Onto pastures new?

London has developed a headline grabbing reputation as the 'divorce capital of world', and rightly so. Newspapers are frequently splashed with high profile, high value financial settlements on divorce.

In addition to those cases where the wife receives a substantial lump sum settlement to meet both her capital and income needs on a clean break basis, the court's approach to maintenance makes it one of the most attractive forums in the world for the financially weaker spouse, with the paying party often ordered to pay maintenance to their spouse for life, if a clean break is not affordable.

Spoilt for choice

In this jurisdiction there are three types of spousal maintenance orders: joint lives, payable until the death of either party or the re-marriage of the receiving party; an extendable term, payable for a fixed period which can be extended; or a non-extendable term, a fixed term which cannot be extended under any circumstances.

The concept of what is known as joint lives maintenance is alien to many of our European colleagues. For example, just across the border in Scotland, the maximum maintenance term is a mere three years, regardless of the financially weaker party's circumstances. There is even a distinction between those cases heard in or around the capital and those dealt with outside of the M25, with a joint lives maintenance order being far more likely to be awarded in the former rather than the latter.

This discrepancy is primarily due to the wide discretion afforded to family law judges to determine both the quantum and duration of maintenance. The court will look at each spouse's income and earning capacity, and the weight attached to these factors will depend on the age and circumstances of the parties. For example, whether or not a spouse has qualifications, has worked recently or has childcare responsibilities for young children. The test is whether, in light of all of the circumstances, the payee can adjust to financial independence without undue hardship.

Relinquishing the throne

The general consensus is that the tide is turning in London, with judges becoming more robust about the notion that the financially weaker party should be supported for life.

One such example is the recent case of Mr and Mrs Wright in 2015. Following the parties' divorce seven years earlier in which Mrs Wright was awarded a joint lives maintenance order, she had taken no steps since to find gainful employment (despite her previous work as a legal secretary and administrator) nor to re-train. Her arguments justifying her failure to do so were rejected.

In addition, the recent key case in this area, SS v NS [2014], heralds a move towards the increase of term orders. The judge made it clear that generally, an award should only be made by reference to needs. The court must consider a termination of spousal maintenance with a transition to independence as soon as it is just and reasonable in every case, and a degree of (not undue) hardship in making the transition to independence is acceptable.

Such case law has added to the growing debate as to whether there should be a radical review of the court's approach to maintenance. In February 2014, the Law Commission published a report relating to financial needs on divorce, with a suggestion of a formulaic approach to calculating maintenance. Most practitioners argue that the rigidity of a more formulaic approach (as adopted in Canada) is unlikely to be appropriate given each case is so fact specific.

Those advising the financially weaker party should be less confident in the generosity of the London courts. They may have to work harder to convince a judge that their client should be awarded a 'meal ticket for life' from their ex-spouse.

The expectation is that judges will want to see hard evidence of the efforts of the receiving party to maximise their earning capacity. However absent statutory reform and the subjective nature of financial awards will continue, so only time will tell whether judges in London will continue to question the fundamental thinking behind spousal maintenance.

Alexandra Hirst (pictured) and Katie O'Callaghan are solicitors at Boddle Hatfield

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