The Michigan Court of Appeals released an opinion on October 16, 2012 discussing how a trial court should interpret a provision in the parties' judgment of divorce that the alimony obligation is terminated upon "cohabitation [of the obligee] with an unrelated male." The court had previously ruled on a similar case [Smith v Smith, 278 Mich App 198; 748 NW2d 258 (2008)], finding the term “cohabitation” to be “unclear” or “equally susceptible to more than one meaning.”
The Smith panel established a "totality-of-the-circumstances test" trial courts should consider when determining whether "cohabitation" exists that justifies termination of an alimony obligation. Specifically, the Smith panel gave examples of three types of evidence trial courts should consider when determining whether a person is "cohabiting" with another within the meaning of the alimony provisions in the judgment. According to Smith, the trial court should examine the following issues:
- The nature of the couple’s living arrangements and the extent to which they share a common residence.
- The nature of the couple’s relationship
- The couple’s financial arrangements.