Cameron v Hoolihan
[2005] NNTTA 84
•16 November 2005
Reported at (2005) 196 FLR 37
NATIONAL NATIVE TITLE TRIBUNAL
Cameron/Ernest Hoolihan, Hazel Illin, Elsie Thompson (Gugu Badhun)/State of Queensland), [2005] NNTTA 84 (16 November 2005)
Application No: QF05/3
IN THE MATTER of the Native Title Act 1993 (Cth)
- and -
IN THE MATTER of an Inquiry into a Future Act Determination Application
Robert Bond Cameron (grantee party)
- and -
Ernest Hoolihan, Hazel Illin, Elsie Thompson on behalf of the Gugu Badhun People (native title party)
- and -
State of Queensland (government party)
FUTURE ACT DETERMINATION - TRIBUNAL JURISDICTION TO DETERMINE MATTER
Tribunal: John Sosso
Place: Brisbane
Date: 16 November 2005
Hearing date: 2 September 2005; 27 October 2005
Representatives:-
Grantee Party: Zoe Farmer, Lawyer
Native Title Party: Susan Gilmour, D & G Lawyers
Government Party: Eve Fraser, Crown Law, Queensland
Catchwords: Native title – future act determination application – proposed mining lease – jurisdiction – whether parties have negotiated in good faith – evidentiary onus – relevance of dealings prior to issuance of s 29 notice – s 31 State deed and ancillary agreement/ILUA signed by native title party and grantee party – s 31 State deed not executed by the State - s 31 State deed and ancillary agreement/ILUA withdrawn by native title party – no challenge to good faith negotiations of government party – grantee fulfilled his obligations to negotiate in good faith.
Legislation: Native Title Act 1993 (Cth) ss 29, 30A, 30(1), 31, 33, 35, 36(2), 37, 38, 39, 41A, 82, 109, 150, 151
Cases: Brown v Eastern and Midlands Rail Co (1889) 22 QBD 391
Brownley v Western Australia (No 1) (1999) 95 FCR 152
Placer (Granny Smith) v Western Australia (1999) 163 FLR 87
South Blackwater Coal Ltd v Queensland (2001) 165 FLR 232
Strategic Minerals Corporation NL/Kynuna/Queensland [2003] NNTTA 83
Strickland v Minister for Lands (Western Australia) (1998) 85 FCR 303
Walley v Western Australia (1996) 67 FCR 366
Walley v Western Australia (1999) 87 FCR 565
REASONS FOR DECISION ON WHETHER THE TRIBUNAL HAS JURISDICTION TO CONDUCT AN INQUIRY
On 27 August 2004, the State of Queensland (the government party) gave notice under section 29 of the Native Title Act 1993 (Cth) (the Act) of its intention to grant Mining Lease ML 10290 (the proposed tenement) to Robert Bond Cameron (the grantee party). There were no registered native title determination applications covering any part of the area of the proposed tenement at this time.
The notice stated that the Mining Lease would authorise the grantee to mine and carry out associated activities subject to the Mineral Resources Act 1989 (Qld), for a term of twenty-one (21) years with the possibility of renewals for a term not exceeding twenty-one (21) years.
The proposed tenement, comprising 37.116 hectares, is located approximately 45 km south west of Greenvale (which is approximately 200 km from Townsville) and lies completely within the boundaries of the Gugu Badhun native title determination application (QUD244/04). The Gugu Badhun native title determination application was filed with the Federal Court on 29 November 2004 and was entered on the Register of Native Title Claims on 23 December 2004. The persons collectively comprising the applicant are Mr Ernest Hoolihan, Ms Hazel Illin and Ms Elsie Thompson. In order to become a native title party for the purposes of the “right to negotiate”, a native title determination application must be entered on the Register of Native Title Claims no more than four months after the notification day – section 30(1). In this matter the Gugu Badhun native title determination application was entered on the Register within the four month period, and the registered native title claimant was a negotiation party for the purposes of the proposed future act – section 30A.
On 15 August 2005, the grantee party applied to the National Native Title Tribunal (the Tribunal), pursuant to section 35, for a determination under section 38. As at least six months had passed since the notification day, the grantee party was entitled to make this application – section 35(1)(a).
On 16 August 2005 I was appointed the presiding Member to constitute the Tribunal for the purposes of conducting the inquiry into the future act determination application.
On 2 September 2005 I convened a preliminary conference in order to determine if agreement could be reached on any issues and to sensibly prepare this matter for hearing. At the preliminary conference a threshold issue which necessarily arose was whether there were any jurisdictional issues which needed to be addressed.
The native title party informed the Tribunal at the conference that it intended to raise a jurisdictional issue namely, that in its opinion the grantee party had not negotiated in good faith. No allegation was made by either the native title party or the grantee party that the government party had not negotiated in good faith.
Section 31(1)(b) of the Act requires that each of the negotiation parties must negotiate in good faith with a view to obtaining the agreement (in this case) of the native title party to the doing of the future act or the doing of the future act subject to conditions to be complied with by any of the parties.
