Not entirely according to the Supreme Court’s decision on 18 July 2018 in the case of Mr and Mrs Mills.
They divorced in 2002, and Mrs Mills received a significant proportion of their available capital to provide her with a rehousing fund of £230,000. Mr Mills was also ordered to pay long term maintenance to meet the shortfall between her living costs (assuming she would rehouse mortgage-free) and her own income. This sort of maintenance order often gives rise to variation applications as the circumstances of the parties change. Making these applications is always costly, and the costs inevitably outweigh the benefit to either party.
There is therefore increasing pressure on the Supreme Court to give clear guidance on the expectations that spouses should have to share their former partner’s income after divorce to try to reduce the instances in which long term maintenance orders are made to only exceptional cases where there would be financial hardship otherwise (as they do in Scotland). It is generally thought that this is the trend in current case law, although the scope for seeking long term maintenance remains and therefore uncertainty and lack of consistency remains in this area across the UK court system.
The Supreme Court dealt with a narrow issue in the case of Mr and Mrs Mills which did not go that far: The court had already provided for Mrs Mills’ housing needs by giving her a significant share of the capital to enable her to buy her own property mortgage-free. She then bought and sold a number of properties, taking out larger mortgages each time and was eventually left with no capital, having to move into rented accommodation.
The question for the Supreme Court was therefore whether she should be able to ask for an increased share of Mr Mills’ income to cover her rent.
Mr Mills argued that the need had already been met by the capital award in the original divorce and he should not have to pick up the pieces after his ex wife had made bad property investments. He succeeded at the first hearing, but that was overturned by the Court of Appeal and his maintenance payments were increased to meet her new shortfall.
He appealed and the Supreme Court confirmed that the decision of the first court was correct: Capital claims had been met, including provision for housing, and were subject to a clean break. To ask for housing provision again, albeit in the form of income to pay her rent, was asking Mr Mills to meet that need for a second time. The Supreme Court did not expect him to do that and considered Mrs Mills’ errant use of the capital since the divorce settlement was not something for which he should be penalised.
We always advise our clients that they only get one bite at the capital cherry. This was an attempt by Mrs Mills to go back for more via her ongoing income claim and thankfully that claim was denied. Had the Supreme Court not taken this decision, the risk would have been there for anyone paying maintenance to their former spouse to have to pick up the tab if funds are squandered. It was, however, a fact-specific decision and so will not prevent variation applications being made.
Stephens Scown’s family team has received top ranking from independent legal guides Chambers UK and Legal 500. To contact Sarah, please call 01872 265100 or email family.truro@stephens-scown.co.uk