ZZ21D58773 - [2025] EWHC 1659 (Fam)

Parties to financial remedy claims have a duty of full, frank and clear disclosure. H’s disclosure in this case has not always complied with that duty. His Form E disclosed gross income for the next 12 months of £155,000 gross. That assertion came nowhere near to giving a complete picture of the annual funds to which H had access. His Form E budget excluding mortgage payments was put at £7,604 per month or £91,248 per annum. It was quite clear in cross examination that H spends at a far higher rate than this. Some of the documents provided by H with Form E appeared to make no sense. The schedules accompanying his tax returns did not match the figures in the body of the returns. Calculating H’s true income is very hard as so much of his life, including historically the mortgage at the family home, is treated as a company expense.

H was ordered to supply bank statements and credit cards going back to July 2019. He failed to provide statements from ABC, blaming the liquidators but he did not produce material from them explaining why he was not able to obtain the statements.

In his answer to the schedule of deficiencies, H claimed that money paid to W prior to separation was treated as part of H’s dividends. This was a lie. There are no corresponding entries on the director’s loan account and W was on PAYE.

H’s presentation of the value of LM1 at nil in his Form E was at best misleading. He must have had a view of its value, yet he gave none. He provided no documents relating to the purchase. His statement produced in answer to the freezing injunction failed to mention the £9.5 million payment due in October 2025. Earlier he refused to give details of the negotiations to exit on the basis he was subject to an NDA. This was untrue.

Ms Hart’s report identifies its own significant deficiencies which have arisen because of material provided or not provided to her by H. She has no proper financial information after 31 December 2023. H has stopped creating management accounts for DEF because, he says, they were only produced because they were required by the mortgagees of a charged property. I find this an unlikely proposition.

Ms Hart’s report identifies that JKL, an entity set up by H since separation, owns a pub purchased for £400,000. Ms Hart has used the purchase price for current value. She has been given no information from H about his plans for the property.

Ms Hart relied on a valuation of a property owned by DEF. The valuation was without planning permission. During his cross examination, H produced planning permissions relating to the property. These were dated May 2025. This only arose as an issue because W had produced a photograph of a lamp post with a planning application sign dated January 2025. I have no doubt H would not have mentioned this had W not produced the photograph.

In cross examination of H and Ms Hart, Mr Thorpe KC attempted to demonstrate that the company accounts produced by reputable accountants were false. He did this by reference to underlying bank statements and attempted to show that the true tax payments and turnover did not actually match the assertions in the accounts. It is in my view impossible to undertake such a task without setting out the allegations in advance and enabling the person against whom such allegations are made to consider them with advisers, whether lawyers or accountants. This attack was not foreshadowed in the points of conduct raised by W and should not have been pursued and I make no findings about these points.

So, I have here before me a man who has been lax with his duty of full and frank disclosure. What approach should I take? I remind myself of Moylan LJ’s guidance in Moher v Moher [2019] EWCA Civ 1482. To paraphrase that guidance, I must determine the resources of the non-disclosing party and when undertaking that task I am entitled to draw such adverse inferences as are justified by the nature and extent of that party’s failure engage with the duty. I must not engage in pure speculation and I must only draw inferences which are proper and reasonable. I will deal with the impact of H’s non-disclosure, as I find it to be relevant, when I come in due course to make my findings as to the value of the parties’ resources when I reach the computational phase.