Julian Wright sold Wright Prospecting stake on bad information, his lawyers say
Julian Wright sold his share in his family’s multi-billion-dollar iron ore empire for a sliver of its true worth after being fed inaccurate asset valuations, his lawyers have claimed.
Julian Wright sold his share in his family’s multi-billion-dollar iron ore empire for a sliver of its true worth after being fed inaccurate asset valuations, his lawyers claim.
He is suing his sister Angela Bennett and the estate of his deceased brother Michael Wright in Western Australia’s Supreme Court over the 1987 deal that saw him sell his one-third stake in Wright Prospecting for $6.8m.
Ms Bennett’s share of the empire is now estimated to be worth more than $2bn.
The siblings’ father, Peter Wright, was the business partner of iron ore pioneer Lang Hancock and has established significant resources interests in WA’s Pilbara region by the time of his death in 1985.
Pat Zappia SC, representing Julian Wright, used his closing submissions on Wednesday to argue that information presented to Julian at the time suggested Peter’s estate was of little value.
“At all material times, the estate was represented as having a net deficiency of assets,” he said.
Mr Zappia also argued that two key members of the Wright Prospecting team were actively working as agents of his estranged siblings at the time the deal was negotiated. Rather than assist Julian, Doug Salt and Carnie Fieldhouse were clearly giving advice to Michael and Angela as they contemplated buying out their brother, he said.
Mr Zappia produced transcripts of conversations from the time that he said showed that Mr Salt was “clearly giving advice” to Michael and Angela, and not just acting as a conduit between the three siblings. The transcripts also showed Mr Fieldhouse was using “tactics of persuasion and inducement” to secure a deal over Julian’s shares.
One of those transcripts showed Mr Fieldhouse describing how he could use a potential capital gains tax bill as “a weapon” in his discussions with Julian.
In a separate conversation, Michael told Mr Salt he had “done remarkably well to get him as far as you have”.
Mr Salt replied: “Oh well, we’re not there yet.”
Mr Zappia also highlighted the transcript of a conversation between Michael and Mr Hancock, in which Michael says “Doug Salt has ended up becoming the negotiating officer and in the end has managed to get Julian to agree”.
Earlier this week, Ms Bennett’s lawyer, Kristina Stern SC, used her closing address to argue that much of Julian’s testimony to the case was “highly unreliable” and “wildly improbable”.
She said there were multiple instances where he had established that Wright Prospecting was worth between $75m and $120m at the time the deal was struck. The trial is expected to conclude on Thursday.