Section 36(2) provides that if any negotiation party, other than the native title party, did not negotiate in good faith, the Tribunal must not make a determination pursuant to section 38. This subsection was inserted in 1998 and basically gives statutory force to the interpretation of the pre-1998 provisions by Carr J in Walley v Western Australia (1996) 67 FCR 366. As such it is a condition precedent for the Tribunal making a determination under section 38 that the government and the grantee parties have negotiated in good faith with the native title party. If the issue of good faith is contested, the Tribunal must deal with the challenge at the outset and until it is determined that there have been good faith negotiations, it cannot proceed to make a section 38 determination.
[10] Any negotiation party alleging bad faith negotiations has an evidential burden which it must discharge by the production of evidence to support its contentions – Placer (Granny Smith) Pty Ltd v Western Australia (1999) 163 FLR 87 at [28]. In this matter directions were set requiring the native title party to produce contentions and documents to substantiate its challenge. Each of the other parties was given the opportunity to respond. Finally, I convened a further conference on 27 October 2005 to address the relevance of events which occurred prior to the government party issuing the section 29 notice, and the question of whether the grantee party had negotiated in good faith. Further Directions were set enabling the negotiation parties to specifically address this issue. Each of the parties assisted the Tribunal by providing their written submissions.
[11] The native title party submitted that honesty of intention on the part of the grantee party was an issue and accordingly, this was an appropriate case for the taking of oral evidence and the cross-examination of witnesses.
In the event I formed the view that there was sufficient material before the Tribunal to enable a decision to be made on the jurisdictional good faith challenge without recourse to oral evidence – section 151. In this regard it is important to recognise that the Tribunal must operate within relatively tight legislative timeframes. The Tribunal is enjoined by section 109(1) to carry out its functions in a “fair, just, economical, informal and prompt way”. In particular the Tribunal is “not bound by technicalities, legal forms or rules of evidence” – section 109(3). This legislative mandate starkly contrasts with the manner in which the Federal Court is required to operate in its native title jurisdiction – see section 82. Moreover, regard should also be given to the following observations of Carr J in Walley v Western Australia (at 378):
“It is apparent from the scheme of Subdiv B of Div 3 of Pt 2 of the Act that Parliament intended that the question whether a future act may be done or may be done conditionally should be decided in a timely manner. References in ss 30, 35 and 36 to periods measured in months and the requirement expressed in s 36(2) confirm this. There is obviously a risk of that intention being thwarted if proceedings before the Tribunal get bogged down in the adducing of evidence and the hearing of argument on the question whether the government party has negotiated in good faith.”
The native title party submission on the facts and the law was provided to the Tribunal on 7 October 2005. This submission was supplemented by the affidavits of Richard Hoolihan (a member of the Gugu Badhun People and Chairperson of Gugu Badhun Ltd), Noel Gertz (a member of the Gugu Badhun People) and Charles Reinalda (former business associate of the grantee party, Mr Cameron). Subsequently on 25 October 2005, the native title party provided the Tribunal with a reply to the submissions of the grantee and government parties and a further submission dated 4 November 2005, on whether dealings between the parties occurring prior to the commencement of the good faith negotiations are relevant to the determination as to whether the parties have negotiated in good faith.
[14] Both the grantee and government parties also provided the Tribunal with submissions on facts and law and subsequently on the preliminary question of the relevance of prior dealings between the parties on the question of good faith.
[15] Despite quite divergent accounts of various events, and the interpretation put on those events, for the purpose of determining the issue of good faith negotiations the central facts and issues are clear and are summarized below.
[16] Shortly after the Gugu Badhun native title application was entered on the Register of Native Title Claims, the legal representative for the grantee party contacted the legal representative for the native title party to arrange the formal commencement of negotiations. A negotiation meeting involving representatives of the native title and grantee parties was convened on 20 January 2005. That meeting was attended, inter alia, by Mr Charles Reinalda on behalf of the grantee party. Mr Reinalda deposed in his affidavit that he had formed a business relationship with Mr Cameron and that he was the representative of, and the financial backer for the project. Mr Cameron deposed in his Affidavit (at para 74) that Mr Reinalda had become “interested in the marble project and he had agreed to finance it, including the grant of ML 10290.” It would appear that Mr Reinalda became acquainted with Mr Cameron only twelve months previously when he employed him as a “sawyer” for three months. Mr Reinalda also deposed that the tenement would be granted in Mr Cameron’s name, but “the project including all further applications for mining leases or EPM’s would be on a fifty-fifty basis. It was agreed that I would negotiate with the Gugu Badhun as the Applicant had a bad relationship due to his previous dealings and the moneys owed by him.” Mr Cameron also deposed that that Mr Reinalda and his legal representative would represent him in negotiations with the native title party because: “I thought that such a strategy would give maximum prospects of success in the negotiations.”
[17] It is necessary to refer to those previous dealings, as the relevance of those dealings has become a key issue in the determination of whether the grantee party negotiated in good faith.
