Validly authorised Indigenous land use agreements: Full Federal Court confirms correct approach, but raises new points

20 Dec 2019

Following a Full Federal Court judgment handed down yesterday, anyone in government or industry with operations underpinned by Indigenous land use agreements (ILUAs) can rest assured that their existing operations continue to validly affect native title – but, significantly, will need to take heed of some important points made by the Full Court to ensure that any future ILUA “authorisation” process will be accepted as valid.

In particular, authorisation meeting organisers will have to consider whether it is feasible to involve incarcerated native title holders (actual or potential) in the authorisation process.  By analogy, similar considerations may also now apply to the authorisation of native title claims and of compensation applications.

McGlade v South West Aboriginal Land & Sea Council Aboriginal Corporation (No. 2) [2019] FCAFC 238 (McGlade No. 2) is notable as being the first time a Full Court has seriously considered and ruled on what it means for an ILUA to be validly authorised. Further, significantly,  the Full Court also considered and distinguished another recent Full Court decision (Northern Land Council v Quall [2019] FCAFC 77 (Quall)) dealing with how representative bodies carry out their certification function. 

We acted for South West Aboriginal Land & Sea Council Aboriginal Corporation (SWALSC), the successful first respondent to each of the 10 applications in McGlade No. 2, both in relation to these Full Court proceedings and with respect to the drafting, negotiation, authorisation and registration of the ILUAs in question (including responding to more than 130 objections).

ILUAs: a quick guide

For many resources, infrastructure, pastoral, government and other project proponents and developers, registering an ILUA is a preferred way in which to ensure that their “future acts” are undertaken validly. (Future acts include such things as the grant of resources tenements and other statutory approvals, as well as grants of real property tenures, in respect of areas where native title may continue to exist. The Native Title Act 1993 (Cth) (NTA) states that a future act will validly affect native title if it is consented to by the parties to a registered ILUA.)

On occasion, however, registration of an ILUA is the only way to ensure a future act validly affects native title. This could be the case where, as a precursor to a grant of freehold title or as part of the settlement of a native title claim, a proponent seeks the voluntary surrender of any native title rights and interests that may exist in relation to a particular area.

Where an ILUA would cover an area where native title has not been determined, the appropriate type of ILUA is an “area agreement” (see Subdiv C of Pt 2, Div 3 of the NTA). In order for an area agreement to be registered:

  • all reasonable efforts must have been made to ensure that all persons who hold or may hold native title in relation to the land or waters in the area covered by the ILUA have been identified (Identification Step); and
  • all of the persons so identified must have authorised the making of the ILUA (Authorisation Step).

An application to the Native Title Registrar for the registration of an area agreement must include either:

  • a certification by all affected representative bodies; or
  • a statement from the applicant to the effect,

that the Identification and Authorisation Steps have been validly undertaken. In both cases, reasons must be given.

In summary, the Registrar must register an ILUA if:

  • for certified ILUAs, no objections are made against registration or (if made) no objectors have persuaded the Registrar that either the Identification or Authorisation Step was not validly undertaken; or
  • for other ILUAs, all registered native title claimants are parties to the ILUA and the Registrar herself considers that the Identification and Authorisation Steps have been validly undertaken.

The point has often been made that the key to a small group of representative negotiation parties for an ILUA being able to bind a large unincorporated group of native title parties to the ILUA is these processes of authorisation and registration.

How are ILUAs authorised?

Under the NTA, people who hold (or may hold) native title in relation to an area authorise the making of an ILUA in relation to that area if they do so according to a traditional decision-making process (where such a process exists and must be used), or otherwise in accordance with a decision-making process that is agreed to and adopted by the people who hold or may hold the common or group rights comprising the native title in question.

While there are several formulations of the applicable test, what is clear from the authorities is that, despite this requirement for “all” identified people to have authorised an ILUA, a valid authorisation does not require the involvement of every person who has been identified as an actual or potential native title holder. Instead, what is required is for the proponents of the ILUA to ensure that they have provided to all identified people whose whereabouts are known, and have capacity to (and are reasonably available to) authorise, a reasonable opportunity to participate in the adoption of a decision-making process and in the making of authorisation decisions pursuant to that process.

This test was ultimately approved by the Full Court in McGlade No. 2 – the first occasion on which a Full Court has done so.

What was McGlade No. 2 about?

Approximately 30,000 Noongar people are recognised as the traditional owners of the South West Region of Western Australia – an area of around 200,000 km². While a number of native title claims have been brought over the last 20 years or more on behalf of some or all of these Noongar people, none has resulted in a determination that Noongar people hold native title in relation to all or any part of the South West Region.

Given these difficulties, the Noongar people sought instead to negotiate with the State of Western Australia for a comprehensive settlement of all of their native title claims.

