Chapter 7

Fifteenth Report: Interim Report for the s.206(d) Inquiry - Proceedings of Conference on 12 March 1999
Table of Contents

Chapter 7

Land Management – s.206(d)(vi)

Introduction

7.1 In recognising native title and finding that the doctrine of terra nullius did not apply, the High Court in Mabo (No2) handed down a decision which had the potential to significantly influence the management of land in Australia.

7.2 Further, by subsequently passing the Native Title Act 1993, the Commonwealth provided for a regime under which native title rights are affected or protected. The Act also provided for the establishment of a Land Fund, in recognition of the fact that many Aboriginal peoples and Torres Strait Islanders would be unable to benefit from the High Court decision in Mabo (No2) as a consequence of the extinguishment of their native title.

7.3 The main objects of the Native Title Act 1993 (s.3) are: to provide for the recognition and protection of native title; to establish ways in which future dealings affecting native title may proceed; to establish a mechanism for determining native title claims; and to provide for, or permit, the validation of past (and intermediate period) acts. That is, the Act governs the ways in which all land users, including native title holders, governments and others (for example pastoralists and miners) can deal with, use, acquire and manage land in instances where native title may exist.

State/Commonwealth Land Management Powers

7.4 Before the commencement of the Native Title Act 1993 it was predicted that the legislation would have a significant impact upon the States and the way in which land is managed. [1] The commencement of the Act also raised the issue of the Commonwealth's power to make laws in relation to land management, which was arguably one of the State's residual powers under the Constitution. [2]

7.5 There had previously been a number of High Court decisions which had addressed the effect of the reserve or residual powers of States on the Commonwealth's legislative power. [3] In Melbourne Corporation v The Commonwealth the High Court held that the powers expressly granted to the Commonwealth by the Constitution did not permit the Commonwealth to pass laws which aimed to control or hinder the State's execution of its governmental functions. [4] Notably, however, in the Franklin Dams Case [5] (in response to the argument that the Commonwealth law preventing the construction of the dam was invalid because it impaired the ability of Tasmania to manage its Crown lands), Mason J stated:

7.6 It can generally be deduced from this judgment that a State's residual powers will only be protected when the Commonwealth law directly affects the State's ability to operate independently. [7] Following the Franklin Dams Case, land management does not appear to fall into this category. Further:

7.7 Despite these precedents, in WA v The Commonwealth [9] the Western Australian Government argued that the Native Title Act 1993 was invalid on a number of grounds, including that it was not a law that fell within Commonwealth power because it was essentially a law about land management and related matters in the States, and that it infringed the implied prohibitions in the Constitution because it impaired the capacity of the States to govern. [10] These arguments, of course, were rejected by the High Court.

7.8 It has been suggested [11] that once native title was recognised in Mabo (No2), it was clear that a legislative response was necessary to manage the complex problems of land management. Arguably, this response emanated from the Commonwealth, and not the States, because the Racial Discrimination Act, providing protection for indigenous land rights, meant that:

Validation of Government Acts

Past Acts

7.9 Pursuant to s.3(d) one of the main objects of the Native Title Act 1993 was to provide for the validation of past acts which may have been invalid because of the existence of native title. Section 14 of the Act allowed for the validation of certain past Commonwealth acts. These acts included (s.226) the grant of a permit or licence, the making of legislation, the creation of any interest in land or waters and the exercise of executive power. [13] States and Territories were also given the power to validate equivalent past acts (s.19).

