Enhancing efficiency in native title agreement-making: the Federal Parliament makes a move

By Mark Geritz, Tosin Aro and Georgia Davis
21 Mar 2019
The Bill is designed to improve native title laws and practice by giving native title claim groups greater flexibility to set their internal processes, and streamlining and improving native title claims resolution and agreement-making.

Amendments have been proposed to the Native Title Act 1993 (Cth) (NTA) and Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) (CATSI Act) that are designed to improve native title law and practice in a number of respects, including by streamlining and improving agreement-making and by increasing the transparency and accountability of registered native title bodies corporate.

Importantly, if enacted, the Native Title Legislation Amendment Bill 2019 (Cth) would also confirm the validity of mining and exploration-related "section 31 agreements" made by resources project proponents with registered native title claimants that included one or more deceased members. The validity of these agreements was called into question following the McGlade decision (McGlade v Native Title Registrar & Ors [2017] FCAFC 10). These amendments will, if passed, provide greater clarity and efficiency for native title agreements.

Proposed legislative amendments

The Bill was introduced into Federal Parliament on 21 February 2019 with the intention of giving effect to several recommendations from reviews of the native title regime recently conducted by the Australian Law Reform Commission, the Council of Australian Governments and the Office of the Registrar of Indigenous Corporations.

The Bill is designed to improve native title laws and practice by:

  • giving greater flexibility to native title claim groups to set their internal processes;
  • streamlining and improving native title claims resolution and agreement-making;
  • allowing historical extinguishment over areas of national and state park to be disregarded where the parties agree;
  • increasing the transparency and accountability of registered native title bodies corporate; and
  • creating new pathways to address native title-related disputes arising following a native title determination.

While the Bill proposes a broad range of amendments, in this article we focus on the amendments likely to be of most interest to industry, including those that relate to introducing greater efficiency to the native title agreement-making process and expanding the circumstances where prior native title extinguishment can be disregarded.

Section 31 Agreements – retrospective validation

In the McGlade decision, the Full Federal Court found that the requirement for a registered native title claimant (RNTC) to be a party to an Indigenous land use agreement (ILUA) meant that each individual member of that RNTC had to sign the ILUA ("RNTC" is the applicant for a native title claim after the claim becomes registered). This was held to be the case even where the only missing signatures were those of deceased members of the RNTC.

While the McGlade decision was limited in its scope to ILUAs, concerns have been expressed following the decision about the lawfulness of what is estimated to be hundreds of section 31 agreements made with RNTCs that included one or more dead members (and, consequently, the legitimacy of the mining projects underpinning those section 31 agreements).

This was of particular concern because proponents, governments and the National Native Title Tribunal (NNTT) all acted on the understanding that a section 31 agreement would be validly made if the only missing RNTC signatures were those of deceased people. To illustrate, the State of Western Australia has estimated that WA has no fewer than 306 mining leases, 11 land tenure grants, and four petroleum titles with section 31 agreements potentially affected by McGlade!

To address these concerns, the Bill proposes amendments that would validate all section 31 agreements whose validity has been called into question by the McGlade decision. This is similar to the approach taken for potentially non-complying ILUAs following the McGlade decision, and is a move that will provide certainty both for industry (with respect to the validity of mining projects underpinned by section 31 agreements affected by McGlade) and for native title parties (with respect to the ongoing enforceability of compensation provisions included in such agreements).

Section 31 Agreements – majority execution

The Bill also includes changes that would enshrine in law the increasingly common practice of native title claim groups setting conditions for how their applicants can make decisions (including how they can sign agreements), with the default position where no such conditions have been set to be that the applicant can act by majority.

This proposed amendment will provide greater clarity and efficiency to the signing of section 31 agreements by confirming that a section 31 agreement will have been validly made if a majority of the persons comprising the RNTC have signed the agreement (or, if the agreement has otherwise been signed in a way sanctioned by the affected native title claim group).

Where majority execution applies, these amendments will avoid the need to implement costly resolution mechanisms such as NNTT "future act determination applications", or Federal Court "section 66B applications", where only a minority of RNTC signatures are missing (the reason for which can be as benign as individuals not being contactable or no longer wishing to participate in native title business, or as tragic as RNTC members having passed away). Even where the minority includes members who are actively opposed to an agreement, the policy behind the Bill is evidently that these individuals should not be able to exercise a veto over the collective wishes of the majority of the RNTC (or, indeed, over the right of the broader claim group to "enjoy and benefit from culture").

Body corporate ILUAs

Where an ILUA is to be made wholly over an area in respect of which native title has been determined to exist, the appropriate ILUA to be entered into is a "body corporate ILUA" – the native title party for which will be the registered native title body corporate (RNTBC) that holds the native title on trust, or is the agent, for the native title holders. Body corporate ILUAs are simpler and more efficient to make than "area agreements" (used where native title has not been determined for all of the ILUA area), which is particularly the result of the much more streamlined registration procedure that applies to body corporate ILUAs.

A quirk of the NTA, however, is that body corporate ILUAs cannot be used if the ILUA area includes areas of freehold or other tenures where native title has been extinguished. That is because such areas will not (cannot) be part of the RNTBC's "determination area". The result is that, even where the traditional owners for the whole of an ILUA area are native title holders represented by a RNTBC, the inclusion of extinguished areas will mean the RNTBC cannot make a body corporate ILUA, and that the more cumbersome area agreement ILUA will instead need to be made.

The Bill recognises that the additional transaction costs and increased registration timeframes required for area agreements are not justified where the whole of the ILUA area is within the traditional country of the determined native title holders.

The Bill also proposes a few additional administrative amendments relating to ILUAs, including noting that removal of an ILUA from the Register of ILUAs will not affect the validity of a future act already undertaken; and allowing minor amendments to be made to registered ILUAs. These amendments include updating:

  • property descriptions which do not result in the inclusion of additional areas; and
  • descriptions identifying a party to the agreement.

Historical extinguishment

The NTA currently allows the prior extinguishment of native title in relation to particular areas to be disregarded, in certain circumstances, when a native title determination is made. These provisions are currently capable of applying to:

  • pastoral leases held by native title claimants;
  • reserves covered by claimant applications; and
  • vacant Crown land covered by claimant applications.

The amendments proposed to the NTA seek to expand these circumstances to also include national, State and Territory parks covered by native title applications, subject to agreement between the Government and the native title parties. They recognise that traditional connection to these areas is often strong, even where native title has previously been extinguished, and are designed to enable native title holders to be able to exercise their native title in these areas. They may even create opportunities for native title parties and governments to agree to joint or co-management arrangements for parks and reserves.

However, the intention to disregard prior extinguishment of a park area will need to be publicly notified with at least three months to be allowed for public comment. This will give an opportunity for any members of the public with leases or other interests in the area to argue why the area should not in fact be included in a native title determination (noting that any such prior interests will prevail over, although not extinguish, the revived native title).

The current section 47 of the NTA would also be amended to ensure it can apply where a body corporate with members who are native title holders, for example an RNTBC, holds a pastoral lease over the relevant area.

To be continued…

With the impending election, it is unclear when (or if) these proposed legislative amendments will come into effect. However, it is clear that current Government policy is to seek to bring greater clarity and efficiency to native title law and practice. How bipartisan such an ideal will prove to be remains to be seen.

In the meantime, we will maintain a watching brief on the legislative process for the Bill and update you as developments occur.

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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.