Gina Rinehart lawyers rubbish Rhodes royalty claim
Hancock Prospecting says the temporary reserves at the centre of a claim from DFD Rhodes expired decades before the area was eventually mined.
Gina Rinehart’s Hancock Prospecting has savaged a legal grab for a share of the billions flowing out of her Hope Downs iron ore mines from one of her father’s former business associates as “fatally” flawed.
The legal team representing the business of Australia’s richest person on Monday opened its defence in the civil claim brought against it by Wright Prospecting and DFD Rhodes.
Wright Prospecting is suing for hundreds of millions of past and future royalties from the Hope Downs mines as well as a stake in the East Angelas iron ore deposits, while DFD Rhodes – the family company owned by descendants of Pilbara trucking figure Don Rhodes – claims it should enjoy a 1.25 per cent royalty from Hope Downs.
Noel Hutley SC, representing Hancock, began by focusing on the case put forward in court last week by DFD Rhodes. The dispute centres on an agreement signed in 1969 that set out a potential royalty for DFD Rhodes in the event that Hancock and Wright ever mined a designated area of “temporary reserves”.
That area of temporary reserves sits over a portion of what is now the Hope Downs mines.
During a complex dissection of the language of the 1969 agreement, Mr Hutley challenged the case put forward by DFD Rhodes.
No mining tenements had ever been issued from the temporary reserves at the centre of the 1969 agreement, which he said was “fatal” to the Rhodes royalty claims.
The arguments put forward by Rhodes’ legal team, he said, made “no sense, just as a matter of grammar”.
He said the right of occupancy over the temporary reserves at the centre of the agreement had expired decades ago without any mining having taken place. It would be another 30 years before iron ore mining finally occurred at Hope Downs.
He also rubbished what he said was the inferred argument that there had been an oral agreement between Rhodes, Hancock Prospecting founder Lang Hancock and Wright Prospecting’s Peter Wright around the time the 1969 agreement was signed.
“The evidence does not come close to supporting any inference that the parties entered into some undocumented side deal,” he said.
Hancock’s lawyers will on Tuesday turn their attention to the potentially much larger claim against them from Wright.
Lawyers for Wright’s daughter Angela Bennett and grandchildren Alexandra Burt and Leonie Baldock – all of them billionaires thanks to their share of Pilbara iron ore royalties – have set out a claim that they should be entitled to a greater share of the iron ore wealth first identified by Hancock and Wright decades ago.
During Wright’s opening, lawyers produced copies of correspondence and meeting records they said showed that Mrs Rinehart knew the Wrights were entitled to more royalties and iron ore assets than they had received.
The matter took 10 years to come to trial and the trial is expected to run for three months.
While Mrs Rinehart could potentially lose billions if judge Jennifer Smith finds against her, she would likely still retain her mantle as the richest person in the country.
Her fortune was estimated to be at $37.1bn in the most recent edition of The Australian’s Richest 250.