Julian Wright says brother and sister conspired to defraud him of iron ore fortune
Mining heir alleges conspiracies and ‘secret committees’ were part of his brother and sister’s plan to defraud him of a massive inheritance.
Lawyers for iron ore heir Julian Wright have detailed what they say was a “deliberate and active deception” by his siblings to defraud him of his stake in the family’s multibillion-dollar iron ore empire.
Mr Wright is suing his sister Angela Bennett and the estate of his deceased brother Michael Wright over the 1987 sale of his one-third stake in Wright Prospecting for $6.8 million.
Pat Zappia QC, representing Mr Wright, used his opening address in the Western Australian Supreme Court on Monday to argue that Julian’s siblings and their advisers had withheld crucial information about the true value of the their father’s estate in the lead-up to the deal.
“In short, the strategy employed by the other siblings was, in Michael’s own words, ‘to trap him like a rat in a bottle’,” Mr Zappia said.
He said Michael Wright, Angela Bennett and their lawyers had breached their fiduciary duties to Julian as they managed the estate of their father Peter Wright, telling the court that the “deliberate and reckless nondisclosure of material information may amount to fraud under common law”.
In particular, he said, they had represented to Julian that the estate was insolvent when it was not, and had concealed their father’s entitlement to lucrative iron ore royalties from a list of disclosed assets.
The statement of assets and liabilities filed to the court after Peter Wright’s death listed his assets at just $223,000 and his liabilities at $760,000. But Mr Zappia said the amount owed was in fact owed to Peter Wright himself, so was not a true liability.
The Wright assets included royalties over the big Mt Tom Price and Paraburdoo iron ore mines, which were already in production at the time, and future mines including Marandoo and Channar, as well as an interest over the huge but still undeveloped Rhodes Ridge iron ore deposit.
While Julian was a director of Wright Prospecting at the time, Mr Zappia said the company’s mining assets were rarely discussed during board meetings. Instead, he said, those assets were discussed in a “secret committee” that Julian was not informed about.
Mr Zappia revealed that Julian would call former BHP and Wright Prospecting geologist Shankar Madan to testify about a “fact-finding tour” of the Pilbara by Michael. Mr Zappia said Mr Madan provided Michael with an insight into the “enormous potential worth” of Wright Prospecting’s Pilbara tenements and royalties.
“Hugely material information in relation to the value of the company and its future potential was not disclosed to Julian and was deliberately withheld from him,” Mr Zappia said.
Wright Prospecting has flagged from the outset that it intends to fight the matter vigorously, and issued a statement through a spokesman at the weekend reiterating its position.
“Given the nature of the allegations Julian is making, we have been seeking to get this matter heard and the claims tested in court as quickly as possible,” a spokesman said.
“As we have said previously, Julian is attempting (retrospectively) to undo binding agreements he appears to now wish he had never entered into.
“He was fully informed when he negotiated and entered into those previous deals (and) was independently advised by experienced lawyers, and he can’t now overturn them by making baseless claims.”
Lawyers for Angela Bennett and the Michael Wright estate are expected to make their opening submissions on Tuesday.