[18] It is not contested that for a period of two years commencing in 2000, negotiations occurred between Mr Cameron (in his capacity as representative for Ebony Ridge Marble Pty Ltd which on 17 April 2000 became Ebony Ridge Marble Limited – hereafter referred to as “Ebony Ridge Marble”) and representatives of the Gugu Badhun People about the grant of a mining tenement (ML 10261) for the extraction of marble over the same area as ML 10290. Ebony Ridge Marble had, at all relevant times, four directors: Denis Hargreaves, Tracey Sariago, Cynthia Hargreaves and Robert Cameron. For a period of less than five months in 2000 a Mr David Coutts was also a director. Mr Cameron was a director of Ebony Ridge Marble between 17 April 2000 and 1 February 2003. The other named persons remained as directors until 26 August 2003, on which date the company was deregistered. It would also appear that during the above time period there were 20 ordinary shares issued by the company, which were held in equal parts by Mr Hargreaves and Mr Cameron. Accordingly, whilst the native title party refers in its material to the negotiations that occurred during 2000–2002 with Mr Cameron, at all relevant times he was acting as a director of the Ebony Ridge Marble, which company had applied for the mining tenement.
[19] The material before the Tribunal suggests that that Mr Cameron initiated contact with representatives of the Gugu Badhun People prior to applying for a mining tenement and sought support for this project including, it is contended by the native title party, financial and related support. Agreement was apparently reached and Mr Cameron (in his capacity as representative for Ebony Ridge Marble) was provided with assistance by Upper Burdekin Enterprises Pty Ltd, a company established by the Gugu Badhun People. The native title party contends that the support provided included the use of office premises, the cost of airfare and accommodation for Hargreaves totaling $1,800 and the hire costs of a vehicle for Mr Cameron to visit the site of the mining lease application. The hire vehicle, it was contended, was damaged, incurring costs of approximately $4,000. It is contended by the native title party that these monies were never repaid by either Mr Cameron personally or Ebony Ridge Marble. Mr Cameron deposed to a different version of events, however solely for the purposes of the good faith determination, I have proceeded on the version of events outlined by the native title party.
[20] Despite the holding of approximately 48 meetings over a two year period, including negotiations involving the framework for an Indigenous Land Use Agreement, negotiations between Mr Cameron and the Gugu Badhun People were ultimately unsuccessful. The application for Mining Lease 10261 was abandoned by the grantee Ebony Ridge Marble and, as noted, the company was deregistered.
It is not contested that during the negotiations the subject of this determination, Mr Reinalda was the primary point of contact between the grantee party and the native title party. The Tribunal has no material before it to seriously doubt Mr Reinalda’s statement of how the negotiations were conducted, including that he was the financial backer, that he dealt directly with representatives of the Gugu Badhun People, provided financial assistance for the taking of marble samples and that he undertook to repay monies allegedly owed to the Gugu Badhun from the previous negotiations.
[22] Mr Reinalda has also deposed that following the execution of an Indigenous Land Use Agreement (ILUA) involving himself, Mr Cameron and the native title party, there was a disruption of the business relationship between Mr Reinalda and Mr Cameron, and Mr Reinalda contacted the legal representative of the native title party indicating that he would no longer be funding the terms of the agreement. It would appear that the business relationship between Cameron and Reinalda was terminated on or about 14 June 2005. Mr Reinalda deposed to his view about the motivations of Mr Cameron in severing their business relationship. Mr Reinalda’s views are pure conjecture and, realistically, incapable of being proved or disproved.
[23] It is also clear from the material before the Tribunal that by 9 June 2005 an Ancillary Agreement/ ILUA and section 31 State Deed were executed by Mr Cameron and Mr Reinalda and all persons comprising the applicant. One issue which arises is the relevance of section 37(a) of the Act which provides that the Tribunal must not make a determination if “(a) an agreement of the kind mentioned in paragraph 31(1)(b) has been made.” On one interpretation, that paragraph could be read down to apply only to the State Deed which is executed by each of the negotiation parties and which provides in paragraph 7.2: “this Deed is an agreement for the purposes of Section 28(1)(f) and Section 31(1)(b) of the NTA.”. If that were the correct interpretation, then section 37(a) would have no application to the inquiry as the State Deed was never executed by the government party. However, I think that the better interpretation of section 37 is that if either the State Deed or (if it be a separate document) the Ancillary Agreement is executed by the relevant negotiation parties, the Tribunal is divested of jurisdiction. In this instance both the State Deed and the Ancillary Agreement/ILUA have clauses providing consent for the doing of the future act by the native title party. Accordingly, both of these documents fall within both section 31(1)(b) and 41A(1)(a). In this matter the Ancillary Agreement/ILUA was executed, however when the section 35 application was made it had been abandoned by the native title party. The sensible approach to applying section 37 is that if there is no section 31 agreement in force at the time the section 35 application is made, the Tribunal has jurisdiction to make a section 38 determination. However, if at any time after the section 35 application is made, agreement is reached, the jurisdiction of the Tribunal lapses. The fact that an agreement was reached but then terminated prior to the section 35 application being made, does not prevent the Tribunal reaching a determination. The focus of section 37 is on the existence of an extant agreement, not on a state of affairs which no longer exists. The Tribunal has been provided with a copy of the Ancillary Agreement/ILUA that was executed. Of significance is clause 2.1(b) which provides: “The Parties agree that they have negotiated in good faith with a view to obtaining agreement about the grant of ML 10290.” In addition, the government party has also lodged with the Tribunal a copy of the section 31 State Deed which was executed by the grantee and native title parties. Clause 7.2 of that Deed states that the parties “have negotiated in good faith”.
