Necessary Financial Documents
There is no getting around the need for full disclosure in a divorce action. With the exception of custody and parenting issues, everything that needs to be resolved is financial and will require some paperwork to be properly divided or, in the case of separate property, to be retained by the party making a separate property claim.
The first step and sometimes the only step in disclosure is completing a form called a Statement of Net Worth (SNW) which is provided by the attorney to the client at the beginning of the case. The form is broken up into different sections for disclosing basic personal and family information, expenses, income, assets and debts, as well as any transfers of assets that have occurred within the past three years. It is designed to be a roadmap of the financial condition of each of the parties.
It is best to review the form with your attorney before signing. Once completed, it is signed under oath and can be used against the client if the entries are not accurate, truthful, or complete. For that reason, the attorneys at Petroske, Riezenman & Meyers, PC, review the client’s draft SNW with the client to be sure of its accuracy. In our experience, many other attorneys ignore this crucial step, and expose their clients to possible allegations of false reporting that can completely undermine a case. For example, a spouse who will need maintenance to be financially self-supporting must be careful that all of her/his expenses are carefully and consistently presented, since the amount of support received may depend on those expenses being reasonable and verifiable.
Once the Statement of Net Worth is completed, signed and notarized, it is filed with the court after a copy is served on the other spouse’s attorney. A copy of the parties’ most recent tax return and several recent paystubs are attached. In an uncontested divorce, the form is usually not filed with the court, but is simply sent to the opposing party or attorney.
For simple cases where the parties’ assets are limited and each party is fully employed and self-supporting, the exchange of Statements of Net Worth may be all the disclosure that is needed.
In cases where there are pensions, significant accounts and/or debts, or where there is a separate property claim, disclosure of actual documents can be important. It is also a good idea to be sure that a spouse has not depleted accounts or run up debt in advance of litigation, which only a review of statements can determine. For a multitude of reasons, it is standard practice to obtain statements of accounts and other financial documents going back at least a few years. Your attorney will advise you on what is necessary to produce.