“Sign up or be bankrupt” – Rinehart family feud details revealed as fight returns to court

The bitter family feud between Gina Rinehart and three of her children will return to court today, with lawyers set to argue in the NSW Supreme Court over the release of further documents detailing the extent of the dispute, which centres around the children’s attempt to remove Rinehart as trustee of a multibillion-dollar trust.

The trust was set up by Rinehart’s father Lang Hancock and holds about 23.5% of Hancock Prospecting, of which Rinehart is chairwoman. The children believed that the Hope Margaret Hancock Trust would vest when Ginia, Rinehart’s youngest child, turned 25 in September last year.

But after Gina lost a bid for the family feud to remain private on Friday, it has been revealed that Rinehart last year secretly deferred the expiration of the trust until 2068 – a decision her lawyers argued was done in good faith.

The court also heard that Rinehart had told her children by email they had “one hour to bankruptcy and financial ruin” if they did not sign a document regarding the family trust.

“Sign up or be bankrupt tomorrow,” the email said.

Rinehart had warned her children that changing the trustee of the trust could lead to a $100 million capital gains tax liability each.

The children taking action against their mother – John Langley Hancock, Hope Rinehart Welker and Bianca Rinehart – argue Rinehart should be removed as trustee on the grounds of serious misconduct.

John Hancock is today quoted saying that his mother could solve the dispute immediately by “stepping down and appointing [her] adult children, who all hold university degrees, as co-trustees, or those who so agree to the position.”

Rinehart’s team has retorted that her children should “go out and earn for themselves,” saying the children had been “provided with every personal and financial advantage.”

In a statement yesterday, Rinehart stated her willingness to quickly resolve the spat, rather than continuing with “distracting, unnecessary and time-wasting litigation.”

It has also been revealed today that Nationals Senator Barnaby Joyce had thrown his support behind Rinehart, writing a letter to one of her children to dump the legal battle.

Joyce and Rinehart’s friendship was highlighted last year when Hancock, chairman of Hancock Prospecting, flew Joyce to the Indian wedding of Mallika Reddy, granddaughter of GVK chairman GVK Reddy.

Fairfax says that Joyce wrote a letter to Hope Rinehart Welker, urging her to drop the court action against her mother.

“It was more to the point of keeping it out of the media,” Joyce is quoted saying.

“It was a letter that basically I thought was sage advice, to keep things out of the media. And now they are in the media so it’s kind of irrelevant what I said there. That’s the end of my comment.”

It was also revealed that Ginia Rinehart, the only child to side with their mother, had initially supported her siblings’ case.

The Australian Financial Review reports that Ginia wrote to her siblings before the legal proceedings pledging her support.

“Hope, of course I trust you and if you feel up to it and want to take over the mess I support you 100 per cent,” she emailed.

Ginia later wrote that she had signed a deed to end the dispute in September last year, telling Hope: “Just spoke to mum. I have to sign the deed if for no one else’s sake than yours and my two nieces.”

“You know at the bottom of your heart this lawyer stuff will NEVER work and all that will result is one massive tax leaving in bankruptcy.”

But, in a statement read out to court on Friday, Ginia accused her siblings of being motivated by greed. “I have no doubt that one day soon my brother and sisters will regret putting money before family,” the statement said.

Rinehart had initially sought for the family feud to be mediated confidentially, pointing to an earlier family agreement that family feuds be settled privately, and concerns about the safety of her children and grandchildren.

Rinehart last week came in 29th on Forbes magazine’s world billionaire list, with an estimated fortune of $US18 billion from iron ore and coal assets. Rinehart also holds stakes in Ten Network and Fairfax Media.

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