[24] It should also be noted that the ILUA was executed on the basis that various obligations would be fulfilled by Messrs Cameron and Reinalda acting together. For example, paragraph 3 of the Recitals state:
“Cameron and Reinalda are together developing a marble mining project within the area of the ILUA, being the Ebony Ridge Marble Project.” Further, paragraph 5 states: “Cameron and Reinalda are committed to building a relationship of mutual respect, understanding and trust with the Gugu Badhun People and to establish fair and certain processes for the use of land and resources within the Agreement Area and to assist in the social and economic development of the Gugu Badhun People.”
The clear import of the uncontested material before the Tribunal leads inevitably to the conclusion that although Mr Cameron was the grantee of the tenement, the negotiations and expectations engaged in and by the native title party were directed towards a partnership between Cameron and Reinalda. To conclude otherwise would be inconceivable based on the documents that have been filed with the Tribunal.
[25] The grantee party has provided the Tribunal with copies of relevant email messages which explain what happened next. At 12.07 pm (EST) on 20 June 2005 Mr Cameron emailed Ms Gilmour, the legal representative of the native title party. He said, in part:
“As you are probably aware by now, Charles Reinalda is no longer involved with the Marble project although he still retains a 5% share of ML 10323. At present I am uncertain of the status of the Sec. 31 agreement and the ILUA as all correspondence was previously directed to Charles Reinalda. Could you therefore inform me and my legal representative, Marian Wilson whether the Document has been or when it will be lodged.”
Ms Gilmour replied at 12.58 pm as follows:
“Could you please confirm that you are able to personally guarantee payment of our fees for the preparation and finalization of the relevant documents that pertain to the Ebony Ridge Marble project. Our instructions are that neither the section 31 agreement/ancillary agreement nor the ILUA is to be filed with the relevant bodies until such time as we receive a guarantee of payment and a statement of your financial capacity to meet the up front payments under the agreement. In relation to our fees, we note that there is currently an invoice outstanding which needs to be met before any further work will be done by us to confirm the ancillary agreement or progress the registration of the ILUA. The current amount outstanding is $4593.60 and the balance of the costs are payable upon the grant of ML 10290.”
[26] Less than one hour later, at 1.54 pm Ms Gilmour emailed Ms Leanne O’Neill of the Department of Natural Resources, Mines and Energy in the following terms:
“I confirm our earlier discussion today that the ancillary agreement in relation to ML 10290 has been withdrawn by the Gugu Badhun People. The agreement was entered into with a partnership made up of Mr Charles Reinalda and Mr Robert Cameron Bond. We understand that the partnership is in dispute and therefore the parties are no longer in agreement. We would appreciate if you could arrange for all counterparts to be returned to us as the party that submitted them to you.”
Ms O’Neill replied at 2.14 pm (EST) confirming receipt of the email and agreeing that the documentation would be returned.
[27] On 27 August 2005 Ms Gilmour, on behalf of the native title party, forwarded an email to Ms Farmer as representative of the grantee party, attaching an amended ancillary agreement deleting all references to Mr Reinalda, but the substantive issues were, she said: “identical to those included in the previous ancillary agreement.” Ms Gilmour said “Should your client wish to execute the re-drafted ancillary agreement and meet the costs incurred to date we do not expect that any further meetings or negotiations will be required.”
[28] Ms Gilmour’s email of 27 August was sent 12 days after the grantee party had applied for a section 38 determination, and this offer of settlement has not resulted in the parties reaching an agreement, which they can do at any time before a determination is made – section 35(3).
[29] The native title party has provided the Tribunal with extensive submissions on the good faith question. However, I need only refer to the following paragraphs of the 7 October 2005 Submissions of the First Respondent which provided a useful summary:
“33. It is the First Respondent’s contention that the grantee has failed to discharge the responsibility to negotiate in good faith in respect of each of the following relevant criteria
- shifting position just as agreement seems in sight;
- unilateral conduct which harms the negotiating process eg issuing inappropriate press releases;
- refusal to sign a written agreement in respect of the negotiation process or otherwise;
- failure to do what a reasonable person would do in the circumstances.
34. The grantee party has engaged in conduct which has led to financial gain being obtained from the native title party due to the grantee’s promises of a future agreement. His conduct in unilaterally severing relations with his business associates, reneging on a recently executed agreement and then refusing to re-enter an identical agreement which would provide for some benefits and recompense to the First Respondent falls far short of what a reasonable person would do in the circumstances.
35. The facts and circumstances are sufficient to lead the Tribunal to the conclusion that Mr Cameron had no intention of repaying the amounts owing to the First Respondent and that Mr Cameron merely executed the earlier agreement for the purpose of securing the grant of a Mining Lease knowing both that he did not have the means to honour the terms of the agreement and excluding the involvement of the other party to the agreement that did have the means to honour the terms of the agreement.
