Spousal Maintenance Agreements.

1. When can spousal maintenance apply?

The core test has two parts.

The applicant must be unable to support themselves adequately, and the other party must be reasonably able to provide financial assistance.

For married couples, the Family Law Act identifies reasons including:

• having the care and control of a child of the marriage under 18;
• age;
• physical or mental incapacity for appropriate paid work; or
• another adequate reason.

The de facto maintenance provisions use a broadly similar need-and-capacity framework.

2. Maintenance is not automatic after separation

One person earning more than the other does not automatically create an entitlement to maintenance.

The Court first looks at whether the applicant can meet their own reasonable expenses from their income and assets. It then considers whether the other party can afford to contribute.

3. What does the Court consider?

The Court considers the needs of the applicant and the other party’s capacity to pay.

Relevant matters include:

• age and health;
• income, property and financial resources;
• ability to work;
• whether a party has the care of a child;
• the need to provide appropriate housing for a child;
• the effect of family violence;
• a suitable standard of living; and
• whether the relationship affected a party’s capacity to earn income.

4. How can maintenance be formalised?

There are several pathways.

5. Using a BFA for spousal maintenance

A Binding Financial Agreement can deal with spousal or de facto maintenance, either by requiring payments or by attempting to limit or exclude future maintenance.

But maintenance clauses need careful drafting because the Family Law Act contains specific rules about when maintenance can be excluded or preserved.

A clause saying “neither party will ever receive maintenance” should not be assumed to work in every future circumstance without proper advice.

6. Consent orders for maintenance

If both parties agree on the amount and duration of maintenance, they can ask the Court to make orders by consent.

Unlike a BFA, independent legal advice is not a statutory requirement for consent orders, although obtaining advice is strongly recommended.

The benefit is that the agreement becomes a Court order and can be enforced as such.

7. What if you cannot agree?

A party can apply to the Federal Circuit and Family Court of Australia for a maintenance order.

The Court can order periodic payments, lump sums or other arrangements depending on the circumstances.

Where there is immediate financial need and it is not practical to determine the final maintenance issue straight away, urgent interim maintenance may be available.

8. How long does maintenance last?

There is no single standard period.

Maintenance may be:

• temporary while a party retrains or returns to work;
• for a fixed period;
• until a specified event occurs; or
• longer-term in unusual circumstances.

The duration depends on the reasons for the applicant’s need and the other party’s capacity to pay.

9. What happens if the receiving party remarries?

A spousal maintenance order generally ceases when the receiving party remarries, unless the Court otherwise orders in special circumstances.

The receiving party has a duty to inform the paying party of the remarriage without delay.

The same general rule applies to de facto maintenance orders where the receiving party marries.

10. Can a maintenance order be changed?

Yes, depending on the type of order and the circumstances.

The Court has power to discharge, suspend, revive or vary maintenance orders in appropriate cases.

A significant change in income, health, employment, living expenses or another relevant circumstance can be important.

A BFA is different: its terms do not automatically change just because circumstances change. It may need to be terminated, replaced or challenged under the relevant statutory provisions.

11. Time limits for maintenance applications

Applications outside those periods generally require permission from the Court, and permission is not automatic.

12. You do not have to wait for divorce

Spousal maintenance is separate from the divorce process.

A married person can apply for maintenance before divorce, and in some circumstances even while the marriage itself is still intact.

That can be important where one party needs immediate financial assistance after separation.

13. Maintenance and property settlement are separate

Spousal maintenance and property settlement are related financial issues, but they are not the same.

A person can have a property claim, a maintenance claim, both, or neither depending on the circumstances.

When negotiating a final financial settlement, lawyers will usually consider how property division and maintenance interact.

14. Example — temporary maintenance

The simple way to think about it