20 February, 2018
BHP Billiton Nickel West Pty Ltd v KN (Deceased) (Tjiwarl and Tjiwarl #2) [2018] FCFCA 8
What you need to know
The Full Court of the Federal Court of Australia has held that failure to comply with the procedural requirements in certain provisions of the Native Title Act 1993 (Cth) (NTA) in granting tenure and interests will not affect the validity of those grants (BHP Billiton Nickel West Pty Ltd v KN (Deceased) & Ors (Tjiwarl And Tjiwarl #2) & Ors [2018] FCAFC 8.
In doing so, the Full Court has confirmed a long held understanding about the operation of the NTA that was turned on its head by the trial judge's decision in 2016.
This decision delivers certainty for the holders of hundreds of interests granted around Australia over many years.
It will also ensure that the States and Territories can continue to implement their existing procedures for the grant of interests that may affect native title in a timely, efficient and certain manner.
In addition, the Full Court found that native title claimants cannot rely on section 47B of the NTA to disregard historical extinguishment over areas that were covered by an exploration licence at the time a native title claim is made.
What you need to do
Proponents whose interests were affected by the trial judge's decision should confirm that their grants were valid on the Full Court's reasoning.
Proponents should continue to comply with the procedural requirements of the NTA.
The trial judge's decision in Tjiwarl
Validity of certain future acts
During the trial of their native title claim in 2016, the Tjiwarl people challenged the validity of a number of mining tenures on the grounds that the State's failure to comply with certain future act procedures in the NTA rendered the grant of those tenures invalid.
This required the Court to decide whether compliance with the relevant future act procedural requirements in the NTA is a pre-condition to a grant being valid for native title purposes. This issue went to the core of the native title system in Australia and affected the grant of hundreds of interests over almost 20 years.
In Narrier v State of Western Australia [2016] FCA 1519, the trial judge held that an act will only be covered by the validating provisions of the NTA if it meets the relevant description of acts to which the provisions can apply and all of the relevant procedures relating to those acts are complied with. Accordingly, a number of licences (for roads, pipelines and power lines) were held to be invalid because of the State's failure to follow the applicable procedural requirements in the NTA in granting those licences.
Application of section 24HA NTA to WA miscellaneous licence for water exploration
The trial judge also found that certain licences granted under the Mining Act 1978 (WA) (Mining Act) to search for water were invalid because they were incorrectly granted by the State in reliance upon section 24HA of the NTA, which applies to grants relating to water management and regulation. In a narrow interpretation of this provision, the Court held that section 24HA was not applicable because the Mining Act was not legislation relating to the management or regulation of water.
Role of exploration licences in the application of section 47B
The trial judge also found that the operation of section 47B of the NTA, which provides for historical extinguishment of native title to be disregarded in certain circumstances, would not be excluded by the existence of an exploration licence over an area. Accordingly, the operation of section 47B could only be excluded where there is a freehold estate, lease, mining lease or reservation over the area at the time the native title claim is made.
The Full Court overturns the trial judge's decision
On 1 February 2018, the Full Court in BHP Billiton Nickel West Pty Ltd v KN (Deceased) & Ors (Tjiwarl And Tjiwarl #2) & ors [2018] FCAFC 8 upheld an appeal from the trial judge's decision.
The Full Court held that:
- failure to comply with certain procedural requirements of the NTA in granting an interest or tenure will not affect the validity of that grant;
- section 24HA of the NTA has a wide operation and applies provided that the legislative provision under which the grant is made relates to the management or regulation of water (it does not matter if the statute as whole relates to other topics, such as mining); and
- the operation of section 47B of the NTA can be excluded over areas covered by an exploration licence at the time a native title claim is made.
