Emails sent by rich-lister Gina Rinehart’s children have shed more light on the bitter behind-the-scenes battle over the family trust, as the multibillion-dollar row over royalties from her iron ore mine continues in the West Australian Supreme Court.
On Thursday the court was shown a string of emails exchanged in 2003, the early days of Rinehart’s son John Hancock’s tug-of-war with his mother over the family trust set up by his pioneer grandfather Lang Hancock.
In them, John is seen raising concerns Rinehart had allegedly breached her fiduciary duty by removing assets from the Hope Margaret Hancock Trust, including Hope Downs, to her children’s detriment.
Gina Rinehart family, John Hancock, Bianca Rinehart, Rose Porteous, Lang Hancock. Picture: Supplied
The emails were relied upon as evidence by Simon Taylor, one of the lawyers helping the family of often-forgotten prospector Don Rhodes to retrieve a 1.25 per cent royalty from ore mined at the Hope Downs tenement and fight John and his sister Bianca Rinehart’s equitable relief claim.
Taylor said other documents showed all the Rinehart children were well aware of John’s issues with the family trust, and the claim to the asset now at the centre of the row.
An email from John to his mother and two of her business associates shows him flagging the prospect of legal action, but vowing not to pursue it.
John declared he had been “very much aligned with my mother” in what went on to be a protracted battle with Lang’s widow Rose Porteous after his death, insisting any criticism would be contrary to their interests to safeguard family assets from other forces, Taylor said.
“I want to stand by [Hancock Prospecting and Gina Rinehart] and fight the Porteous camp,” John wrote.
“I hope you will remember the effort I have put in, especially in turning the tide in the media against the Porteous camp.”
While John vows to go quiet, his sister Bianca appears to take up the case in 2004 by going to John’s lawyers over allegations Rinehart shifted assets out of the trust and charged it inappropriately.
But much to John’s disappointment, Bianca appears to get cold feet.
Rose Porteous at her former home Prix d’amour in Perth.Credit: Tony McDonough
“I am disappointed in your attitude towards this trust issue, Bianca,” John wrote to Bianca.
“It’s wrong, and I wonder what your attitude would be if you hadn’t brokered your $18,500 deal from New Idea.
“You started this legal action, not me, but you and I know you will share in the benefits of my actions.
“I don’t mind doing this for you, but if it fails you will be weak as ever. I won’t hesitate to tell her [Rinehart] you were behind it from the start.”
In response, Bianca insists she never intended to follow through on the lawsuit and that the conversation made her sad.
Bianca went on to become intimately involved in the Hope Downs project with Gina, while John pursued the case solo before he eventually asked his mother to step aside as trustee.
With negotiations with Rio Tinto to become a joint venture partner in the Hope Downs project still underway, John vows not to do anything that would attract negative publicity and jeopardise the deal under a 2005 settlement deed he signed with his mother.
But the vow not to go public appears short-lived, with another email read to the court showing John advising his sisters, Hope and Ginia, about an article being published in The West Australian newspaper.
In the email he explains the action and accuses his mother of breaching her duties to enrich herself at their detriment.
“She has removed tenements, including Hope Downs, from the children’s control. My grandfather wanted to leave these to his grandchildren, the distribution of which is a four way split,” he said.
“There are more things I could tell you, but this is highly confidential.”
Just a few months later, Hancock Prospecting’s general counsel Terry Solomon recites a conversation with John to Rinehart in which he threatened to go on a “media drive” if his mother did not respond to his legal action within seven days.
In an email from Bianca to Solomon, she said John had been continuing to lobby her to join him, embarking on his “usual rhetoric” and telling her how she would be enjoying her life more if she came over to “his side”.
“I gave him my usual response, I would never be able to do such a thing as my conscience wouldn’t allow it,” she said.
“I’ve chosen to remain out of this attack.”
John responded by saying: “don’t assume my attack is over.”
Several years later, John and two of his sisters fought to remove Rinehart as trustee in court, with Hope later backing out after inking a confidential settlement with her mother.
Bianca would go on to helm the trust, but the battle over assets has continued behind closed doors.
John and Bianca are now working together to seek relief in the form of a proprietary interest in Hope Downs, which Rhodes has argued would extinguish its interest.
Taylor told the court the documents made it clear the children were all across the issues they now intended to ventilate almost two decades later, but the children’s claim should fail because they didn’t act fast enough.
He said John had avoided beginning proceedings in his claim over a slice of Hope Downs so that the asset could be developed for his own benefit.
Rhodes has also argued holding a trust interest in the shares of a company did not automatically give one a proprietary interest in its assets.
Hancock Prospecting is expected to begin its opening submissions on Monday.
The case continues.
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