Miller v. Miller

Reiber, C.J.,

¶ 39. concurring in part, dissenting in part. Because I believe that the trial court acted within its discretion in finding changed circumstances in Smaller v. Smaller, I dissent from the majority’s opinion in that case. Although I would remand for additional findings of fact, it was not error for the family court to consider the economic effects of wife’s cohabitation arrangement in its analysis of changed circumstances.

¶ 40. Pursuant to 15 V.S.A. § 758, the family court may modify a maintenance order “upon a showing of a real, substantial, and unanticipated change of circumstances.” As the majority recognizes, the family court has discretion in determining whether changed circumstances exist, and this Court will not disturb its determination “unless the discretion was erroneously exercised, or was exercised upon unfounded considerations or to an extent clearly unreasonable in light of the evidence.” Taylor v. Taylor, 175 Vt. 32, 36, 819 A.2d 684, 688 (2003). By concluding that the sharing of household expenses, in addition to cohabitation, can never constitute changed circumstances, the majority deprives the family court of its ability to fully exercise its discretion in considering motions to modify. Specifically, in Smaller, I believe that the family court acted within its discretion in considering the significance of the “financial security” provided to wife by her cohabitation arrangement. See 15 V.S.A. § 752(b)(1) (requiring court, in *163fashioning maintenance award, to consider “financial resources” of party seeking maintenance, among other factors); Taylor, 175 Vt. at 39, 819 A.2d at 690 (recognizing that recipient spouse’s “improved financial security” will support modification of maintenance award); Bullard v. Bullard, 144 Vt. 627, 629, 481 A.2d 1049, 1051 (1984) (observing that because original maintenance decree “takes into consideration the financial capabilities and prospects of both spouses, it is only reasonable and fair that in considering a modification of that original order, a court examine the evidence relating to the change in financial circumstances of either or both spouses”).

¶ 41. The family court found that at the time of the parties’ divorce wife was living in the marital residence but spending several nights a week at the home of her boyfriend, Tony Garland. After the divorce, wife rented her own apartment, and Mr. Garland moved in five months later. Mr. Garland continues to live with wife, and he does not maintain a separate residence. While the court did not make specific findings as to Mr. Garland’s income or his ability to contribute, it did find that he works full-time but does not pay rent or contribute to the household expenses.

¶ 42. Based on this evidence, the court concluded that husband had established a real, substantial, and unanticipated change of circumstances since the final divorce order. Since that date, the court explained, wife had been involved in a long-term relationship with Mr. Garland, and the two now lived together in her home. The court concluded that, regardless of whether Mr. Garland actually shared expenses with wife, if he had the ability to do so, he lived in the same household, and he earned an income, then this constituted another source of support and income that was potentially available to wife. In other words, the court reasoned, wife could not avoid a modification of spousal support by allowing her partner to live with her rent-free, even though he was working full-time, simply because she did not want her maintenance award to be modified. The court explained that wife could choose not to have Mr. Garland pay for half of the rent or the utilities, but it was unfair to make husband pay for wife’s decision. It therefore reduced husband’s maintenance obligation by $350, which was approximately half of the rent and the utilities.

¶43. The majority holds that the family court erred in finding changed circumstances because the family court’s conclusion rested on its sense of injustice rather than any substantial change. According to the majority, any financial savings that a recipient spouse realizes from the sharing of household expenses alone cannot constitute changed *164circumstances. See ante, ¶ 20 (recognizing that sharing of household expenses may produce some measure of financial improvement but holding that this improvement alone cannot be changed circumstances unless Court is prepared to hold that former spouse who takes in a roommate to reduce expenses will similarly lose such savings because of an offsetting reduction in maintenance). The majority thus concludes in Smaller that, even if wife’s partner had contributed equally to the expenses of the household, this alone would not constitute a substantial improvement in wife’s financial circumstances so as to warrant a modification of maintenance. Id. ¶ 30.

¶ 44. I cannot accept this conclusion. First, living with a roommate would not constitute “cohabitation” as defined by the majority, and thus its roommate analogy is inapt. See ante, ¶ 19 (“To constitute changed circumstances, cohabitation must approach the permanency of marriage. Thus, any claim of changed circumstances must include ‘some permanency or long-term relationship.’”) (quoting Combs v. Combs, 787 S.W.2d 260, 262 (Ky. 1990)). More importantly, I am not prepared to conclude that the sharing of household expenses, in addition to the existence of a long-term relationship, can never constitute changed circumstances. Indeed, in a cohabitation case (not a “roommate” case), it is difficult to conceive of a situation where a court could find changed circumstances in the absence of such economic factors.

¶ 45. While the majority states that it adopts “the majority rule for cohabitation situations,” ante, ¶ 18 (citing Smith v. Mangum, 747 P.2d 609, 611 (Ariz. Ct. App. 1987)), the majority rule does not foreclose a trial court from considering evidence of shared expenses in determining whether changed circumstances exist. See Mangum, 747 P.2d at 612 (holding that, although cohabitation is not, in itself, the de facto equivalent of marriage that would warrant modification of spousal maintenance, “all evidence relating to the economic nature of the relationship between [wife] and [cohabitant] would be relevant and admissible to show that [wife’s] support needs have changed”). To the contrary, the cases cited by the majority support the proposition that the sharing of household expenses is a proper factor for the trial court to consider in determining if changed circumstances exist in a cohabitation case.

