Section 4.13 Full Disclosure

• Library: Family Law Deskbook and 2014 Supp

b. (§4.13) Full Disclosure

Full disclosure of income, assets, liabilities, and expectancies is critical to blunt an attack of insufficient knowledge of property rights. Although not required by statute or caselaw, detailed schedules are strongly recommended. One obvious drawback of not listing this information is that the court will have nothing to rely on but the credibility and memories of the parties.

A common claim of invalidity is based on asserting insufficient financial disclosure. The challenge usually involves the spouse claiming that he or she could not have known what rights were being waived because of incomplete disclosure. As stated in §4.11 above, it is critical that prospective spouses make full disclosure of the nature and extent of property rights. It is recommended that disclosure also be made of liabilities, income, and expectancies. Proper recitals in the agreement have been held to be prima facie evidence that full disclosure was made. Estate of Tegeler,
688 S.W.2d 794 (Mo. App. E.D. 1985). In Heady v. Heady, 766 S.W.2d 489 (Mo. App. E.D. 1989), it was held that failure to disclose some property of nominal value was not fatal to the validity of the agreement. The wife in Heady also asserted the accuracy of the values of some of the scheduled assets, but she failed to present any evidence at trial regarding different values.

Some attorneys recommend that, to avoid any claim of undervaluation, the assets should be overestimated because this will prevent a claim that a waiver would not have been given had the true value been known. Other attorneys suggest this may be a bad idea because untruths should not be allowed to permeate the negotiations. Whether an overestimation is tantamount to lying is an arguable point. In the absence of a formal appraisal, one approach is to qualify values by indicating that they are without formal appraisal and are good faith estimates. Another approach is to indicate that the value is “unknown” if an estimate amounts to nothing more than a guess. In any case, great care should be given to the preparation of financial schedules. It is advisable to obtain financial statements that may have been submitted by the client to lending institutions or filed in other court proceedings in the recent past to ensure that there is no conflict between the nature or value of assets listed in the statements and the schedules attached to the agreement.

In In re Marriage of Lewis, 808 S.W.2d 919 (Mo. App. S.D. 1991), the...