What is spouse maintenance?
Commonly known as Alimony in the US, spouse maintenance is financial support that’s paid by one spouse to the other after separation or divorce. It is intended to assist a spouse who might otherwise not be able to meet their financial needs. There is no simple answer to the question, how is spousal maintenance calculated, but here’s what’s important to know.
How is spousal maintenance calculated?
First, be aware that spouse maintenance is unrelated to child support or child maintenance. Courts rarely now look at child support matters, this all being dealt with by the Child Support Agency other than in very limited circumstances. However, spouse maintenance is dealt with by a Judge in the family law courts.
Secondly a spousal maintenance claim may be made as part of an overall property application, or separately. It could be filed as an urgent or interim application, or as part of seeking a final property settlement.
Thirdly, unlike child support which for the vast majority of cases has a fixed formula and is indexed annually, there is no set formula that a court follows when deciding on spouse maintenance payments.
So how can you work out whether you’ll be granted spouse maintenance, and if so, how is spouse maintenance calculated? There are a lot of factors that the courts have to take into account with spouse maintenance applications, and the courts have a very wide discretion. Each case is considered on its own facts, after an assessment of each party’s income and expenses, future needs, and a host of other factors that come into play (more on this below).
What orders can a court make?
There are two essential parts to a spouse maintenance application:
- The needy spouse has a shortfall of income to meet expenses AND
- The ‘richer’ spouse has a surplus of income after meeting their own reasonable expenses.
These two things must both be present. If there is a shortfall on one hand, but no surplus on the other, sadly, the needy spouse may not receive spouse maintenance. Equally, the ‘richer’ spouse may have a large surplus, but unless the needy spouse can show a shortfall, the needy spouse may not receive an order for spouse maintenance.
If a court grants spouse maintenance, it can make any of the following orders:
- order the payment of a lump sum;
- order regular payments, say fortnightly;
- order the transfer of property in lieu of cash;
- make a final order;
- make an order for a fixed term or for life or an interim order until further order;
- impose reasonable terms and conditions; or
- make any other order which it thinks is necessary to make to do justice in the case.
Whether the order is made on an urgent, interim or final basis can also affect calculations.
How is spousal maintenance calculated?
An applicant spouse needs to establish to a court that they can’t support themselves and meet their reasonable needs, as well as establishing that their ex can reasonably provide support.
The courts will assess a range of factors. This includes whether there are children requiring care, the parties’ earning capacity, their age and health, their respective incomes, assets and resources, what a reasonable standard of living would be, what contributions each party has made to the marriage, whether the ‘needy’ spouse is running down cash to live on, and a variety of other circumstances that the court needs to consider to enable it to do justice. A party’s role as “breadwinner” or “homemaker” will often be relevant, as it’s often in marriages that had traditional spouse roles where maintenance claims are made. In those cases, a homemaker/carer party can find it difficult to re-enter the workforce after a long absence, or may still have the primary care of children which prevents them working to their full earning capacity.
How long is spouse maintenance ordered for?
Spousal maintenance does not typically continue for life. It can be for quite a short period in some cases—as long as it’s sufficient to allow the receiving party to re-train and seek employment, or until they receive their share of the property settlement or until children are older. However, the court does have the power to make more open-ended orders in rare circumstances.
What happens if you have a new partner?
Re-marriage can affect spouse maintenance claims. If you are in a new de facto or domestic relationship, a court will need to examine your new domestic relationship to determine whether or not the circumstances of the new relationship allow you to support yourself adequately.
What happens if things change?
Once a spouse maintenance order has been made, it can be re-visited. Sometimes a payer loses their job, or re-marries and has new children that affect their ability to make the existing payments. Sometimes a recipient needs more maintenance than before. In such cases, a fresh application to a court to vary an order will be needed.
Does your relationship qualify as one deserving of a spouse maintenance claim?
In most cases, it’s fairly obvious that a couple was in a de facto relationship. However if this is in dispute, the courts have to determine the facts. There have been cases in the Australian family courts, for example, where a couple has been deemed to be de facto even if they haven’t actually been living together in the same home.
What happens if your ex quits work to avoid paying spousal maintenance?
If an ex-spouse strategically decides during a divorce that they aren’t going to work anymore, this doesn’t necessarily mean they will be relieved of their obligations in terms of child support and spouse maintenance. Conversely, if your ex-spouse makes a deliberate choice to quit employment during a divorce in order to generate an artificial need for support, they may be in for a rude awakening when they discover that the courts will not order their spouse to support their decision not to work.
Making a deliberate, strategic decision to quit a job—as opposed to being made redundant or being terminated due to factors such as poor performance (which can of course also be deliberate)—does not magically reduce an individual’s earning capacity. What’s more, if your spouse did have a job when proceedings started, they’ve already established to the court that they have earning capacity. Depending on the situation, the courts may still expect your ex to look for another job.
However, you may need to file evidence to show that your ex is voluntarily unemployed or under-employed.
It’s always important to remember that your earning capacity does not equate to the money you currently earn. And even if it seems that someone appears to have the capacity to pay maintenance, he or she won’t be forced to pay it if a court deems their spouse does have the earning capacity to be able to support themselves—in that case, they are expected to seek work.
Is there a way to estimate likely spousal maintenance?
While there is no online calculator for spousal support in Australia, you can try to get a general ballpark figure with the help of a family lawyer. This will involve working out your income and expenses and making a guesstimate of the same for your ex. A family lawyer should then be able to advise you whether spousal maintenance is likely to be payable and if so, what the likely amount might be.
It’s always important to consider the benefits of getting a successful spouse maintenance order versus the costs and stress of running such a case. Is your final hearing in a few months or years? Is it worth running such a case?
Are there any time limits to know?
Yes. If you were married, you have 12 months from the date of your divorce order being made final to start an application for spousal maintenance (and property). If you were in a de facto relationship, you have a little longer—24 months from the date of your separation. Sometimes courts will grant “leave” (permission) to apply for maintenance outside the time limit, but you’ll have to successfully prove there are special grounds. It’s important to note that judges have found there is a distinction in the Family Law Act between the “finality principle” that applies to property settlements and to spouse maintenance. Ensure you get advice from a family lawyer as to your prospects.
Do you have to go to court to get spousal maintenance?
If you can work things out between you to arrive at consent orders, that’s far better than protracted litigation on the issue. But if you can’t work things out between you, there are other non-court options to help you reach agreement on what is fair–consider the various Alternative Dispute Resolution processes that are available such as arbitration, mediation or collaboration. You could also outline an agreement on fair spousal maintenance in a Binding Financial Agreement (which can also be made post-divorce, ie. a post-nup).
Obtaining legal advice in relation to spousal maintenance is highly recommended, as you’ll need to be advised on your prospects for success, as well as the ultimate commercial worth of making an application. Your lawyer should also first try to negotiate to reach an agreement with your ex, so that ideally some interim payments can be arranged to support you after separation. If you decide to go ahead and make an application, it’s also important that you and your lawyer properly prepare the application with all the necessary evidence, to give it its best chance of success and avoid having your case dismissed.
How is spousal maintenance calculated?
If you need assistance with a spousal support claim or any other family law matter, please contact Canberra family lawyer Cristina Huesch or one of our other experienced solicitors here at Alliance Family Law on (02) 6223 2400.
Please note our blogs are not legal advice. For information on how to obtain the correct legal advice, please contact Alliance Family Law.
