Ginia Rinehart, left, has sided with her mother Gina Rinehart.
Ginia Rinehart, left, has sided with her mother Gina Rinehart.

Win for Gina Rinehart in bitter family feud over $5b trust

The poisonous billion-dollar dispute between Australia's richest woman Gina Rinehart and two of her four children has been taken out of the public spotlight.

The sensational row over the family trust which saw bitter emails in which Ginia Rinehart, who has sided with her mother, dubbed an "oxygen thief" by her brother, will now go to confidential arbitration after a ruling today by the High Court.

Ginia Rinehart, left, has sided with her mother Gina Rinehart.
Ginia Rinehart, left, has sided with her mother Gina Rinehart.

It is a win for Ms Rinehart, 65, who has been locked in the escalating dispute with her daughter Bianca Rinehart, 40, and son John Hancock, 43, since September 2011 when she changed the vesting date of the Hope Margaret Family Trust - established by her father, the late mining magnate Lang Hancock for his four grandchildren - days before the children were due to come into the money.

Western Australia-based Ms Rinehart became chairman of the family flagship company Hancock Prospecting Pty Ltd and the Hancock Group after her father died in 1992 and has built a fortune worth $20 billion.

Ginia, 34, has been on her mother's side from the start and the third sister, Hope Rinehart Welker, 33, pulled out six years ago.

Family feud: Bianca Rinehart.
Family feud: Bianca Rinehart.

The two eldest children allege "misconduct" and "dishonesty" by their mother who has denied the accusations in court.

Ms Rinehart had warned the children that the original vesting date of the Trust, which holds almost 25 per cent of the shares in Hancock Prospecting and is worth about $5 billion, would leave them exposed to substantial capital gains tax liability and likely bankrupt them.

The trusts were to vest in 2011, when John Hancock, the eldest child, reached the age of 25.

Bianca Rinehart and Mr Hancock also allege their mother wrongfully transferred valuable mining assets away from a trust to another trust in which Ms Rinehart had a substantial financial interest.

Despite the case running for years, Ms Rinehart has not been required to file a defence to the claims and no findings have been made with respect to the claims, the High Court said.

The court has sided with Ms Rinehart in rejecting an appeal by the brother and sister against a Federal Full Court ruling that deeds they all signed included clauses for any disputes to be confidentially arbitrated.

Siblings John Hancock and Bianca Rinehart.
Siblings John Hancock and Bianca Rinehart.

"Each of the Deeds contains an arbitral clause," the High Court said in a majority judgment of four to one.

The deeds were intended to address the risk of commercial damage to Hancock Prospecting and the Hancock Group by public statements which might be made by Mr Hancock and the risk of disclosure of confidential information, the court said.

"Confidentiality was plainly a serious concern at this point," the court said in its judgment published today.

"(They) referred to Mr Hancock's use of "sensationalist media" to publicise his claims and the potential for him "to negatively seek exposure with the public or with the media" particularly during periods of negotiation."

The brother and sister have claimed that their mother's dealings have " diminished the assets of trusts" and seek to be appointed trustees of the family trust.

Ms Rinehart has said she had "always worked in the best interests of our family company", benefiting all four children through the trust.

"Hard work, sacrifice and immense dedication, not short-term gambles in hope of quick easy money, has got us here," she has said.

"This has become a company this family should be genuinely very proud of … not attacked or distracted for selfish reasons in public litigation."

Among the poisonous emails written by Mr Hancock and exposed during the court saga was one to his mother: "Mother, just tell Gina to wear a bag over her head - cover up her genetic deficiencies from prying eyes."

 

Gina Rinehart and daughter Ginia.
Gina Rinehart and daughter Ginia.