A Spousal Maintenance Order (or Periodical Payments Order) is the financial obligation the court decides one party in a divorce will pay the other party following their divorce. It will be a set amount paid on either a weekly or monthly basis for a defined period but, once it’s in place, can a maintenance order be varied?
The simple answer is yes. When a Maintenance Order is made, the court has the power to vary that order if one party’s personal circumstances changes significantly. For example, one party could lose their job or start to earn significantly more than they did at the time of the divorce.
Although the formal process will involve the court, in some cases it can be possible for the parties to reach a private arrangement. However, you should bear in mind that a private arrangement will not be legally binding, nor will it prevent previously ordered payments from being enforced in the future. This means it is always advisable to progress an application to vary a Spousal Maintenance Order with a family law professional.
What variations can be made to a Maintenance Order?
Maintenance payments can either be increased, decreased, suspended or terminated.
There are many reasons why maintenance payments will need to be changed, these include:
- A considerable change to the level of either party’s income
- Either party has entered into or ended a new relationship
- There has been a significant change to either party’s needs or living expenses
- Either party has had a child
How do can a Spousal Maintenance Order be varied?
To change the terms of a Spousal Maintenance Order you will need to make an application to the court.
However, there are various criteria that will need to be satisfied:
- An existing Maintenance Order must be in place (even if the Order is only ‘nominal’)
- The party receiving maintenance must not have remarried
- The applicant must be able to prove there has been a change in their circumstances since the court made the original Order
- The applicant must be prepared to explain what has happened in the intervening years since maintenance began
The Court then has the discretion to decide whether to allow a variation of maintenance.
Their deliberations will involve a range of considerations. Section 25 of the Matrimonial Causes Act 1973 and Schedule 5, Part 5 to the Civil Partnership Act 2004 set out the statutory principles:
- First and foremost, the welfare of any children involved
- The income and earning capacity of each party, currently and in the foreseeable future
- The financial needs, obligations and responsibilities of each party
- The standard of living enjoyed before the marriage or civil partnership broke down
- The ages of the parties and any physical or mental disabilities
- The length of the marriage or civil partnership
- Any contributions made or likely to be made for the welfare of the family
- Conduct from either party that in the court’s opinion it would be unjust to disregard it
- Whether compensation for any loss of career opportunity through marriage or civil partnership is deserved
In some cases, it may be decided that it would be more beneficial for the parties to have a ‘clean break’.
This is done by calculating or ‘capitalising’ the total value of future maintenance and ordering the payer to cover all future maintenance payments in one lump sum. If a lump sum is paid, this would of course signal the end of the Maintenance Order.
Capitalisation offers some benefits:
- All financial ties between the parties will be permanently cut
- The payer’s financial outgoings will be reduced
- New relationships won’t be impacted
- There is no risk of any future variations
However, there also potential downsides to capitalisation.
Firstly, you cannot be sure what will happen in the future. If you are the recipient, your personal situation could change significantly – for example you may find yourself unable to work or suffering from a serious health issue – and your financial needs could increase unexpectedly as a result.
Alternatively, the recipient partner’s income may significantly increase which means that if you were to capitalise now, the payer may risk paying more than they would if they continued to pay maintenance and applied for a downward variation in the future. On the other hand, the payer’s income could increase which would mean the recipient could miss out on the opportunity to apply for an upward variation in the future.
If you are considering making an application to vary a Maintenance Order, you should discuss every aspect with one of our experienced family lawyers. They will help you make an informed decision as to the best way forward. Please contact us today to make an appointment.