What in the World Are These Required Disclosures?
Colorado Rules of Civil Procedure 16.2: What does it mean for your case?
If you file a motion in domestic court, you will most likely be told to create a financial affidavit and comply with Colorado Rules of Civil Procedure (“CRCP”) 16.2 disclosures. CRCP 16.2 applies to all domestic relations cases. The purpose of CRCP 16.2 is to create a uniform procedure used to resolve issues involving financial disclosures in domestic relations cases.
CRCP 16.2(e) requires both parties in a domestic case to provide a full and honest disclosure of all facts that materially affect the parties’ financial rights and interests in the case, in addition to the financial interests of the children involved. Both parties are required to disclose all material facts and information without requiring the other party to submit a request for the information. If a party knowingly fails to provide all the required information, they may be subject to sanctions, including the possible re-distribution of property after the final decree has entered.
CRCP 16.2 sets out specific mandatory disclosures required in CRCP Form 35.1, including copies of taxes, bank statements, items showing or supporting values of all assets and debts, and items showing or supporting all forms of income. It also lists items that would be necessary for computation of child support, such as documentation of insurance, child care, and extraordinary expenses.
It is important to note that the items listed in Form 35.1 are not exhaustive. Merely complying with the production of disclosures laid out in Form 35.1 will not protect the providing party from incurring sanctions for failure to disclose in the future. CRCP 16.2 requires that all material information be disclosed whether or not it has been specified in Form 35.1.
Examples of material information not listed in Form 35.1 include trust fund payments, annuities, and stipends. The blanket rule for CRCP 16.2 disclosures is to provide everything that could have a material effect on the parties’ rights and interests – namely any assets, debts, and all forms of income.
In addition to the disclosures required by Form 35.1, parties must provide a completed sworn financial statement (Form 35.2), which is documentation of a party’s income, assets, debts and expenses. If applicable, the completing party must also provide a supporting schedule (Form 35.3), listing stocks, bonds, retirement accounts and other specific assets. In addition to filing the sworn financial statement and supporting schedule, parties must complete and file a certificate of compliance with the court. The certificate of compliance signifies the party has provided a complete and accurate disclosure of all material facts and information to the best of their knowledge and abilities.
If a party fails to comply with CRCP 16.2 and does not provide complete and accurate disclosures, the court has the authority to sanction the non-compliant party. Such sanctions may include the reallocation of material assets or liabilities even after the final decree or judgment has been entered.
In 2005, a five-year look back provision in CRCP 16.2 took effect. The five-year look back provision applied to Colorado Courts continuing jurisdiction over property division for five years after the entry of the final decree or judgment. It allowed them to allocate marital assets or liabilities, the omission or non-disclosure of which materially affected the original allocation of assets and liabilities.
CRCP 16.2 is an important aspect of every domestic case and failing to comply with CRCP 16.2 can have serious and lasting effects for the non-compliant party.