7.10 The validation provisions were included in the Native Title Act to remove any doubt about past acts by the Commonwealth, States or Territories. [14] The Act [15] provided for different effects of validation, depending on the type of past act:

Intermediate period acts

7.11 The High Court judgment in Wik created uncertainty about the validity of certain acts done by governments between the commencement of the Native Title Act 1993 on 1 January 1994 and 23 December 1996 (the date of the Wik decision). The main reason for concern was that many of the acts had been done without adhering to the Act's procedures on the widely held assumption that the valid grant of a leasehold estate extinguished native title. [17]

7.12 The Explanatory Memorandum to the Native Title Amendment Bill 1997 outlined the view that governments had taken following the implementation of the Native Title Act:

7.13 Division 2A of the amended Native Title Act provides for the general validation of intermediate period acts; that is, certain acts over freehold and pastoral lease land and public works occurring between 1 January 1994 and 23 December 1996 which were potentially invalid because of native title. [19] The States and Territories are also able to validate intermediate period acts pursuant to s.22F (subject to ss.22B, 22C). [20]

7.14 In similar manner to the validation of past acts (Division 2), the amended Act sets out the different effects of validation [21] of intermediate period acts on native title, depending on the classification of the intermediate period act:

7.15 The amended Native Title Act also allows the Commonwealth, States and Territories to legislate to confirm previous extinguishment of native title (ss.23A-E). The ability of State, Territory and Commonwealth governments to validate past and intermediate period acts is considered critical for their ability to manage land and natural resources, and to provide certainty for acts or grants of interests in relation to land and water within their respective jurisdictions.

The Future Act Regime

Valid Future Acts

7.16 The future act regime under the Native Title Act governs the validity of an act affecting native title, its conditions, and the procedures that must be followed before the act can be undertaken. The Explanatory Memorandum to the Native Title Amendment Bill 1997 explains the basis of the future act regime as follows:

An act was a future act under the Native Title Act 1993 (s.233) if:

7.17 The Native Title Act 1993 provided for a future act regime distinguishing between permissible and impermissible future acts. A future act was a `permissible future act' (s.235), in most instances, if it satisfied the `freehold test'. That is, if it was:

7.18 This definition only applied to onshore acts; pursuant to s.235(8)(a) all future acts in offshore places were `permissible'. [24] The renewal, re-grant or extension of a commercial, agricultural, pastoral or residential lease was also a permissible future act (s.235(7)) provided that it did not create a proprietary interest where one did not exist before, or create a larger proprietary interest than under the original lease.

7.19 The Act also provided that `low-impact' future acts were permissible (ss.234, 235(8)). These were generally acts that had a limited duration (that is they commenced and ended before any determination of native title was made over particular land or waters) and they did not include such things as the grant of freehold estate or a lease, or the conferral of exclusive possession interest or mining leases.

7.20 The general presumption was that the non-extinguishment principle applied; that is, native title was not extinguished and merely suppressed or suspended while the future act and its effects were in place (s.238). The future act regime also provided for compensation for the effect of permissible future acts on native title.

7.21 In order to undertake a valid future act, the Commonwealth, or a State or Territory government had to follow certain procedures set out in the Native Title Act. Essentially there were three options:

Changes to the Future Act Regime

7.22 The amendments to the Act's future act regime implemented points 3, 4, 5, 6, 7, 8 and 10 of the Ten Point Plan. [25] The range of acts excluded from the definition of `future acts' (s.233(2)) was extended to include `intermediate period acts' which are not considered future acts to the extent that they purport to validate an act or extinguish native title. [26]

7.23 The permissible/impermissible future act scheme of the original Act was removed and replaced by 12 separate categories of validity for future acts. First, future acts are valid, or can be validated, if they are consented to under an Indigenous Land Use Agreement (ILUA) (s.24AA(3)). The other 11 bases for validity pursuant to s.24AA(4) are:

7.24 Significantly, while Subdivision M of the Act provides that certain acts must meet the freehold test and satisfy the right to negotiate provisions before being considered a valid future act, there is a large number of acts that can be valid without complying with these requirements. While the Wik decision held that native title rights could co-exist with other rights, the Commonwealth Government considered that co-existing native title rights did not amount to full ownership and that the continued use of the freehold test was not appropriate to determine what acts could be done by governments. [28] Hence many future acts were excluded from the requirement to satisfy the freehold test.

7.25 Further, the non-extinguishment principle applies to the categories of valid future acts unless otherwise stated. Notably, however, native title is extinguished by the following valid future acts:

7.26 Issuing a s.29 notice remains the most common avenue for governments to validly undertake future acts. Non-claimant applications are still available with enhanced protection pursuant to s.24F, while the agreement provisions in s.21 have been replaced with the substantial Indigenous Land Use Agreement provisions.

