Are you worried about whether your spouse is hiding money in your divorce? Many people are. Especially when they have not been the person responsible for managing the family finances during the marriage. The state of California has a first line remedy for this called Declarations of Disclosure. These are forms that must be filled out by each party, signed under penalty of perjury and exchanged. In court speak the forms are known as FL-142 and FL-150.
FL-142 is a four page Schedule of Assets and Debts. Here are the instructions written on the form.
“List all your known community and separate assets or debts. Include assets even if they are in the possession of another person, including your spouse. If you contend an asset or debt is separate, put P (for Petitioner) or R (for Respondent) in the first column (separate property) to indicate to whom you contend it belongs. All values should be as of the date of signing the declaration unless you specify a different valuation date with the description.“
The general idea is that the State of California wants to act as the first line of defense when it comes to spouses playing “fair” with financial information in their divorces. In the absence of disclosure requirements unrepresented litigants would likely have no mandated process for discovering and analyzing the family’s current financial circumstances leaving the holder of the information with an unfair advantage.
Disclosure forms take the first step towards leveling the playing field. Legal counsel generally consider these forms to be the first step in the discovery process. Discovery loosely refers to the legal process of uncovering information about the parties to a divorce. In this instance we are looking at financial information. As a financial expert I will review these forms and the back-up accompanying and build a set of Issues, Concerns and Questions I would like addressed in additional discovery requests. Declarations of Disclosure are a very important step in piecing together the family financial picture.
Non-compliance with the disclosure rules can lead to a variety of outcomes and punishments. In re Marriage of Rossi the court ruled Husband was entitled to 100% of lottery winnings Wife had failed to disclose. This is an extreme example with extenuating circumstance including Wife attempting to conspire with lottery officials and co-workers to hide the winnings. Other cases have resulted in sanctions or fines to the no-complying party.
Understanding concepts such as these could play a significant role in your post-divorce future. Hiring an experienced CDFA will ensure a more secure, comfortable future for YOU. Make sure you sit down with us at Pacific Divorce Management before finalizing your settlement agreement.