Cox v Western Australia - [2008] NNTTA 90

NATIONAL NATIVE TITLE TRIBUNAL

Angelina Cox & Ors on behalf of the Puutu Kunti Kurrama & Pinikura People/ Wintawari Guruma Aboriginal Corporation/Western Australia/FMG Pilbara Pty Ltd, [2008] NNTTA 90 (11 July 2008)

Application No: WF07/40

IN THE MATTER of the Native Title Act 1993 (Cth)

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IN THE MATTER of an Inquiry into a Future Act Determination Application

Angelina Cox, Angie Cox, Annabelle Stewart, Arness James, Charleston Cox, Chloe Hayes, Darryl Hughes, Gary Hughes, Harold Ashburton, Lily Mackay, Maudie Diowton, Mitchell Drage, Maurice Daublin on behalf of Puutu Kunti Kurrama Pinikura People (WC01/5) (first native title party)

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Wintawari Guruma Aboriginal Corporation (WC97/89) (second native title party)

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State of Western Australia (government party)

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FMG Pilbara Pty Ltd (grantee party)

FUTURE ACT DETERMINATION - TRIBUNAL JURISDICTION TO DETERMINE MATTER

Tribunal: John Sosso
Place: Brisbane

Date: 11 July 2008

Hearing dates: 11 January, 19 March, 9 May, & 20 June 2008

Representatives:-

Grantee Party: Mr Ken Green, Green Legal Pty Ltd

First Native Title Party: Mr Shahzad Rind, Yamatji Barna Baba Maaja Aboriginal Corporation
Second native Title Party: Ronald Bower, Corser & Corser Lawyers

Government Party: Mr Domhnall McCloskey, State Solicitor’s Office

Ms Paola O’Neill, Department of Industry and Resources

Catchwords: Native title – future act determination application – proposed mining lease – jurisdiction – whether grantee party has negotiated in good faith – evidentiary onus – no challenge to good faith negotiations of government party – grantee party has not negotiated in good faith – no jurisdiction to make a determination pursuant to s. 38.

Legislation:
Native Title Act 1993 (Cth) ss 24EB, 29, 31, 35, 36, 37, 38, 39, 42A, 75, 150, 193

Cases:Brownley v Western Australia (1999) 95 FCR 152
Cameron v Hoolihan (2005) 196 FLR 37
Dann & Ors (Amangu People)/Western Australia/Empire Oil Company (WA) WF06/21 [2006] NNTA 153 (24 November 2006) Member Sosso
Fejo v Northern Territory (1998) 195 CLR 96
Hughes (on behalf of the Eastern Guruma People) v Western Australia [2007] FCA 365
Mt Gingee Munjie Resources Pty Ltd v Victoria (2003) 182 FLR 375
Placer (Granny Smith) v Western Australia (1999) 163 FLR 87
Risk v Williamson (1998) 87 FCR 202
South Blackwater Coal Ltd v Queensland (2001) 165 FLR 232
Walley v Western Australia (1996) 67 FCR 366
Walley v Western Australia (1999) 87 FCR 565
Western Australia v Dimer (2000) 163 FLR 426
Western Australia v Taylor (1996) 134 FLR 211
Western Australia/Thomas on behalf of the Waljen People/Anaconda Nickel Ltd WF98/7 [1998] NNTTA 8 (4 September 1998) Hon. C J Sumner
Western Australia/West Australian Petroleum Pty Ltd & Anor/Hayes & Ors on behalf of the Thalanyji People WF00/07 [2001] NNTTA 18 (9 March 2001) Deputy President Sumner
Williams v Minister for Land and Water Conservation (2003) 128 FCR 517
WMC Resources Limited/Western Australia/Evans on behalf of the Koara People WF00/1 [2000] NNTTA 259 (7 July 2000) Deputy President Sumner

