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 watercraft 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 reflects 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: