Rinehart settles with 'broke' Hope
Gina Rinehart has reached a settlement with her estranged daughter Hope, who has split with her husband and fallen on hard times as she struggles to support her two young children in New York without an income.
Explosive emails reveal the financial difficulties Hope and her husband, Ryan Welker, faced after legal action was taken against Mrs Rinehart in September 2011.
The emails show that Mr Welker was forced to resign as a director of the listed mining services company Mineral Resources, despite having the support of the board. Hope is believed to have written to her mother before Christmas seeking a settlement. She also wrote to her half brother, John Hancock, and half sister Bianca Rinehart informing them of her decision to withdraw from the litigation the three children launched in September to remove their mother as trustee alleging "deceptive, manipulative and disgraceful conduct". At the time, the youngest child, Ginia, sided with her mother.
The three children have been negotiating the terms of Hope's withdrawal since December but are yet to reach a deal on how she can exit. A stumbling block is believed to be Mrs Rinehart, whose lawyers have been trying to impose certain demands and concessions.
Hope is expected to apply for leave to withdraw from the case on March 12, when a directions hearing is set. That will leave John and Bianca fighting to remove their mother as trustee from the Hope Margaret Hancock Trust.
Legal sources said her withdrawal would not weaken the case.
Hope and her husband are understood to have been struggling financially for more than a year, forcing them to liquidate assets to help fund legal bills and living costs. They are believed to have split before Christmas. They married in 2005 when Hope was 19.
Emails reveal that Hope has been in financial difficulties for 18 months. They also reveal that Mr Welker did not want to resign from Mineral Resources on October 7, 2011, contrary to an ASX statement that he resigned to focus on "other business interests" following a move overseas and "recognising the difficulty this would cause in providing the level of commitment he would like to bring".
Mr Welker was appointed to the board of Mineral Resources in late 2010 as a representative of the Rinehart-owned Hancock Prospecting Pty Ltd, which had a shareholding in the company.
The day before Mr Welker's resignation - and three weeks after legal action was launched against Mrs Rinehart, executive director Chris Ellison told Mr Welker: "We are getting serious heat from HPPL on the board position and they will soon have it all over the media which I can't afford and I hope you understand I have enjoyed having your support and as a director and friend and hope you understand - I just don't want MRL caught up in a blood-bath - Chris."
Mr Ellison declined to comment on the email, saying the issues were private and confidential to the Rinehart family. Still, other emails reveal pressure had been building since the September 5, 2011 litigation was launched in the Supreme Court of NSW.
In an email later that month, which addressed his mother-in-law as "Mrs Rinehart", Mr Welker said: "I have spent part of this week addressing the merits of your request for me to resign from the board of Mineral Resources.
"I have deliberated with the other board members at Mineral Resources and independently reviewed my statutory obligations as a director of a public company. I respectfully decline to submit the resignation you have requested," he wrote. He notes he had received the support of the board to remain.
He also wrote: "You also continue to insist that I have some role in the continuing court action against you. I have no personal claim against you; Hope, Bianca and John can withdraw the action whenever they so choose irrespective of my feelings on the matter." Even so, he described the legal action against Mrs Rinehart as "morally and ethically correct - even if that means you and I are in personal conflict for the rest of our lives".
The email trail
From: Ryan Welker. Sent: Thursday, 29 September 2011 10:44 PM
To: Gina Rinehart
Subject: Update Regarding Mineral Resources
I have spent part of this week addressing the merits of your request for me to resign from the board of Mineral Resources. I have deliberated with the other board members at Mineral Resources and independently reviewed my statutory obligations as a director...and respectfully decline to submit the resignation you have requested.
From: Chris Ellison. Sent: October 6, 2011 8:48:22 AM EDT
To: Ryan Welker
Subject: Re: MRL Board
I hate to be the bearer of bad news but I need to ask you to resign from the MRL Board. We are getting serious heat from HPPL on the board position and they will soon have it all over the media which I can’t afford.
Executive Director, Mineral Resources