REASONS FOR DECISION ON WHETHER THE TRIBUNAL HAS JURISDICTION TO CONDUCT AN INQUIRY

The issue to be determined in this matter is whether FMG Pilbara Pty Ltd (the grantee party) has fulfilled its obligations under section 31 of the Native Title Act 1993 (Cth) (“the Act’) and negotiated in good faith with the registered native title claimant for the claimant application brought on behalf of the Puutu Kunti Kurrama and Pinikura People (“the first native title party”) and the Wintawari Guruma Aboriginal Corporation (“the second native title party”). Neither the grantee party nor either of the native title parties formally contended that the State of Western Australia (“the government party”) has not negotiated in good faith, although the first native title party did contend in its Response to the Grantee Party’s Response (at para 1) that neither the grantee or government parties had negotiated in good faith “as no good faith negotiations had commenced at the time of the filing of the s 35 application.” However, apart from that statement, no material has been filed with the Tribunal providing any legal basis for contending that the government party did not negotiate in good faith as required by s. 31(1). For the purpose of this matter I have accordingly proceeded on the basis that the only issue in contention is the question of whether the grantee party has negotiated in good faith. The issue of good faith goes to the jurisdiction of the Tribunal to make a section 38 determination, and once raised must be dealt with prior to a consideration of the section 39 criteria – Walley v Western Australia (1996) 67 FCR 366.
On 25 April 2007, the government party gave notice under section 29 of the Act of its intention to grant Mining Lease 47/1404 (“the proposed tenement”) to FMG Pilbara Pty Ltd.
The notice stated that the grant of the proposed tenement would authorise the grantee to mine for minerals for a term of 21 years from notification of grant, and a right of renewal for a further 21 years.
The proposed tenement, comprising 4341.19 hectares, is located approximately 65 kilometres west of Tom Price, situated at Latitude 22º 29’ S, Longitude 117º12’ E within the Shire of Ashburton. The tenement includes land and waters that comprise part of both the first native title party’s native title determination application area and the area subject to an approved determination of native title in favour of the second native title party.
The first native title party filed its native title determination application on 30 October 2001 and its current registered native title rights and interests were entered on the Register of Native Title Claims on 29 November 2001. The second native title party is a prescribed body corporate established following the Federal Court making a determination of native title in favour of the Eastern Guruma People on 1 March 2007 – Hughes (on behalf of the Eastern Guruma People) v Western Australia [2007] FCA 365. The details required by s. 193(2)(e) were entered in the National Native Title Register on 1 March 2007 at which point it became a registered native title body corporate.
On 23 November 2007, the grantee party lodged with the National Native Title Tribunal (the Tribunal), pursuant to sections 35 and 75 of the Act, an application for a determination under section 38. As at least six months had passed since the notification day, the grantee party was prima facie entitled to make this application – s. 35(1)(a).
On 14 January 2008 I was appointed the presiding Member to constitute the Tribunal for the purposes of conducting the inquiry into the future act determination application. A number of status conferences were convened and various Directions were made. On 19 March 2008 I made Directions, inter alia, giving the parties liberty to provide contentions addressing the question whether the Tribunal was able to separately determine the issue of negotiation in good faith by the grantee party with the second native title party but not making a determination in relation to the first native title party. The government party filed Contentions on 2 April 2008 addressing this issue. In the event it was not necessary to deal with this question and the jurisdictional challenge has been dealt with involving both native title parties.
Both the native title and grantee parties have provided extensive written submissions on the issues germane to the jurisdictional challenge. The government party advised by letter dated 25 February 2008 that it did not propose to file a statement of contentions on the question whether the grantee party had negotiated in good faith. The submissions received from the grantee party and both native title parties are as follows:

Native title party submissions:

Statement of Contentions of the Second Native Title Party (SCNTP2) dated 8 February 2008
Statement of Contentions of First Native Title Party (SCNTP1) dated 8 February 2008
Affidavit of Mr Shahzad Rind sworn on 8 February 2008 in support of the First Native Title Party
Further Contentions Second Native Title Party (FCNTP2) dated 22 February 2008
First Native Title Party’s Reply to the Grantee Party’s Statement of Contentions (RNTP1) received 9 June 2008
First Native Title Party’s Response to the Grantee Party’s Response (NTP1RGPR) dated 27 June 2008

Second Native Title Party’s Response to the Grantee Party’s Response (NTP2RGPR) dated 27 June 2008

Grantee party submissions:

Statement of Contentions of Grantee Party (GPSC) dated 26 February 2008
Statement of Facts Relevant to the First Native Title Party (SFNTP1) dated 26 February 2008
Statement of Facts Relevant to the Second Native Title Party (SFNTP2) dated 26 February 2008

Grantee Party’s Response to the Reply of the First Native Title Party (GPR) dated 18 June 2008.

