Introduction. When spousal maintenance (alimony) is awarded in an Arizona divorce case, its purpose is usually to assist a spouse who is unable to earn sufficient income on her own to provide for her reasonable needs. In certain cases, however, a spouse who has contributed to the other’s educational opportunities may qualify for an award of spousal maintenance without demonstrating financial need.
Policy. The purpose of this non-needs-based form of spousal maintenance is to achieve fairness–to reimburse the spouse who has made sacrifices to advance the other’s education. This type of spousal maintenance has been termed “reimbursement spousal maintenance.”
Statutory Basis. A.R.S. Section 25-319 is the governing spousal maintenance statute in Arizona. Three of the four possible grounds for a spousal maintenance award under the statute are needs-based. See A.R.S. Sec. 25-319.A.1., 2., and 4. Subsection 3 of the statute, however, allows the court to award spousal maintenance “if it finds that the spouse seeking maintenance: . . . [c]ontributed to the educational opportunities of the other spouse.” A.R.S. Sec. 25-319.A.3. This subsection requires no showing of financial need.
Example Case. Wife is an associate attorney in a mid-sized Phoenix law firm earning $120,000 per year. Wife is on track to make partner and double her income within the the next two years. Wife marries Husband, who is a recent graduate of A.S.U. and who will be starting medical school at U of A soon. Wife’s law firm has no Tucson office, but to support her Husband, Wife resigns her position and moves to Tucson with Husband so Husband can attend medical school.
After some searching, Wife is able to find a job as an associate attorney in a Tucson law firm earning $90,000 per year. Because she is a lateral hire, the firm’s policy is that she must wait a minimum of five years to be considered for partner. Wife thrives in her new firm, impressing her superiors and earning regular raises. She is able to pay for Husband’s medical school and thereby help Husband avoid massive student loan debt. By the time Husband finishes medical school four years later, Wife’s salary is up to $150,000 and she is one year away from becoming partner.
Husband elects to do his three-year dermatology residency in a Phoenix hospital earning a meager salary, and Wife again has to leave her law firm and seek employment in Phoenix. Wife is hired as a senior associate in a Phoenix firm at a salary of $130,000 per year. Wife is the primary breadwinner during Husband’s residency, again helping the couple remain debt-free. By the end of Husband’s residency, Wife has finally made partner with her firm, and she is earning $200,000 per year. Meanwhile, thanks in large part to Wife’s financial and other support, Husband is the top resident in his program, and upon completion of his residency, Husband accepts a job offer from the best dermatology practice in the Valley at a starting salary of $250,000, with that number expected to double within five years.
Upon landing his plum job and after seven years of marriage, Husband announces he wants a divorce from Wife. Had Wife remained with the law firm she worked for when she married Husband, Wife would now be earning $300,000. Nevertheless, at $200,000 per year, Wife is well-able to support herself through her own employment. She does not qualify for an award of spousal maintenance based on need.
Although she does not require spousal maintenance to meet her needs, Wife seeks an award of reimbursement spousal maintenance in the divorce case under A.R.S. Section 25-319.A.3. If Wife is able to submit reasonably reliable evidence at trial documenting the economic losses she suffered by sacrificing her own career to advance Husband’s education and documenting the financial advantages she provided Husband by paying for his education, Wife could potentially receive an award of spousal maintenance without any showing of financial need.
Amount and Duration Factors. In determining the amount and duration of the reimbursement spousal maintenance award, the court is able to consider all relevant factors, but two of the statutory factors are especially applicable and are NOT needs-based. A.R.S. Section 25-319.B. provides that the court may consider: . . .
“6. The contribution of the spouse seeking maintenance to the earning ability of the other spouse”, and
“7. The extent to which the spouse seeking maintenance has reduced that spouse’s income or career opportunities for the benefit of the other spouse.”
In our example above, Wife would do best to focus on these two factors in her trial presentation. An effective strategy for Wife would be to hire an expert such as a CPA to prepare a detailed financial analysis and demonstration of the net present value of the financial benefit Wife’s contributions bestowed on Husband (25-319.B.6.) and the detriment suffered by Wife (25-319.B.7.) as a result of her sacrifices for Husband.
Conclusion. Although reimbursement spousal maintenance cases are far less common than maintenance cases based on need, the facts of certain cases DO justify awards of reimbursement maintenance. If you would like an evaluation of the strength of your reimbursement spousal maintenance case, please contact my office to schedule a consultation.
Copyright © 2013, 2018 by Scoresby Family Law – J. Kyle Scoresby, P.C. All rights reserved.