The terms of the “South West Settlement”, which include the surrender of all native title in relation to the South West Region in return for a settlement package valued at some $1.3 billion, were recorded in six “Settlement ILUAs” agreed in relation to discrete parts of the South West Region.

After all six agreements were authorised (at authorisation meetings convened by SWALSC in the first quarter of 2015), applications were made to the Registrar for registration of the Settlement ILUAs in June 2015. Each of the registration applications was certified by SWALSC, as the representative body for the South West Region. More than 130 objections were made against registration of the Settlement ILUAs. The objections were made in two tranches, with the second tranche following an earlier successful Full Court application by many of the applicants in relation to McGlade No. 2.

All six Settlement ILUAs were registered on 17 October 2018. In December 2018, 13 applications seeking judicial review of the six registration decisions were made to the Federal Court. 10 of these were referred directly to the Full Court for hearing, and were heard on 30 and 31 May, and on 25 November, 2019.

McGlade No. 2 is the Full Court’s judgment in relation to these applications.

The key review grounds

The key grounds advanced by the applicants to the judicial review proceedings were that the Registrar erred in finding that the Settlement ILUAs had been properly authorised in circumstances where:

  • Noongar people had not been offered the opportunity to participate in the authorisation process by any means other than by a meeting held on country (such as by way of proxy and/or postal voting);
  • incarcerated Noongar people were not given an opportunity to participate in the authorisation process;
  • “most” Noongar people were not involved in authorisation; and
  • six separate authorisation meetings were held in relation to the South West Region, but in no case were all Noongar people invited to attend a meeting.

The hearings on 30 and 31 May took place shortly after the making by another Full Court of the decision in Quall. That decision was to the effect that the relevant representative body, the Northern Land Council (NLC) had improperly delegated to its CEO the function of certifying the registration application for the subject ILUA. As a consequence, the applicants in relation to McGlade No. 2 sought and were granted leave to amend their judicial review applications to include a “Quall Ground”. The Quall Ground was heard by the Full Court on 25 November 2019.

Postal and proxy voting

The Full Court found that there was nothing inherently objectionable about the belief by SWALSC that the appropriate way to authorise the ILUAs was for people to meet in person and on country to engage in debate and discussion about the important matters to be resolved in respect of each ILUA.

The Full Court also recognised some of the difficulties inherent with proxy and postal voting as options for authorisation. In neither case would the native title holder be present at the meeting to hear debate, and then form or confirm views, about such things as whether there was a mandatory decision-making process and, if not, which decision-making process to agree to and adopt.

While, as the Full Court found, attendees at a meeting are at liberty to agree to and adopt a decision-making process that features proxy and postal voting, the attendees did not do so at any of the six authorisation meetings held for the Settlement ILUAs.

The inclusion of prisoners in the authorisation process

The most novel ground of review was that SWALSC had identified that there were Noongar people incarcerated in prisons throughout the South West Region, but had not then given these prisoners the opportunity to participate in the authorisation process by way of a vote. This was also the most concerning ground of review, given that it had the potential to render invalid the:

  • authorisation processes that have been conducted for every one of the over 900 registered area agreement ILUAs; and
  • the mining and petroleum tenements, real property tenures, surrenders of native title and even native title determinations that had relied on these ILUAs.

Success for the applicants on this ground could well have required action by the Commonwealth Parliament to validate all ILUAs whose registration had been underpinned by authorisation processes that did not involve voting by prisoners. As a result of certain comments made by the Full Court, such action may nevertheless be appropriate.

In the event, the Full Court noted that SWALSC had taken into account the position of Noongar prisoners, and had provided them with an ability to participate in the authorisation process through means other than attendance and voting at meetings (including by giving them notice of the meetings and conducting information sessions in some prisons). In our experience, these steps are far in excess of the actions typically taken by the organisers of authorisation meetings to involve prisoners in the authorisation process.

Ultimately, the Full Court found that Noongar prisoners were but one of several classes of Noongar people who were unable to attend the meetings – and that their inability to attend meetings did not mean that a reasonable opportunity to participate had not been afforded to the native title holders – actual and potential – as a group.

The Full Court accepted the submission by SWALSC that the decisions to be made at an authorisation meeting – for example, whether there was a mandatory traditional decision-making process – should not lightly be regarded as being amenable to isolated voting at a polling station or to the ticking of a box. Such decisions would ordinarily most properly be made at a meeting, with the benefit of listening to debate and to legal advice, and after the opportunity to ask questions.