36. It remains the case that there is no reason why Mr Cameron did not execute the amended agreement when it was presented to him after the termination, as a result of the unilateral action of Mr Cameron, of the involvement of Mr Reinalda.”
[30] The grantee party contended that there was no evidence of a lack of good faith for a number of reasons. Of particular significance for this determination were the following:
(a) the grantee party was not required to negotiate about a commercial arrangement between him and the Gugu Badhun People, especially as it related to an event unrelated to the future act, occurred some years previously and related to another future act;
(b) the grantee party did negotiate in good faith about the future act in question, as was evidenced by the terms of the ILUA and the section 31 State Deed;
(c) while the grantee party never repudiated either the ILUA or State Deed, the native title party did repudiate both;
(d) the grantee party was free to sever (or create) business relationships as he saw fit, this was a matter solely for him;
(e) Mr Cameron and Mr Reinalda were jointly and severally bound to honour the commitments in the ancillary agreement/ILUA. If the native title party was concerned about Mr Cameron fulfilling his contractual obligations, they could have exercised the legal options open to them;
(f) by the time the native title party offered an alternative agreement, a section 35 application had been made, and the grantee party was no longer obliged to negotiate in good faith;
(g) the grantee party never shifted position just as agreement seemed in sight, it was in fact the native title party who shifted position by repudiating the executed agreements.
[31] The government party refuted any contention that its conduct in any way affected the grantee party’s ability to negotiate in good faith or that the State acted unreasonably such that there was a lesser standard imposed on the grantee party to negotiate in good faith. These contentions relate to certain statements in the grantee party’s submissions to the effect that the State failed to progress the execution of the section 31 Deed. As the government party contended, there was no evidence supporting that line of argument and I find that the State acted entirely properly in this process and could in no way be held responsible for the breakdown in commercial relations between the native title party and grantee party.
[32] Much of the native title party’s case depends on the relevance of events that occurred some years previously and in relation to a separate future act. The native title party contended that in this matter the subjective honesty of intention and sincerity of the grantee party had been brought into question and that it was central to that allegation that regard be taken of the previous events. The native title party’s reasoning was as follows:
- “The grantee party took very few steps in the negotiations. Effectively only three steps were taken. These were firstly to involve Reinalda and to stand by while Reinalda negotiated, secondly, jointly with Reinalda, to execute the agreements negotiated by Reinalda and thirdly to then terminate his relationship with Reinalda at a time when the grantee party believed that a section 31 agreement had already been finalized.
- The behaviour of the grantee party in doing each of these three things can only be understood and properly characterized by reference to the earlier dealings between the grantee party and the native title party and by reference to the relationship between the grantee party and Reinalda. The role of the grantee party was so limited that it would be impossible for the Tribunal to characterize the conduct of the grantee party without taking into account all the circumstances.
- The net result of the grantee party taking these three steps was that, despite agreements have (sic) been executed and negotiated in good faith with Reinalda, the ancillary agreement was in fact very unlikely to be performed.
- The likelihood as to whether or not the ancillary agreement would be performed in the circumstances is a question of fact which can only be decided after all the circumstances and evidence is taken into account including the evidence that is available as to the grantee party’s financial circumstances, the grantee party’s honesty in related dealings, statements made by the grantee party in related dealings and the conduct of the grantee party generally toward both the native title party and Reinalda..”
[33] Both the government and grantee parties contended that the obligation to negotiate in good faith only arises once the section 29 notice has been given and there is a native title party. In this matter, the obligation to negotiate in good faith did not arise until four months after the notification day. Further, it was contended that the obligation to negotiate in good faith has to be assessed by reference to the future act, and not matters unrelated to that act. Matters that arose in the past which are not related to the future act cannot be taken into account in assessing whether the grantee party has negotiated in good faith in relation to ML10290. Finally, it was suggested that if a future act inquiry traversed too widely and sought to investigate matters unrelated to the future act, this would undermine the object of having the jurisdictional issue of good faith dealt with as a relatively straightforward preliminary question of fact.
[34] The grantee party further submitted that even if the Tribunal were minded to consider past matters they were so remote in terms of time, persons and the legal status of various persons that they would not assist this inquiry.
[35] There is a plethora of Federal Court and Tribunal jurisprudence on issues relating to the obligation to negotiate in good faith. Clearly the obligation on the negotiation parties to negotiate in good faith is central to the right to negotiate process and is a legislative manifestation of the central role that the Commonwealth Parliament envisaged that negotiated outcomes would play, as evidenced by the repeated mentions in the Preamble to the Act.
[36] It is also self-evident that while the Act mandates that the negotiation parties negotiate, it places no limitation on the matters that can be discussed and agreed to. The Act compels the negotiation parties to come to the table and hopefully reach an agreement that will allow the future act to be done consensually and without the making of a section 38 determination. The Act quite properly places an obligation on the negotiation parties to consider a range of matters, but if they wish to go beyond those matters and reach a more comprehensive and enduring compact, that is a matter entirely for the parties to determine. In short then, the Act requires that the negotiation mandated by section 31 “be directed to obtaining an accord between a government and a native title claimant for the exercise of a power of government in respect of the use of the land in a manner that respects the connection with that land of indigenous people.” Brownley v Western Australia (No 1) (1999) 95 FCR 152 at 162 per Lee J.
