Billionaire Gina Rinehart's company used the reputation and goodwill of her father's business partnership with another company to secure access to ore-rich tenements it claimed as its own, a court has been told.
The heirs of Lang Hancock's former business partner, Peter Wright, are fighting in the West Australian Supreme Court for multibillion-dollar stakes in a series of Hope Downs assets the mining pioneers discovered in the 1950s.
Their lawyer Julie Taylor said under a 1987 agreement between the men, Hancock Prospecting wasn't entitled to, as it did, develop the partnership's tenements without sharing the profits with Mr Wright's company.
She said Hancock Prospecting misinterpreted part of the document.
"As (Hancock Prospecting) would have it, clause five envisaged that the partners could secretly take up existing known opportunities of the partnership in a race to be the first to win them in their own name, without regard their partner's interest in them," she said on Wednesday.
Ms Taylor said clause five was not the "golden bullet" Hancock Prospecting presented it to be in reference to the company's legal defence against the Wright's claims.
"By the time of entry into the 1987 agreement (Hancock Prospecting) had acknowledged on multiple occasions that (Wright Prospecting) was entitled to share in the future exploitation of the East Angelas and Hope Downs reserves," she said.
Ms Taylor told Justice Jennifer Smith that even if Hancock Prospecting and its controlled entities were entitled to pursue the opportunities for its own benefit, that's not what it did.
"Instead, using partnership letterhead, partnership staff, the goodwill of the partnership business ... history and reputation with the government (it) in fact used the resources of the partnership to obtain the renewed rights over the areas," she said.
"That is not an accident."
She said Hancock Prospecting and its subsidiaries would not have been able to beat out competitors, such as BHP Billiton, who wanted access and were knocked back.
"Hancock Prospecting, using its status as a partner, applied for these tenements ... (and) cannot now deny that the exploration licences were obtained as an asset of the partnership," she said.
About two dozen lawyers and company spin doctors have packed a Perth courtroom for the trial since it started on Monday, which also involves Mrs Rinehart's two eldest children, John Hancock and Bianca Rinehart.
The pair are claiming they are entitled to a hefty share in the Hope Downs operation as assets their grandfather left them.
Deceased prospector Don Rhodes' family company DFD Rhodes was also represented in court and claims a 1.25 per cent royalty share of Hope Downs' production, over a deal with Mr Hancock and Mr Wright that saw it hand over tenements in the 1960s.
Mrs Rinehart inherited her father's iron ore discovery in WA's Pilbara region and forged a mining empire after he died in 1992.
She developed mines from the tenements Mr Hancock and Mr Wright discovered at Hope Downs, signing a deal in 2005 with Rio Tinto, which has a 50 per cent stake in the project.
Her wealth is estimated to be about $36 billion and she is executive chair of Hancock Prospecting.
The Hope Downs iron ore mining complex is made up of four open-pit mines near Newman.
It produces more than 45 million tonnes each year and is one of Australia’s largest and most successful iron ore projects.
Wright Prospecting has demanded a share of unmined and mined Hope Downs tenements and royalties.
Hancock Prospecting maintains it undertook all the work, bore the financial risk involved in the development and is the legitimate owner of the assets.
