What is spousal maintenance?
In Australia, spousal maintenance is the responsibility of one party to financially support the other party following the breakdown of their relationship. Spousal maintenance can be applicable following the breakdown of a marriage or the breakdown of a de facto relationship.
Spousal maintenance is separate from property settlement and separate from child support. A party can be liable to pay spousal maintenance for the benefit of their former spouse in addition to child support, which is for the benefit of their children.
A liability to pay spousal maintenance can be ordered by the court or agreed to between the parties. If parties reach an agreement regarding the payment of spousal maintenance, they can enter into Orders or a Binding Financial Agreement to formalise the agreement. Even if it is agreed that no spousal maintenance will be paid, it is important to formalise this in an agreement. Failing to do so could expose parties to risk of a spousal maintenance claim in the future.
How is Spousal Maintenance determined?
A liability to pay spousal maintenance may arise if all of the following factors are present:
- The party seeking maintenance is able to demonstrate reasonable needs;
- That party cannot adequately support themselves using their own income (without any income tested pension); and
- The other party has capacity to support them.
Matters that can be relevant in determining one party’s need for support and the other party’s capacity to provide support include the following:
- Having care of a child of the marriage under the age of 18, or another dependant;
- Earning capacity;
- Income, property and financial resources;
- Education;
- Age;
- Ill health or disability;
- Reasonable standard of living; and
- Duration of the relationship.
Types of Spousal Maintenance
There are a variety of types of spousal maintenance, including periodic, lump sum, interim, and urgent.
Urgent
Urgent spousal maintenance may be ordered by the Court if one party has a pressing or immediate need for financial support. The Court has the power to make an order for urgent maintenance without making a detailed enquiry into the parties’ financial circumstances.
Usually, urgent spousal maintenance is ordered for a limited period until such time as an interim or final maintenance order can be made. Urgent maintenance can be ordered by way of lump sum or periodic payments, depending on what the Court considers to be reasonable in the circumstances.
Interim
Interim spousal maintenance may be ordered in circumstances where there is a need for maintenance prior to the finalisation of the parties’ matter, but the need is not urgent or immediate. The Court requires sufficient evidence from both of the parties (in the form of an Affidavit and Financial Statement) and conducts an interim hearing before making their decision regarding interim maintenance. An interim spouse maintenance order will apply for the period stipulated by the Court or until discharged by further order of the Court.
Lump sum
Spousal maintenance may be ordered by way of lump sum or periodic payments. It is generally the case that spousal maintenance will be paid periodically, however, lump sum maintenance may be more appropriate in some circumstances. Lump sum maintenance may be appropriate where the paying party has been inconsistent with periodic payments in the past, the receiving party has encountered difficulty enforcing the payments, or the receiving party requires a lump sum in order to re-establish themselves in a new home.
Is there a time limit for applying?
Yes, time limits do apply if you intend to make an application for spousal maintenance. These are the same time limits that apply to applications for a property settlement.
If you are, or have been, married, you have one year from the date that your Divorce Order is granted to apply to the Court for spousal maintenance.
If you have been in a de facto relationship, you have two years from the date of the breakdown of your relationship to apply to the Court for spousal maintenance.
Applications to the Court outside of these time limits will only be allowed in special circumstances.
If your time limit is approaching and you have not yet applied to the Court or formalised an agreement regarding spousal maintenance, you should contact us urgently for advice.
How long does spousal maintenance last?
Spousal maintenance payments can last for a short or long period of time following separation, depending on the needs of the receiving party and capacity of the paying party. The liability to pay spousal maintenance will last as long as stipulated in an enforceable agreement or the Court’s orders.
Generally, the receiving party will not be entitled to continue to receive spouse maintenance if they marry another person or if they pass away. If the receiving party commences a new de facto relationship, the Court will look at their particular circumstances to determine whether spouse maintenance should continue to be payable.
Spousal maintenance examples
We provide some examples of circumstances when spouse maintenance may be relevant, as follows:
Caregiver
Often, when parties to a relationship have children, one parent reduces their employment in order to care for the children and the other parent remains in the paid workforce. When this happens, the caring parent usually relies on the working parent’s income to meet their living expenses. This also gives the working parent an opportunity to continue to advance their career, obtain promotions and gain experience, while the other parent remains at home. The effect of this is that one parent builds up their capacity to earn an income over the course of the relationship and the other parent’s capacity to earn an income diminishes the longer they are out of the workforce. In these circumstances, the parent who was the caregiver for children may be entitled to spousal maintenance until such time as their capacity to earn an income increases.
Relocation
Spousal maintenance can be relevant in circumstances where one party relocated from a different country to pursue their relationship with a person who lives in Australia. The parties’ earning capacities may be different because the relocating party’s qualifications are not recognised in Australia or language barriers prevent them from obtaining employment. In these circumstances, it may be necessary for the relocating party to receive spousal maintenance until they complete further education or obtain relevant experience to increase their earning capacity.