History of Negotiations with First Native Title Party

The grantee party filed with the Tribunal specific documents dealing with the factual background to its negotiations with the native title parties. The first native title party does not contest any of the facts listed in that document relevant to it – RNTP1 at para 1. No other party has contested that document, and, accordingly, for the purposes of this inquiry the Tribunal has accepted the accuracy of the material contained therein. The “facts” outlined in that document are set out below:

*No. DATE*	*EVENT*
1 YEAR 2005	PNTS represents the Nyiyaparli, Palyku and Karriyarra Peoples in respect of land access agreements entered into between those peoples and the Grantee Party.
2 16 Nov 06	Grantee Party applied for Tenement: See ¶3.1 of Rind Affidavit and GP Doc 2.
3 07 Feb 07	Alexa Morcombe (GP forwards email to Sunil Sivarajah (PNTS) which attaches draft Land Access Agreement (identified on its cover as Draft 4 – 30 January 2007): see GP Doc 3

“

*No. DATE*	*EVENT*
4 07 Feb 07	Sunil Sivarajah (PNTS) forwards response email to Alexa Morcombe (G)) which states in part as follows: “Regarding the land access discussions, are you able to send through a detailed list of the following also? 1. a complete list of tenements FMG is looking at in KM, Yindjibarndi and PKKP country (the tenements numbers and a location would be great). Did mention that there were some mining leases/general purpose leases that FMG were looking at?” see GP Doc 4
5 21 Mar 07	Meeting between Michael Gallagher (GP), Stuart Robinson (GP);Michael Thompson (GP) Alexa Morcombe (GP), Sunil Sivarajah (PNTS) and various members of the First NT Group: see GP Doc 5
6 27 Mar 07	Grantee Party (Alexa Morcombe) forwards letter to PNTS (Sunil Sivarajah) concerning meeting held 21 Mar 2007. The letter states in part as follows: “Michael outlined some of the aspects of FMG’s existing Land Access Agreements with the Nyiyaparli, Palyku and Karriyarra. He indicated that FMG would like to commence negotiations with the PKKP for a similar agreement. … The group advised FMG that they are willing to enter into negotiations with FMG for a Land Access Agreement.” See GP Doc 6
7 11 April 07	PNTS (Sunil Sivarajah) emails letter to Grantee Party (Alexa Morcombe) requesting certain information see GP Doc 7
8 22 Apr 07	Grantee Party (Alexa Morcombe) forwards letter to PNTS (Sunil Sivarajah) enclosing information, including map showing location of the Tenement; see GP Doc 9
9 24 Apr 07	PNTS received notice of the proposed grant of the Tenement: see ¶4 of Rind Affidavit
10 25 Apr 07	Notification Day for the Tenement: see P3.2 and annexure SR 1 of Rind Affidavit and GP Doc 8
11 7 May 07	Grantee Party (Alexa Morcombe) forwards letter to PNTS (Sunil Sivarajah) which encloses a copy of the Mineralisation Report submitted to DOIR in respect of M47/1404: see GP Doc 10.
12 8 May 07	PNTS receives letter dated 7 May 2007 from Grantee Party. The letter states in part: “I confirm FMG’s consent to PNTS engaging Graham Castledine as a consultant lawyer to assist PNTS with the conduct of negotiations for Land Access Agreements. FMG agrees to pay the cost incurred by PNTS for Graham’s services, subject to a suitable agreement being reached. Representatives from FMG would like to meet with you, Graham (and Sunil if that is appropriate) at a suitable time, to discuss the most appropriate way to proceed.” see ¶5 and annexure SR 2 of Rind Affidavit
13 15 May 07	PNTS (Shaz Rind) forwards facsimile to Grantee Party confirming Shaz Rind has conduct of the proposed negotiations: see ¶ 6 and annexure SR3 of Rind Affidavit

