I am regularly asked by clients, and individuals who I am offering initial advice to, how the complex issue of maintenance works. There is barely a day that passes where a high-profile case (often those involving celebrities or multi-millionaires!) doesn’t make the pages of our daily newspapers. The truth of the matter is that spousal maintenance, as with any financial issue arising from divorce, is complex and the ‘rules’ vary enormously from case to case.
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So, what is it?
Spousal maintenance is income payable by one spouse or former spouse to the other, in their own right and in addition to any child maintenance. It is often one of the first topics people want advice on and unsurprisingly it is very often a problematic issue in divorce and dissolution cases. That said, it is often underplayed and its significance and benefit can be minimised by the potentially paying party.
Why do I have to pay it?
Many clients find it a difficult concept to grasp that the law can order them to financially maintain their former spouse even after divorce or dissolution. In short, there is a common law duty imposed upon spouses to support each other whilst the marriage/civil partnership exists but what many people aren’t aware of is that the duty continues after separation as a result of statute.
There is no automatic entitlement to spousal maintenance on divorce or dissolution. However, legislation obliges the court to consider whether it is possible to achieve a clean break between the parties, or whether the needs of one party require maintenance to be paid by way of a ‘top up’ income from other sources to meet his or her ‘needs’. A clean break ends financial claims against one another on divorce or dissolution (save for child support).
There are many complexities involved in spousal maintenance but in essence its purpose is to meet the ongoing reasonable financial needs of the financially weaker party. Often the reality is that the marriage or civil partnership has changed the course of a person’s life. Some people may have given up a successful career to focus on bringing up the children, running the household or supporting their ambitious husband or wife. When the marriage or civil partnership then ends it is obvious that moving on, having given up their chances of a high income, is going to be extremely difficult without some sort of support or compensation.
The questions the court has to consider is how much and for how long?
The level of maintenance paid will mainly depend on the couple’s financial needs. The current trend does seem to be that a person’s needs will be generously interpreted. What should be made clear is that there is no automatic right to an equal share of income unless a person’s “needs” requires it.
As part of the disclosure process, each person must compile a schedule of their anticipated future outgoings. This will be scrutinised and it will necessitate a balancing exercise in achieving fairness. The concept of ‘need’ is not fixed in law and there is room for the exercise of discretion in the assessment of needs. It is in the assessment of need that opinions differ. So if you are separating, keep a careful note of your expenditure so you can justify it going forward.
How long will I have to pay spousal maintenance for?
Spousal maintenance can be paid for a fixed term (which might need to be extended) e.g. until the youngest child reaches 18 or for life e.g. until one or the other dies. It can even extend beyond the death of the payer if that maintenance has been secured. You can also have a nominal order, which is where nothing substantive is paid, but there is no clean break, leaving the door open for claims to be made later on. It is like a pilot light which gently burns in the background. A clean break order is where no spousal maintenance is payable.
All spousal maintenance orders automatically end on the remarriage of the recipient. Significantly they do not end automatically by law on cohabitation. Why? Cohabitation does not create a legal commitment.
Our current legislation requires that maintenance ends as soon as it is just and reasonable, and a term order i.e. one of fixed duration should be considered by the court, unless the receiving party would be unable to adjust without undue hardship to the ending of the payments.
The objective of maintenance orders is to enable a transition to independence, to the extent that it is reasonable bearing in mind the length of the marriage, standard of living, the need to house the parties, and the continued shared responsibilities relating to children.
What the above proves is that there is no hard and fast answer. The and the general lack of clarity around spousal maintenance is being addressed by the Matrimonial Needs Working Group which was established following a recommendation by the Law Commission that the law relating to financial needs on divorce be clarified.
In a recent case a prominent family judge, Mr Justice Mostyn, known for not mincing his words, has attempted to provide some guidelines on the subject of maintenance. His guidelines are not binding but he provides a useful summary.
- A spousal maintenance award is properly made where the evidence shows that choices made during the marriage have generated hard future needs on the part of the claimant. Here the duration of the marriage and the presence of children are pivotal factors.
- An award should only be made by reference to needs, save in a most exceptional case where it can be said that the sharing or compensation principle applies.
- Where the needs in question are not causally connected to the marriage the award should generally be aimed at alleviating significant hardship.
- In every case the court must consider a termination of spousal maintenance with a transition to independence as soon as it is just and reasonable. A term should be considered unless the payee would be unable to adjust without undue hardship to the ending of payments. A degree of (not undue) hardship in making the transition to independence is acceptable.
- If the choice between an extendable term and a joint lives order is finely balanced the statutory steer should militate in favour of the former.
- The marital standard of living is relevant to the quantum of spousal maintenance but is not decisive. That standard should be carefully weighed against the desired objective of eventual independence.
- The essential task of the judge is not merely to examine the individual items in the claimant’s income budget but also to stand back and to look at the global total and to ask if it represents a fair proportion of the respondent’s available income that should go to the support of the claimant.
- Where the respondent’s income comprises a base salary and a discretionary bonus the claimant’s award may be equivalently partitioned, with needs of strict necessity being met from the base salary and additional, discretionary, items being met from the bonus on a capped percentage basis.
- If the choice between an extendable and a non-extendable term is finely balanced the decision should normally be in favour of the economically weaker party.
If you’ve read this post this far, you might be interested to read some of his other comments in relation to this particular case. At the beginning of his judgment he described the wife’s claim for income as ‘speculative, experimental and unfeasible’, a ‘product of the great bitterness that the wife feels towards the husband’ and said that her statement ‘is a most unhappy document and seems to have been written with a pen dipped in vitriol’. As I said, he doesn’t mince his words. This is what emotion can do which is why my colleagues and I at Family Law Partners we recommend our clients see a specialist counsellor.
Until the report is published by The Matrimonial Needs Working Group family lawyers will continue to navigate their way through the vague and hazy legal principles relating to spousal maintenance and what is essentially a battle of the budgets.
For more information about Spousal Maintenance, please do not hesitate to contact us.
Take a look at our recent blog on spousal maintenance – in what circumstances will spousal maintenance be changed?
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