Costs talk in Wright, Hancock dispute

Lawyers for descendants of mining pioneers Lang Hancock and Peter Wright have stayed busy ironing out issues related to the ongoing trial over billions of dollars in royalties.

Wright Prospecting wants to recoup more costs from Gina Rinehart-led Hancock Prospecting than the maximum amount recoverable under the usual court scale, over a hearing that lasted less than a day.

A legal dispute between the descendants of the companies’ founders has been ongoing for more than a decade and has culminated in a civil trial scheduled to run in the Supreme Court of Western Australia for several months.

Wright Prospecting claims it is entitled to royalties from iron ore produced on Pilbara tenements co-owned by Hancock Prospecting and Rio Tinto.

Lawyers for the parties involved have dealt with other matters separate but related to the main trial, with a judgment over costs delivered by WA Supreme Court Justice Jennifer Smith yesterday.

In March, Justice Smith ruled in favour of Wright Prospecting in opposing Hancock Prospecting's request for an advance ruling to admit several documents in the trial.

The maximum cost relating to the hearing to be recovered under the relevant scale is $20,790, according to the judgment.

However, Wright Prospecting claims the maximum scale amount was inadequate to cover the actual costs it incurred, being about $130,000.

In her judgment delivered yesterday, Justice Smith found there should be a special costs order for Wright Prospecting despite Hancock Prospecting's opposition.

“Given that the actual costs incurred by WPPL submitted to the court … and based on my own knowledge of the case and its circumstances, I am of the opinion that [Wright Prospecting] has made out there is a fairly arguable case that the amounts allowable under the relevant determinations are inadequate,” she said.

“It remains for the taxing officer to 'consider the reasonableness of and necessity for the work undertaken, and to make a judgment about the remuneration reasonably required'.”

The legal showdown between Wright Prospecting and Hancock Prospecting is further complicated with Mrs Rinehart's children, John Hancock and Bianca Rinehart, being involved in the proceedings.

Bianca Rinehart outside of the WA Supreme Court during the trial. Photo: Nadia Budihardjo

John and Bianca added their own strike out application and also opposed Hancock Prospecting's request for an advance ruling in March, and claimed their mother's company should pay their costs.

In her judgment, Justice Smith found Hancock Prospecting should be required to pay John and Bianca's costs, but not at a special costs order.

"It is clear that the oral strike out application did not add meaningfully to the length of the hearing (which took less than a day), and that the arguments overlapped with and were relevant to the HPPL parties' application for an advanced ruling on the deeds," she said.

"Consequently, Bianca and John should be entitled to their costs of and incidental to their preparation of defending the HPPL parties' application."

The trial was scheduled to resume tomorrow, ending a two-week break after the parties' opening submissions, but has been vacated to next week.

Discovery issues

DFD Rhodes has launched its own legal action against Hancock Prospecting, claiming 1.25 per cent of royalties from the sale of iron ore produced by the Hancock-Wright partnership on the same disputed Pilbara tenements.

Earlier this week, DFD Rhodes' lawyer Kim Lendich told the court that 350 pages of the documents were not made available for inspection because John and Bianca claimed privilege.

Speaking to the court, Ms Lendich said John and Bianca's application was likely an abuse of process.

"How can documents produced by the [Hancock Prospecting] parties be in John and Bianca's privilege?" she said.

"We shouldn't be held out on these documents."

John and Bianca's lawyer Adam Hochroth told the court that the documents were produced wrongly by Hancock Prospecting.

"We apprehend that Rhodes will be accusing my client on not adhering with discovery," he said.

"It alleges my client hasn't complied with [court orders]... It's a serious application that my learned friend brings."

WA Supreme Court Justice Natalie Whitby ordered the parties to file more submissions with the matter to return to court by mid-September.