*No. DATE*	*EVENT*
14 29 May 07	Meeting between Castledine (PNTS), Shaz Rind (PNTS) Blair McGlew (GP), Bruce Larson (GP) and Alexa Morcombe (GP) at which it was agreed the parties should enter into a negotiation protocol to govern the conduct of the negotiations and which would incorporate a timeline: see GP Doc 12.
15 31 May 07	At 8.59 am Alexa Morcombe (GP) forwards email to Shaz Rind (PNTS) which email attaches a letter dated 31 May 2008 confirming outcomes of earlier meeting of 29 May 2008: see ¶8 and annexure SR 4 of Rind Affidavit and GP Doc 12
16 12 Jun 07	Alexa Morcombe (GP) forwards letter to Shaz Rind (PNTS). The letter confirms the Grantee Party’s commitment to fund external legal advice for First NTP: GP Doc 13
17 29 Jun 07	PNTS receives letter from Grantee Party dated 27 June 2007 identifying five exploration and prospecting licences which are in the “right to negotiate” process and which the Grantee party seeks to be granted: see ¶9 and annexure SR 5 of Rind Affidavit and GP Doc 14
18 17 Jul 07	PNTS receives copy of letter from Grantee Party to Government Party dated 9 July 2007. The letter states in part: “FMG has already commenced negotiations regarding M47/1404 with the native title parties, the Eastern Guruma People and the PKKP People, and is keen to progress the negotiation process. FMG requests the State to commence negotiations with FMG and the native title party regarding the grant of M47/1404” See ¶11 and annexure SR 6 of Rind Affidavit and GP Doc 15
19 18 Jul 07	PNTS receives initial “negotiation letter” dated 16 July 2007 from the Government Party : see ¶12 and annexure SR 7 of Rind Affidavit and GP Doc 16
20 27 Jul 07	PNTS receives letter dated 24 July 2007 from Grantee Party enclosing information concerning the Tenement which the Government Party’s “negotiation letter” dated 16 July 2007 requested be forwarded by the Grantee Party to the First NTP: see ¶13 and annexure SR * of Rind Affidavit and GP Doc 17
21 31 Jul 07	PNTS forwards letter to Government Party providing information concerning the Tenement as requested by the Government Party’s “negotiation letter” dated 16 July 2007: see ¶14 and annexure SR 9 of Rind Affidavit. The Grantee Party notes that it did not receive the facsimile transmission being annexure SR 9 of Rind Affidavit. In this regard the fax confirmation sheet comprised in annexure SR 9 of Rind Affidavit confirms that the facsimile transmission failed.
22 3 Aug 07	Alexa Morcombe (GP) forwards email to Shaz Rind (PNTS). The email attaches: 1. a draft Negotiation Protocol showing marked up amendments proposed by the Grantee Party; 2. a draft Land Access Agreement (identified as Draft 1-3 August 2007 on its cover) see GP Doc 18.

