Two women have won a Supreme Court appeal to have their divorce settlements overturned.
Alison Sharland and Varsha Gohil both successfully argued that their ex-husbands had misled them about how much they were worth.
Alison Sharland agreed a settlement with her ex-husband, thinking his business was worth between £22m and £32m.
Subsequent press reports indicated the business was being prepared for public flotation, and placed its value at about £1bn.
The Supreme Court decided that Mr Sharland had been ‘seriously misleading’ and ‘dishonest’ about his business.
Varsha Gohil agreed a settlement, having received only limited disclosure from her ex-husband.
The agreement recorded her belief that Mr Gohil had not provided full and frank disclosure. Mr Gohil was later convicted for fraud and money-laundering offences and sentenced to 10 years’ imprisonment.
In his criminal proceedings, he was found to have laundered sums of up to £37m.
The Supreme Court could not rely on the details of those proceedings, but concluded that he had in any event perpetrated ‘large-scale material non-disclosure’ when they reached their agreement Ms Sharland said after the judgment: “My legal battle has never been about the money, it has always been a matter of principle. I entered into an agreement with my estranged husband thinking that it was a fair one.”
Giving the judgement of the Supreme Court, Lady Hale said Ms Sharland had been “deprived of a full and fair hearing” because of “her husband’s fraud”.
The Supreme Court ruled that both settlements should be set aside and the cases reopened for further consideration.
The decisions are important, as they will have an impact on how spouses conduct themselves in family court proceedings.
There were previous concerns that spouses were able to conceal their assets and get away with it.
The latest ruling sends out the clear message that material non-disclosure and fraud will not be tolerated, and also that divorce settlements can be overturned in those circumstances.
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