For future reference, however, the Full Court did also observe that:

  • there is “no doubt that proper and genuine consideration by a representative body” as to how to involve prisoners identified as actual or potential native title holders would be “expected as part of ‘reasonable efforts’”; and
  • it will be important for representative bodies (and, we would think, other organisers of authorisation processes) to consider a range of methods of voting that might be appropriate in order to give a reasonable opportunity for participation. That is, in-person meetings on country should not necessarily now be seen as an acceptable default option. In McGlade No. 2, there was evidence that SWALSC had sought the assistance of the Australian and Western Australian Electoral Commissions but had encountered obstacles that made alternative methods of voting impractical.

Organisers of authorisation meetings should document evidence to show that they have considered such involvement and such other methods and, if applicable, their reasons for concluding that such involvement and such other methods were not feasible.

Inadequate participation in authorisation

The allegation was that there were some 15,000 adult Noongar people, most of whom reside in Perth and would have found it too difficult to attend authorisation meetings on country. The Full Court gave this complaint short shrift.

Where adequate transport is provided, the Full Court held that it is “entirely appropriate” to hold authorisation meetings on country – at a location on or close to the land that is under consideration in an ILUA. The Full Court noted that it hardly helped this argument that the authorisation meeting held in Perth (for the Whadjuk ILUA) attracted over 100 fewer attendees than the authorisation meeting held 250km from Perth in Katanning (for the Wagyl Kaip & Southern Noongar ILUA).

In short, the proportion of native title holders who attend is not to the point – rather, it is the opportunity given to them to attend (by providing early notice and transport) that tells.

The “single Noongar” argument

The sole ground of review advanced by the applicants for four of the 10 applications was that in no case did the meeting notice for any of the six authorisation meetings include an invitation to all Noongar people. The ground was founded on the accepted idea that there was a single Noongar society at sovereignty.

However, as SWALSC noted in its submissions (which the Full Court accepted), this did not mean that all descendants of that society, according to their traditional laws and customs, held native title in relation to the whole of the South West Region. It was this division of rights that meant that there were separate registered native title claims throughout the Region, and that made it appropriate to have six Settlement ILUAs that covered areas that coincided with these registered claim areas.

Certification of the ILUAs

The “Quall Ground” was another that could have had far-reaching consequences, given that it appears to be general practice within representative bodies for ILUA registration applications to be certified through the CEO, who signs the reasons for the representative body. On the basis of Quall, each of the applicants was given an opportunity to argue that the registration of the Settlement ILUAs was ineffective as each of the registration applications had (on their argument) been certified – not by SWALSC – but by SWALSC’s CEO.

The Quall Ground failed for a number of reasons, including that:

  • the reasoning in Quall did not apply to the Settlement ILUAs as what had been at issue in Quall was the delegation by the NLC of the certification function under the NTA, when the NLC only had the statutory power to delegate powers and functions under its governing legislation (the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) (ALRA)), whereas SWALSC had a more general power of delegation under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) (CATSI Act) and its Constitution; and
  • in any event, rather than a wholesale delegation, SWALSC’s directors had in fact passed resolutions giving their CEOs authority to sign and take all steps necessary to certify the applications for the ILUAs.

More generally, however, the Full Court held that, as an Indigenous corporation incorporated under the CATSI Act, SWALSC’s internal working does not rely on the exercise of strict delegation powers in an administrative law sense. In conducting their business, Indigenous corporations such as SWALSC perform their functions and exercise their powers through their directors and through authorised employees and agents. A function performed in this way, in the opinion of the Full Court, is not performed by the authorised employee, but by the corporation itself.  The NTA, in section 203FH, also contemplates corporations such as SWALSC acting through authorised officers (a point not expressly agitated in Quall, but accepted in McGlade No. 2).

This was sufficient to distinguish the case from Quall (and meant that a decision could be made prior to the decision of the High Court in Quall, in respect of which special leave has been granted).

It seems clear from the Full Court’s reasoning that it is correct to distinguish between the functioning of CATSI Act bodies such as SWALSC (and presumably, by analogy, of representative bodies that are incorporated under the Corporations Act 2001 (Cth)) and that of ALRA bodies such as the NLC.

What's next for future native title settlements and ILUAs?

While the decision in McGlade No. 2 can properly be regarded as a general affirmation of the prevailing understanding of the law of authorisation of ILUAs, current and future parties to ILUAs should pay close attention to clues within the decision as to what in future will need to be done to ensure an authorisation process is accepted as valid, particularly the need to:

  • consider whether it is feasible to involve incarcerated native title holders (actual or potential) in the authorisation process;
  • consider the viability of alternative processes for authorisation to the tried-and-tested method of voting in person at authorisation meetings held on country; and
  • carefully document all steps taken and strategies considered with respect to the Identification and Authorisation Steps for the ILUA.

The ultimate consequence of McGlade No. 2 is that, unless it is appealed to the High Court, the judgment will allow Australia’s largest native title settlement to proceed and to take full effect.

Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.