The Right to Negotiate

7.27 Subdivision B of Division 3 of Part 2 of the Native Title Act 1993 set out the detailed provisions in relation to the right to negotiate. Under s.26, the right to negotiate applied in relation to a range of future acts undertaken by governments in relation to the grant of mining rights, and the compulsory acquisition of land for grant to a third (non-government) party.

7.28 Under the original Act the right to negotiate was a statutory right acquired upon entry in the National Native Title Register following formal acceptance. Following the decision in Northern Territory v Lane [29] claims were automatically entered on the Register on lodgement, and there was a three-month `guillotine' period in which claims were required to pass the acceptance test. Any government wishing to undertake an act attracting the right to negotiate was bound to adhere to a series of procedural requirements before being able to `do' the `future act', such as grant the mining or exploration licence. The government party was required to:

7.29 The Act allowed governments to give notice that the proposed act attracted the expedited procedures (s.32) (and therefore the right to negotiate did not apply) provided the act did not (s.237):

The Act provided time frames and procedures under which native title holders could object to an act attracting the expedited procedures, and for an arbitral body to make a determination as to whether the expedited procedures were to apply (s.32(3),(4)).

7.30 The 1993 Act also enabled a party to apply to the NNTT or an approved State/Territory arbitral body if an agreement was not reached within the time frame set (4 months in relation to exploration and 6 months in any other case) (ss.27,35). The arbitration period was not supposed to last more than 6 months and provision was made for ministerial override of any determination in relation to the future act (s.42).

Changes to the Right to Negotiate

7.31 The Native Title Amendment Act 1998 made a number of changes to the right to negotiate. In outlining the Government's view on the need for reform of the right to negotiate regime, the Attorney-General stated that:

7.32 The changes to the right to negotiate are contained in Subdivision P of the amended Native Title Act. A number of acts are exempted from the right to negotiate and the States/Territories are able to implement their own alternative regimes to replace the right to negotiate in certain circumstances (ss.43, 43A). [32] Importantly, the right to negotiate is only available to registered native title claimants or registered native title bodies corporate; that is, they have to first pass the new, more stringent registration test (ss.190A-D). The right to negotiate now generally applies to future acts that:

7.33 The right to negotiate no longer applies to any of the future acts listed in s.24AA(4)(a) to (i), as well as a range of other acts excluded pursuant to s.26. These include:

7.34 In some cases, while the right to negotiate has been removed, governments must still comply with other procedural rights before making a grant or doing a future act. The extent of these procedural rights varies considerably. Such a right may simply provide for comment on a proposed act, for example in relation to the grant of a licence in relation to water, living aquatic resources or airspace (s.24HA). The right to comment also applies in relation to the extension of primary production activity on a non exclusive pastoral or agricultural lease to include forestry operations, horticultural activities or aquaculture (s.24GB(9)). Alternatively, it may be a more substantial right including the right to be notified and consulted, the right to object and the right to have the objection heard by an independent body. Examples of acts attracting these types of procedures include:

Acts which must meet the freehold test but are not subject to the right to negotiate are only valid if registered native title claimants or registered native title bodies corporate are extended the same procedural rights as if they held freehold or ordinary title.

7.35 Where the right to negotiate applies, it will only be available once for all future acts within the same project, whereas previously the right to negotiate attached to each act (eg. exploration and mining). States and Territories now also have the flexibility to decide at which stage of proceedings to commence the right to negotiate process for each act. The right to negotiate procedure must, however, be completed before any future act may occur. [35] The government party must notify the registered native title claimants and registered native title bodies corporate, any representative bodies for the land or waters concerned, the person who requested the act and the public. This notification allows any potential native title claimants to make an application or to become registered within the time limits set. [36]

7.36 The requirement to negotiate in good faith is retained and clarified to make it clear (s.31) that all parties are required to negotiate in good faith with a view to obtaining agreement from each of the native title parties for the doing of any future act. However, good faith negotiation is now only required regarding matters related to the effect of the act on the native title interests of the parties (s.31(2)). [37] If the parties are unable to reach agreement within certain time limits (now a uniform 6 months for both mining and exploration acts), the Act provides that either party can apply for a determination about whether the act can be done and on what conditions (ss.35,38). There is also provision for ministerial override of a determination made by the NNTT or a State/Territory arbitral body provided certain procedures are followed (s.42).

