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10 May 2017

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Maintenance – Is it for Life?

Posted by: Chris Burrows

This is a very topical headline as our daily newspapers recently carried reference to a Court of Appeal Judgment and a comment made by Lord Justice Pitchford which seems to have resulted in much public furore. The papers have interpreted the judicial comments, in such a way, as they were calling for a change to the Law.

The report is of course very fact specific. The case involved a challenge by Tracey Wright, the former wife of a racehorse trainer, Ian Wright, to a decision which would see her future maintenance significantly reduced.

The parties had separated in 2006. The then family home had been ordered to be sold and the net proceeds of sale had been divided equally. This had allowed Mrs Wright to purchase a property in her own name for £450,000 free of mortgage. Mrs Wright and the two children of the family had continued to live in that property. As part of the original divorce Court Order, Mr Wright had been ordered to pay maintenance of £75,000 per annum, of which £33,200 per annum was spousal support for Mrs Wright alone.

In 2014, the former husband applied to the Court to reduce spousal maintenance because he was concerned at aged 59, that the sums involved would be unaffordable upon his retirement. The initial decision of the Court was that the spousal maintenance payments would ultimately cease, subject to a tailing off over a five year period leading up to Mr Wright’s retirement. The Court made it clear that there was no good reason for Mrs Wright not to seek work following separation, particularly when she had a good earning capacity with easily identifiable job qualifications.

Mrs Wright was unhappy with the original Order and appealed. Lord Justice Pitchford’s comments were blunt to say the least. He very much emphasised the need that Mrs Wright should simply ‘get on with it’ and seek a job like numerous numbers of other women with children.

The newspapers have seen this decision as very much ground breaking. In actual fact, it is a move towards what the Statute had always intended, which is to encourage spouses – generally women – towards financial independence. However, women with children at school still need childcare and that is often going to cost more than ever a mother can earn if she were to go out to work.

The major legislation in this area of Law is the Matrimonial Causes Act 1973. This Act of Parliament, although somewhat elderly now, has kept up to date thanks to subsequent cases and there was always emphasis within the original wording of the legislation requiring the Court to look at whether it was possible for there to be a clean break as part of a financial deal between divorcing parties.

Usually, when advising parties in a divorce settlement, it is essential that you identify heads of claim and, in particular, whether it is possible for an additional lump sum payment to be made in lieu of ongoing maintenance. This is often a difficult ask, as there is insufficient liquidity to buy off a competing spouse’s claims. However, in certain circumstances, a spouse – usually a husband – is very keen to effect that clean break, particularly if he envisages that his business will go from strength to strength and he would be reluctant to then deal with his former spouse at a time when his wealth had increased considerably. In those circumstances, a husband often attempts to achieve that clean break, even if it is expensive for him in the short-term, as he will not face variations of maintenance claims by the former wife in future years. In addition, it avoids the need to deal with a once and for all capitalisation of a wife’s monthly maintenance order which is possible under current legislation.

What is clear is that it is essential that specialist family law advice is sought. This will allow heads of a claim to be addressed at the earliest possible moment and for realistic budgets to be considered, which is much more likely to lead to an early financial settlement, rather than a polarisation of positions and inevitable bitter Court proceedings.

About the Author

Glaisyers Solicitors has built many strong relationships over the years. Elizabeth Hassall has specialised in family law for over 20 years and is consistently recognised as a leader in this field of law by both Chambers and Legal 500 Directories. If you’d like to speak to Elizabeth, please email [email protected]

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Chris is a Senior Solicitor and is head of the firm's Private Client department. Chris specialises in advising business owners on a wide range of topics such as wills, trusts and estate planning. He also advises individuals and family trustees on wills, probate and estate administration. Chris has a special interest in supporting vulnerable clients who lack mental capacity and can't manage their own affairs.

Chris Burrows - Senior Solicitor, Head of Private Client

To discuss how glaiysers can assist you contact Chris Burrows on [email protected] or via 0161 832 4666.

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