[37] The type of matters which may be addressed during negotiations is indicated by the criteria set out in section 39 which the Tribunal must take into account in making a determination under section 38. Nonetheless, there are also other provisions in the Act which assist in determining the range of matters that properly could form the basis of negotiations. Of particular relevance is section 33, which deals with both the issue of royalties and existing non-native title uses of the subject land and waters. Nevertheless, while the opportunities afforded by the obligation to negotiate in good faith are open ended, and circumscribed only by the parties themselves, the obligation to negotiate is of a much more limited compass. The obligation is limited to negotiations related to the effect the proposed future act may have on the registered native title rights and interests of the native title party. A refusal or failure to negotiate about matters unrelated to the effect of the future act on the registered native title rights and interests of the native title party does not mean that either the government or grantee party has failed to negotiate in good faith – section 31(2). To go further would create a tendency, as Carr J pointed out in Walley v Western Australia (1999) 87 FCR 565 at 587 “for negotiations to be more protracted and, in turn, for the hearings before the Tribunal also to be protracted and time-consuming.” What constitutes matters relating to the registered native title rights and interests of a native title party necessarily depends, in each matter, on the content of those rights and interests.
[38] The obligation imposed by the Act is to negotiate in good faith: there is no obligation to conclude an agreement. Consistent with this, it is not a breach of good faith for a negotiation party to exercise their rights under section 35. The Act does not compel agreements or force parties to reach an accord which they perceive to be contrary to their interests. In this matter the fact that the grantee party applied for a determination under section 35 was not an indication of bad faith, rather it was the clear manifestation of a negotiation party exercising its legal entitlement – Strickland v Ministers for Lands (Western Australia) (1998) 85 FCR 303 at 322 per R D Nicholson J. Likewise there is no obligation to continue to negotiate after a section 35 request is made. The parties are at liberty to continue to negotiate, and section 35(3) recognises this. The Tribunal regularly facilitates that process by holding section 150 conferences and by amending Directions to give the parties time to reach an accord when they have expressed a desire to do so. In this regard I agree with the findings of Deputy President Sumner in South Blackwater Coal Ltd v Queensland (2001) 165 FLR 232 at 237-240 subject to only one small caveat. Deputy President Sumner agreed with an earlier Tribunal determination to the effect that a party’s conduct after a section 35 application is made may be relevant to whether a party has negotiated in good faith before it was made (at 240). That may or may not, be the case. However, as a matter of law I see no mandate in the Act for the Tribunal receiving evidence of behaviour after a section 35 application is made. Indeed, if that were the case it may prove to be a disincentive to parties continuing to negotiate, because if the content of post section 35 negotiations were able to form a basis for determining the good faith issue, parties would necessarily become more constrained about what they would bring to the table and what they would discuss. To put it in common parlance, the obligatory negotiation clock stops the moment a section 35 application is made. The charter of the Tribunal is to look back in history and reach a conclusion on the facts presented. It would be inconsistent with this task, and unhelpful, if the Tribunal were to be presented with a running commentary on contemporaneous negotiations.
[39] The content of the requirement to negotiate in good faith has been thoroughly canvassed in a number of Tribunal determinations and endorsed by the Federal Court. It is, nevertheless, important to stress that the words ‘negotiate in good faith’ “must be given their normal meaning having regard to the statutory context and principles of statutory interpretation” Walley v Western Australia (1999) 87 FCR 565 at 573 per Carr J. I adopt, for the purposes of this inquiry, the following observations of Deputy President Sumner in Placer (Granny Smith) Pty Ltd v Western Australia (1999) 163 FLR 87 at 93-94:
“Negotiation involves ‘communicating, having discussions or conferring with a view to reaching agreement’: Western Australia v Taylor (1996) 134 FLR 211 at 219. Good faith requires the Government party to act with subjective honesty of intention and sincerity but this, on its own, is not sufficient. An objective standard also applies. The Government and grantee parties’ negotiating conduct may be so unreasonable that they could not be said to be sincere or genuine in their desire to reach agreement. The Tribunal must look at the conduct of the Government party as a whole but may have regard to certain indicia which were outlined in Western Australia v Taylor as a guide to whether the obligation has been fulfilled. One of these indicia is whether the negotiation party had done what a reasonable person would do in the circumstances. There is no requirement that the Tribunal be satisfied that the Government party has made reasonable offers or concessions to reach agreement but it is permitted to have regard to the reasonableness or otherwise of them if it assists in the overall assessment of a party’s negotiating behaviour. Lack of good faith in the negotiations by the native title party will be relevant to whether the other parties have fulfilled their obligation and may impose a lesser standard on them.”
