What is spousal maintenance?
Many traditional family units often comprise of a chief bread winner whilst another party undertakes the role of home maker and parent. It is a fallacy to suggest the bread winner adds more value to the asset pool than the home maker, because anyone who has spent more than a few days caring for children or a household full time knows just how exhausting it can be. Furthermore, it is important to note that the spouse who chooses to remain at home is denied the opportunity and means to develop their skill set beyond those required within the domestic framework, whilst the breadwinner gets the benefit of gaining vocational experience and often, pay increases and elevation through the corporate ranks.
The Family Law Act allows for financial maintenance, either in a lump sum or regular payments, to the non-working spouse, usually after the break down of a lengthy relationship. There is no specific requirement of marriage and de-facto partners are also entitled to spousal maintenance. The rationale behind spousal maintenance rests upon evening the balance between the parties’ respective income earning capacities, with the view to ensuring the recipient is better able to re-establish themselves, either through re-training, relocation etc., after the break down.
There are time limits for spousal maintenance applications (unless the other side agrees) and applications for spousal maintenance must be filed within 12 months of divorce or within two years of separation. Applications can be successfully made out of time with leave of the Court, provided you have a reasonable explanation for the delay in filing.
The Courts adopt a three-step approach to determining spousal maintenance claims. The Applicant must first establish a financial need. Secondly, the Applicant must establish that the Respondent has the capacity to pay spousal maintenance. Thirdly, if the Court is satisfied that the first two arms have been adequately covered, it must then look at the amount payable, rate of payment, period of payment which is considers appropriate in all of the circumstances, and it must give consideration to the factors under section 75(2) of the Family Law Act.
Step 1- Does the Applicant have a financial need?
If you are unable to support yourself financially to an adequate standard of living, you may be entitled to spousal maintenance. What is considered adequate varies from case to case and does not mean simply meeting the party’s bare needs. If you have become accustomed to a particular standard of living during a lengthy cohabitation, the Court will consider a continuation of that standard for the near future, provided the Respondent is in a position to pay.
Where one party has ample resources and the parties previously enjoyed a high standard of living, it is unreasonable to expect the other party to survive on low paid employment immediately after the separation as a means to support oneself, particularly if the party has been out of the work force for years. The Court will consider the Applicant’s assets and income versus expenditure to assess whether their reasonable needs and expenditure exceed the income available to them. They do not need to have used up all of their assets and capital (including any awarded under a property settlement) to satisfy this requirement. A person relying on social security payments or donations from their former spouse, friends or relatives is clearly not able to support themselves adequately: In the Marriage of Murkin (1980) 5 Fam LR 782.
Step 2- Is the Respondent in a financial position to pay?
If you are able to establish genuine need, the Court will then examine whether your spouse is in a financial position to pay. This is usually done by assessing the financial means against the Respondent’s own reasonable needs and his/her ability to contribute to your support. If the Court is satisfied they are able to contribute, it will make further inquiries to establish the extent to which they should do so. The Court does not look too favourably at a Respondent who deliberately leaves their job or voluntarily reduces their income.
If the parties have children, the Court will consider the number of children, their ages and any special needs of a child. The Court will also consider the age, physical and mental capacity of the Applicant’s ability to hold down gainful employment. Evidence of job applications, the availability of existing income not being enough to support themselves and retraining, evidence of failing health and lack of qualifications are all relevant considerations, although these factors are not exhaustive.
Step 3- How much should the Respondent pay?
If a Court decides you are entitled to maintenance, it will then move to address the amount payable and the manner in which it is paid (i.e. in a lump sum as part of the property settlement, or regular part payments over a period of time). The Court must again address the future needs factors under section 75(2), as well as information each party has provided about their income and expenses. The court is required to set out each of the section 75(2) factors relied upon in reaching its decision.