The Effects of Cohabitation on spousal Maintenance Payments
The recent case of Grey v Grey [2009] explored the issues surrounding spousal periodical payments and whether these should be reduced if the wife cohabits with a 3rd party, but does not re-marry.
In this case Mr and Mrs Grey had been together for nine years, by the time they separated in 2005. They had a daughter born in 2001 and had married in 2003. Periodical payments of £135,000 per annum were awarded from November 2006 until March 2009 and £125,000 per annum thereafter. There were also child support payments. The assets were divided equally between the two parties.
The husband challenged the award of periodical payments. During the hearing the husband had presented evidence to the court that the wife was now cohabiting with another man. That she was in fact pregnant by him and thus would have been receiving financial support from him. The husband's father and an enquiry agent had kept a detailed diary, observing movements at the wife's house. The wife had denied these allegations prior to the hearing in several communications via her solicitors, but was forced to admit that they were true when the evidence was presented to her in court.
The Trial Judge decided that as counsel for the husband had not put any evidence before the court, as to the new partner's income (or any figures relating to whether the wife was receiving financial support from him) the wife's cohabitation did not affect her entitlement to spousal payments.
The Court of Appeal found that the issue should not be whether the new partner was contributing but what he should be contributing to the household. Many previous cases were considered by the Court of Appeal. Despite there being no legislation that provided that post-marital cohabitation should be taken into account, the Court was clear in its recommendation that fairness to the parties should also be a deciding factor in such cases. Particularly as cohabitation is becoming more and more commonplace in our society.
In this case, it was held that the financial situation of the new partner should be investigated, due to the particular facts of this case. The couple were cohabiting and were expecting a child together which suggested that they would be in a permanent relationship. After investigation of the new partner's financial position fresh financial awards could then be made and the Court would have discretion to backdate the terms of these awards. If necessary these could be backdated beyond the date of the husband making his original application to vary the periodical payments for his ex wife.
It seems therefore that in future Courts may consider post marital cohabitation in their consideration of financial awards, if it would be in the interest of fairness.
If you would like further guidance on this case, or your own case, please contact our Family Law Department on 020 7611 4848.
