SPOUSAL MAINTENANCE – A FIGHT WORTH HAVING?

Spousal maintenance is the provision of financial support of one spouse by the other following the breakdown of a marriage or de facto relationship. A more familiar term for spousal maintenance is “alimony”, which is used readily in the United States of America.

Spousal maintenance differs from child support and adult child maintenance, which specifically relates to financial support for children of the marriage or a de facto relationship.

A party to a marriage or de facto relationship in need of continuing financial assistance from a former partner can make an application for spousal maintenance under the Family Law Act 1975 by setting out their income and expenses in a Financial Statement filed with the Court. It is then up to the Court to determine whether the party applying for spousal maintenance can or cannot meet their own reasonable expenses from their personal income or assets and whether the other party has the capacity to pay the maintenance sought.

Orders for spousal maintenance can be made on an urgent, interim or final basis, with payments to be made in a lump sum, or by periodic amounts. Generally, spousal maintenance is paid to fund the other spouse’s daily living costs including mortgage or rental repayments, healthcare costs and other household expenses.

A party to a marriage has a time limit of 12 months from the date the divorce becomes final to bring an application for spousal maintenance. From 1 March 2009, a party to a de facto relationship can bring an application for spousal maintenance within two years of the breakdown of the relationship. This law also applies to same-sex couples. Once the time limit has expired, however, a party will need to prove hardship before an application for spousal maintenance can be made.

Applications for spousal maintenance are commonly brought in circumstances where one party has a significantly higher income and earning capacity than the other and or the applying party has not worked for reasons including being a primary caregiver for the children of the marriage or de facto relationship. Incapacity to work due to injury or illness and the age of the applying party are also factors that are carefully considered when making determinations about whether spousal maintenance is payable. Receiving spousal maintenance is not an automatic right. The Court will consider the financial needs of the applicant as well as the respondent’s capacity to pay and make a determination as to how much spousal maintenance should be paid, if any at all. There is no precise formula for determining how much spousal maintenance should be paid.

Additionally, the right to spousal maintenance does not automatically flow from the applicant receiving no or minimal income. In circumstances where the applicant has the potential to earn an income but is choosing not to, spousal maintenance may be denied. It is expected that the primary carer of children will take reasonable steps to find employment to financially support themselves after the children start school, provided that the applicant has the capacity to find gainful employment.

In order to allow a party to get back on their feet following separation, spousal maintenance may be paid to that party for a limited period of time or until they are able to adequately financially support themselves. A “sunset provision” may be included in the agreement or Court Order to provide an end date for spousal maintenance payments to be made. This may occur if the receiving party enters into a new de facto relationship or otherwise re-marries. In this instance, the Court will consider the financial relationship between the receiving party and their new partner in determining whether they are able to adequately support themselves. In limited circumstances, spousal maintenance may be ordered to be paid on a permanent basis. The duration for paying spousal maintenance is assessed on a case by case basis.

It is possible to defend an application for spousal maintenance by filing a Response to Initiating Application and an accompanying affidavit and Financial Statement to support a claim as to why the respondent does not have the ability to pay.

Ultimately, a Court will exercise discretion in making Orders for spousal maintenance and there is no precise formula for determining how much spousal maintenance is payable. However, if you are facing the prospect of not being able to meet your own reasonable expenses following separation, the option to apply for spousal maintenance exists.

It is sometimes a costly exercise engaging in litigation and a client may need to consider a cost benefit analysis to determine whether the prospective legal costs in pursuing a claim may exceed the amount of spousal maintenance sought. In these instances, clients are encouraged to focus on trying to achieve an overall property settlement and/or lump sum payment of spousal maintenance as this may enable him or her to access sufficient monies to re-establish themselves without requiring ongoing support from a reluctant spouse.

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