California divorce requires substantial financial transparency between spouses. Each spouse generally has an obligation to disclose assets and liabilities, and those responsibilities can continue while the divorce is pending.

Failing to disclose property can therefore create much more serious problems than simply leaving an item off a financial form.

Assets Must Be Disclosed Even if Their Value Is Disputed

A spouse generally cannot decide that an asset does not need to be disclosed simply because they believe it has little or no value.

Disclosure requirements are intended to give both parties access to the information necessary to evaluate the marital estate.

That can include assets whose ownership, characterization, or value is disputed.

This is particularly important with assets such as retirement benefits, business interests, investment accounts, employment benefits, and other property that may not have an obvious present value.

Identifying the asset allows the parties to investigate its character and value rather than allowing one spouse to make that decision unilaterally.

There Is a Continuing Duty to Update Information

Disclosure is not necessarily completed once the first set of financial forms is exchanged.

Spouses have continuing disclosure obligations regarding activities affecting assets and liabilities. Material changes may require an immediate, full, and accurate update.

This means that a spouse who learns additional material information about an asset may need to provide that information even if the asset appeared on an earlier disclosure.

Final disclosures can also require material information concerning the characterization and valuation of assets claimed to be community property, community obligations, and the parties’ earnings, accumulations, and expenses.

What Can Happen When Information Is Missing?

Incomplete financial disclosures can interfere with the divorce process and may prevent or delay the entry of judgment in circumstances where required disclosures have not been completed.

The complying spouse may have options for addressing missing or inadequate disclosures. Depending on the circumstances, these can include requesting compliance, seeking additional information, and asking the court for appropriate relief.

The consequences can become especially serious when nondisclosure involves a breach of the duties spouses owe one another regarding community assets. The available remedies depend heavily on the nature and circumstances of the nondisclosure.

Transparency Matters Throughout Property Division

A fair division of property depends on knowing what property exists.

Keeping organized records and updating financial information throughout the divorce can make it easier to identify assets, evaluate debts, investigate separate-property claims, and determine whether additional discovery is necessary.

When something appears to be missing from a spouse’s disclosures, addressing the issue while the divorce is pending can be important rather than assuming it will resolve itself before judgment.