South Carolina Divorce and the Financial Declaration: What you need to know.
The Financial Declaration is a critical document in all South Carolina divorce cases. Failure to take it seriously could lead to big problems.
Rule 20 of the South Carolina Rules of the Family Court set out the requirements for the filing of a Financial Declaration in a South Carolina Divorce case. Rule 20 is very clear and designed to ensure due process. Any competent Family Law practicer knows that a Financial Declaration must be filed in any case where “the financial condition of a party is relevant or is an issue to be considered by the court”.
Software such as Settlyd can be of great benefit when filling out the financial declaration as it will eliminate much of the errors usually attributed to the old way of manually entering and adding financial data.
Many lawyers often surprised to learn that Rule 20 also says that:
A Financial Declaration shall be filed and served prior to or at the first hearing, or no later than 45 days after the complaint is served, whichever occurs first
When a party “fails to timely answer or otherwise plead, the plaintiff shall not be required to serve a financial declaration on the defendant prior to the final hearing”
Sanctions for willful non compliance on both the attorney and party.
It is a critical document and must be prepared carefully. It’s a good practice to double check and verify your client’s work. When we entrust our clients to fill out a financial deflation, they often do not take it seriously and treat it as another form they have to deal with. Once a party commits to those numbers, it could be very difficult to change them after a final hearing. The Settlyd “client portal” provides an efficient way for the client to enter their data electronically and it is much easier for an attorney and paralegal to review and edit their entries.
To understand how important this document is, take the case of Charley Penny. He filed a financial declaration at the time of his divorce, then went back to court 2 years later looking for a reduction of alimony based upon a reduction of his income. The problem was that Charlie really did not have very good evidence, so he told the Judge he had under reported his annual income on his filed financial declaration during his original divorce by the sum of $20,000! The Court of Appeals would not hear it.
Financial declarations are sworn documents. With Mr. Penny’s case, the family court, which approved the parties’ agreement in February 1998, relied on Husband’s representation of $140,000 in annual income, as reflected in his financial declaration. In this action for reduction, however, Husband testified his income in 1997 had been under-reported by him and that it was actually $165,226. The family court then utilized this inflated figure as support for its decision to reduce Husband’s support obligation, finding that Husband’s income had decreased substantially since the 1998 divorce. This was error.
See also the case of Lewin v Lewin, 396 S.C. 349, 721 S.E.2d 1 (Ct. App. 2011) where the Court of Appeals upheld the trial court in finding that Husband’s Financial Declaration lacked credibility and that it would be “inequitable to allow [Father] to benefit” from a financial declaration which lacked credibility, and found “those issues adverse to [Father].”