7.37 The amended Act continues to provide for the expedited procedures (s.32). The main difference is the definition of an act attracting the expedited procedures (s.237) which now states that an act may attract the expedited procedures if it is not likely to (the original definition was `does not'):

Indigenous Land Use Agreements (ILUAs)

7.38 Under the Native Title Act 1993, the scope for agreements between native title claimants, governments and affected third parties (eg pastoralists, miners, developers etc.) to authorise future acts was quite limited. Section 21 allowed native title holders to enter into agreements with governments to surrender their native title, or to authorise any future act affecting their native title. Agreements could be for any lawful consideration and could, if required, be made on a local or regional basis.

7.39 The ability to make agreements concerning future acts is much broader under the amended Act. Provision is made for three different types of Indigenous Land Use Agreements (ILUAs). [38] ILUAs are binding agreements between actual or potential native title holders and those wishing to use the land. ILUAs were introduced into the Act as a result of widespread support for an enhanced agreements process. However, at March 1999 there had been no ILUAs registered. The matters which can be covered under an ILUA are extensive. [39] Among other things, an ILUA can cover:

7.40 An ILUA can be entered into for any consideration, or subject to any conditions agreed to by the parties. Consideration, for example, may include the grant of freehold estate or any other interests in land. [41] An ILUA must meet certain requirements set out in ss.24BA, 24CA and 24DA before it can be entered on the Register of Indigenous Land Use Agreements. Once registered, an ILUA becomes a binding contract between the parties and binds all native title holders for the area, regardless of whether they are parties to the agreement. [42] The registration of an ILUA validates the act or acts that it covers. Where an ILUA requires legislation to be passed for it to be fully implemented, the relevant parliament may do so, despite any other provision in the NTA.

7.41 Under an ILUA native title continues to exist as provided for by the non-extinguishment principle (s.238), except where the ILUA specifically provides for extinguishment through surrender. [43] Compensation for future acts done under an ILUA is generally limited to what is contained in the agreement (s.24EB(4),(5) and (6)). Nevertheless, where it is established that a person has native title rights but did not benefit from the agreement, that person may be eligible for compensation.

The Land Fund and the ILC

7.42 The Aboriginal and Torres Strait Islander Land Fund and the Indigenous Land Corporation (ILC) were established in 1995 to replace the original Land Fund. The land management functions of the ILC are prescribed by s.191E of the ATSIC Act and are designed to ensure that the ILC develops a strategic approach to assisting indigenous land managers to manage their land in sustainable ways. The operation of the original Land Fund is discussed in Chapter 6 of this report, and the operation of the new Land Fund and the Indigenous Land Corporation is discussed in Chapter 8.

Summary

7.43 In summary:

The Committee's Duty

7.44 Pursuant to s.206(d)(vi), the Committee is required to report on the effect of the operation of the Native Title Act 1993 on land management.

7.45 In carrying out this duty the Committee will, among other matters, consider the effect of the future act provisions on land management and the potential for agreements using the Indigenous Land Use Agreement provisions in the amended Act.

 

Footnotes

[1] Twomey A `The Native Title Bill – Impact on the States' Mabo Papers 1994, p.138.

[2] Quick J and Garran R The Annotated Constitution of the Australian Commonwealth 1901, p.935; cf Twomey A op.cit., p.130.

