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What is the Impact of Coronavirus on Maintenance Payments?

on Monday, 23 March 2020.

As time goes on and the measures that are being imposed by the Government are being heightened, the indirect impact of Coronavirus (COVID 19) is getting even more far reaching.

The impact that this is having on businesses is particularly evident with some businesses asking employees to take unpaid leave or reduce their hours or terminating contracts all together. We are anticipating a number of client queries relating to this and how this may affect financial settlements and arrangements.

This issue is particularly relevant in the context of maintenance payments wherein the payer is reliant on their income to pay a maintenance payment ordered by the court. For illustrative purposes, I set out below a fictitious example:

Bob and Rose divorced in 2018. They agreed a financial settlement at mediation and this was incorporated into a Consent Order by VWV which was approved by the Court. Amongst other arrangements such as the lump sum of £50,000 and transfer of one of the jointly owned properties, Bob agreed to pay Rose £3,000 per month maintenance for a period of 5 years. Bob is an actor in a leading soap and in light of the social distancing recommendations filming of the soap has been dramatically reduced. As such, Bob's income will be reduced and he is worried that he will not have enough money to pay Rose each month.

Coronavirus Legal Advice

Can Bob Vary the Financial Order?

Orders that can be varied are defined in section 31 of the Matrimonial Causes Act (MCA 1973). With limited exceptions, only income orders can be varied. Capital orders are final orders and cannot be varied, except as to detail.

If Bob wishes to reduce the payments he makes to Rose each month, he would need to apply to the court to vary the original order. When reviewing Bob's application, the court has a wide discretion and will, amongst others, apply the principles below:

  1. Welfare of any children
  2. Any significant change in circumstances to the matters that the court had regard when making the original order
  3. Fairness
  4. Finances including the decreasing income of one party and the increase of the other
  5. Proportionality

At first instance, the court will consider the welfare of any children of the relationship that will ultimately be reliant on the maintenance payments. The court will also consider how reduced filming will financially effect Bob's salary as well as how long this is likely to go on for. Further, they consider what additional resources Bob has during this time and whether he can meet the maintenance payments in any other way. Of course, it may be that Rose's financial position has changed too so this is likely to be considered.

Each matter will be considered on a case by case basis and as mentioned above, the court has a wide discretion so the outcome of an application is not certain.

VWV is a full service, professional law firm and are unable to offer free legal advice at this time.

If you do require legal assistance and would like to discuss your case with a specialist Divorce & Family lawyer, please contact Sam Hickman in our Family Law team, on 0117 314 5435 or complete the below form.

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