Matrimonial Causes Act 1973 – leaving Courts free to determine what is “fair.”

In both the Sharland and Gohil cases the Appeal Court Judges sympathised with the wives and were able to see that their husbands’ lying and fraud had arguably prevented the Courts from being “fair.”

The Courts have previously been very reluctant to reopen ancillary relief cases after a final order – even when a husband later went bankrupt and creditors tried to take the matrimonial home won by the estranged spouse Hill v Haines [2007] EWCA Civ 1284.