Rinehart children in secret settlement pact
Family torn apart: John Hancock, Gina Rinehart and Ginia Rinehart.
Gina Rinehart's daughter Hope Welker signed a secret deed with her half brother and half sister to pay them two-thirds of any settlement and all their legal costs if she would settle with her mother.
The secret deed was signed in January 2012 by the three children, John Hancock, Bianca Rinehart and Hope, as part of a funding arrangement.
According to emails revealed in Fairfax Media earlier this week, Gina Rinehart offered Hope $300 million to settle and "walk away" soon after legal action was taken against her in September 2011 by three of her four children to remove her as trustee of the multi-billion dollar family trust.
Hope reached a confidential settlement with her mother after officially withdrawing from all legal action in the NSW Supreme Court on Tuesday. If the settlement was $300 million the deed says she would have to pay John and Bianca $100 million each, plus all fees and loans.
Hope approached her mother in December 2012 to settle after her marriage broke down and she was unable to pay bills including rent on a New York apartment that she is living in with her two young children.
An SMS sent to Hope on November 26, 2011 and released exclusively to The Age on Wednesday suggests that a smaller deal might have been struck than the original $300 million offer that was outlined in an email exchange between Hope and her estranged sister Ginia.
The message sent on November 26, 2011 by Ginia's fiance, Ryan Johnston on November 26, 2011 said: "I'm not sure what you've been offered exactly as I'm not privy to all that but my suggestion is to get as much as you're being offered, go buy two massive houses, a jet and five cars and send your kids to the school you want. Much better than trying to make a deal when you are out of money and at your weakest time to negotiate... Call me whenever you want and I'm doing this under the radar so let's keep it that way..."
Less than two months later Hope had signed the secret deed with her half brother and sister John and Bianca as a way to obtain funding. They have been using this funding source since January 2012 to pay legal bills that are estimated to cost $100,000 a month.
The six-page deed, obtained by Fairfax Media, says "Hope and Bianca agree that should either of them settle the current or any subsequent related action in the NSW Supreme Court then they will repay the whole of the debt then outstanding to [name taken to protect source] and will then share the balance of proceeds received from the settlement equally between the other and their brother John pending final settlement of the action or related action or actions when they and John agree to then account fully, for the amount or amounts so paid and shared, to either of Bianca or Hope or both or John as may have settled previously pursuant hereto."
In an email to Hope on November 22, 2011, Ginia said: "I cannot believe you have hired litigation funders, and even worse you could be that stupid to do so and then act like it's a good thing! You do know they will take at least 30% of anything of you get (if you get anything!!!!) why the hell don't you just take the 300 MILLION dollars mum has repeatedly offered you and walk away, leave us the hell alone and start looking after my nieces properly! Not that you deserve a penny as you have never worked a day in your life but if you cannot live with 300 million dollars for doing absolutely nothing then you really are disgusting. You clearly do not want to be a part of our family, nor have you ever wanted to be part of the company so take the money and walk away from everything! That way you can not have to deal with mum as trustee!"
John Hancock said today: "Was Ginia's fiance, Ryan Johnston, right when he said to Hope not to negotiate when she had run out of money and totally desperate, as 'they' will squeeze her? One thing my Mother knows how to do well is squeeze a hard bargain- and that's a compliment."
He also said he thought his estranged sister Ginia was "a little harsh" on Hope regarding the loan arrangement he had organised. "Luckily not on terms as imagined by Ginia. Ginia's terms would've been a disaster- that sort of litigation funding deal is a rip-off."