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What Constitutes “Hardship” When You Are Well-to-Do?

What Constitutes “Hardship” When You are Well-to-Do?

In determining the proper amount of spousal support that should be awarded after a married couple divorces, the court is guided by various established legal and policy-based principles. One of them is that the support should seek to alleviate economic “hardship” on the part of the spouse who is entitled to receive it.

As with many of the other factors, the concept of “hardship” is relative:  What amounts to hardship in one family setting will be vastly different to what is considered hardship in another.

This dichotomy was well-illustrated in Plese v. Herjavec, which involved the high-profile divorce between Canadian television personality Robert Herjavec (most recently seen on the reality shows Shark Tank and Dragon’s Den) and his wife of 24 years, Diane Plese.

In the context of determining the appropriate amount of spousal support to which the wife should be entitled, the court wrote:

Spousal support is also designed to relieve economic hardship.  What is “hardship” in the context of this family?  I need to look at the pre-separation lifestyle of the family to understand this context.

At the date of separation, the parties lived in a 22,000 square foot home (not counting the basement) with an indoor pool, ballroom, tennis court, tea house, and ten-car garage housing numerous luxury vehicles. The home was located on more than 2 acres in one of the most exclusive areas of Toronto.  The parties owned a ski chalet in Caledon, a luxurious vacation property in Florida, boats and other water craft and a Muskoka cottage.

The former couple’s lifestyle was commensurately extravagant, as the court described:

The family travelled extensively.  Family holidays were often taken using THG’s private jet, which Ms. Plese described as one that can fly “over the ocean”.  Holidays included European destinations.  On a holiday in Greece, the parties rented a yacht and staff to sail the family around the Greek Isles.  Ms. Plese testified that if the aircraft was being used for THG business, and she wished to take a trip, Mr. Herjavec would charter a private plane for her.   Mr. Herjavec did not refute this evidence.

Ms. Plese’s financial statement shows she owns considerable expensive jewellery from Cartier.  At valuation day it was worth over $428,000.  Ms. Plese says this figure reflect roughly half of what it cost.  Again, I heard no evidence to the contrary.

Mr. Herjavec testified he spent $100,000 on a piano for High Point, but, since no one in the family could play, invested a further $25,000 on a device that would play the piano.  Mr. Herjavec owned and operated numerous luxury cars. The middle child, Skye, received a car for her 16th birthday.  The children were educated at exclusive private schools.  The two girls attended elite American universities.  Both older children have pursued post-graduate studies, at no personal financial cost to them.  The family lived a rarified existence of privilege and luxury.

It is telling that [their daughter] Skye, when asked whether it was true she enjoyed luxurious holidays with her family, simply answered:

I mean they were just vacations to me, I don’t – it depends on how you see them.

Skye was then asked how she saw them. She answered:

I was going on vacation with my family … it depends what you – like that’s how I grew up, that’s – it was a vacation with my family is how I saw it.

In awarding support, the court had to examine the post-split downgraded lifestyle that the wife was now living, in light of the divorce after a longstanding marriage.  The court explained:

Ms. Plese testified that her lifestyle has suffered since the breakdown of the marriage.  For example, instead of travelling by private jet, she flies with commercial airlines.  Instead of staying in a suite of rooms at luxurious hotels, she now stays in a single hotel room.   I have no evidence that Mr. Herjavec has experienced any similar reduction in his lifestyle.

I conclude that without spousal support, Ms. Plese will have suffered economic hardship as a result of the end of the marriage.

For the full text of the decision, see:

Plese v. Herjavec, 2018 

At Russell Alexander Collaborative Family Lawyers, our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

Son-In-Law Gets Lifelong Licence to Use Mother-in-Law’s Portion of Family Island

Son-In-Law Gets Lifelong Licence to Use Mother-in-Law’s Portion of Family Island

One of the main components of my Family Law practice is guiding clients through the process of property division upon separation and divorce. The question of how to divide property is not always easy; some properties are unusual, have long family histories, or have sentimental memories attached to them.