Operation of the NTA – certainty is returned
The Full Court provide a number of reasons why failure to comply with the procedural requirements in certain provisions of the NTA will not affect the validity of a grant, including that:
- the relevant NTA provisions are generally expressed to the effect that if an act (eg the grant of a tenement or licence) is "covered" by the provision, then it will be valid. They do not say "complies with" or "satisfies" the provision. The procedural requirements are then imposed in relation to those valid acts;
- the right to negotiate provisions are expressed quite differently. They provide that "if the procedures in this Subdivision are not complied with, the act will be invalid to the extent that it affects native title". Those provisions expressly impose conditions for validity;
- the Explanatory Memorandum for the Native Title Amendment Bill 1997 (Cth), which introduced the procedural requirements, states that failure to notify under one of the relevant provisions "will not affect the validity of the future act"; and
- the text, structure and context of the NTA do not support the trial judge's conclusions about the consequences of non-compliance with the procedural requirements. In fact, there is nothing in the statutory scheme to support this construction other than a perceived unfairness. The consequences of breach of a statutory requirement must be dictated by legislative purpose alone determined by reference to the language of the relevant provision and the scope and object of the whole statute.
The Full Court was also critical of the trial judge for not following the obiter comments made by an earlier Full Court in 2001 in Lardil Peoples v Queensland [2001] FCA 414 (Lardil). The Full Court emphasised the importance of the doctrine of precedent and noted that the decision should not have been departed from unless it could be distinguished or was plainly wrong. The Full Court did not find any basis upon which Lardil could be distinguished and, moreover, agreed with the construction in Lardil.
This decision confirms the long held understanding about the operation of the NTA that was upturned by the trial judge's decision in 2016.
It delivers certainty for the holders of hundreds of interests granted around Australia over many years, and reduces the risk of the validity of those interests being challenged following their grant. It will also ensure that the States and Territories can continue to implement their established procedures for the grant of interests that may affect native title in a timely, efficient and certain manner.
Full Court confirms wide application of section 24HA NTA
The Full Court also overturned the trial judge's finding that the Mining Act 1978 (WA) (Mining Act) is not legislation that relates to the regulation or management of water.
The Full Court disagreed with the trial judge's characterisation of the Mining Act as legislation relating to mining, rather than water. In fact, the Full Court was critical of any attempt to identify a single, unified purpose of a statute as a whole. Instead, the Full Court said the focus should be on whether the specific provision under which the future act is done relates to the management or regulation of water.
Section 91 of the Mining Act permits the grant of a miscellaneous licence for prescribed purposes, and the Mining Regulations 1981 (WA) permits a licence to be granted for a number of purposes relating to water, including to search for groundwater.
The Full Court found that section 91 of the Mining Act, together with the relevant provision of the Mining Regulations, met the description of legislation relating to the management or regulation of water.
As a result of this decision, applicants for interests relating to water (eg bores) can rely on the less onerous future act procedures in section 24HA of the NTA, provided that the specific legislative provision under which the tenure is granted relates to water, even if the statute as a whole relates to other topics such as mining.
Exploration licences and section 47B NTA
The Full Court also found that native title claimants cannot rely on section 47B of the NTA to disregard historical extinguishment over areas that are covered by an exploration licence at the time an native title claim is made.
Section 47B of the NTA provides that historical extinguishment of native title over an area can be disregarded if, at the time the native title claim is lodged, that area is occupied by the claim group and is not covered by a freehold estate, lease or reservation.
The trial judge found that a "lease" included a mining lease, but did not extend to an exploration licence. The Full Court disagreed with this conclusion and found that the definition of "mine" in the NTA, which includes to "explore or prospect for things that may be mined", meant that the term "lease" would also include an exploration licence.
As a result, section 47B will not allow historical extinguishment to be disregarded in areas covered by an exploration licence at the time a native title claim is lodged.
This finding will potentially have significant consequences as exploration licences typically cover much larger areas than mining leases. For example, in 2016, approximately 2.4 million hectares of Western Australia was covered by mining leases, while 31 million hectares were covered by exploration licences. This will mean considerably fewer determinations of exclusive native title.
The decision may also result in the re-opening of existing native title determinations where section 47B has been incorrectly relied on to disregard historical extinguishment.
For further information, please contact:
Andrew Gay, Partner, Ashurst
andrew.gay@ashurst.com
