Rebecca Tarn, Solicitor with Top North East Divorce and Children Specialists, Major Family Law comments in the North East Times when a marriage ends, there will always need to be some level of financial consideration given, for which there is, of course, legislation to ensure parties are treated as fairly as individual circumstances allow.
It has become popular for people to talk in terms of a clean break, whereby the marital assets are divided between the parties in full and final settlement and neither party has any ongoing financial responsibility towards the other
Historically, when the Matrimonial Causes Act 1973 came into force, there was no requirement to try to achieve a clean break, but this led to concerns about fairness and the Act was amended so that a formal duty was imposed on the Court to at least consider a financial clean break in every case.
But what if one of the parties to the marriage has no independent income? Maintenance for a spouse (or periodical payments as they are known) depends principally on the potential recipient’s needs, actual level of income and ability to earn income. There are no set formulas and the amount payable depends on the payer’s net income, among other factors.
It’s a tricky area of the law with little in the way of judicial guidance. Each case is decided on its own facts and the opinion of the Judge hearing the application. Since the latest recession, many families have been unable to reach financial settlement as there is insufficient capital to agree a clean break, which has led to a noticeable increase in applications for spousal maintenance.
A typical scenario involves a wife whose income prospects, unlike her husband’s, have been damaged following years of full-time childcare. If her income claims cannot be settled by way of a lump sum payment from matrimonial assets, should she be required to find employment and go out to work while the children are still young?
Fast forward a few years: the marriage breaks down after the children have grown up and left home and the parties are in their 50’s. Having left work to have children, the wife never returned to work and the family relied solely on the husband’s income. Most likely the wife supported the husband whilst he built his career and/or business. Is it fair to expect this lady to find employment and return to work?
In both cases, the Court is under a duty not only to consider if maintenance should be payable, but for how long it should be paid. A ‘joint lives’ order means maintenance has to be paid until either party dies (or if the receiving spouse remarries). A ‘term order’ is one where the maintenance is paid for a fixed term. This can be extendable or non-extendable depending on what is Ordered.
There is no cut and dry formula, but a clean break is unlikely to be Ordered where children are involved, and maintenance for a fixed term only is unlikely to be Ordered where the payee is over 55 unless substantive capital is available.
Maintenance is a vital component of any matrimonial settlement and an entitlement that should always be carefully considered. Nevertheless, statistics show that less than 50% of orders make provision for maintenance.
Calls have been made from within the legal profession for an overhaul of the law relating to maintenance, to make it clearer, more straightforward and decisions more uniform. For the time being, though, expert advice, as always is vital to ensure you know where you stand.
Rebecca Tarn is a Solicitor at Major Family Law, the Divorce and Family Law Specialists, 12 West Road, Ponteland, Newcastle upon Tyne. T: 01661 82 45 82 www.majorfamilylaw.co.uk. Twitter: @majorfamilylaw