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Sharland and Gohil – Misrepresentation and Financial Disclosure

Oct 15, 2015
The Supreme Court has today ruled that two wives (Mrs Sharland and Mrs Gohil) may re-open the original financial settlements reached with their husbands due to non-disclosure of the husbands’ true financial positions at the time that the agreements were reached.

In the case of Mrs Sharland, she and her husband had reached an agreement during the course of court proceedings. However, Mrs Sharland later discovered that the husband had been actively planning to float a successful company, in which he owned two-thirds of the shares. 

In the case of Mrs Gohil, she too had reached a financial agreement with her husband, however her husband was later convicted of money laundering that occurred during the course of the marriage. 

The question before the courts was whether the misrepresentation vitiated the consent orders entered into at the time of the hearing. Would the wives have consented to the orders as they were had they known their husbands’ true financial position?

In Sharland v Sharland the Court of Appeal drew attention to the differences between an order of the court and a contract. In contract law, the contract derives its powers from the consent of the parties where as an order derives its power from the court. However, the Supreme Court rejected this position as a consent order could hardly be called such if there was no consent. Consent is afforded the importance it has as a result of full and frank disclosure. Without one, there cannot be the other.

The rulings serve as a stark reminder that full and frank disclosure dominates the principles of financial settlements.

For more information please contact Karen Pritchard, or a member of our Family Team on 01279 755777. 

Karen Pritchard

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Karen Pritchard

Karen joined Nockolds in September 2015. Before joining the firm, Karen graduated with a First Class degree in Law from the University of Westminster and ...

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