SS v NS (Spousal Maintenance) (Rev 1)

Spousal maintenance should ordinarily meet needs generated by choices made during the marriage. It should be assessed by reference to needs, resources and the marital standard of living, although the latter is not the lodestar. The court must consider whether maintenance can end through a transition to independence and should normally impose a term unless termination would cause undue hardship. A term should be extendable only where the evidence does not make independence more probable than not. A discretionary bonus may be shared by a capped percentage, while necessary expenditure is met from salary and discretionary expenditure from bonus income. The court must assess the claimant’s budget globally as well as examining its individual items.

The wife sought financial relief following the breakdown of a marriage of about eleven years, during which the parties had three children. The husband was a highly paid banker with salary, bonuses and deferred compensation. The wife had left employment to care for the children and had limited current earnings, but was training to become a Pilates instructor.

The parties agreed that spousal periodical payments should be made. They disputed the amount, treatment of deferred compensation and bonuses, and whether the order should be extendable or non-extendable. The court also determined the division of capital, child support and school fees.

1. Capital. The matrimonial assets were to be divided equally, subject to needs. The husband’s earned but unvested shares formed part of the divisible matrimonial property. Deferral, conditionality and income-tax treatment did not justify excluding them, although those features could justify different treatment in division. The wife’s capital needs were met from the liquid assets, with equal pension sharing and an adjustment to the illiquid investments.
2. Spousal maintenance. An award was justified because choices made during the marriage had generated hard future needs, particularly through childcare and the wife’s career break. Awards should ordinarily be confined to needs. Where needs were not causally connected to the marriage, maintenance should generally alleviate significant hardship. The marital standard of living was relevant but had to be balanced against eventual independence.
3. The court should consider termination and a transition to independence as soon as just and reasonable. A term should be considered unless ending payments would cause undue hardship. There was no exceptional threshold for extending a term: the court should examine whether the original premise that independence could be achieved had proved impossible. If the choice between an extendable and non-extendable term was finely balanced, the economically weaker party should normally prevail.
4. The wife’s budget had to be assessed globally, while still considering its individual items. Necessary needs could be met from salary and additional discretionary expenditure from a capped percentage of bonus. The court awarded indexed core maintenance of £30,000 per year on an extendable term ending in 2025, and 20% of the husband’s net bonus capped at £26,500 per year until 2021, with deferred bonus payments deferred correspondingly.
5. The husband was ordered to pay school fees and indexed child support of £7,500 per child per year, reduced by 50% during tertiary education to first-degree level. There was no order as to costs.

First-instance decision in the High Court (Family Division). No appellate history is stated in the judgment.