When Could £90 Million Upon Divorce Be Described As “unfair”?

After rumours surrounding his extra-marital affairs with another woman surfaced, Robert Herjavec and his wife Diane Plese separated on July 24, 2014 after 24 years of marriage and three adult children. Plese filed for divorce in March 2015.

When a couple divorce, it’s not unusual for maintenance to form part of the financial settlement. Only a few days ago, the Toronto Sun reported that a Canadian court had ruled that Shark Tank star Robert Herjavec should pay his ex-wife $125,000 per month in spousal maintenance payments, accompanied by a very sizeable capital settlement in the order of tens of millions of Canadian dollars. While maintenance payments on this scale are relatively rare, understanding what maintenance is, as well as the factors the courts may take into account when it comes to awarding maintenance payments, can help you to understand what to expect.

What is spousal maintenance?

Spousal maintenance can be paid to former spouses on a monthly basis. It can either last for a defined period of time or on what is known as a ‘joint lives’ basis. ‘Joint lives’ means that it will continue until either the payee or the payer of the maintenance dies.

Joint lives maintenance orders are becoming increasingly rare here in England and Wales.

So how do the courts decide on an amount?

Herjavec and his wife of 24 years fought their family court battle over everything from the number of parking spaces in the garage of their mansion to the value of their other real estate assets.

When deciding on how much maintenance payments should be, the courts look at everything from how much income you have already, to how much you need to live on.

In this case, Herjavec made his fortune with his cybersecurity business called ‘Bark’, which he sold for £31 million in 2000. According to the court, this windfall gave the family “unimagined wealth, which would change their family’s life and lifestyle fundamentally,”. As such, it was important to take their lifestyle and family life into account when awarding maintenance.

In the end, the Ontario Supreme Court ruled that Diane Plese should be awarded $125,000 a month in spousal support and a total of $25 million from their massive fortune. Some of these assets included $2.4 million from the proceeds of sale of the couple’s Florida home.

Furthermore, the earning capacity of both parties is also taken into account by the courts.  This is also the case here in England and Wales.

How much maintenance should be paid and the period of time the maintenance payments will last are down to the discretion of the court and will depend upon the facts of the case.

Waggott v Waggott

In this case, Mr and Mrs Waggott agreed that their assets, which were valued at over £16 million, would be divided equally between them upon divorce. However, what they couldn’t reach an agreement on was Mrs Waggott’s entitlement to Mr Waggott’s future income.

The original court awarded a ‘joint lives’ spousal maintenance order, which both parties appealed, albeit on different bases. The Court of Appeal overruled the joint lives order and imposed term maintenance with payments  finishing in 2021. The court concluded that the lower court had erred in applying the sharing principle (this means that the starting point is that all assets should be divided equally) to earning capacity as a resource. The judge said that sharing stopped “at or within a short time of the end of the relationship”.

Mrs Waggott was later refused permission to appeal this decision by the Supreme Court.

Spousal maintenance can be complicated

If you and your spouse are unable to reach an agreement regarding spousal maintenance, you can ask a solicitor to negotiate for you or the courts to decide for you.

Ultimately, the maintenance payable – if any – depends on the facts of the case and there is no set formula to be applied to each individual marriage/civil partnership.

Need advice about maintenance or any other aspect of your divorce? Get in touch to speak to one of our expert family lawyers.

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