¶ 46. In Van Dyke v. Steinle, 902 P.2d 1372 (Ariz. Ct. App. 1995), for example, the court explained that “[t]he ‘focal point’ of the court’s inquiry in a cohabitation situation is the recipient’s need for continued support,” id. at 1378 (quoting Mangum, 747 P.2d at 612), and thus a *165court should conduct a factual inquiry into the economic effect that the cohabitation actually has on the supported spouse. Id. at 1382. As the Van Dyke court observed, “only evidence relating to the economic nature of the cohabitation would be relevant” to show that a recipient spouse’s support needs have changed since the final divorce decree. Id. at 1378. The Van Dyke court concluded that a factual question existed as to whether wife’s cohabitation resulted in changed circumstances, and it held that, on remand, the trial court could consider house maintenance and repairs performed by wife’s cohabitant, as well as “any other reductions in wife’s household expenses, or expenditures she incurs by the addition of [the cohabitant] to her household” to determine to what extent, if any, wife’s spousal maintenance should be reduced. Id. at 1384.

¶ 47. In Lombardo v. Lombardo, 992 S.W.2d 919, 923 (Mo. Ct. App. 1999), another case cited by the majority, the court recognized that “trial courts should be allowed to take into account the third party’s support of the receiving spouse, and the receiving spouse contributions to the support of the third party” in determining whether a cohabitation arrangement has resulted in a substantial and continuing economic change of circumstances. Id. The Nevada Supreme Court reached a similar conclusion in Gilman v. Gilman, another case on which the majority relies. 956 P.2d 761, 764 (Nev. 1998) (explaining that those courts who have adopted the majority rule in cohabitation cases “hold that alimony payments used to benefit the cohabitant should be eliminated or reduced to meet the recipient spouse’s actual needs”). The Gilman court recognized the “economies of scale” that can result from cohabitation, and it emphasized that the “economic needs” test that it adopted allowed the “lower courts to focus upon the specific facts of each case, while retaining their substantial discretion when making spousal support modification decisions.” Id. at 765-66; see also In re Marriage of Schroeder, 238 Cal. Rptr. 12, 15 (Ct. App. 1987) (recognizing that cohabitation may reduce the need for spousal support because sharing a household gives rise to economies of scale and, more importantly, the cohabitant’s income may be available to the recipient spouse); Van Gorder v. Van Gorder, 327 N.W.2d 674, 679 (Wis. 1983) (recognizing that where cohabiting couple share expenses, it may be appropriate to decrease or terminate maintenance payments because, under some circumstances, two people living together can live more cheaply than if they lived separately, but noting that certain living expenses, such as rent, would in many cases be the same whether the recipient spouse lived alone or not).

*166¶ 48. Here, the trial court acted within its discretion in concluding that wife’s financial situation has changed since the date of the final divorce order. The family court’s consideration of the “financial security” afforded wife by her cohabitation arrangement is consistent with this Court’s holding in Taylor. In Taylor, the obligor argued that his ex-wife, as a result of her remarriage, had “access to such income and wealth that she no longer need[ed] maintenance.” 175 Vt. at 39, 819 A.2d at 690. Although we did not hold that the motion to modify should necessarily be granted, we recognized that wife’s improved “financial security” provided proper grounds for the motion to modify. Id. Moreover, we note that in Miller v. Miller, discussed above, the family court concluded that there had been a substantial improvement in wife’s financial circumstances based on its finding that wife’s new husband had the “financial capacity” to contribute $1000 per month toward the support of their joint household. This is precisely the type of “financial security” that is relevant in considering a motion to modify, and the majority errs by foreclosing the family court from considering it. To hold, as the majority does, that shared expenses between cohabitants is never sufficient to show changed circumstances constrains the trial court’s discretion and suggests that a recipient spouse might structure his or her living arrangement so as to avoid a modification of maintenance.

¶ 49. The majority recognizes that the family court has discretion in determining whether changed circumstances exist, id. at 36, 819 A.2d at 688, and as this Court has explained, “ [t]here are no fixed circumstances for determining what meets this threshold, and ... evaluation of whether or not any given change is substantial must be determined in the context of the surrounding circumstances.” Pigeon v. Pigeon, 173 Vt. 464, 466, 782 A.2d 1236, 1238 (2001) (mem.) (quotations omitted). I believe that the family court in Smaller acted within its discretion in applying the relevant factors and concluding that a substantial change of circumstances existed where wife was involved in a long-term relationship, her boyfriend was living with her (rather than the other way around), he was employed and had the ability to contribute to household expenses, and he did not do so. It was not error to conclude that these factors significantly affected wife’s financial security or “financial resources” and they justified modification of the initial maintenance award. In fight of the absence of specific findings as to Mr. Garland’s income and his ability to contribute, however, I would remand this case to the family court for additional findings.

*167¶ 50.1 am authorized to state that Chief Justice Allen (Ret.) joins in this dissent.