Spousal Periodical Payments Orders
Question – what is a Spousal Periodical Payments Order?
A Spousal Periodical Payments Order is a continuing obligation, on separation, for one party to pay the other a weekly or monthly sum. Payments may be secured with the provision of a capital deposit. The court may make Spousal Periodical Payments Orders on or after:
– decree of divorce
– nullity, or
– judicial separation
When making such Orders the court is obliged to consider whether periodical payments should be made only while the payee adjusts, without undue hardship, to the termination of their financial dependence on the payer.
When the parties are separated before their financial settlement is agreed a Maintenance Pending Suit Order may be made. This is financial provision before decree absolute or a decree of judicial separation is made.
The purpose of Spousal Periodical Payments
This is to provide maintenance for a party and may be used to assist in achieving a fair outcome on divorce, bearing in mind the principles of:
– needs – reasonable income and capital needs
– compensation – for loss one party suffered arising out of the relationship, e.g. giving up a lucrative career to care for the parties’ children
– sharing – parties respective disproportionate contributions during marriage being considered as equal
Duration of Spousal Periodical Payments Order?
There can be various triggering events when periodical payments cease such as re-marriage or subsequent civil partnership of the party in whose favour the Order is made.
Death – periodical payments cease on the death of either of the parties.
Can the payments be extended?
This may be done so long as there is not a bar in the Order preventing a party from making a future application.
Earning capacity and Spousal Periodical Payments
Consideration must be given to the financial resources each party has or is likely to have in the foreseeable future including any increase in earning capacity that the court could reasonably expect a party to acquire. Regard must be had to:
– Current earning capacity
– Future earning capacity (and the other party’s right to share it)
– Potential earning capacity (particularly where the party has not worked during the marriage or has given up work to care for children)
– Compensation for loss of earnings or earning capacity.
A payee’s earning capacity is taken into account when quantifying Spousal Periodical Payments and regard to the payee’s age, qualifications and role in the marriage, whether the payee is the primary carer of children, length of time since payee was in a workplace, payee’s recent work experience and availability of suitable jobs for the payee would also be made.
Nominal Spousal Periodical Payments Order
This is designed to act as a safety net to allow for a future variation application should the circumstances of either party change. This is usually used where, for example the payer’s financial position might improve with a promotion at work, the payee’s financial position may deteriorate due to illness or redundancy, or the payer has artificially depressed their income for the purposes of proceedings and where there is a possibility that income will increase in the future. When making an application for upwards variation it must be shown that there has been a significant change in circumstances.
Varying Spousal Maintenance
An income fall justifies an application for a downward variation and similarly an income rise justifies an upward variation. At all times the appropriateness of a clean break should be considered.
If a Spousal Periodical Payments Order is made for several years or on a joint lives basis consideration of index linking should be made, i.e. the periodical payment will increase annually in line with the retail prices index. In some cases the consumer prices index is used and sometimes it might be appropriate for automatic variations to be made, i.e. payments will increase by the same percentage as the payers salary.
Should you wish to consult our Accredited Family Law Specialist for further advice please telephone us to arrange an appointment.
