News + Insights
Maintenance and Cohabitation
By: Molshree “Molly” A. Sharma / October 11, 2017
What happens if a maintenance recipient does not marry but simply cohabits?
In the vast majority of cases, a divorcing party is entitled to maintenance or spousal support if they earned significantly less than their spouse or were primarily a home-maker during the marriage. Across the country, the law is quite consistent that if a maintenance recipient remarries they can no longer receive maintenance from their former spouse. However, the issue of a continuing obligation to pay support to a cohabiting ex spouse is more complex. The question, of course, is what happens if a maintenance recipient does not marry but simply cohabits? In many states, cohabitation is a terminating event for receipt of maintenance, but courts have been interpreting cohabitation much less literally and focusing instead on the financial aspects of the relationship to be a determining factor in whether to terminate support based on cohabitation.
The rationale for terminating a maintenance award when a resident, continuing conjugal cohabitation exists, is to avoid the supposed inequity created when the recipient spouse is essentially involved in a marriage-like relationship with all its benefits, but does not formalize the relationship through a legal marriage. At the same time, legislatures in the majority of states have made it clear that they did not intend to create a moral standard for people involved in less traditional relationships. Therefore, the courts consider several factors and the inquiry is an intense, fact-based one. Some of the most common factors are:
- The length of the relationship;
- The amount of time the parties spend together;
- The nature of the activities they engage in;
- The interrelationship of their personal affairs;
- Whether the parties’ vacationed together; and
- Whether the parties’ went on holidays together.
The case law previously focused on all these factors without outlining if more weight was being given to one or another. However, in the last decade there appears to be a discernible shift where courts are consistently less concerned about the length, frequency or intimate aspect of the new relationship, and more with the actual financial intertwinement of the recipient and new significant other. In fact, there are several instances of cases where the new couple spent holidays and vacations together, even several overnights a week. In some instances the parties, while actually living together, each paid their own expenses, and courts have found that the ex-spouse seeking termination based on cohabitation has failed to meet his burden as the need for financial support continued where the ex -spouse was not receiving financial benefits from a new relationship. Essentially, the need of the recipient spouse has become the biggest factor in determining whether the maintenance payments continue. In re Marriage of Herrin, 262 Ill.App.3d 573, 577
This shift in analysis can be evidenced from cases all over the country. In Illinois the case law indicates that even when a recipient ex-spouse is living with her significant other, or he is with her multiple nights a week, they vacation together, and in some instances have joint club membership, it is not a basis for termination unless there are economic factors such as equitable contribution to household expenses, loan of funds, purchases of significant items such as cars for one another and payment of bills on the others behalf, and an intended permanence to the relationship. Essentially, the courts are differentiating between a significant dating relationship and actual cohabitation in the sense of financial intertwinement and expectation of long-term commitment akin to a marital relationship.
Further, a seminal new Illinois Appellate Court ruling in May 2015 from the Second District adds to this analysis in a significant manner. The case of In re Marriage of Miller held that the key factor in determining cohabitation was economic intertwinement. In re Marriage of Miller, 2015 Il App (2d) 140530, 40 N.E.3d 206 (2015).
On the West Coast, which has notably had a long history of focusing on the economic aspect of the new relationship, the 2nd District California Appellate Court noted that an order for permanent alimony may be modified only when a change in the former husband’s ability to pay or the former wife’s need is shown. The court, in Double v Double (1967, 2d Dist) 248 Cal App 2d 650, 56 Cal Rptr 687, held that the former wife’s meretricious conduct, in living with a man to whom she was not married, was not sufficient to terminate the husband’s obligation to pay alimony.
On the East Coast while as evidenced by cases such as Gavet v. Gavet, there was a line of case law that focused on the economic aspect of the relationship, holding “while cohabitation constitutes changed circumstance that may justify modification of alimony, such modification is proper only if cohabitant supports or subsidizes alimony recipient under circumstances sufficient to entitle supporting spouse to relief,” Gayet v Gayet (1983) 92 NJ 149, 456 A2d 102. While the application of this holding was inconsistent before it is in fact much more consistent in the last decade.
There are instances where the court focusing on the financial need has not terminated maintenance but reduced it after determining the average monetary value of the benefit received by the new significant other. The New Hampshire Court in Bisiq v. Bisiq reduced maintenance to the recipient ex-wife because there was evidence her new paramour contributed to some expenses such as rent, utilities and travel, but his contribution was not significant enough to justify anything but a decrease in the amount. Bisiq v Bisiq (1983) 124 NH 372, 469 A2d 1348.
In Hawaii, a trial Court could not terminate the husband’s duty to pay spousal support since (although the statute terminated the payor’s duty to pay spousal support upon the recipient’s remarriage) the rule is not the same for cohabitation, inasmuch as in a marriage situation, where a recipient’s spouse assumes statutory responsibilities and obligations to recipient. This is not the same as cohabitation, and the recipient’s cohabitation is not relevant to the payor’s duty to pay spousal support unless the decree specifically authorizes or requires a reduction or termination upon cohabitation, and where (as cohabitation was not illegal) its alleged or perceived immorality was not relevant to the payor’s duty to pay spousal support. Amii v Amii (1985, Hawaii App) 695 P2d 1194
The main factors that seem to determine between a finding of one or the other is the existence of an intention of permanence akin to a level of commitment assumed in a marriage and the comingling of finances. Therefore, to avoid termination of maintenance it is imperative to advise clients to not co-mingle finances and avoid discussions leading to marriage, etc. Further, the consideration of whether to file a petition for termination of maintenance should focus more on financial intertwinement than other factors.
As a practitioner representing a client in a dissolution proceeding, it may be strategic to consider a lump sum buyout of maintenance depending on the circumstance of the client. For example, take a younger client, someone who is actively dating or has already embarked on a serious relationship. This client may be an excellent candidate for a buyout of maintenance so that they are free to move on with their lives without economic hardship. It may even be attractive to the payor client to agree to a buyout as it provides certainty (no reviews of maintenance), and completely resolves the financial support obligation to the spouse. I have also negotiated agreements where maintenance continues for a period of time even after remarriage or cohabitation so as to incentivize the recipient spouse to cohabitate or remarry. It is also useful to take the advice of an accountant when negotiating these agreements because maintenance is tax deductible to the payor and includable in the payee’s income for tax purposes, but a buyout of maintenance is considered to be an asset division and therefore not deductible to the payor nor included as the payee’s income. It is indeed still a developing body of law, but per best practice, it is essential for divorce practitioners to ensure their clients are fully aware of the repercussions of how they develop a new relationship, and conversely, when it is an appropriate time to seek relief and termination of support obligations.