There is an old song that runs along the lines of young married couple where everything is blissful and rosy, children come along, husband worked long hours and at some point the husband strays and finds himself on the receiving end of an application for spousal maintenance.
The words of the song go like this:
“He doesn’t earn much money only $4000 Per.
some Judge who thinks it’s funny says he’ll give $6 to her.
He says judge what if I fail? The judge says march, right into jail.
You’ll find it cheaper for you to keep her than making whoopee.”
So who can claim spousal maintenance and under what circumstances?
The following is from a paper delivered on July 7th, 2016 at Continuing Legal Education organized by the Family Law Practitioners Association.
The entitlement to maintenance is governed by section 72 (1) of the Act.
A party to a marriage is liable to maintain the other party, to the extent that the first mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:
- by reason of having the care and control of a child of the marriage who was not attained the age of 18 years;
- by reason of age or physical or mental incapacity for appropriate gainful employment; or
- for any other adequate reason;
having regard to any relevant matter referred to in subsection 75 (2)
In a de facto relationship section 90 SD – 90 SF, is the relevant equivalent
Section 72 (and its de facto relationships equivalent) defines the “threshold” test and has two limbs.
- the applicant must demonstrate that he or she is unable to support himself or herself adequately; AND
- the payer must be reasonably able to pay
In the case of Eliades(1981) FLC 91-022 Nygh J said “the test of ability to support oneself
is not identical to the test of whether one is in need, but means whether the applicant is in a position to finance himself or herself from his or her own resources. That is to say, the test is whether by reason of earning capacity, by reason of capital or other sources of income which have accrued independently to the applicant, The applicant is in a position to look after herself.”
Section 74 (1) of the Act (90 SE for de facto claims) gives the court power to “make such order as it considers proper for the provision of maintenance” having regard to the matters under section 75 (2). [90SF(2&3) for de facto claims).
You should note in de facto claims the court may have regard to the terms of any property or maintenance order made or proposed in relation to a de facto party’s spouse or other de facto.
The applicant Bears the onus of proof of being unable to support herself or himself.
When considering a spousal maintenance application the court considers firstly, the threshold question, need and capacity to pay , and only then may it go on to consider the matters in section 75 (2).
It does not automatically follow that even though the payer is reasonably able to do so, that the applicant is entitled automatically to the same standard of living as prior to separation. Reasonableness is the guiding principle.
It is not necessary either for an applicant to exhaust all savings and capital before having an entitlement to spousal maintenance.
Court’s approach in this regard was set out in Bevan(1995) FLC 92-600 and followed closely by Mitchell (1995) FLC 92 – 601 stating that
the days are long gone when it is necessary for an applicant to use up all her assets and capital in order to satisfy the requirement that she is unable to support herself “adequately”. Where the line is to be drawn will depend on the circumstances of individual cases’
Time limits applicable for an application for spousal maintenance is 12 months following divorce Section 44 (3) and 2 years following separation Section 44 (5) for de facto claims.
In the majority of cases it is reasonably easy to determine whether spousal maintenance should be paid or not. Where one spouse is in receipt of a high income, or at least better than average and the applicant is in receipt of a government benefit, it does not take much to figure out.
More difficult are the cases where both parties appear to have a reasonable amount of resources available to them.
In the most recent case determined in the High Court, Hall v Hall (2016) HC A23, the decision being handed down on 8 June 2016 an interim spousal maintenance order had been made for the husband who is a property developer, to pay the wife who was a medical practitioner, interim spousal maintenance of $10,833 per month.
The order was made after the wife’s financial statement disclosed that she had an interest in 2 luxury motor vehicles and an interest in the estate of her late father, the value of which was unknown at the time.
Following the making of the interim order, the wife’s interest in the estate became known and revealed the estate to be quite substantial. The wife’s late Father expressed a “ wish” in his will that the wife should receive from a group of companies in which the late father held shares which in turn had been bequeathed to the wife’s brothers, a lump sum payment of $16,500,000 on the first occurrence of a number of specified events. One of those triggering events was a divorce from the husband.
One gathers from such terms, the husband was not held in high regard by the wife’s late father.
In addition, the father’s “wish” was that the wife should also receive an annual payment of $150,000 until that date, if any, of that lump sum payment of $16,500,000.
