John Hancock, the estranged son of Australia’s richest person Gina Rinehart, has won an epic legal battle over control of the family’s multibillion-dollar family trust, with his sister and ally Bianca Rinehart appointed trustee.
On Thursday, NSW Supreme Court Justice Paul Brereton appointed Bianca, 38, trustee of the Hope Margaret Hancock Trust, which was set up by her late grandfather Lang Hancock and is thought to be worth about $5 billion.
Justice Brereton also ordered Mrs Rinehart to hand up documents and accounts relating to the trust that John and Bianca had claimed were withheld from them for many years.
The decision follows a bitter and public three-and-a-half-year war that saw Mrs Rinehart and her youngest daughter, Ginia, 28, pitted against her eldest two children, John, 39 and Bianca. Hope Welker, 29, who initially launched the legal action against her mother, settled in 2013 for $45 million because of the “high degree of distress” the litigation was causing her.
Justice Brereton said: “Mrs. Rinehart has demonstrated that she is prepared to go to extraordinary lengths to retain control, directly or indirectly, of the Trust, and that she is capable of exerting enormous pressure and great influence to do so”.
In particular, he said her past conduct in relation to the trust’s capital gains tax issue indicated she would be likely to exhert considerable pressure and influence on any independent trustee appointed by the court.
n 2011 PricewaterhouseCoopers gave Mrs Rinehart legal adivce that the beneficiaries would not have to pay capital gains tax if the trust vested. However, Mrs Rinehart “manipulated” the top-tier financial services firm into preparing advice that her children would have to pay, and the amount would be so large as to bankrupt them. Bianca was told she faced a $142 million bill.
Outside the court Mr Hancock said given the findings regarding PwC and Hancock Prospecting CFO Jay Newby over the capital gains tax issue, “more action will be taken”.
“They should apologise for their extraordinary misconduct in this matter- I will be bringing it up with the Chartered Accountants association in due course. I hope nobody else needs to live through being threatened with bankruptcy for no reason, as these people have done,” Mr Hancock said.
Further, Mrs Rinehart repeatedly sought to have the case stayed, referred to arbitration, kept out of the public domain, going as far as the High Court. She also tried to convince her children to withdraw the action, through her lawyers and other “influential connections” such as federal MP Barnaby Joyce who wrote to Ms Welker imploring her stop the case. Some of her tactics approached “intimidation” Justice Brereton said.
“I have never seen such pressure exerted, so persistantly, on a litigant, as has been apparent in this case,” Justice Brereton said.
Mr Hancock said: “Hopefully that’s the last time a senior politician uses his government email to intimidate my younger sister when she’s trying to fight a huge battle”.
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