[3] See for example; Amalgamated Society of Engineers v Adelaide Steamship Co. Ltd (1920) 28 CLR 129 (the Engineer's Case); Melbourne Corporation v the Commonwealth (1947) 74 CLR 31; The Commonwealth v Tasmania (1983) 158 CLR 1 (the Franklin Dams Case); Australian Capital Television Pty Ltd and Others v The Commonwealth of Australia (1992) 177 CLR 106 (The Political Ads Ban Case).

[4] Twomey A op.cit., p.130.

[5] The Commonwealth v Tasmania (1983) 158 CLR 1.

[6] The Commonwealth v Tasmania (1983) 158 CLR 1, p.139.

[7] Twomey A op.cit., p.132.

[8] Twomey A op.cit., p.132.

[9] Western Australia v The Commonwealth (1995) 183 CLR 373.

[10] Nettheim G `Western Australia v The Commonwealth' Aboriginal Law Bulletin Vol.3 No.73 April 1995, p.5.

[11] Basten J QC `The Native Title Amendment Bill and the Senate Amendments' Native Title: facts fallacies and the future Symposium Papers UNSW 30 May 1998, p.106.

[12] Basten J QC op.cit., p.106.

[13] Commentary on the Native Title Act 1993 op.cit., p.C12.

[14] Commentary on the Native Title Act 1993 op.cit., p.C12.

[15] The term `past act' was defined in s.228 and essentially included legislation passed before 1 July 1993, and acts or grants made before 1 January 1994 (the date of commencement of the Native Title Act 1993) as well as some acts done in the future but linked to past acts (see Commentary on the Native Title Act op.cit., p.C14).

[16] An act subject to the non-extinguishment principle does not extinguish native title. Instead, the native title rights and interests are effectively suppressed, either wholly or in part, until the act that affected native title is removed.

[17] This assumption is included in the Preamble to the Native Title Act, and was referred to by the Prime Minister, Paul Keating, in his Second Reading Speech on the Native Title Amendment Bill 1993. This issue is discussed in Chapter 5.

[18] Native Title Amendment Bill 1997 Explanatory Memorandum, pp.35,36.

[19] Explanatory Memorandum op.cit., pp.35,39.

[20] The extent to which the States and Territories have implemented validation legislation is outlined in Chapter 3.

[21] Section 22B.

[22] Explanatory Memorandum op.cit., p.71.

[23] Ordinary title means freehold unless referring to the ACT or Jervis Bay in which case it means leasehold (s.253).

[24] Commentary on the Native Title Act 1993 op.cit., p.C15.

[25] Explanatory Memorandum op.cit., p.71.

[26] Explanatory Memorandum op.cit., p.306.

[27] Section 24AA(5) provides that certain acts passing the freehold test must also satisfy the right to negotiate requirements in subdivision P.

[28] Guide to the Native Title Amendment Act 1998 Department of Prime Minister and Cabinet July 1998, p.4.

[29] Northern Territory v Lane (1996) 138 ALR 544.

[30] Section 29(1).

[31] House of Representatives Hansard, 4 September 1997, pp. 7890,7891.

[32] Explanatory Memorandum op.cit., p.167.

[33] Guide to the Native Title Amendment Act 1998 op.cit., p.25.

[34] Guide to the Native Title Amendment Act 1998 op.cit., pp.25,26.

[35] Explanatory Memorandum op.cit., p.171.

[36] Guide to the Native Title Amendment Act 1998 op.cit., p.27.

[37] Explanatory Memorandum op.cit., p.171

[38] These are body corporate, area and alternative procedure agreements pursuant to Subdivisions B, C and D Division 3 Part 2 Native Title Act 1993.

[39] Guide to the Native Title Amendment Act 1998 op.cit., pp.10,11.

[40] Note however that an alternative procedure agreement cannot provide for extinguishment of native title rights or interests, s.24DC. This is due to the fact that there is no requirement that native title holders must be parties to the agreement, unlike the other types of ILUAs.

[41] Explanatory Memorandum op.cit., p.83.

[42] Native title holders have rights under s.24BI, 24CI and 24DJ to object to an ILUA being registered.

[43] Explanatory Memorandum op.cit., p.80.