Financial disclosure in divorce – lessons from Mahtani v Mahtani

Full and frank financial disclosure is the foundation of a fair divorce settlement. When one party hides assets or refuses to engage, it can seriously affect the outcome. The case of Mahtani v Mahtani illustrates how the Family Court deals with non-disclosure in divorce and ensures justice even when one spouse won’t cooperate.

Disparity in lifestyle and the court’s jurisdiction

In the case of Mahtani v Mahtani, the wife (aged 50) was the applicant and the husband (aged 52) the respondent. They had two children – a 16-year-old at secondary school and a 19-year-old at university. Both living with the wife in London.

While the wife relied on benefits and shared a two-bedroom flat with the children, the husband continued to live in the former marital home in Indonesia and enjoyed several other properties with amenities such as swimming pools and tennis courts. His lifestyle was far closer to the standard the family had enjoyed during the marriage.

The wife wished to pursue a financial remedy claim in England and Wales, but before the proceedings could continue, the court had to decide whether to recognise the parties’ Indonesian divorce. The judge found that the husband had misled the Indonesian court and failed to take reasonable steps to notify the wife, and that the Indonesian divorce could not therefore be recognised.

This decision confirmed that the English court retained jurisdiction to deal with the financial issues between them.

Orders and freezing injunctions

As the wife could not meet her everyday expenses or legal costs, she applied for maintenance, a legal services order (to cover her legal fees) and a freezing injunction over the husband’s assets. The court granted all these applications, but the husband failed to pay the £227,774 owed.

His continuing failure to comply with orders of the court in England and Wales led to the case being fast-tracked to a final hearing.

Failure to comply with orders for financial disclosure

Despite multiple court directions, the husband provided no information about his finances. In contrast, the wife complied fully with her obligations.

The husband did not attend any hearings, although the court was satisfied he had received all notices and orders. The final hearing therefore proceeded in his absence, relying primarily on the wife’s evidence.

Judgment and consequences of financial non-disclosure

Given the husband’s failure to provide any financial disclosure or engage with the proceedings, the judge had little option but to draw adverse inferences about his financial position and resources.

The court assessed the husband’s property resources at around £27.8 million, excluding business assets. The wife’s financial needs, including provision for the children, were assessed at £7.4 million – the amount she was awarded.

A worldwide freezing injunction was ordered to remain in place until the wife received her award and the husband was also ordered to pay her legal costs.

The case highlights the firm stance the courts take on non-disclosure in divorce and financial remedy proceedings. Even when one party refuses to cooperate, the court can make findings about assets based on the available evidence to ensure fairness. Attempts to frustrate proceedings rarely succeed and often lead to higher costs or more severe outcomes.

What separating couples can learn about financial disclosure

Failing to provide full and frank financial disclosure, or trying to avoid engagement altogether, is a high-risk approach that almost always backfires financially.

The court may make findings based solely on the other party’s evidence, which can lead to a much greater award being made against the non-disclosing spouse. It can also result in significant costs orders.

As part of the process, both parties are usually required to complete Form E, the detailed financial statement setting out income, assets, liabilities and future needs. Providing accurate and complete information in this form is essential to avoid delays, disputes or adverse inferences being drawn by the court.

Cooperation and transparency are therefore key to achieving a fair and efficient outcome.

How we support clients in navigating divorce and finances

At Thomas Mansfield Family Law, we help clients navigate separation and financial proceedings with clear, practical advice and specialist expertise. Our solicitors take a constructive approach, focusing on fair outcomes that protect your financial position and the best interests of your children.

If you need advice on financial disclosure or concerns about your spouse’s cooperation, contact us today to speak with one of our family law experts.

To read more about Mahtani v Mahtani, click here.