Canadian Heiress Ordered to Pay Portion of Ex-Husband’s Legal Costs in Prolonged Court Battle
We previously blogged about the ongoing and very high profile divorce between Eleanor McCain, heiress to the McCain family fortune, and her estranged husband, Jeff Melanson. Their saga has now entered a new chapter after a judge recently ordered Ms. McCain to help pay Mr. Melanson’s legal fees.
Ms. McCain and Mr. Melanson married in spring of 2014. At the time of the marriage, Ms. McCain had a net worth of more than $365 million, and an annual income of $4.25 million. Mr. Melanson had an annual income of $400,000, but was in debt, negating this income. They entered into a prenup in which Ms. McCain agreed to pay Mr. Melanson a lump sum of $5 million upon marriage breakdown.
The couple ultimately split approximately nine months after their wedding, at the beginning of 2015. Ms. McCain subsequently applied for an annulment, alleging that Mr. Melanson was a womanizer with a history of workplace harassment and “behind-the-scenes abuses”.
Ms. McCain also filed a motion to have Mr. Melanson’s lawyer, Harold Niman, removed as counsel. Mr. Niman had previously represented the ex-wives of Ms. McCain’s brothers in their respective divorce proceedings. According to Mr. Melanson, a response to Ms. McCain’s motion to remove his lawyer cost him $144,000.
At the time of the costs proceedings, Mr. Melanon had incorporated a consulting company but had not earned any income from it. He argued that the negative publicity surrounding the ongoing court matter with Ms. McCain made him a “less attractive candidate” for work. Mr. Melanson had $205 in his chequing account, and a balance of zero in his savings account, with his only significant asset being his RRSP.
Justice Horkins of the Ontario Superior Court ordered Ms. McCain to pay $125,000 in interim costs to Mr. Melanson, stating that “it is clear that he cannot afford to pay his legal fees”.
The Judge went on to say that this amount should eventually either be credited against any claim that Mr. Melanson might obtain from his $5 million pre-nup with Ms. McCain, or be reimbursed if the court ultimately decides that he is not entitled to the money outlined in the marriage contract.
Justice Horkins rejected Ms. McCain’s argument that Mr. Melanson did not deserve to have his legal costs covered as he had gone on a “spending spree” since their court battle began, and had travelled extensively, including to places such as Yukon, British Columbia, and California. The Judge noted that Mr. Melanson had to resign from his former position as CEO of the Toronto Symphony Orchestra due to the publicity around the marital dispute, and consequently, had to tap into his line of credit and sell his Toronto home. She found that Mr. Melanson’s travels had been reasonable given the nature of his previous employment and his need to actively seek additional employment, to honour board commitments, and to attend speaking engagements across North America. His travel costs had decreased from more than $90,000 in 2015, to approximately $53,000 in 2016.
Both parties have been ordered to reach a settlement prior to the end of this year.
Costs Consequences in Family Law Cases
There can be significant costs consequences in family law disputes. Judges retain discretion to award costs, pursuant to section 131 of the Courts of Justice Act and Rule 24 of the Family Law Rules. In making a costs determination, court must consider a number of fundamental objectives as set out by the Court of Appeal in Serra v. Serra:
- to partially indemnify successful litigants for the cost of litigation;
- to encourage settlement; and
- to discourage and sanction inappropriate behaviour by litigants.
The court must additionally consider all factors relevant to the circumstances of each specific case.
If you have questions about your rights and obligations in a separation, divorce, or high asset divorce speak with experienced Windsor family law lawyer, Jason P. Howie, at 519.973.1500 or contact us online. We serve clients in Windsor, Essex County and throughout the region.