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14 July 2016 0 Comments
Posted in Family

Spousal maintenance on divorce – how it’s decided

Posted by , Solicitor

A couple of years ago, Mostyn J stated that an attempt to create a formula to calculate spousal maintenance “may prove to be an impossible task, given the scale and scope of the individual variables.”

On that backdrop, it is perhaps unsurprising to see regional variations in both the amount and terms in which spousal maintenance is awarded on divorce, as recently reported. Studies have found evidence of a north-south divide, resulting in courts in the North of England making orders for maintenance for lower amounts and shorter terms than courts in the South. There is also a difference between courts in London and courts in the regions, which are more likely to award maintenance for a fixed term only.

Well established principles

  • Financial independence – In every case the court should aim to establish financial independence between the spouses as soon as possible after the end of a marriage and it must consider whether a clean break (i.e. no spousal maintenance) is appropriate.
  • Needs – Spousal maintenance is properly ordered when choices made during the marriage have generated future needs for one spouse – for example, one spouse has given up work to look after young children on the agreement that the other would provide financially for the family. If no causal link can be established between choices made during the marriage and one of the spouses’ need for supplementary income, spousal maintenance will only be appropriate when required to alleviate significant hardship.

Save as in the most exceptional cases (e.g. in cases where one of the parties’ income is extremely high), maintenance is only ever calculated by reference to needs and it should represent a fair proportion of the income of the paying spouse in any event.

Maintenance should only be awarded for as long as it will reasonably take the receiving spouse to adjust and transition to financial independence. In certain circumstances, such transition might never happen, for example when the receiving spouse is unable to work due to ill-health. In other instances, an effort should be made to identify a moment in time when it would be reasonable for payments to stop – for example certain milestones in the life of a child should be considered, such as completion of primary school or secondary school.

Consideration also has to be given to whether a maintenance term should be extendable or not, taking into account the need to protect the financially weaker party.

So how are the principles applied?

Even though the principles are well established, there is no formula to calculate spousal maintenance. Very few cases are clear-cut and in each individual case the principles will allow for a spectrum of possible outcomes, none of which is necessarily wrong.

This could be a fairly typical example:

Husband (H) and Wife (W) are both in their late 30s; they have three children aged 10, 6, and 2. H earns £30,000 pa, W has not worked since the eldest child was born. It is probably reasonable to expect W to secure some employment (although possibly not full time given the age of the children) but spousal maintenance would be appropriate in this case provided W could show a situation of need.

Applying the principles above, all of the following outcomes would be fair and reasonable:

  1. Spousal maintenance to cover the whole of W’s income needs until the youngest child completes primary school.
  2. Spousal maintenance to cover the whole of W’s income needs until the youngest child completes secondary school.
  3. Spousal maintenance to cover the whole of W’s income needs until the youngest child starts primary school and then spousal maintenance to cover her income needs over and above what she can reasonably earn by working part-time and supplementing her income with tax credits until the youngest child completes primary school.
  4. Spousal maintenance to cover the whole of W’s income needs until the youngest child starts primary school and then spousal maintenance to cover her income needs over and above what she can reasonably earn by working part-time and supplementing her income with tax credits until the youngest child completes secondary school.

And this list could go on, depending on the myriad of variables which make each case different from each other. It is also important to understand that spousal maintenance must be considered in the context of the overall financial settlement that it might be appropriate to achieve a clean break on income in exchange for a higher proportion of the capital.

Best to settle

The absence of a formula to calculate spousal maintenance should make a settlement more attractive for both the paying and the receiving spouse. Once the range of outcomes which are appropriate in a case has been identified, it is almost always best to retain control and reach an agreement on one of them. Leaving it for a third party (a judge) to impose a solution can often result in an outcome not quite satisfactory for all involved.

It is therefore important to seek legal advice on finances early on when a marriage breaks down. A family solicitor can help you identify the range of ways in which a court could decide your case, and help you navigate through the process to achieve the best possible outcome in the circumstances.

For advice on separation, spousal maintenance or any other family law issue contact our team

0800 923 2074     Email usfamily.enquiries@roydswithyking.com

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