NEWS & INSIGHTS

The cost of failure to tell the truth

In Goddard-Watts v. Goddard-Watts [2019] EWHC 3367 (Fam), the wife successfully appealed a financial remedy order made at the rehearing of her claims. Holman J determined that the husband intentionally and dishonestly failed to disclose the ongoing discussions for the sale of his company before the financial remedy proceedings concluded with a sealed order. He ordered that the wife’s claims be heard again.

The wife had successfully made a set aside application because of the husband’s fraudulent non-disclosure in 2015 

In 2017, Wife found out that Husband had again failed to make full disclosure, so she filed a second application to set aside the application. In October 2015, Husband would have gotten £65 million from an offer for his company. At the second hearing, Husband told the judge that the offer had been taken back because it was too good to be true. The judge agreed with the joint appraiser that the company was worth £16.14 million. In fact, there had been more general talks with the buyer both before and after the re-hearing. On November 22, 2016, with Husband’s knowledge, a specific proposal was made at a higher price than before. The buyer didn’t turn it down, but instead asked for more information.

Holman J found that there had been a dishonest failure to tell the truth. Husband knew that he had to tell the truth until the final order was signed, and he should have told the truth about the talks and proposal. At least by the time the judgement was made, Husband’s evidence was no longer correct. If the judge had known the truth, he would not have made the order when he did (Sharland v Sharland [2015] UKSC 60). Another hearing would have happened. Holman J wasn’t sure that the judge wouldn’t have made a very different order, but he did admit that it was possible that he wouldn’t have. Because of this, Sharland’s exception at paragraph 33 did not apply. There was a good chance that Wife would get a bigger award. The difference between £30 million and £100 million in net assets was huge. So, it was impossible to say that the judge would have just looked at the unreported assets that led to the re-hearing without making any other changes (Kingdon v Kingdon [2010] EWCA Civ 1251). Even though there might have been a deduction for the work Wife did after they split up, it’s not true that she wouldn’t have been given more, even though she might not have been. The order was thrown out, and a second hearing was ordered.