Australian Billionaires Win Rio Tinto Royalty Dispute
New South Wales Supreme Court Justice David Hammerschlag in a May 10 decision said Mount Bruce Mining Pty, a unit of Rio Tinto, owed the royalties under a 1970 agreement in which it agreed to pay 2.5 percent on iron ore sales from the Channar and Eastern Ridge lands in Western Australia.
Rio Tinto, Rinehart’s Hancock Prospecting Pty and Wright Prospecting had agreed on the sum in dispute, the judge said without specifying it. The judge had been told by the plaintiffs’ lawyers during the March trial that about $200 million was at stake. Rio had argued the properties lay outside the area on which royalties were due under the deal negotiated with Rinehart’s father Lang Hancock and his partner at the time Peter Wright, who had founded Wright Prospecting.
“The royalty is payable in respect of ore won from the physical area,” Hammerschlag said in the ruling.
Bruce Tobin, a Melbourne-based spokesman for Rio Tinto, said yesterday the company was examining the judgment and considering its options.
Wright Prospecting welcomes the ruling, the company said in an e-mail yesterday, adding the agreed sum of the royalties is confidential.
Lang Hancock and Peter Wright discovered iron ore deposits in the Pilbara region of Western Australia in the 1950s. The find now makes Rio Tinto, which operates mines through Hamersley Iron Pty., the biggest producer in the country. The prospectors’ companies collect a 2.5 percent royalty from a 1962 agreement with Rio Tinto on sales of iron ore mined at some of the Pilbara properties.
Rinehart, who inherited the iron-producing properties from her father, is ranked the 42nd richest person in the world, with a net worth of $17.3 billion, according to the Bloomberg Billionaires Index.
Angela Bennett, Peter Wright’s heir, and Rinehart are in disputes over other royalties and properties in the region, with Wright Prospecting seeking 50 percent of Hancock’s stake in tenements known as Hope Downs 4, 5 and 6, according to a Sept. 24 lawsuit filed in the Supreme Court of Western Australia in Perth.
The Case is Wright Prospecting Pty v. Hamersley Iron Pty. 2013/NSWSC536. Supreme Court of New South Wales (Sydney).
To contact the reporter on this story: Joe Schneider in Sydney at firstname.lastname@example.org
To contact the editor responsible for this story: Douglas Wong at email@example.com