The recent decision in Clarke v. Johnson is precisely such a case: the property in question was a family-owned island, and a camp that had been built on it. The issue was whether a son-in-law – who had separated from his wife – should be entitled to use the portion of a family island owned by his former mother-in-law.

The matriarch of family, Martha, was one-third owner of a Sudbury-area island on Lake Panache, which had been purchased around 1971 with her now-deceased husband. The remainder of the island was owned by her brother-in-law and sister-in-law, who each owned a one-third share. Under an informal and unwritten agreement, each owner (together with his or her family) was entitled to use their own one-third, although a “Main Lodge” building was reserved for common use by all.

Martha’s daughter Victoria had married a man named Donald, and they had two children together. Early on in their marriage, and with Martha’s permission, Victoria and Donald had built a camp on Martha’s share of the island, using $5,700 from Donald’s RRSP, and $17,000 loan from Martha’s husband (which was never repaid, apparently with his concurrence). Victoria and Donald placed a $15,000 prefabricated cottage on the property.

Victoria and Donald separated in 1991. Since that time – and because in the separation process Victoria had “washed her hands of the camp” and now “wanted no part of it” – Donald and the children had enjoyed exclusive of the camp on the island. According to Victoria, the camp was not Donald’s to deal with, but she was content to have him and the children use it, as long as he maintained it. She never once visited the camp since the 1991 separation.

Enter Wesley, the son of Victoria and Donald. Wesley had been living out west for 10 years, but had moved back to Sudbury. He expressed an interest in using the camp, which was fine with Donald as long as it did not interfere with his own planned use. Unfortunately, Donald and his son Wesley could not come to terms on this point, and their relationship became strained. Donald then decided to refuse to allow Wesley to use the camp at all.

This was where Martha stepped in again. Pointing out that she was the legal owner of the one-third of the island on which the camp was situated, and asserting that her son-in-law Donald’s use was predicated on his willingness to share it with the children, she claimed that she would terminate Donald’s use, and issue a trespass notice to him.

Donald brought an action to determine his rights in connection with the island, claiming that while he was not himself an owner of the island itself, he was an owner of the camp that was situated on it. More to the point, Donald claimed that he had an equitable right to occupy the property and the camp, based on the principle of unjust enrichment.

After hearing a good deal of evidence, the court allowed Donald’s action. First of all, it had to characterize the camp structure itself: despite its prefabricated nature, it had become a permanent structure on the land when Donald and Victoria had it installed. It was not merely a “chattel” that could be removed.

Next, the court found that Donald had successfully established a legal claim for “unjust enrichment,” by showing that: 1) Martha had been enriched by Donald’s actions; 2) Donald had suffered a corresponding deprivation as a result; and 3) there was no juristic (legal) reason for the enrichment.

Legally, it was clear that his former mother-in-law Martha still owned the portion of the island in question. However, Donald had not only contributed funds to constructing the camp in the first place, but over the subsequent 20 years he had also paid the bills, made improvements, and had sole responsibility for upkeep and maintenance. All of these benefited Martha. Furthermore Martha never occupied the camp herself, whereas Donald had enjoyed exclusive possession of it for about 20 years.
In these circumstances, there was clear enrichment to Martha, deprivation by Donald, and no juristic reason for it. The court was then left to craft the appropriate remedy.

Given what the court called Donald’s “very real and significant emotional attachment” to the camp – and the fact that this could not easily be quantified in dollars – the proper legal remedy was to impose a constructive trust on the camp, which would reflect Donald’s interest. Also, given his long period of uninterrupted use and sole responsibility for maintenance, Donald was also entitled to regulate the use of the camp by his children. This, the court found, would reflect the legitimate expectations of the parties.

As such, the court’s solution was to give Donald a licence to occupy the camp until he died, or until he was no longer physically able to attend there. Such a licence was personal to him, and could not be assigned or sold in any way. Moreover, the court imposed a condition that he was required to maintain the camp in a good state of repair, to refrain from materially altering its nature or character, and to pay taxes and utility costs related to it.

For the full text of the decision, see:

Clarke v. Johnson (2012), 2012 ONSC 4320, 2012  http://canlii.ca/t/fs65x

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at www.RussellAlexander.com.