The Group Hug recently posted about child support and potential economic abuse after a divorce or separation where the more affluent parent may refuse to share the key costs for a child or children, including school trips, school uniforms, hobbies, and club membership fees. The post was about how this refusal might be another example of financial abuse of the other parent.
Sadly, this does happen and more often than many would realise. Indeed, like most solicitors, I have advised parties on both sides of the argument.
What can be done if there is a dispute around child related costs?
The issue of child related costs and how these should be shared is a complex legal issue. As such, I have prepared this blog to provide some useful information about such disputes.
For the most part, the court is unable to make an order for child maintenance unless both parties agree the amount payable, and it forms part of a financial order in their divorce or dissolution. There are some exceptions to this rule, but decisions regarding child maintenance are usually the responsibility of the Child Maintenance Service (CMS).
If parties going through a divorce or dissolution agree the child maintenance, then the child maintenance element will be binding for one year only, after which point either parent can apply for a calculation by the Child Maintenance Service (CMS). Some may not pursue a new calculation but, equally, there is little that can be done to prevent either parent from seeking a new calculation which may well benefit them.
If you and the child’s other parent cannot agree the appropriate level of child maintenance, the parent who lives with the child or children for more of the time can apply to the Child Maintenance Service (CMS) for them to calculate how much child maintenance the other parent (often referred to as the “non-resident” parent) should pay. A fee is usually payable to the CMS unless the applicant is under the age of 18 or they are the victim of domestic abuse.
How is it worked out?
The process for calculating how much the non-resident parent should be paying in child maintenance is based on a percentage of their income and the number of children they must pay maintenance for.
There is a reduction of 1/7th for each night per week, averaged over a year, that the child or children stay with the paying parent. This will include any school holiday contact that the child or children spend with the non-resident parent.
Additionally, there is also a reduction applied if the non-resident parent has any other children in their household or if they are paying child support to more than one parent.
If the non-resident parent earns more than CMS threshold level (currently £156,000 per annum or £3,000 per week gross), the court can make a top-up maintenance orders under Schedule 1 of the Children Act 1989, the Matrimonial Causes Act 1973 or the Civil Partnership Act 2004. Much will depend on whether the parents are or were married or in a civil partnership when considering child maintenance.
In some circumstances, the courts can make orders regarding maintenance to meet a child’s special needs if they have a disability or for payment of educational or training costs.
The court will sometimes consider making child maintenance orders where a non-resident parent or the child or children live abroad.
The website, www.cmoptions.org, contains useful information regarding child maintenance, including a child maintenance calculator.
Schedule 1 of the Children Act 1989
The court does have the power to order the transfer of property to a child or to order the payment of a lump sum to a child within divorce or dissolution proceedings. Such orders are rare since the finances in a divorce or dissolution will generally be shared between the parents rather than transferred to their children.
As an alternative for seeking financial support on behalf of children, an application under Schedule 1 of the Children Act 1989 is possible, which the following able to apply on behalf of a child or children:
- a parent,
- special guardian, or
- person in relation to whom an order has been made providing that a child lives with them (a child arrangements order).
A child can also sometimes make an application themselves against one or both parents.
Schedule 1 applications are more commonly pursued by parents when they are not married or civil partners. That said, it is possible for those who have divorced or dissolved a civil partnership to apply for further financial support on their children’s behalf in certain circumstances.
Should I be aware of anything before making a Schedule 1 application?
The court has a wide discretion in Schedule 1 cases and the final outcome can be difficult to predict. This makes it hard to know whether it is going to be proportionate or worthwhile financially and psychologically making such an application at the outset.
If the order sought is of modest value, then it may not be proportionate to make a Schedule 1 application since the costs and effort in pursuing such a claim may outweigh the value of the order being sought. Furthermore, if little or nothing is known about the finances of the other party, then there are risks in pursuing such claims if it turns out that they have little, or no, assets of their own or where any orders would be difficult, or impossible, to enforce – such as where the paying parent is based in another country.
Another point to be aware of is that cost orders can be made against a party who makes an application deemed to be unnecessary or disproportionate. Such orders may also be made against either party if they fail to negotiate reasonably during the case.
What financial provision can be claimed under Schedule 1 of the Children Act 1989?
The court can order:
• a lump sum or series of lump sums. Such lump sum payments could be for any number of reasons, but examples include purchasing a family car or paying for school trips or private school fees. A key element with lump sum claims is that there is no limit on the number of lump sum applications which can be made on behalf of a child or children. This means multiple applications could be made during a child’s life.
• a property to be transferred or held in trust. Such provision isfor the benefit of a child until a certain event occurs – usually when the child or children reaches the age of 18 or completes their full-time secondary. The property will then usually revert back to the paying parent or be sold with all proceeds paid to the paying parent.
• “Top up” child maintenance. Can be sought when:
- the non-resident parent’s income is higher than the limit which the Child Maintenance Service deals with (currently £156,000 per annum gross);
- in respect of educational expenses;
- for expenses connected with a child’s disability.
When can a child apply?
If a child is receiving, or intends to receive, instruction at an educational establishment or training, or if there are special circumstances such as a disability or illness, a child over 18 can apply to the court for maintenance or a lump sum from one or both parents so long as their parents do not live together.
A child can only apply where a court order providing for maintenance to be paid for that child’s benefit was not in place immediately before they reached the age of 16.
What does the court consider when making a decision under Schedule 1?
The court will consider:
• the income, earning capacity, property, and other financial resources that each of the parent has or is likely to have in the foreseeable future.
• the financial needs, obligations, and responsibilities that each parent has or is likely to have in the future • the financial needs of the child.
• the income, earning capacity (if any), property and other financial resources of the child.
• any physical or mental disability of the child, and
• the way the child was being or is expected to be educated or trained.
Are Schedule 1 cases expensive?
Schedule 1 claims can be expensive and time-consuming, particularly if it is not possible to negotiate a settlement and it is necessary to apply to court.
A point worth noting is that it is possible for the parent seeking Schedule 1 orders to ask the other parent (who usually has more money) to pay all, or some, of their legal costs and the court do regularly make orders of this nature to help ensure a balanced playing field in terms of legal advice.
What should I do next?
The issue of financial provision and support for a child or children is a complex and often misunderstood area of the law. If you would like to discuss potential financial claims on behalf of your child or children, then you should seek specialist family law advice at the earliest opportunity.
Myself and my colleagues at Summit Law LLP would be happy to talk through your matter free of charge to discuss your options, cost estimates and next steps.