GILMAN VS. GILMAN (DIVORCE PROPERTY & ALIMONY)

Statutes cited

Key holdings

Practitioner summary

A ruling on a motion to modify spousal support is reviewed for abuse of discretion. DuBois v. DuBois, 92 Nev. 595, 555 P.2d 839 (1976). Under NRS 125.150(7), unaccrued alimony may be modified upon a showing of changed circumstances. The court adopted the majority 'economic needs test': post-divorce cohabitation warrants modification or termination of alimony only if the recipient spouse's actual financial need for support has decreased as a result of the cohabitation. Gayet v. Gayet, 456 A.2d 102, 104 (N.J. 1983). Shared living arrangements, without evidence of a decrease in the recipient's actual financial needs, are generally insufficient. The court held cohabitation per se is insufficient to require modification without an associated change in financial circumstances, and declined to adopt a rebuttable presumption of decreased need (a matter for the Legislature). The court found support in Jackson v. Jackson, 111 Nev. 1551, 1555, 907 P.2d 990, 993 (1995) (cohabitant contributions relevant to support determinations). Applying the test in the Callahan case (Docket No. 28892), which had no cohabitation provision, the court held the district court did not abuse its discretion because Ken presented virtually no evidence that Valerie's actual financial needs were reduced; she paid rent and household expenses and borrowed from Chuck. In the Gilman case (Docket No. 27896), the decree contained a valid, enforceable cohabitation provision addressing cohabitation with a man who 'significantly contributes to her support.' See Spector v. Spector, 112 Nev. 1395, 1396-97, 929 P.2d 964, 965 (1996). Under settled contract-construction principles, where parties foresee a condition and provide a remedy, that remedy is presumed to be the sole remedy, Old Aztec Mine, Inc. v. Brown, 97 Nev. 49, 52, 623 P.2d 981, 983 (1981), so the contractual provision, not the general changed-circumstances statute, governed. The record showed Tom never 'significantly contributed' to Marjorie's support. The court distinguished Western States Construction v. Michoff, 108 Nev. 931, 840 P.2d 1220 (1992), as involving a business partnership between cohabitants, absent here. Cohabitation does not amount to a de facto marriage because Nevada does not recognize common law marriage, Watson v. Watson, 95 Nev. 495, 496, 596 P.2d 507 (1979), and 'remarriage' means a solemnized ceremony, Shank v. Shank, 100 Nev. 695, 697, 691 P.2d 872, 873 (1984). Both denials were affirmed.

In plain language

This decision consolidated two divorce cases raising the same question: whether an ex-spouse's cohabitation with a new partner justifies reducing or ending alimony (spousal support). In one case, Richard Gilman sought to end alimony to Marjorie because she lived with a boyfriend, Tom; their divorce decree said the court would consider alimony if Marjorie cohabited with a man who 'significantly contributes to her support.' In the other, Ken Callahan sought to end alimony to Valerie because she lived with a boyfriend, Chuck; their decree had no cohabitation clause. Both district courts refused to reduce the alimony, and both paying ex-husbands appealed. The Supreme Court affirmed both denials and adopted an 'economic needs test.' Under that test, cohabitation by itself is not enough to change alimony; alimony may be modified or terminated only if the recipient's actual financial need for support has decreased because of the cohabitation. Merely sharing a home, without evidence that the recipient's real financial needs have gone down, is not enough. The Court explained this test fairly balances everyone's interests: it does not punish people for choosing to cohabit, it protects a recipient who might be left with nothing if the relationship ends (since unmarried partners generally owe each other no support), and it protects the paying spouse from effectively subsidizing a third party. Applying the test to Ken and Valerie's case (no cohabitation clause), the Court held Ken failed to show Chuck's contributions reduced Valerie's actual needs. In Richard and Marjorie's case, the Court held the parties' own decree contained a specific cohabitation clause, so that contractual provision - not the general 'changed circumstances' statute - governed; and the evidence showed Tom never 'significantly contributed' to Marjorie's support. The Court distinguished the Michoff line of cases (about business partnerships between cohabitants), which was not present here. Both denials were affirmed.