Maintenance payments and a new partner: bad news for cohabitees? (Part 2)
February 19, 2010 203 comments
In my previous post I set the scene in a hotly disputed area of law: maintenance payments and the ex-husband who resents paying after his former partner begins living with another man.
The Court of Appeal has issued a judgement (Grey v Grey (2009EWCA Civ1424)) that should help to resolve this grey area, even though it will mean wives who choose to cohabit could stand to lose their maintenance. Put starkly, in line with changing social attitudes the pendulum has swung away from dependent wives. They may now be faced with very tough choices post-divorce: do they live with someone, or keep their maintenance?
Grey v Grey
This case involved a wealthy couple in their thirties, whose 10-year marriage had produced one daughter. When they divorced the capital was divided equally between them, and the judge set Mrs Grey’s maintenance at more than £100,000 per annum.
The husband subsequently appealed this award, on the basis of his ex-wife’s relationship with a man called Mr Thompson. The wife hotly contested the claim that she was cohabiting. Unfortunately for her, she lived on the same street as her former in-laws. Mrs Grey’s former father-in-law and an enquiry agent carried out observations which showed she was indeed living with him, a fact that she persistently denied through her solicitors and later in court.
Worse still for Mrs Grey was that her former husband had also discovered that she was pregnant. His legal team ambushed her with this revelation during cross-examination in court. She admitted her pregnancy and that she was “in a fixed, committed relationship” that was permanent in nature. (At which point I can imagine her legal team fiddling with ties, looking intently at blank bits of paper and staring, stony-faced, into the distance!)
Insufficient information was produced about Mr Thompson’s financial position for the court to make an overall determination about the case, so they allowed Mr Grey’s appeal on the basis that Mr Thompson and Mrs Grey were cohabiting. The case was then sent back to the court that had made the original maintenance order, for a rethink.
In his judgment, Lord Justice Thorpe clearly set out the law.
It is often difficult to establish that a couple is cohabiting, and this was the first question that he addressed.
His Honour Judge Tyrer reviewed the criteria used by social security authorities, and which were called upon to demonstrate a state of cohabitation in Kimber v Kimber (2001)1FLR383:
(a) the parties were living together in the same household;
(b) the living together involved a sharing of daily tasks and duties;
(c) there was stability and permanence in the relationship;
(d) the financial affairs of the couple were indicative of their relationship;
(e) their sexual relationship was admitted and on-going;
(f) there was a close bond between the third party and the wife’s child;
(g) as regards the motives of the couple it was clear that the wife had denied cohabitation and acted as she had so as to continue to enjoy the payment of maintenance from her husband;
(h) there was sufficient evidence that cohabitation existed in the opinion of a reasonable person with normal perceptions.
The next step was to consider the legal consequences of cohabitation.
Firstly, as I explained in my first post about maintenance payments and a new partner, there is no automatic provision in English law for termination of maintenance because of cohabitation, unless a court order expressly provides for this. Very few orders do, because it requires the wife’s consent. Furthermore the law does not equate remarriage with cohabitation. Upon remarriage, maintenance payments cease.
Current law therefore requires a review of all the circumstances, but not an automatic cut-off of maintenance payments simply because a couple is living together.
In reaching his conclusion, Lord Justice Thorpe quoted the comments of that modern thinker, Mr Justice Coleridge:
Coleridge J, who in K-v-K (2006)2FLR468 criticised “this troubling and messy area of law and current legislation enacted against an utterly different social fabric…not adequate to deal with it, and invited the Court to “grapple with this point as there is no (early) prospect of statutory change …and this issue will not go away”
In response and considering the position overall, Lord Justice Thorpe stated:
This dynamic area of the law should not be out of touch with generally accepted notions of fairness:
The solution to this issue is, we suggest, as follows:
(a) If settled cohabitation be established then, as a matter of ordinary practice that ought to lead to no substantive maintenance order being made: or if it be a variation application the previous periodical payments order being abrogated.
(b) Secondly in a case where the court has continuing concern as to the dependent’s ability to be or become self-sufficient and has no obvious recourse against the cohabitant, then a nominal order should be made.
What does this mean for divorcing couples?
Well, it means that if a woman is found to be cohabiting, the discovery will not be ignored, even if she is not being funded by her new partner.
As both Lord Justice Thorpe and Lord Justice Wall have made very clear, the question is not what the new partner is contributing but what he ought to be contributing – and if he can afford to pay, he will be expected to do so. It is a matter for each court to make its own assessment based on all the facts. If they judge that no further maintenance should be paid, then no further maintenance will be paid.
There is clearly a greater risk now for those women who wish to cohabit, as they stand to lose their valuable, tax-free maintenance payments. If they do not want to be grilled in court about the nature of their new relationship they should be certain not to cross the line and live with their partner until they are completely and utterly sure.
The risk of starting a new, post-divorce relationship is no longer restricted to emotions. Now an ex-wife must also take into account the possible financial impact of cohabiting with a new partner.
Socially, morally and legally this all sounds sensible.
However, what of the dependent housewife who has given up her own career to raise children, and who now finds herself staring into the unknown with hands tied, asking two questions:
Do I jump without a parachute? If I do, what kind of landing will I have?
February 19, 2010
Categories: Finances and Divorce