Prestation compensatoire: spousal compensation in French divorce

If there is one French legal concept that American and British clients consistently misunderstand, it is this one. They hear “spousal compensation” and think of alimony: a monthly cheque, reviewable, that stops when the recipient remarries. The prestation compensatoire is none of those things, and the misunderstanding costs people money on both sides of the negotiation.

Olivia Uzan advises spouses who are entitled to claim a prestation compensatoire and spouses who are asked to pay one, in Paris and in cases that cross borders.

What the law says

The Civil Code allows one spouse to be ordered to pay the other a sum intended to compensate, as far as possible, for the disparity that the end of the marriage creates in their respective living conditions. The key word is disparity. The question is not whether one spouse needs money, but whether the divorce leaves the two of them in noticeably different situations, and whether that difference has something to do with the marriage.

It is fixed once. The court looks at where each spouse stands when the divorce becomes final and where each can reasonably expect to be, and the figure is not revisited afterwards if life turns out differently. Where the capital is paid in instalments, only the payment schedule can later be adjusted, not the amount. Only the rare annuity can be revised, and only on a significant change of circumstances.

It is paid as capital, not as income. The law strongly prefers a lump sum: money, the transfer of a property, or a mix of the two. Where the paying spouse cannot manage it at once, the capital can be spread over instalments for up to eight years. A lifetime annuity still exists but is now the exception, reserved for a recipient whose age or health prevents them from supporting themselves, and the judge has to give specific reasons for ordering one.

And it is independent of fault. The spouse who wanted the divorce, or who caused it, can still receive a prestation compensatoire. A court can refuse one on grounds of equity, in particular where the divorce is granted on the exclusive fault of the spouse who claims it, but that remains a specific situation, not the general rule.

How the amount is decided

There is no formula in the statute. The judge, or the spouses if they are divorcing by agreement, weigh a list of factors set out in the Civil Code: how long the marriage lasted, the age and health of each spouse, their qualifications and professional situation, the choices made during the marriage, in particular where one of them cut back or gave up a career to raise the children or to follow the other’s, the assets each will hold once the property has been divided, and their existing and foreseeable pension rights.

Several calculation methods circulate among practitioners. Judges know them and sometimes use them as a cross-check. None is binding. In practice the amount depends far more on how the case is built than on any arithmetic: the completeness of the financial disclosure, the way a career sacrifice is documented, the credibility of each spouse’s account of their future. The same disparity can produce very different results depending on the file.

When the spouses agree

In a divorce by mutual consent the prestation compensatoire is negotiated between the spouses, each with their own lawyer, and written into the agreement. This gives them control over the amount and over how it is paid. It also means that the agreement, once signed and filed, has the force of a contract. It cannot be reopened simply because one spouse later decides the figure was too low or too high. It can be set aside only on ordinary contract grounds, essentially a defect of consent such as mistake, fraud or pressure, and courts rarely accept such challenges where each spouse had a lawyer and the reflection period was respected. That is a reason to negotiate carefully the first time, not a reason to avoid the route.

Tax

How the payment is structured has tax consequences for both spouses, and they are large enough to shape the negotiation. A lump sum paid within twelve months of the divorce becoming final gives the payer a tax reduction of a quarter of the amount, on a base capped by law, and is not income for the recipient. A payment spread over a longer period works the other way: deductible for the payer, taxable for the recipient. A mixed arrangement, part capital within the year and part over time, is possible and has its own rules. These questions belong at the start of the discussion, not after the figures have been agreed.

For the spouse being asked to pay

The defence turns on three things: whether there really is a disparity, whether it results from the marriage rather than from the other spouse’s own choices, and what each of them will actually own once the property has been divided. A claim presented as obvious often looks different once the liquidation of the matrimonial regime is properly worked through. It is possible to reduce a claim substantially, and sometimes to defeat it.

Across borders

Where one spouse lives abroad, or the divorce itself takes place outside France, two further questions arise: can a French prestation compensatoire be enforced in the other country, and how will a foreign support order be treated in France?

The first is less simple than it looks. American courts and enforcement agencies are built around periodic support. A French award is a fixed capital sum, based on need and disparity but paid once and never revised, and it does not fit neatly into either of the boxes an American court expects to find, property division or maintenance. The international convention on the recovery of maintenance, in force between France and the United States, offers only limited help for spousal support on its own, as opposed to child support. In practice a French award often has to be presented to the American court directly, and explained. The reverse is more predictable: an American support order is enforced in France after exequatur, once the French court has checked the foreign court’s jurisdiction and the fairness of the proceedings.

Admitted in both Paris and California, Olivia Uzan negotiates and drafts with enforcement on both sides in view.