Friday, 31 August 2012

Everything I have, with you I share...

...except my bank statements, my diary and the vintage Porsche I haven’t told you about.

Should married couples share everything?

A recent internet statistic claims that one third of people would be willing to snoop on their partners to see if they are having an affair.  But what if you’re after more than evidence of an indiscretion?  If partners are willing to snoop to discover the true extent of their other half’s social exploits then what about their financial exploits?

The law recognises the need for privacy and confidentiality, even against one’s spouse.  The subject was considered in the much publicised case of Imerman [2010] EWCA Civ 908 which went to the Court of Appeal. In that case Lord Neuberger MR stated that:

The notion that a husband cannot enjoy rights of confidence as against his wife in respect of information which would otherwise be confidential as against her if they were not married, seems to us to be simply unsustainable.” (para 82) and

Subject of course to the court being satisfied that the normal equitable principles would otherwise be in play, a claimant is not to be denied equitable relief merely because the defendant is, or has obtained the material or information in question from, his or her spouse.” (para 85)

In other words, if a spouse gathers evidence surreptitiously, their other half will still have all the remedies available to them which would exist had their spouse been a complete stranger, such as ‘breach of confidence’, ‘theft’, or ‘offences under the Computer Misuse Act 1980’.

The equitable relief that Lord Neuberger was referring to in Imerman was the return of hundreds of thousands of documents that the wife’s brothers had stolen from the husband’s computer.  These documents were confidential to the husband, and the wife had no more right to retain them than the husband would have had to retain a copy of the wife’s personal diary (assuming she kept one).

So, there exists a right to confidentiality between spouses (which I am sure many people will be very relieved to hear) but what happens when the parties separate and there are financial proceedings on foot?  The Court requires both parties in proceedings to give full and frank disclosure of their financial circumstances.  Documents, including bank statements, asset portfolios and property valuations, which can be kept secret during the marriage, must be laid bare.  This did not help the wife in Imerman as it was held that the fact that the husband would have been under an obligation to disclose the disputed documents was not relevant to the principle of confidentiality.  Interesting then, that a couple who are going through a divorce owe each other a greater obligation to disclose their financial affairs than a couple who is happily married.  

Should the same level of financial disclosure exist within a marriage as on divorce?   After all, it is not just the assets which couples are keeping from one another but debts too, £41billion according torecent reports.  Such dishonesty could lead to bankruptcy, and further financial consequences for the whole family, so perhaps there is an argument for saying that spouses must share such information with each other?  It does still leave the problem of actually obtaining the information as, even if spouses were obliged to share their financial position with one another then, according to Imerman, a spouse who sought to obtain information from their other half through dishonest methods could still be breaking the law.  The only solution would be to remove the principal of confidentiality against one’s spouse and the Courts have made it quite clear that they are not prepared to do that.

If you’d like to read more on this topic then Mr Justice Mostyn gave an excellent analysis of marriage and the economic relationship between spouses in his address to the All ParliamentaryGroup on Family Law in 2010.

Don’t be shy!  Tell me what you think.

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