Mansfield J
This is the first determination of compensation for the extinguishment of native title rights and interests under the Native Title Act 1993 (Cth) (NTA). The matter was resolved by agreement and the Court was satisfied that it was appropriate to make orders in accordance with the proposed consent determination
The respondents were the State of South Australia and De Rose Hill-Ilpalka Aboriginal Corporation RNTBC (ICN 4712). The Commonwealth of Australia intervened in the proceedings.
Background
The application for native title to which the compensation was made commenced on 19 March 2013 and has a long history.
The starting point was an application on behalf of the Nguraritja for a determination of native title pursuant to s 61 of the NTA. After a lengthy trial and judgment: De Rose v South Australia [2002] FCA 1342 and an appeal: De Rose v South Australia [2003] FCAFC 286; (2003) 133 FCR 325, a further evidentiary hearing took place before the Full Court.
In June 2005 the Full Federal Court determined that the Nguraritja held native title rights and interests over the same area as the “Determination Area” described in these orders: De Rose v South Australia (No 2) (2005) 145 FCR 290 (De Rose Hill Determination).
The De Rose Hill Determination excluded those parts of the Determination Area over which extinguishment of native title had occurred.
The first and second compensation applications
In June 2011, the Prescribed Body Corporate (PBC) for the Nguraritja applied for compensation due to extinguishment for acts in the claim area and other areas excluded from the De Rose Hill Determination (First Compensation Application).
Negotiations for settlement of the First Compensation Application between the Nguraritja and the State took place under Court-ordered mediation and Heads of Agreement were signed.
However, under s 62(3) of the NTA, a claim to an area that has not previously been the subject of a native title determination must be accompanied by an affidavit and the applicant must be a natural person. As the PBC acts as agent to the native title holders in relation to their recognised native title rights and interests it has no role to play in relation to native title rights and interests that have been extinguished. Consequently, the PBC could not validly claim compensation for the excluded area. The State agreed to allow the Applicant to discontinue the First Compensation Application as it was considered defective and the application was dismissed with no costs order.
In 2013, a second Native Title Compensation claim (Second Compensation Application) was commenced. The parties intended the determination of the Second Compensation Application to reflect the terms of the earlier agreement reached by the Nguraritja and the State.
Consequently, the parties sought an order under s 87(5) NTA in terms of the proposed Consent Determination and attaching a Settlement Deed that resolves all of the State’s actual and potential compensation liability to the Nguraritja in the area covered by both the First and Second Compensation Applications (the Agreement area) up to the time of the determination of the Second Compensation Application.
The Commonwealth did not consent to or oppose the orders.
The further determination of native title and extinguishment
The Court then made a native title determination under s 13(2) of the NTA over those parts of the claim where no determination had previously been made. The Commonwealth did not oppose the making of the determination. This is the entire area of the Second Compensation Application proceeding.
The parties agreed that compensation be payable by the State under the NTA for the following three past acts by the State that extinguished native title, occurring after commencement of the Racial Discrimination Act 1975 (Cth):
The 20 January 1992 freehold grant of surrendered pastoral lease to an individual;
The 15 October 1981 creation of the Stuart Highway Corridor on land surrendered from a pastoral lease; and
The 1 November 1996 resumption to the State of pastoral lease land for the establishment of the Agnes Creek car park.
The Applicants, the PBC and the State agreed that the State was not liable for any compensation in relation to the Tarcoola to Alice Springs railway corridor.
The Applicants, the PBC and the State did not agree on the compensable status of certain pastoral improvements, but agreed that the State’s compensation settlement sum would discharge the State’s obligations in relation to those improvements, whenever they occurred.
Part of the mediation included negotiations on the amount of compensation that was appropriate for the compensable extinguishment caused by the State.
