A message from Leanne Abela & Joseph Schepis.
What is spousal maintenance?
“Maintenance” is not defined in the Family Law Act 1975 (Cth) (“the Act”), but has a broad definition (Branchflower & Branchflower (1980) FLC ¶90-857) Spouse maintenance is financial support paid by a party to a marriage to their former husband or wife in circumstances where they are unable to adequately support themselves.
Spousal maintenance is not child support. Child support is paid for the benefit of the child or children. Spousal maintenance is paid for the benefit of the spouse. The Family Court can order a party to pay spousal maintenance in addition to child support.
Under the Act, a person has a responsibility to financially assist their spouse or former de facto partner, if that person cannot meet their own reasonable expenses from their personal income.
Where the need exists, both parties have an equal duty to support and maintain each other as far as they can. This obligation can continue even after separation and divorce. The extent of the support depends on what the other party can afford to pay.
The primary purpose is to adjust for any disparity between incomes or earing capacities of parties based on their respective needs. Maintenance orders usually last for a short period of time after separation (for example 2 to 3 years) to enable the recipient to retrain, enter the workforce and/or generally re-establish himself/herself.
Maintenance can be paid as compensation for economic disadvantage and may be required to be paid for a relatively long period if sufficient adjustment cannot be made in property settlement. For example in Mitchell & Mitchell (1995) FLC ¶92-601it was ordered that a property division of 90% in favour of the Wife of an asset pool of about $300,000 did not disqualify the wife from spousal maintenance. The Full court remitted the issue of spousal maintenance to the trial judge and made an order that the husband pay the wife the sum of $150 per week by way of interim maintenance.
One party may be ordered to pay maintenance for the other or provisions can be in a Binding Financial Agreement.
What does a court consider when making a decision about Spousal Maintenance?
The procedure the Family Court must follow in a spousal maintenance claim is to examine a threshold test under section 72 of the Act. The court considers the needs of an applicant and the respondent’s capacity to pay. The court considers the following about both of the parties:
The court also takes into account with whom the children (under 18 years of age or adult children who are disabled) live.
See section 75(2) (married) and section 90SF (de facto) for further information.
This test is sometimes summarised as “need versus ability to pay“. If the Court is satisfied that the threshold test has been met, namely that one party is unable to support themselves and the other has the capacity to make payments to them to assist with their financial needs, the Court then exercises its discretion to determine whether it should make an order and if so, what order it considers proper in the circumstances.
How do I get Urgent Maintenance?
Urgent maintenance is granted by a court where a party has an immediate pressing need for financial assistance. This situation usually occurs immediately following a separation between the parties which leaves one of them without any financial support whatsoever.
The Court will usually make an order of specific period of time, until the parties are in a position to come back to Court with more detailed financial disclosure to enable the Court to deal with the question of ongoing maintenance in a more detailed manner.
Applications for urgent maintenance are determined by the court on a pragmatic basis and without detailed financial disclosure.
In order to obtain a grant for urgent maintenance the Applicant must demonstrate an urgent and immediate need and evidence that he/she would otherwise ordinarily be entitled to maintenance.
Do I still receive spousal maintenance if I start a new relationship?
A party is not entitled to maintenance if they marry another person unless the court otherwise orders (see section 82). If a party commences a new de facto relationship the court will take into account the financial relationship between the party and their new de facto partner when considering whether the party is able to support themselves adequately.
When do the payments stop?
Spousal maintenance usually stops when:
Is there a time limit for applications for spouse maintenance?
If a party was married, applications for spouse maintenance must be made within 12 months of when their divorce become final, unless they were in receipt of a pension at the expiration of that period.
If the party was in a de facto relationship, the applications for de facto partner maintenance must be made within 2 years of the breakdown of the de facto relationship.
If a party does not apply within these time limits, permission of a court will need to be sought. Leave is not always granted but is granted if the party was reliant on a pension at the end of the period.
It is common for the issue of spousal maintenance to be considered as part of a property settlement and in addition to a child support assessment.
Spousal maintenance applications can be very complex. When deciding to make an application or respond/defend an application, it is very important that you are in a position to disclose and explain your current financial position and likely financial position after a property settlement.
Once this has been done you are in a position to clearly establish whether you have a need to bring an application (looking at your income and expenses) or capacity to pay the other party (where your income earning capacity exceeds your needs). This can sometimes require an intricate forensic analysis of your financial circumstances.
It is recommended that you seek legal advice if you think you may be a party who is eligible for spousal maintenance or if you are a party that may be asked to pay spousal maintenance.
If you require legal advice or representation please contact our friendly team on 9306 0044.