July 2 (Bloomberg) -- Billionaire Gina Rinehart’s Hancock Prospecting Pty failed to dismiss a lawsuit brought by the family of her father’s former partner over the ownership of an iron ore mine being built in Western Australia.
Supreme Court of Western Australia Justice Rene Le Miere in Perth today told Wright Prospecting Pty to refile its complaint as he rejected Hancock’s argument that Wright’s case was filed too late.
Wright Prospecting is seeking 50 percent of Hancock Prospecting’s stake in three tenements, known as Hope Downs 4, 5 and 6, according to a copy of the writ filed Sept. 24 in Perth. Hancock Prospecting and Rio Tinto Group, the world’s second-largest exporter of iron ore, jointly own the Hope Downs assets under a 2005 agreement. Both companies claimed a win in the decision.
“Wright Prospecting welcomes the judge’s decision,” the company said today in an e-mailed statement. “Wright Prospecting now intends to resume proceedings in this matter.”
“Hancock Prospecting welcomes the judge’s decision,” relating to the striking out of the claim, Chief Financial Officer Jay Newby said in an e-mail. “Hancock proposes to issue an appeal in respect of the summary judgment.
The $1.6 billion Hope Downs 4 project, owned 50 percent by Rio, will have annual capacity of 15 million metric tons when it starts production this year, according to an August statement from Rio. It’ll be Rinehart’s second operating mine after the $1 billion Hope Downs 1.
The judge said Wright Prospecting based its complaint on a 1985 letter from a minister, which it argued gave it rights to the property. The letter gave no such rights, the judge said.
Hancock Prospecting argued Wright Prospecting took too long to sue, having had knowledge of the basic facts for years.
Le Miere ruled that should be determined at trial.
Wright Prospecting was founded by Peter Wright, who discovered the iron ore deposits with Rinehart’s father, Lang Hancock. Rinehart inherited the mining assets and is chairman of the company Hancock founded.
Rinehart is the 34th richest person in the world, with a net worth of $19.5 billion, according to the Bloomberg Billionaires Index.
Wright Prospecting, in its lawsuit over Hope Downs 4, 5 and 6, accused Hancock Prospecting of breach of trust for selling the property without its consent and breaches of fiduciary obligations, according to the writ.
Wright Prospecting sought an accounting of all profits earned by Hancock Prospecting from those assets and compensation for the breaches. It also asked the court to declare Hancock Prospecting held half the property in trust for Wright Prospecting, and to award it any proceeds from the sale and royalties Hancock Prospecting received.
The case is between Wright Prospecting Pty and Hancock Prospecting Pty. Civ2617/2012. Supreme Court of Western Australia (Perth).
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