Kingsley Napley

Spousal maintenance is a thorny topic.

Traditionally English law has recognised the concept of maintenance for life on divorce, with the breadwinner (male or female) expected to support the financially weaker party.

Recently however there have been a slew of cases suggesting this principle is falling out of favour and in practice there are often moves by the financially stronger party to achieve a clean break divorce if possible, or to limit the scope of maintenance payments rather than sign-up to open ended awards.

That is why all eyes were on the conclusion of the long running Mills v Mills saga this week which went all the way to the Supreme Court.

The Supreme Court had been asked to consider whether the court was entitled to decline to increase Mrs Mills’ maintenance payments to fund payment of all or some of her rent when her housing needs had been catered for in the original divorce proceedings.

Mr and Mrs Mills separated in 2000 after 13 years of marriage, divorcing in 2002.  At the time of their divorce it was agreed that their now adult son would continue to make his home with Mrs Mills.

The parties reached agreement on the financial claims between them, with Mrs Mills taking a total of £230,000 of the net equity of the family home (approximately 91%) and receiving maintenance payments of £13,200 per year.  The husband kept the parties’ shares in their surveying companies and £23,000 of cash from the sale of the family home.

Mrs Mills’ maintenance award did not include provision for rent, as it was anticipated she would use her capital award to purchase a mortgage free property.

Even though it was accepted by both that she had no ability to raise a mortgage, nevertheless later in 2002 Mrs Mills purchased a house for £345,000, raising the balance on mortgage.

What then followed was a series of property transactions where Mrs Mills “committed herself to borrowings which were too high”.  

These are neatly summarised in the Supreme Court’s judgment, but ultimately the result was that by the time Mr Mills applied to court to stop maintenance payments in 2015, Mrs Mills was living in rental accommodation, had no capital and debts totalling £42,000.

Mrs Mills cross applied, seeking an increase to her maintenance award, as she now had rental costs which had not been factored into the original award.

The decision of the first court saw the order remain at the rate of £13,200 per year with both parties’ applications failing. Both appealed, and in the Court of Appeal, Mrs Mills successfully argued to increase her maintenance to £17,292 per year, which included her shortfall in her rental payments.

Whilst Mr Mills was not permitted to appeal the decision that he should continue paying maintenance, he was given permission to appeal the decision to increase the maintenance award to cover the shortfall.  The Supreme Court allowed his appeal and effectively restored the maintenance to the 2002 amount.

The judgment makes clear that Mrs Mills’ housing needs had been catered for within the original capital award given to her in 2002 and that Mr Mills should not be expected to bear the consequences of his ex-wife’s poor financial decisions over the last 16 years.

Whilst these cases remain fact specific and the Mills v Mills decision does not totally bar future claims being made due to the court’s wide discretion, it does give us a strong indication of the law in this area.

Spouses seeking to increase their maintenance award to meet a need that was already catered for with a capital award face a tough test. Even though it was accepted that Mr Mills could afford to pay at the higher level and that Mrs Mills had a greater need, it was not considered fair that he should meet this greater need.

The question of fairness will play a key role in future cases looking at this point.

What paying parties may find disappointing about this case is that Mr Mills remains obliged to pay his ex-wife maintenance, even at the original level.  Mr Mills has now been paying maintenance for 16 years, three years longer than the parties were married and living together.

The question of how long maintenance should be paid remains unanswered and fact specific.  No doubt, the Mills v Mills case will be an incentive to those wanting to push for further change in the area of spousal maintenance. Many argue that a lifelong maintenance payment obligation is outdated and patriarchal and that the law should support financial independence between divorced couples.

For the moment the message is clear: whilst Mrs Mills is not required to move to full financial independence from her ex-husband, she must now meet her increased housing costs herself and cannot look to her ex-husband to meet her needs generated by the choices she has made; responsibility for these choices rests solely with her.

About Stacey Nevin

Stacey Nevin, an associate in the Family & Divorce Law team at Kingsley Napley LLP. She works on cases involving all aspects of family law including maintenance cases, private children cases and relocation cases.

Going through a divorce process is stressful. There are lots of things to think about and one of these is likely to be what you should do to protect your hard-earned money.

It is essential to have a suitably drafted Will in place to ensure that your assets pass according to your wishes in the event of your untimely death.

If you die without a valid Will, the intestacy rules will dictate how your assets are distributed following your death.

If you are married without children, the intestacy rules state that your entire estate will pass to your spouse.  If you are married with children then your spouse keeps the first £270,000 and all the personal possessions. The remainder of the estate is divided in half, with one half passing to the spouse and the other half being divided equally between the children.

A divorce is only legally finalised once decree absolute has been granted. If you were to die before this, without a valid Will, a substantial portion of your assets would pass to your spouse – this is not an ideal scenario for most people.

This outcome can be avoided by making a Will stating who you want your assets to pass to. If you have young children, it is likely that a flexible Will containing some form of protective trust would be best for you.  The Will would appoint trustees to manage funds for your children on your behalf until they reach a certain age. It would also address who should be guardian(s) of your children in the event that you and their other parent die whilst the children are under the age of 18.

If you already have a Will which benefits your spouse, you ought to update this early on in the divorce process. It is not unheard of that someone will die whilst part way through divorce proceedings, with the unintended consequence of assets passing to their spouse.

Even once the divorce process is complete, it is important to note that divorce does not revoke a Will. It is clearer and better to take control and prepare a new Will which does exactly what you want it to do.

It is easy to push preparing a Will to the bottom of the to-do list. However, as part of the divorce proceedings you will most likely be taking a closer look at your assets and financial position.  This is an important step in the process of making a Will, so it makes sense to tick this off the list at the same time.

It can be difficult to know what sort of Will you want (or need) during the divorce proceedings when you do not know what your asset position will be at the end of the process. Rather than taking the risk of waiting to update your Will, it is advisable to ask your solicitor to prepare a “holding Will” for you. This can put some very simple protections in place during the interim. The holding Will can easily be revisited once the divorce and financial settlement are finalised.

When reviewing your finances and your Will, you should also ensure that you do not overlook assets which do not usually pass by Will, such as life policies written in trust, death in service benefits and pensions.  Any nomination forms and expressions of wishes should be brought up to date to reflect your wishes.

Note: All references to “marriage” above include civil partnerships and references to “spouse” also include civil partners. 

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About Stephanie Mooney

Stephanie Mooney is an Associate in the Private Client team at law firm Kingsley Napley LLP. She advises on succession planning, the preparation of Wills, inheritance tax, trust creation and administration, mental capacity and the administration of estates.

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