Co-authored by Alexandra Coyle and Emily Molloy, Gold Coast based Senior Associate and Law Clerk in Family Law at Robbins Watson Solicitors, this article dives into the concept of spousal maintenance during separation in family law detailing the legal obligations on each party.
Spousal maintenance is an essential concept in family law that ensures financial fairness and support following separation. This legal concept addresses financial disparities between former spouses or de facto partners and aims to provide necessary financial assistance where one party is unable to adequately support themselves post-separation. Understanding the complexities of spousal maintenance – from the concept of spousal maintenance to the factors that the Court takes into consideration as well as the rights of each party – is essential in family law matters.
What is Spousal Maintenance?
Spousal maintenance is a form of financial assistance paid by one spouse to the other following separation. Governed by the Family Law Act 1975 (Cth), for both married and de facto couples, the overarching principle of spousal maintenance is that one party requires financial assistance to adequately support themselves, and the other party has the capacity to be reasonably able to provide financial support.
There must be a genuine need by one party for financial support. This is not a test of whether one party is in need but rather a test as to whether that party is in a position to finance themselves from their own resources. This type of support is separate to child support as the financial support is primarily intended to assist the lower-earning spouse to maintain a reasonable standard of living.
Factors Considered by Courts in Determining Spousal Maintenance
When assessing spousal maintenance claims, the Federal Circuit and Family Court of Australia takes into consideration various factors. These factors include:
Financial Needs and Resources: The court will examine the financial resources as well as the financial needs and obligations of each party. This examination includes referring to each party’s income, assets, liabilities and mental capacity to gain appropriate employment.
Income and Earning Capacity: The present and potential future income and earning capacity of each party is assessed with qualifications, work experience, age and health considered. Income is assessed from employment, investments and any other sources.
Contributions During the Relationship: Each party’s contributions during the relationship are considered including financial, non-financial, homemaker and parenting contributions. This acknowledges that one party may have sacrificed equally contributing financially as they have taken on more responsibility for the children of the relationship or maintenance of the home.
Factors Affecting Ability to Work: If one party has greater parenting responsibilities for young children of the relationship or if their health imposes as a barrier to their ability to work this is considered. Additionally, consideration is given if one party is eligible for a government pension, allowance or benefit.
Standard of Living: The length of the relationship is taken into account as to assess the maintenance required to maintain the reasonable standard of living that was established and enjoyed during the relationship.
Other Relevant Factors: The court will also consider the age, health, parenting arrangements for the children of the relationship and child support obligations. In addition, whether the party in need of maintenance could be supported for the duration to undertake further education or training to establish themselves to obtain an adequate income.
Spousal maintenance is not automatic, with each case assessed on its own individual merits. Outcomes can vary in relation to spousal maintenance as the maintenance is dependent upon the specific circumstances put forth by the parties.
Types of Spousal Maintenance
There are various types of spousal maintenance – urgent, interim, and final.
Urgent
If one party has urgent or immediate need for financial assistance following separation they can apply to the Federal Circuit and Family Court of Australia for urgent spousal maintenance. The Court has the power to order one party to pay the other party spousal maintenance when the factors above have not yet been fully considered in depth. This payment can be a one-off lump sum payment or periodic payments to assist the recipient immediately and usually have a deadline until interim or final orders or an agreement to be made.
Interim
This type of spousal maintenance is awarded when it is not urgent, but one spouse requires financial assistance during the separation period and before the finalisation of property matters. Interim spousal maintenance provides short-term financial support to one party during the interim period where the parties are negotiating and working to settle the property matters. The purpose of this spousal maintenance is to provide interim financial support to the lower-earning spouse. Spousal maintenance will only apply for the period stipulated or until such time a final order or agreement is made.
Final
This type of spousal maintenance is on-going and usually is applicable in circumstances where one party cannot become financially self-sufficient in the foreseeable future due to various factors such as age, significant age gap affecting earning potential, health or caregiving responsibilities. Final spousal maintenance can continue until such time significant circumstances change such as remarriage or improvement in one party’s financial circumstances. This payment can be a one-off lump sum payment or periodic payments over a certain period of time.
It is noted that property settlement should be determined initially with spousal maintenance determined after. This is due to the fact that through a property settlement the lower-earning party may be awarded a greater benefit as to afford them a capital sum and/or investment opportunities and thereby are not in need of further financial support.
Rights and Responsibilities of Spousal Maintenance
It is crucial that both parties understand their rights and responsibilities when involved in spousal maintenance arrangements.
These rights and responsibilities include:
For the Recipient: The party that requires financial assistance due to income disparity has the right to request from the other party financial assistance so that they can meet their reasonable living standard. This party is entitled to a fair assessment of their financial needs and contributions over the course of the relationship. The recipient has the responsibility to use the financial assistance firstly for essential living expenses such as housing, utilities, food and other necessity costs.
For the Payer: The party that is obligated to pay the other party has the responsibility to provide financial assistance based on their capacity to do so and the other party’s need for assistance. The paying spouse must provide accurate and complete financial disclosure as to assess their ability to pay spousal maintenance. The payer must provide the financial support in accordance with the agreement or order.
Jointly: Both parties have the responsibility to comply with any order or agreement made. Each party has the right to seek for variation or termination of spousal maintenance in certain circumstances, such as significant change in financial circumstances of either party, employment status change of either party, the recipient’s cohabitation with a new partner or remarriage or any other relevant change. These factors are considered to ensure fairness and relevance to the spousal maintenance.
How to record Spousal Maintenance
Parties can negotiate spousal maintenance agreements without needing to go to court. These agreements are binding on the parties and must take into consideration the abovementioned factors. Agreements can be formalised though either binding financial agreements or consent orders. It is noted that consent orders are court orders, however, an application for consent orders does not require the parties to attend Court.
Alternatively, if parties cannot mutually agree to spousal maintenance one party, usually the party in need of financial assistance, can apply to the Federal Circuit and Family Court of Australia seeking the Court’s assistance to determine spousal maintenance.
Time Limitations
There are strict time limits in relation to bringing an application to the Court for spousal maintenance. If the parties have been married the deadline to make an application for spousal maintenance is 12 months after a divorce order. As for de-facto parties, an application must be brought within 2 years after the date of separation.
There is no time limit imposed to vary, review, suspend or discharge spousal maintenance.
Conclusion
Spousal maintenance is a vital aspect of family law that ensures fair financial support following a separation or divorce. Navigating spousal maintenance can be challenging but by understanding your rights and responsibilities, as well as the factors courts consider, both parties can work towards a fair and just outcome.
Whether you are seeking financial support or are obligated to provide it, consulting with an experienced family lawyer is crucial to ensure your rights are protected and your obligations are met fairly. Each case is unique, and seeking tailored legal advice ensures that your financial future is handled with care and expertise in accordance the Family Law legislative framework.
For expert guidance on spousal maintenance matters or any family law issues, contact Alexandra Coyle by clicking here to discuss your situation. Alternatively, you can click here to get started independently on detailing your reason for spousal maintenance or your obligation to pay spousal maintenance.