The wife’s argument was that the gift was voluntary and not binding on the estate . Howver the court drew the inference that the wife having a very good relationship with her brothers, she would have received the annual payment of $150,000 from the Group had she asked her brothers for it. The court found that the brothers’ provision to the wife of 2 luxury motor vehicles indicated the very good relationship she had with her brothers.
The Full Court’s decision was upheld by the High Court. Had the wife asked her brothers for the payment she would have received the annual payment of $150,000 and the evidence demonstrated that the wife was able to support herself adequately and that the threshold requirement section 72 (1) was not met.
The High Court went on to consider whether a potential source of financial support amounts to a financial resource of a party and held that it turns in most cases on a factual enquiry as to whether or not support from that source could reasonably be expected to be forthcoming were the party to call on it.
The court found a financial resource of the wife was a matter falling within section 75 (2) (b) and that payment was available to the wife if she asked for it. The court held in that case
“because it bore centrally on the ability of the wife to support herself adequately, the availability to the wife of the annual payment from the Group was also a fact or circumstance in respect of which it was open to the Family Court to form the opinion that the justice of the case required that it be taken into account. The analysis of the Full Court shows that it formed that opinion. There was thus, in addition to a matter within section 75 (2) (b) a matter within section 75 (2) (o)”
it’s unsurprising, given that scenario, that the wife’s appeal was dismissed with costs.
An earlier case, but still within the last 12 months, Rain & Creed (2015)FamCAFC133 was an appeal against a maintenance order on the grounds that the limit of four years was unsupported by the evidence.
The wife appealed against an order that was conditional upon the husband’s continued receipt of disability payments. I hasten to point out those disability payments were not government benefits, but were payments made by an insurer under a disability insurance policy. The policy was triggered by the husband severe depression.
The policy provided for the husband to receive lump sum payment of $135,495 and thereafter $3,756 per week which according to the terms of the policy would continue until he was aged 70.There was of course a get out clause for the insurer that if the insurer determined the husband was only partially disabled or was able to resume ork,. The policy could cease.
The wife challenged both the property division and the spousal maintenance decision. I shall leave aside the findings relating to property division.
The wife argued that the maintenance provision should not be limited to 4 years arguing that her needs may not diminish or that the order may result in further litigation. The court found that the focus should be on the “ husband’s capacity to pay, and in the circumstances, although we accept it is not ideal, the parties may need to return to court”.
The court there varied the maintenance order, leaving its payment amount intact but conditional on the husband receiving the insurance payments and removing its 4 year limit.
A Further interesting decision was made In Woodgate  FCCA 2419 (30 October 2014) . In that case, the husband, a police officer who had been injured on duty and was receiving a benefit until he could commute his pension. The wife was awarded spousal maintenance, pending commutation, where she would then have an interest in those funds.
Judge Henderson considered a 28 year cohabitation where the non-superannuation pool was $57,498 (para 2) but the husband’s superannuation benefit was worth “close to $1 million and is in addition to the receipt by him of a substantial fortnightly pension”
The husband’s injury was described as “deteriorating mental, psychological and emotional health … caused by the stresses of his job … resulting in him being pensioned off as ‘hurt on duty’”
The Court said (from para 105):
” . . . [Counsel for the husband] says the husband’s hurt on duty pension is more like a personal injuries claim and that [the] wife has at best a 30% entitlement to that asset although concedes she would likely receive the majority of remaining assets such as the money in trust shares and the like.
( … )
 This benefit consists of 2 parts the fortnightly pension and the lump sum. The fortnightly pension was gross $3,320.23 and is now $2,747.29. The lump sum is $949,061.41 when commuted in 4 years.
 It was contended by [counsel for the husband], relying upon decisions such as Hayton & Bendle [ FamCA 592]; T & T [T & T (Pension Splitting)  FamCA 207] a decision of Watts J; and Crawford & Crawford [ FMCAfam 1315] a decision of Judge Altobelli of this Court, that the wife’s entitlement to the husband’s pension when commuted in four years and his ongoing fortnightly pension payable to him is at best some 30 per cent. I need no longer consider the issue of the percentage entitlement of the wife to his weekly pension as it is agreed the wife has a claim for maintenance”
Although due to time constraints, I have only provided you with a snapshot of the area of spousal maintenance, it is an area that is worthy of more attention by practitioners than it currently appears to receive.
The threshold test must always be met before the considerations in section 75 (2) are considered and is a separate consideration from the division of property.