In recent years we’ve seen family court judges lean towards limiting awards of spousal maintenance in favour of what’s sometimes called ‘a clean break divorce’. These clean break orders involve each spouse dismissing all financial claims against the other once the divorce is finalised. To make up for ongoing spousal maintenance one party will usually agree to pay a lump sum or transfer property.
Against this backdrop of clean break financial orders it is also open to a spouse who has been ordered to pay maintenance under an old, open-ended court order to apply to change that order. The application is usually to:
- Stop the payment of ongoing maintenance altogether;
- Reduce the amount of maintenance payable; or
- Limit the time during which maintenance will be payable.
Here we examine a 2023 case, WK v JC, where both husband and wife sought to change a periodical maintenance payment order that dated back 20 years to 2004. The case is a useful illustration of the increasingly prevalent view of family court judges that spouses should aim to be financially independent after their divorce and not seek to rely on regular long term maintenance payments from a former spouse.
WK v JC: Competing Claims To Alter 20-year-old Maintenance Order
Briefly the facts of the WK v JC case were as follows:
The wife aged 60, had devoted much of her life to bringing up her children. The judge indicated that she very much still sees herself in that role despite the children now being adults. The husband is a 67-year-old retired finance executive. The couple married in 1992 and the marriage broke down in 2002.
An order was made in 2004 for the sale of the then family home and division of the sale proceeds slightly in the wife’s favour. A spousal periodical payments order for life in favour of the wife was also made for £17,500 per year.
Fast forward to 2022 and both husband and wife made Form A applications –the wife seeking an increase in the maintenance payments, the husband seeking a decrease or a discharge of the maintenance order.
In terms of the law, the judge highlighted that:
- The court cannot reopen capital claims (in relation to property and other assets). In cases like the current one judges can only consider whether the periodical maintenance payments ought to change and whether a lump sum instead of ongoing maintenance can be paid
- In deciding whether to alter the maintenance payments judges must apply a needs-based assessment. Critically it is for the party in receipt of maintenance to justify the need for ongoing dependency and the continuation of financial provision
- In making the needs-based assessment courts have a wide discretion as to whether to take into account any capital the person in receipt of maintenance has
Decision: Use Of Own Funds To Meet Needs
In this case the wife, apart from her investment income and maintenance payments also had several hundred thousand pounds of her own money. In deciding whether this pot of money should be taken into account when assessing her needs, the judge quoted an earlier judgment where Mostyn J had said:
“I struggle to conceive of any case where in the assessment of the claimant’s needs it could be tenably argued that it was reasonable for her not to have to spend her own money in meeting them. After all, that is what the money is for”.
The wife’s capital of several hundred thousand mentioned above was a combination of money from the original divorce settlement and some inherited money. She presently generated £12,000 per annum from her investments. At 60, the judge noted the wife was significantly younger than the state pension age and was in reasonable health. He took the view that she could earn £10,000 per annum for a further six or seven years. Whether the wife decided to work or not was a matter for her.
In conclusion the judge ordered the husband to pay the wife a lump sum, reduced to reflect her personal capital and income and her earning capacity. Once the lump sum was paid the maintenance obligation would come to an end.
Comment
It’s sometimes thought that to vary maintenance orders there must be a significant change in circumstances. But in WK v JC this wasn’t necessarily the case. And yet the judgment was crystal clear. Through a combination of the wife using her own capital and income to meet her needs and payment of a lump sum, the maintenance order was stopped.
The law in this area is far from certain. Judges always have a high level of discretion depending on the facts of each case. You should always seek legal advice – either if you want to stop paying maintenance or you want to increase or safeguard the maintenance you are receiving.
In closing it’s worth noting that we always impress upon clients the need to be aware of cost consequences in these types of proceedings. Indeed the judge in WK v JC lamented the significant cost to each party in bringing the proceedings at all. He expressed surprise and sadness that two:
“such sensible and pleasant people as this husband and wife have been so unable to compromise their differences that they have felt the need to spend almost a quarter of a million in fighting each other. I am afraid this is one of these cases where, sadly, the costs probably outweigh the real parameters of the dispute.”