The NSW Supreme Court has dealt a severe blow to Gina Rinehart in her battle with two of her children, rejecting the mining magnate's claims of privilege over documents from accountancy firm PricewaterhouseCoopers that have become central to the bitter case.
Last month, John Hancock and Bianca Rinehart won access to hundreds of pages of explosive communications between the Rinehart camp and the top accountancy firm that showed it was asked to produce two versions of tax advice over the contentious family trust.
This included a "sanitised version" to be shown to her four children that removed any mention of uncertainty over whether they would face a crippling capital gains tax liability if the trust vested as it was supposed to on September 6, 2011.
Almost 50 of these documents were redacted, with Mrs Rinehart claiming they were either privileged or were confidential.
But NSW Supreme Court judge Patricia Bergin yesterday rejected Mrs Rinehart's efforts to block her children from getting access to the missing communications.
She said the multibillionaire had "seen fit to positively propound particular beliefs" when she wrote to her four children three days before the trust was due to vest, telling them they would be bankrupted by capital gains tax if it went ahead.
Judge Bergin said Mrs Rinehart had used the PwC advice and her "state of mind and specific beliefs at the time of sending the letter" were critical to the case.
It is a big blow to Mrs Rinehart just two weeks out from the trial, which will focus on what she knew when she told her four children that she was going to delay the vesting of the trust for their own good by more than half a century.
The Australian Taxation Office had since contradicted her claims that vesting would have trigged capital gains tax liability.
Mr Hancock and Bianca Rinehart are seeking to have their mother removed as head of the family trust.