COVID-19 EXPERT LEGAL INSIGHTS

My financial circumstances have changed –
can I vary the spousal maintenance I pay?

28 April 2020

If your income has reduced as a result of the coronavirus pandemic, you may not be able to pay the same amount of maintenance to your former partner. This could be short-term or you might be worried the situation could be more permanent.
 

Set out below are some key points to consider if you can no longer afford to pay the spousal maintenance you have been ordered to.

An order is an order – don’t breach it

You may have had your salary cut temporarily, been told that your bonus is being withheld or your business might be suffering in lockdown. Whatever your situation, it is unlikely that you saw it coming. Nevertheless, a Court order requiring you to pay maintenance to your former partner will apply unless it is varied.

There are two ways you can vary an order: by reaching an agreement with your former partner or, if you cannot agree, by asking the Court to decide whether, and if so how, the order should be changed.

If you just need to get through this uncertain period, try to be pragmatic

If you think your income reduction will be short-term, the most pragmatic way forward is to try to reach an agreement with your former partner. Going to Court is often costly in terms of legal fees, time and energy and it may not be proportionate if the reduction in maintenance will only be short-term.

There are a number of practical steps you can take to try to broker an agreement and avoid Court:

  • Start a conversation -  Alert your former partner to any concerns you have about your income reducing as soon as possible. In certain industries, for example, your bonus could be a key part of the income you rely on. Where this is the case, any details about bonuses being deferred or potentially withheld should be communicated as early as possible so you both know what might be coming down the track.
     
  • Get creative – There might be additional solutions available in these bizarre times or options you have not previously considered. For example:
    • Can you both take advantage of a mortgage holiday to free up some extra cash? What would that look like?
    • Whilst you are both in lockdown, outgoings are likely to be falling. Are there ways you could both reduce your expenditure short-term?
    • Could there be some kind of ‘maintenance holiday’? Possibly made up with a ‘bonus’ when income increases?
    • Is there a way capital could be used sensibly to make up any shortfall?
  • Record any agreement - If you are agreeing to vary the maintenance set out in your Court order temporarily, the agreed terms should ideally be recorded in a consent order and filed with the Court. The Court has said that it will do its best to continue processing orders in private law cases. Even if the order is not processed soon, all the necessary paperwork will at least have been completed and filed by you and your former partner. This should reduce the likelihood of any unnecessary and potentially costly disputes later.

If you think your income reduction could be more permanent, take advice early

If you think you are dealing with a permanent change to your income, how you proceed will depend on the precise details of your circumstances. Pragmatic discussions with your former partner about the short-term position, as soon as possible, are still necessary but it is also a good idea to take legal advice early. It is important that the right action is taken at the right time. Failing to act fast enough in the short-term could result in an order being breached. Acting too soon regarding the long-term position could see you being unfairly criticised for trying to use the short-term financial impact of coronavirus to justify a long-term reduction in maintenance. Whatever needs to be done, our team has a wealth of experience in variation cases and can help you secure the best possible outcome.

Summary

We hope that the income reductions being suffered by many are temporary. If you think yours is, try to reach a pragmatic, short-term arrangement with your former partner about maintenance. Where that is not possible, you may need to apply to the Court urgently to vary your order and ensure that you are not in breach by failing to pay when you are unable to.

If you fear that your income reduction could be more permanent and would like advice on how to proceed, please contact a member of our team.

You may also be interested in reading our other blogs in this series about changes in financial circumstances as a result of the coronavirus crisis and its impact on divorce settlements and maintenance:

Please note that the general guidance provided within this blog is accurate at the time of writing (28 April 2020). It does not constitute legal advice and specialist advice should be sought in individual circumstances.

About the author

Cady Pearce is a Senior Associate in the family and divorce team. She advises on a range of private family matters involving both finances and children. Cady has experience of complex financial cases and often deals with cases involving overseas assets and unusual issues. She previously worked in the financial litigation team at Magic Circle law firm and is familiar with complicated financial structures. She has a particular experience in advising City professionals and businesspeople.

 

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