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Divorce – What Happens if the Employment Golden Goose Expires?

It is unsurprising that high earners are routinely required to pay maintenance to their less well-paid ex-spouses – but what happens if the employment goose that laid the golden eggs subsequently dies? The High Court addressed that issue in directing a clean financial break between a warring former couple.

When their marriage came to an end, the husband was working abroad, earning a high six-figure salary, while the wife had largely devoted herself to home-making and child-caring duties. Following their divorce they reached an agreement, which was formalised by a court order, whereby their assets were split equally between them. The husband also agreed to pay the wife ongoing maintenance, including 25 per cent of his basic net pay. A further 25 per cent was to be paid in respect of maintenance for their three children.

Their relative financial positions had since greatly changed, however: the husband’s earnings had substantially reduced following his return to the UK whilst the wife had done well in her career. Their earnings and the value of their assets had reached a point close to parity. In those circumstances, the husband applied to vary or terminate the spousal maintenance order.

Ruling on the matter, the Court noted that the case cried out for a clean break in that the continuing enmity between the couple had caused nothing but harm to them and their children. They had engaged in near-constant litigation at disproportionate cost. The simple fact was that the dramatic reduction in the husband’s earnings had significant financial consequences for both of them.

The Court directed that, on the husband paying the wife a lump sum of £38,000, his spousal maintenance obligations should terminate. Whilst acknowledging that such an outcome might appear harsh to the wife, the Court found that it accorded with both their changed financial circumstances and fairness.

Given the extent of her assets and earnings, the wife would be able to adjust to the loss of her maintenance without undue hardship. After also making adjustments to the husband’s child maintenance obligations, the Court expressed the hope that a clean break would bring the couple’s hostility to an end.

Published
2 May 2022
Last Updated
21 May 2022