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Maintenance or a clean break?

Spousal maintenance (and maintenance for a former civil partner) is one of the areas of financial settlement which is more likely to cause disagreements. This is primarily because spousal maintenance ties two people together who are no longer in a relationship, through the medium of a monthly payment from one to the other. It is frequently a bone of contention, and the cause of ongoing resentment, and even litigation between a former couple. That said, for many people coming out of marriages without the means to support themselves, it can be an essential lifeline.

First a brief reminder of the options with regards to maintenance on divorce or separation. Please note we are not talking about maintenance for children (child support) here, but rather adult maintenance. Also, we are focussing on the longer term options, rather than the short term remedy of “maintenance pending suit”, which lasts just long enough to get through the process (we’ll come to that one another time).

First, on a division of finances, the court has a duty to consider whether a clean break is feasible and fair looking at other assets in the case – in this case, no spousal maintenance is payable from one to the other. For this to work, both parties need to be able to support themselves going forward. Clean breaks are far more common in short marriages, and those where there are no dependent children, and where both parties are capable of generating their own income; the court will try to get there if it can, but it is not fair to do so in every case.

The other option is for there to be a maintenance order (also known as a periodical payments order), either be for a fixed term or on an open ended (known as “joint lives”) basis. If it is for a term that could be as little as a few months or years, or for as long as until the youngest child finishes tertiary education, or until retirement, for example. A maintenance order that ends on the expiry of a term is effectively a deferred clean break. If a maintenance is ordered on a joint lives basis, it lasts until either party dies, or the person receiving the regular payments remarries, or there is a successful application to end it.

It is often a cause of some concern for our clients to learn that all maintenance orders are variable for as long as they last, and it is open to either the payer or the recipient to ask for payment levels to be altered if their circumstances change. It is also possible to ask for a maintenance order to be capitalised, namely a lump sum paid to “buy out” the ongoing maintenance and for there to be a clean break on payment of the lump sum, or otherwise for the court to end the obligation.

The third option is what is known as a “nominal” maintenance order. This means that no actual money changes hands, but there is no clean break either (and this can be for joint lives or for a term). The purpose of a nominal maintenance order is to act as a safety net for the potential recipient in case he or she needs to ask for substantive financial help from the other party in the future. Nominal orders are most commonly used where there are children, and whilst both parents might be working, it would not be right to leave the parent with main day to day care of the children without financial back-up in the event of redundancy or other change of circumstances.

Two recent cases have looked at maintenance, and we thought a quick run through of them would help bring the picture up to date.

On the question of nominal maintenance orders, the case of Matthews v Matthews made it clear that there is no presumption of nominal maintenance when young children are primarily living with one parent or the other. In this case the children were aged 3 and 6 and living with the wife, who had a higher earning capacity than the husband. The wife wanted a nominal order whilst the children were minors, which is a standard approach (the “safety net” mentioned above). The trial judge imposed a clean break, which was upheld by the Court of Appeal on the basis that the court must consider whether a clean break is appropriate, and on the facts of this case it was. The fact that the husband was paying child support and the wife had a higher earning potential swung the decision against any continuing obligations between the adults.

Another case looked at when a former spouse can stop paying maintenance, and whether there should be a final lump sum payment to (in part) capitalise the maintenance. Here the husband had been paying a significant yearly amount to his first wife. He had remarried and had two young children with his second wife, who had tragically been diagnosed with terminal cancer. It was the husband’s firm intention to retire from his well-paid job when his wife passed away, to look after his two young children. He therefore applied to end the maintenance payments to his first wife. She had been able to save money from the maintenance already received, and the court looked at the income generating potential of those savings. Looking at the wife’s income needs for the rest of her life, and what she could provide herself, the judge ordered that the maintenance would end when the husband retired, and he should pay a lump sum of nearly 3 years’ maintenance at that point to discharge the obligation for good (there were also compensation arguments put forward by the wife, but they are beyond the scope of this blog).

To sum up, maintenance orders are based primarily on the financial needs of both former spouses, and there is no guarantee that a court will order anything to be paid, or even a nominal order. The obligation to achieve a clean break is at the forefront of judges’ minds and one will be effected if it can fairly be achieved. Remember, going to court and having a judge decide for you should usually be a last resort: negotiation, mediation and collaborative law will give you the best opportunity to articulate what you want and can tolerate, to keep the decision making between the two of you as far as possible.

As always, if you would like to make an appointment to talk this over with us, we are on 01223 443333.

*This blog is written for informational purposes as a free public resource. Nothing in this blog or elsewhere on this website should be construed as legal advice. Although we welcome discussion, please note that CFLP is unable to give legal advice in response to comments left under this article.

 

Join the discussion 2 Comments

  • Jon says:

    To clarify then, in the example above (except where the wife perhaps has equal to less earning potential) but the wife prefers to have a clean break, will the judge go against the the wife’s wishes even though both parties wish it (due to the judges perception of the financial circumstances and appropriateness)?

  • paul newman says:

    please could you advise me on what court form i need to apply to the courts for a maintenance deferment or cease payments, due to a change of circumstance , there are no children in this matter

    thanks paul newman

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