In this inquiry the native title party referred the Tribunal to the above statement of the law as well as to the indicia for good faith negotiations set out by Deputy President Sumner in Western Australia v Taylor (1996) 134 FLR 211 at 224-225. The indicia are, nonetheless, as Deputy President Sumner highlighted in Placer (Granny Smith) guidelines only and may or may not be sensibly applied having regard to the particular facts presented by each inquiry.
[40] One aspect of the above statement of the law is the focus on the negotiation parties to act not only superficially reasonably, but honestly. In short, there is an obligation on the negotiation parties to enter into discussions with an open mind and an honest desire to reach a reasonable accord. A party will not negotiate in good faith if they come with an ulterior motive or desire not to reach agreement, and paper over this with an outward display of proper, but empty, negotiating techniques. Lee J said in Brownley v Western Australia (No 1) (1999) 95 FCR 152 at 162-163: “if a State purports to engage in negotiation, but, in truth, its conduct serves an ulterior and undisclosed purpose antithetical to the making of an agreement with a native title claimant, it will not be negotiating in good faith. Delay, obfuscation, intransigence, and pettifoggery would be indicia of such conduct.” However, the indicia outlined by Lee J are examples of overt bad faith. It may be that a party will “go through the motions” and give the outward appearance of negotiating reasonably with the ultimate goal of never reaching an accord. Bad faith of this type while easy to allege is difficult to establish. Allegations of dishonesty or deceit are serious matters and, if established, would constitute bad faith. Consequently if a negotiation party alleges dishonesty or deceit on the part of another negotiation party, the party so alleging has an evidentiary burden, on the balance of probabilities, of substantiating the allegation – see Strategic Minerals Corporation NL/Kynuna/Queensland [2003] NNTTA 83 at [40] per Deputy President Sumner.
[41] Turning now to the material before the Tribunal, it is clear that the grantee party through his legal representatives and his then business partner, initiated negotiations with the native title party. Those negotiations were conducted in a spirit of good will and resulted in an agreement being reached within an acceptable time period. There has never been a suggestion that the terms of the ancillary agreement were not appropriate. In fact the native title party has by its conduct since the section 35 application made it clear that it was not the substantive terms of the agreement that were at issue. The fact that the grantee party did not himself engage in such negotiations but delegated that task to others is not an indication of bad faith. Indeed it is open to the Tribunal to draw the conclusion that, having regard to past dealings, this was a sensible and commercially proper course of action to adopt. The negotiations resulted in the native title party and grantee party executing both the ancillary agreement and the State Deed. In both documents there are clear statements to the effect that the parties have negotiated in good faith. There is no material before the Tribunal that these documents were not entered into consensually and with full knowledge of their contents. To put it shortly, the parties, both of which had experienced and competent legal representatives, freely and with full knowledge executed agreements after what was clearly a series of fruitful negotiation meetings which met the criteria of good faith negotiations set out exhaustively in various Tribunal and Federal Court decisions. It would be a very unusual circumstance if a party, having executed an agreement with a clause confirming good faith negotiations, could subsequently substantiate allegations of bad faith.
[42] This difficulty is further compounded in this matter by the uncontested fact that it was the native title party who purported to unilaterally terminate the agreements. The native title party contacted the government party and withdrew its consent prior to the Minister executing the State Deed.
[43] The fact that after a section 35 application was made by the grantee party, the native title party sought to re-open negotiations by submitting the contracts in exactly the same form except for the deletion of references to Mr Reinalda, suggests that there was nothing commercially unsatisfactory with the initial agreement. As previously indicated, the grantee party was under no legal obligation to negotiate after the section 35 application was made. I draw no adverse inferences from the fact that the grantee party has chosen not to re-enter the agreement he previously executed. The conduct of the parties subsequent to the section 35 application are not relevant to whether the parties did or did not negotiate in good faith prior to the section 35 application by the grantee party.
[44] Despite what would appear to be a clear case of good faith negotiations, the native title party contends that its actions were reasonable and explicable, and can only be properly understood and properly weighed by the Tribunal by regard to the previous history of negotiations between the Gugu Badhun and Mr Cameron.
[45] In this matter the native title party contends that the Tribunal needs to have regard to the previous dealings and previous negotiation conduct of Mr Cameron as this sheds light on his negotiation modus operandi. The government party contends that in assessing whether the grantee party negotiated in good faith the Tribunal should not, and cannot, have regard to conduct of the grantee party prior to 23 December 2004, being the date on which the obligation to negotiate in good faith arose.
[46] In assessing good faith the Tribunal is entitled to have regard to any relevant material which the negotiation parties file. If there is evidence, which is sought to be relied upon by any of the negotiation parties, that is logically probative to the question of good faith, then it can be admitted and given appropriate weight. Clearly if the connection between the question of good faith and the facts sought to be relied upon are so slight that the facts are too remote, then that material will not be admitted or will be disregarded. Sometimes the Tribunal, which adopts a commonsense approach to questions of evidence, will place so little weight on the material that in a practical sense its admission is of no assistance to the party relying on it.
