6 February, 2018
Requiring strict compliance with the Mining Act 1978 (WA)
The High Court's decision in Forrest and Forrest Pty Ltd v Wilson [2017] HCA 30 casts doubt on the validity of numerous Western Australian mining leases granted since 2006 and potentially signals a change in approach to the interpretation of the Mining Act 1978 (WA).
The Act required applications for mining leases to be accompanied by a mining operations statement or mineralisation report. The applicants lodged two mining lease applications that were not supported by either an operations statement or a mineralisation report. A mineralisation report was lodged several months later. The applications overlapped a pastoral lease held by Forrest & Forrest Pty Ltd. Forrest lodged objections to the applications.
The Warden effectively dismissed the objection and recommended to the Minister that the applications be granted. The Warden held that while the lodgement of a mineralisation report was an essential precondition to the exercise of a power to make a recommendation, it was not an essential precondition that the report be lodged at the same time as the application.
Forrest's appeal eventually reached the High Court, which held that the lodgement of a mineralisation report contemporaneously with the application for a mining lease was an essential precondition to the Warden exercising jurisdiction to recommend the grant of the mining lease. The Court's decision rested on the application of orthodox principles of statutory construction with particular focus on the objects and purpose of the Act. One of the key factors in the decision was that the Act represents the legislature's conferral of specific powers on the executive to grant rights to exploit the minerals of the State, and that those rights must be complied with strictly.
The High Court decision is a divergence from the general view that had prevailed in Western Australia that the Act permits a degree of discretion in waiving non-compliance with the Act. Accordingly, while the impact of the decision is limited to mining lease applications lodged after February 2006, there exists a real possibility that it will signal a change in approach to the interpretation of the Act and the consequences of non-compliance with its requirements.
For more information, see our Energy & Resources Alert dated 24 August 2017.
Execution of Indigenous Land Use Agreements
The decision of the Full Federal Court in McGlade v Registrar National Native Title Tribunal [2017] FCAFC 10 sent shockwaves through the industry given its rejection of established practices governing the execution of indigenous land use agreements (ILUAs) under the Native Title Act 1993 (Cth). The effect of the McGlade decision in relation to ILUAs has been reversed by the Native Title Amendment (Indigenous Land Use Agreements) Act 2017 (Cth) which came into effect on 22 June 2017, but the Amendment Act may not cure the impact of the McGlade decision on other types of native title agreements.
Prior to McGlade, the decision in QGC Pty Ltd v Bygrave (No 2) (2010) 189 FCR 412 stood as formal authority for the proposition that, provided it is properly authorised, an ILUA can be registered if at least one of the persons named as applicant for the relevant claim was a party to the ILUA.
The Full Court in McGlade declined to follow the decision in Bygrave and instead held that an ILUA requires all named applicants for a claim to execute the agreement with no exceptions, including situations where members had died or refused to sign against the wishes of the group as a whole.
This decision cast doubt over the validity of over one hundred ILUAs registered since 1998 in circumstances where not all of the registered native title claimants had signed the agreement, and created significant uncertainty and risk with respect to tenures or activities done under the authority of those ILUAs.
The Amendment Act came into effect four and a half months after the McGlade decision, and retrospectively validated registered ILUAs that did not comply with McGlade (and by implication validated all tenures granted and acts done under those ILUAs). The Amendment Act also allowed the registration of ILUAs lodged before McGlade that did not comply with the decision, and changed the requirements for future registration so that native title claim groups can decide who among the applicants will be a party to the agreement (whether by nomination or a decision that the agreement be signed by a majority of applicants).
However, while the Amendment Act appears to have resolved the position in relation to ILUAs, there is a risk that McGlade could apply to other native title agreements such as right to negotiate agreements which are not addressed in the Amendment Act. This has left a cloud of uncertainty over potentially hundreds of tenements granted in reliance on these agreements. The Federal Government announced its intention to progress further amendments to the Native Title Act to address this issue (and several others) and released an Options Paper in December 2017.
For more information on McGlade and the implications of the Act, see our Native Title Alert dated 2 February 2017 and our Native Title Alert dated 14 June 2017.
Native title compensation – Timber Creek appeal
In a highly anticipated appeal decision, the Full Federal Court upheld most of the trial judge's findings in the Timber Creek compensation claim (Northern Territory v Griffiths [2017] FCAFC 106).
In August 2016, the Federal Court determined that $3,300,261 compensation was payable to the Ngaliwurru and Nungali Peoples for the impact of land grants and public works on their native title rights and interests (Alan Griffiths and Lorraine Jones on behalf of the Ngaliwurru and Nungali Peoples v Northern Territory of Australia [2016] FCA 900) (Timber Creek). This was the first ever assessment of native title compensation in Australia.
A detailed analysis of the trial judge's decision is contained in our 1 September 2016 Native Title Alert Insights from the Timber Creek decision on native title compensation.
The decision was appealed to the Full Court of the Federal Court and almost all issues were re-agitated in the appeal. The Full Court upheld the $1.3 million award for hurt feelings and loss of spiritual attachment (awarded as non-economic loss or solatium) and rejected the Commonwealth and Northern Territory's arguments that the award was manifestly excessive.
However, the Full Court held that the trial judge had overvalued the economic aspects of the native title rights and interests and reduced the award from 80% to 65% of the freehold value of the relevant land at the time of the compensable acts.
The Full Court agreed with the trial judge that only simple interest was payable on the economic loss component of the award and rejected the native title holders' claim for compound interest.
Applications for special leave to appeal to the High Court were filed by the native title holders, the Northern Territory and the Commonwealth seeking to overturn almost every aspect of the decision. It will be some time before we have further certainty on the assessment of native title compensation in Australia.
For further information, please contact:
Adrian Chai, Partner, Ashurst
adrian.chai@ashurst.com
