A trust dispute involving the immensely wealthy Rinehart family has been in the headlines recently. It is an interesting and high profile example of how estate planning – whether in the form of a will, or a trust deed – can sometimes go wrong.
The case concerns the Hope Margaret Hancock Trust, which was established in 1988 by Lang Hancock in favour of the children of his only daughter – Gina Rinehart. Mrs Rinehart was appointed trustee of the Trust which, according to ABC news, holds a large portion of the Rinehart family’s wealth, estimated to be worth around $4 billion.
In 2011, three of Mrs Rinehart’s four children accused her of misconduct with regard to her role as trustee, alleging that she changed the date on which they were able to receive their share of the Trust property. Mrs Rinehart denied any wrongdoing, but the three children began legal action to have her removed from the position of trustee.
One of them has since withdrawn from the action and, more recently, Mrs Rinehart has said that she is willing to give up her role as trustee.
Despite this, the case was heard in the Supreme Court of New South Wales earlier this month. It has now concluded, without resolving the issue of who is to be the replacement trustee for Mrs Rinehart. According to ABC, the judge presiding over the case has reserved judgment on this matter, and also on the validity of changes made by Mrs Rinehart in 2006 to a constitution governing the Trust.
It is clearly a complicated case, but it is important to remember that trust disputes like this are relatively rare. In fact, the creation of a trust can be an effective way of securing assets for the benefit of future generations, and they are an important part of the estate planning process.
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