What is Reasonable Support and Adequate Support?
As has been explained elsewhere, a party to a marriage that has ended can apply for spousal maintenance under section 72 of the Family Law Act 1975. If parties were not married but in a de facto relationship, an application for spousal maintenance can be made under section 90SE of the Act. Whether or not spousal maintenance is granted will depend on a number of considerations. When an order is made for spousal maintenance the court will consider what is reasonable support and what is adequate support.
When is spousal maintenance ordered?
The considerations that determine whether spousal maintenance is ordered include:
- The income and expenses of the party applying for maintenance;
- The capacity of the party applying for maintenance to earn income;
- The capacity of the respondent party to pay for spousal maintenance.
A party will be required to support the other party to the former relationship where it is found that it is reasonable for them to do so and the other party is unable to adequately support him or herself. When making an order for spousal maintenance, the Federal Circuit and Family Court (FCFCA) must determine what is reasonable in the circumstances and what is adequate by taking into account the factors listed in sections 75(2) and 90SF(3) of the Family Law Act 1975. These factors include:
- How old the parties are and the state of their health;
- What income, property and financial resources each party has including their earning capacity (taking into account their physical and mental capacity for their ability to earn);
- What would be a reasonable standard of living taking into account all the circumstances of the case;
- How an award of spousal maintenance would allow the recipient party to engage in further education or training to improve their earning capacity;
- How long the marriage lasted and how it may have affected the parties’ abilities to earn, e.g. one party may have remained at home to take care of children, and this may have eroded their earning capacity.
Reasonable adjustments and adequate support
The following principles have been noted in relation to what are reasonable adjustments in relation to spousal maintenance and what is meant by adequate support:
- Adequate support does not mean that the standard of living prior to the separation has to be maintained through the spousal maintenance payments;
- “Adequately” does not have a fixed meaning. What is adequate is to be determined by the considerations contained in section 75(2) of the Family Law Act 1975;
- Adequate support through spousal maintenance does not mean merely providing the bare minimum or a subsistence level of support;
- If possible, both parties to the former relationship should continue to live at the same level they had enjoyed during the relationship. However, if financial resources do not allow for this the standard of living may need to be lower;
- In some situations it may be reasonable for parties to enjoy a higher standard of living than they did during the relationship;
- A party seeking spousal maintenance is not required to use up all of their financial resources before they can qualify for spousal support. Again what is reasonable is to be determined from the circumstances of each case;
- There is no entitlement for a party to enjoy a luxurious standard of living because the other party has substantial financial resources. Also, just because one party can afford to maintain the standard of living enjoyed by the other party during the relationship, this does not mean that they are required to do so.
The clean break principle
An overarching principle that applies to the law of spousal maintenance is that of the “clean break” principle, which is noted in sections 81 and 90ST of the Family Law Act 1975.
The principle is that as far as is practicable, the court will make orders that finalise the financial affairs between the parties and avoid further matters coming before the court.
Criticisms of the spousal maintenance system
The current law in relation to spousal maintenance in Australia has been criticised for a number of reasons. These criticisms include:
- There is no guidance on the relevant importance of the items on the list of considerations for whether spousal maintenance should be granted;
- Some of the items on the list for consideration suggest other approaches to the granting of spousal maintenance should be followed other than that espoused by the “clean break principle”;
- There is little guidance on how to choose the principles that should apply in a particular case; and
- Statistics show that despite the law allowing for spousal maintenance, women still tend to end up financially worse off when a long-term relationship ends in separation or divorce.
There have been some recent calls for law reform in this area to ensure this area of law has more clarity and also delivers results that are more just and equitable. We will have to watch and see if any suggested changes are realised in the near future.
If you require legal advice or representation in any legal matter, please contact Armstrong Legal.