Published: 19th August 2019
Divorce is always a very difficult period of time for all involved, with various different disputes making the battle of divorce drag on for often a very long time. However, for divorce proceedings that involve high net worth individuals, the whole process can sometimes be even harder, given that there is so much on the line.
With this in mind, any mistakes along the way can truly have a big impact on the outcome of the proceedings, making it incredibly important that mistakes simply aren’t made by the family lawyer or the clients themselves.
In order to help you understand what can potentially go wrong, we have listed some of the most common mistakes made within divorce cases involving high net worth individuals.
Rushing into a Decision – As a divorce can be a testing and difficult time in a person’s life, it is sometimes the case that people rush into decisions.
This is often done to reduce the amount of time that the divorce carries on for, in the hope that the stress and the pain being endured can be relieved as quickly as possible.
However, it is certainly not advised to rush into any decisions, especially when they can have huge implications on your business interests.
Asset Hiding – Asset hiding in a divorce is definitely something that you want to avoid.
You should always give full financial disclosure including all details on your financial position, such as bank statements, property valuations, other financial assets like investments and pension information.
It is also ill advised to transfer assets to a third party to avoid the other partner making a claim against you.
Although it may be tempting, assets are more often than not discovered, and if either party are found to be hiding them, they are likely to lose standing within the divorce proceedings and any fraudulent activity is likely to have a big impact on the final settlement.
Make sure to do your homework - You should also do your homework as the other party may well be hiding assets themselves, as it is common in most relationships that one party has more control over the finances than the other.
Rather than just "taking their word for it", due diligence must be done to ensure that all financial matters are fully investigated before reaching a financial settlement, as the correct information can make a significant impact on the outcome.
It is worth having any property or business valuations conducted by an impartial third party to ensure they are valued correctly and they should also be aware of the tax implications of the settlement so you understand your obligations in relation to tax.
Letting Emotions Dictate Decisions – In divorce proceedings, emotions run high and this can sometimes have an impact on the decisions that are made.
You should always try to keep your emotions under control and not let them dictate decisions as you are likely to lose out from the divorce, and your former partner may receive much more than they are entitled to.
Usually there is one party who feels more responsible for the decision to divorce than the other, which can bring guilt into play, and the guilty party then feels they should give more financially then they are obliged to.
The reasons behind the divorce have no bearing in regards to the financial settlement (although it is possible only in very specific circumstances) so it's important to leave emotion out of the equation for the fairest outcome possible.
If you require assistance with any aspect of family law then the team at K J Smith Solicitors can help. Our team are experienced in dealing with a wide range of divorce cases including international divorce and high net worth divorce cases.
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