New York Wants Spouses Awaiting Divorce Fairly Provided for Financially

October 20, 2012

New York Wants Spouses Awaiting Divorce Fairly Provided for Financially

Divorce can be devastating financially for the spouse who makes less money during the time period when related legal matters are pending. Not uncommonly, when the decision to divorce is made, one spouse moves out of the family home pending resolution and two households are set up on the same number of dollars that previously supported one.

Effective Oct. 12, 2010, a new temporary maintenance law took effect in the state of New York to address this and similar types of situations.

What Is Temporary Maintenance?

In most marriages one spouse either makes less money or does not work at all, perhaps staying at home to raise children or meet other family responsibilities. This reality creates a situation rife for financial stress when the marriage falls apart. When the household then splits into two, the spouse with lower earnings can suddenly be faced with having no money or not enough money to pay the mortgage or rent, utilities, other bills and living expenses.

That is the state of affairs that temporary maintenance is designed to remedy.

Broadly, "maintenance" is the payment from one spouse to the other for basic living expenses like food, clothing, housing, utilities, transportation expenses and so on. Other common terms for this concept include "spousal maintenance," "spousal support" and alimony.

In New York, maintenance can be either temporary for the period of time while the divorce case is pending, or part of the final divorce decree for payments after the divorce. Spousal maintenance after the divorce is usually for a temporary time period until the receiving spouse can get on his or her feet.

What Is the Policy Behind the Changes?

The New York Legislature wanted to make temporary maintenance a more predictable number for the parties involved and encourage divorcing parties to negotiate a temporary maintenance agreement. Before the 2010 amendments, the court could order temporary maintenance based on "justice" considering the prior standard of living, and whether one spouse could pay the other if the other needed it.

How Is Temporary Maintenance Calculated Now?

The new law provides an exact formula to determine what temporary maintenance figure would be appropriate considering the individual circumstances of each spouse. The state courts provide a free online temporary maintenance calculator. In essence, the formula requires the smaller of these two figures:
-Take 40 percent of the parties' combined income; then subtract the lower-salaried spouse's income, or
-Take 30 percent of the higher-salaried spouse's income; then subtract 20 percent of the lower-salaried spouse's income

The formula only considers the first $524,000 of an individual's income. This upper cap will be officially adjusted, presumably upward, every other year on Jan. 31 based on the urban consumer price index. For those with earnings above the cap, the law sets out nineteen factors for the judge's consideration to determine if a higher figure would be appropriate.

The formula also adjusts for people with extremely low incomes so that payment to one spouse does not unfairly impoverish the other.

Many divorcing spouses will be able to negotiate a temporary maintenance agreement wherein they agree on the monthly payment amount, often with the assistance of their respective lawyers. The formula, however, provides a good starting point for negotiation since the parties know the number the judge will consider if they cannot agree.

If the parties cannot agree on temporary maintenance, the judge will look at the number calculated by the formula. However, the judge still has the discretion to adjust this number by consideration of seventeen specific factors like the marital standard of living, ages and health, earning capacity, wasting or illegal transfer of marital assets, medical insurance needs, exceptional child expense, the need for education or training, and more, including any other "just and proper" factor.

Commentators observe that the law does not include as a factor the length of the marriage, something traditionally considered in alimony matters. Some question why the legislature would mean to treat a decades-long marriage the same as a brief one for purposes of temporary alimony, although it could arguably still be considered under the catch-all "just and proper" factor.

Interestingly, the length of the marriage is an enumerated factor for the court to consider in a case where one spouse's income is over $524,000.

Anyone contemplating divorce or facing issues of temporary maintenance in New York should speak with an experienced, knowledgeable divorce attorney to understand the ramifications of the complex state laws that apply.

Article provided by Shaked & Posner
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