Improving the functionality of Indigenous Land Use Agreements could give greater autonomy for native title holders.
The seminal High Court Mabo decision of 1992, and the resulting Native Title Act (Cth), ushered in a new era for the land rights of Aboriginal and Torres Strait Islander people.
Native title recognises that Indigenous Australians have rights and connections to lands and waters where they have practised, and continue to practise, traditional laws and customs.
Under the Act, native title claimants can apply to the Federal Court to have their native title legally recognised. At present, it is estimated that approximately 36 per cent of Australia’s land mass has been granted native title.
The Native Title Act has played an important role in sustaining the diverse cultures of Aboriginal and Torres Strait Islander people.
However, the Act is not without scrutiny, particularly the onerous burden of proof it imposes upon native title claimants, and the ease with which native title can be extinguished.
Indigenous Land Use Agreements
A considered achievement of the Act is the negotiation and mediation of Indigenous Land Use Agreements (ILUAs).
“ILUAs facilitate a binding agreement between the native title group and governments, companies or individuals, and generally concern the use of land and waters,” explains Associate Professor Margaret Stephenson, a property law researcher and educator within the Curtin Law School.
Stephenson explains ILUAs are entered into voluntarily but are legally binding when registered with the National Native Title Tribunal (NNTT). They can detail future development of land, cultural heritage and protection, compensation for loss of native title, and employment opportunities for the native title group.
“ILUAs are used to record an agreement between a pastoral lessee and the native title group to facilitate the exercise of coexistent rights over the land and waters contained in the leasehold of unallocated State land.
“They establish ways for the parties to regulate the use of the property for grazing or mining purposes, and facilitate access to the property for traditional owners performing obligations at spiritual sites and conducting ceremonies.”
There are 1,278 ILUAs registered with the NNTT, including the Argyle Diamonds ILUA, the Ord Final ILUA and the Murchison Radio-Astronomy Observatory ILUA in Western Australia.
The problem with ILUAs
While ILUAs can deliver harmonious outcomes for both parties, Stephenson says a key concern is ensuring ILUAs remain enforceable when the non-native title party changes.
“When registered with the NNTT, ILUAs gain the benefits of the Act, including contractual effect, legal certainty and validation of previous and proposed acts.
“Registration will not, however, automatically make that agreement binding on third party assignees of a pastoral or mining lease.”
This is due to the common law contractual principle of ‘privity of contract’, which means third-party assignees are not bound by an ILUA agreement unless they are a party to that agreement.
As yet, no best practice exists for dealing with the conditions of an ILUA when pastoral leases are assigned to a third party. Currently, if a third-party assignee chooses not to acknowledge an ILUA, the agreement becomes obsolete.
In such cases, the native title holder can still exercise their rights in tandem with the rights of the third party. However, the 1996 Wik Peoples v Queensland case outcome determined that in instances of conflict between the two groups, the rights of the native title holder must yield to those of the pastoralist.
Finding a solution
Stephenson puts forward several solutions to ensure ILUAs remain binding when the non-native title party changes.
“One way to enforce the terms of the ILUA is to have both parties sign a new agreement. However, the negotiation process would have to start again and the new pastoralist may not agree to the same terms.”
ILUAs also take time to negotiate and are expensive. It can take up to two years to lodge and register an ILUA with the NNTT, costing a minimum of AUD$50,000.
Stephenson suggests it would be simpler to amend the Act.
“Firstly, to ensure that if the leases are assigned to third parties, the assignees will be bound by the terms of the ILUA.
“Secondly, to amend section 24EA(2) of the Act by deleting the words in that section that state ‘a person is not bound by the agreement unless the person is a party to the agreement’.”
Such a solution may not be beyond the realms of possibility. On 21 February this year, the Commonwealth government introduced the Native Title Legislation Amendment Bill 2019 to amend the Act.
One amendment proposes allowing revisions to ILUAs that update parties to the agreement, including where a party has assigned or otherwise transferred their rights or liabilities under the agreement.
The Bill signifies an acknowledgement from the Commonwealth and wider society that changes to the Act must occur if it is to continue to advocate for native title holders, and ensure sustainable management and care of native title lands and waters throughout Australia.
Landmark native title settlement
In March this year, the High Court handed down its landmark ‘Timber Creek’ decision. This decision essentially determined a price for the economic and cultural loss caused by the extinguishment of native title, specifically that of the Ngaliwurru and Nungali native title holders from the Northern Territory.
The case has been described as ‘one of the biggest since Mabo’, and resolved the long-standing question of how much native title is worth under the Native Title Act. The issue for the Court was the quantum of compensation and how it should be calculated.
“Two components for calculating compensation for the extinguishment of native title were endorsed by the High Court,” Stephenson says.
“These included economic loss and solatium. In relation to economic loss, the Court found that compensation is equivalent to 50 per cent of the freehold value of the affected land. In relation to solatium (i.e. the ‘cultural loss’), the Court affirmed that the claim group was entitled to compensation sum of $1.3 million.”
The ‘Timber Creek’ decision establishes a precedent on what should be taken into account in assessing native title compensation claims and in the negotiation of compensation in ILUAs. However, compensation will still vary depending on the particular factual circumstances of each case, and thus no absolute formula will apply to all situations to determine compensation.