Sections 51, 51A and 53 of the NTA set out the criteria for determining compensation. Section 51 of the NTA sets out principles to be applied when making a determination of compensation on just terms and s 51A limits the total compensation for total extinguishment in relation to particular land or waters to the amount payable for a compulsory acquisition of a freehold estate, unless that would infringe the requirement in s 53 for compensation to be on ‘just terms’ as per s 51(xxxi) of the Commonwealth of Australia Constitution Act 1900 (Cth).
The State did not accept that the current freehold value of the extinguished area was necessarily relevant to the value of the native title rights and interests lost. However, the issue was agreed to be relevant for the purpose of section 51A(1) of the NTA.
Obtaining agreement on the freehold value of the land concerned was not possible. Ultimately, the parties exchanged amounts which they would be prepared to offer or accept until a mutually agreeable amount was reached.
The Agreement does not cover any compensable extinguishment of native title attributable to the State in the period following the determination.
Orders for compensation
Justice Mansfield considered the agreement satisfied the requirements of sections 87 and 94 of the NTA and it was appropriate for the Court to make the orders:
An agreement had been reached by the parties and the Commonwealth, as intervener, did not oppose the making of the determination.
The determination provides the method for determining the persons entitled to the compensation, the amount or kind of compensation to be given to each person and any dispute regarding the entitlement of a person to an amount of compensation.
All relevant interest holders in the area have had an opportunity to take part in the proceeding.
All parties have had independent and competent legal advice in the proceeding.
Schedule 1 to the proposed Consent Determination contains a detailed description of the Determination and Agreement Areas.
In reaching this conclusion, his Honour referred to the solicitor employed by South Australian Native Title Services and senior counsel who advised the native title holders and the PBC as an indication of the informed nature of the parties’ consent. His Honour also referred to extensive negotiations in Adelaide and considered the on-country discussions and disclosures important for contextualising the significance to the native title holders of particular areas of land. His Honour considered this approach to be consistent with the preference for mediation as the primary means of resolving native title applications.
Justice Mansfield cited Lander v South Australia [2012] FCA 427 at [12] that, where the parties have entered into an agreement and, particularly where one of the parties is the state:
[T]he Court does not need embark on its own inquiry of the merits of a claim made in the application to be satisfied that the orders sought are supportable and in accordance with the law: Cox on behalf of the Yungngora People v State of Western Australia [2007] FCA 588 at [3] per French J. However, it might consider that evidence for the limited purpose of being satisfied that the State is acting in good faith and rationally: Munn for and on behalf of the Gunggari People v State of Queensland (2001) 115 FCR 109 at [29]-[30] per Emmett J.
Justice Mansfield also considered that the early resolution of proceedings, without the need for a hearing, is also consistent with the overarching purpose of the Court’s civil practice and procedure, to facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible.
The nature and extent of negotiations about the amount of compensation was another factor used by the Court to conclude that orders under s 87 of the NTA were appropriate.
Compensation payment not disclosed
The Compensation Agreement (Schedule 3 of the Orders) does not disclose the compensation payment amount. Justice Mansfield considered this was necessary to prevent prejudice to the proper administration of justice, under s 37AG(1)(a) of the Federal Court of Australia Act 1976 (Cth). The reasons for not disclosing the figure are discussed at paragraph 82. His Honour considered that disclosure of the compensation figure may:
create expectations in other matters which private consensual agreement should not produce, as there are presently no decisions addressing how compensation under the NTA is to be assessed;
Be seen to set a tariff for other compensation claims which is not appropriate as each set of circumstances will necessarily be different;
Draw attention to and invite criticism – positive or negative – of the Nguraritja from other compensation claimants under the NTA in a way which would be unfair. It may also invite criticism – positive or negative – of the State;
The unfairness would flow from the fact that, as the figure has been agreed in private mediation and negotiations, it is not possible to know the detailed considerations which led to the agreement.
All of these factors mean disclosure of the figure may impede the prospects of satisfactory negotiation of other compensation claims and that would impede and prejudice the proper administration of justice, especially where the NTA encourages the negotiated outcome of applications particular to the circumstances of each case.