[47] There is no restriction on the Tribunal to receive into evidence past conduct of a negotiation party, if it is relevant to the issue of good faith. It would be wholly artificial to limit material to conduct arising after the commencement of good faith negotiations. Clearly parties engaged in such negotiations are influenced by a range of factors, and past negotiations and conduct may well be relevant not only to assessing the negotiations but also the overall tenor of the proceedings. However it would be a mistake to import too much from previous negotiations. The Courts have shown uniform reluctance to admit into evidence a party’s conduct on previous occasions if its sole purpose is to prove likelihood of misbehaviour in the matter under inquiry – Brown v Eastern and Midlands Rail Co (1889) 22 QBD 391 at 393. The Tribunal and Federal Court have recognized that relationships do change once negotiations start, and if a party was so influenced by past negotiations that they did not approach the new negotiations with an open mind and a preparedness to reach a reasonable accord, they would be the party failing to negotiate in good faith.
[48] In this matter, then I have taken into account the previous negotiations involving Mr Cameron as representative of Ebony Ridge Marble and the Gugu Badhun. The weight I have placed on those negotiations however has been tempered by the fact that:
(a) they occurred some years previously;
(b) the native title party itself was not formally involved, even though members of the native title party were key players in those negotiations;
(c) the negotiations related to a different mining lease;
(d) the negotiations, whilst involving Mr Cameron, also involved other persons connected with Ebony Ridge Marble; and
(e) the negotiations were not subject to the “right to negotiate” provisions of the Act but under the alternative State provisions then in force in Queensland.
[49] Even taking into consideration the previous conduct of both Mr Cameron and some members of the native title party, this does not adequately explain the unilateral and precipitate action of the native title party in terminating contractual relations with Mr Cameron.
[50] Given due weight to the material before the Tribunal, a reasonable person could form the view that the native title party had reason to be concerned when it was informed that Mr Cameron had severed business relations with Mr Reinalda. It was Mr Reinalda who had been the primary contact point during the negotiations. It was Mr Reinalda who had made promises to pay certain monies to the native title party. It was Mr Reinalda who had been responsible for engendering an atmosphere of good will with the Gugu Badhun People. Finally, it was Mr Reinalda who was included as one of the parties to the ancillary agreement. To contend, as the grantee party has, that it was Mr Cameron’s right to sever business relationships as he saw fit is not persuasive. Mr Cameron could do as he saw fit in the running of his business affairs, but if his conduct in making or breaking commercial relations with others has or had an impact on agreements negotiated with other negotiation parties, then it is unsustainable to contend that the Tribunal must ignore such matters.
However, the native title party did not engage in any discussions with the grantee party when it was informed of the break of business relations with Mr Reinalda. No serious attempt was made to discuss the ramifications of the break of relations with Mr Reinalda on the performance of the agreements. The native title party could have contacted the State and asked that execution of the State Deed be stayed until those matters were discussed. Certainly it was entirely proper for the native title party to seek further and better particulars from the grantee party. Having been put on notice of the change in commercial relations, the onus was then on Mr Cameron to respond to any reasonable requests from either the native title party or the government party. An issue which necessarily would have arisen was the legal impact of the severing of the business relations with Mr Reinalda on the enforceability of the ancillary agreement/ILUA. It may well have been the case that the agreement was itself of dubious legal validity, a fact which would have, no doubt, had an impact on whether the Minister for Natural Resources, Mines and Energy would have executed the State Deed. However, it is not helpful to engage in legal supposition of this sort as the native title party did not seek to raise these issues in the context of sensible legal negotiations. Instead it unilaterally terminated contractual relations.
[52] The logically relevant evidence before the Tribunal in this inquiry leads inexorably to the conclusion that there have been good faith negotiations. Whilst the past relations of the Gugu Badhun and Mr Cameron were not good, the current negotiations were conducted in an atmosphere of goodwill leading in short order to agreements. Whilst the severing of business relations between Cameron and Reinalda put the native title party on notice that further inquiries were needed it did not justify or explain the unilateral action of the native title party. The Tribunal has been presented with a litany of past events which are said to justify the action taken by the native title party on the basis that the negotiations were a sham and that Mr Cameron engaged in what was claimed to be (in effect), misleading and illusory negotiations.
[53] As early as 1477 in a case reported in the English Year Books (Anon 1477, Y.B. Pasch. 17 Edw. IV, f, I, pl.2) Brian CJ said “it is trite learning that the thought of man is not triable, for the devil himself knows not the thought of man.” The Tribunal is not in a position, nor could it ever be, to know what motivated Mr Cameron in terminating his business relations with Mr Reinalda other than that which has been put into evidence. The objective evidence does not support the bad faith contentions of the native title party. Allowing oral evidence and the cross-examination of Mr Cameron would be highly unlikely to shed any more light on proceedings, but only result in even more delays. The native title party has not discharged the evidentiary burden to justify its allegations of bad faith. I find that the grantee party fulfilled his obligation under section 31 to negotiate in good faith.
Decision
[54] The grantee party has fulfilled his obligation to negotiate in good faith as required by section 31(1)(b) of the Native Title Act 1993 (Cth) and the Tribunal has jurisdiction to conduct an inquiry and make a determination pursuant to section 38.
John Sosso
Member
15
1
0