*No. DATE*	*EVENT*
23 24 Aug 07	Graham Castledine (Castledine Legal and Mediation Services) forwarded email to Alexa Morcombe (GP). The email states in part: “Both the PKKP and … confirmed their willingness to enter into negotiations with FMG for a [Land Access Agreement]” See GP Doc 20
24 13 Aug 07	Meeting between Blair McGlew (GP), Bruce Larson (GP), Shaz Rind (PNTS), Kirsty MacKenzie (PNTS) and various member of the First NT Group: see ¶15 and annexure SR 10 of Rind Affidavit. Annexure S Rind Affidavit expressly states that a resolution of the First NTP was that the: “negotiations are to include the proposed grant to FMG of currently outstanding tenements, including E47/1300, E47/1302 and the nine prospecting licences referred to in FMG’s presentation.” (emphasis added)
25 3 Sep 07	Shaz Rind (PNTS) received letter dated 24 August 2007 from Grantee Party. The letter states in part: “At the meeting, I promised to provide some further information to assist you thinking about the next stage of our discussions to establish an agreement for our long term relationship. Attached to this letter, you will find 1. Maps showing your claim area along with Fortescue’s tenements and mining interests… The maps will show that Fortescue has applied for a mining lease in your country (M47/1404) We have previously provided information to you (via PNTS) about our application for M47/1404. The State has also requested we provide … . We would like to tell the State that we don’t need them to participate directly in our negotiations about the M47/1404 at this stage. However, we will keep the State informed about our progress in reaching an agreement about the grant of M47/1404.” See ¶16 and annexure SR 11 of Rind Affidavit and GP Doc 19
26 6 Sep 07	Meeting between Graham Castledine (PNTS), Shaz Rind (PNTS), Bruce Larson (GP), Alexa Morcombe (GP) and Michael Gallagher (GP) at which, among other things, it was agreed that the Tenement would be included in the negotiations for the land access agreement: see ¶17 of Rind Affidavit
27 12 Sep 07	Alexa Morcombe (GP) forwards two emails to Shaz Rind (PNTS). The first email confirms the outcomes of meeting of 6 Sep 2007, including, that the Tenement would be included in the negotiations for a land access agreement. The email states in part: “At the meeting I became aware that the amendments to the negotiation protocol were not put to the groups at the last meeting. To save going back over this again with the groups – the main point for us was the confidentiality clause. We want the negotiations to be evidence in a hearing at the NNTT about whether the parties have negotiated in good faith regarding our application for the Mining lease M47/1404 and any other tenements that may be discussed. If this could be altered then we are prepared to sign the negotiation protocol. Our suggested amendment to that clause is in the draft document referred to above.” The second email simply forwards the email sent by Alexa Morcombe (GP) to Shaz Rind (PNTS) on 3 August 2007. see ¶18 and annexure SR 22 of Rind Affidavit and GP Docs 21 and 22.

*No. DATE*	*EVENT*
28 20 Sep 07	Shaz Rind (PNTS) forward letter to Alexa Morcombe (GP). The letter states in part: “We confirm the negotiations in relation to M4/1404 tenement application will be included in the overall LAA negotiations.” see GP Doc 23
29 24 Sep 07	Meeting between Alexa Morcombe (GP), Michael Thompson (GP), David Forrest (GP), Eamond Hammonds (GP), Graham Castledine (PNTS), Emma Greenwood (PNTS), Shaz Rind (PNTS) and members of the First NT Group: see ¶19 and annexure SR 13 of Rind Affidavit
30 26 Sep 07	Alexa Morcombe (GP) forward letter Shaz Rind (PNTS). The letter states in part as follows; “The Negotiation Protocol The PKKP advised Fortescue that it had several minor amendments to the draft negotiation protocol. Fortescue agreed with the amendments and the Negotiation Protocol is now ready for signing by the parties.” see GP Doc 24
31 3 Oct 07	Shaz Rind (PNTS) forwards letter to Grantee Party which encloses copy of First NTP Negotiation Protocol signed by the First NT Group: see ¶20 and annexure SR 14 of Rind Affidavit and GP Doc 25
32 19 Oct 07	Shaz Rind (PNTS) receives letter dated 16 October 2007 from Grantee Party which encloses copy of First NTP Negotiation Protocol signed by the Grantee Party: see ¶21 and annexure SR 15 of Rind Affidavit and GP Doc 26
33 22 Oct 07	Shaz Rind (PNTS) forwards letter to Grantee Party (Alexa Morcombe). The letter states in part: “Recent working group meetings outcomes At the meeting of 24 September 2007 with the PKKP People, PNTS and FMG in Onslow the PKKP working group agreed to the following: 1. To progress negotiations with FMG for a Land Access Agreement … … M47/1404 – Application We reconfirm that negotiations in relation to M47/1404 tenement application will be included in the overall LAA negotiations.” see GP Doc 27
34 29 Oct 07	Shaz Rind (PNTS) forwards letter to Grantee Party which encloses signed heritage agreements in relation to “priority mining tenement applications”. see ¶22 of Rind Affidavit

*No. DATE*	*EVENT*
35 5 Nov 07	Meeting between Alexa Morcombe (GP), Michael Thompson (GP), Blair McGlew(GP), Bruce Larson (GP), Graham Castledine (PNTS), Shaz Rind (PNTS), various other members of PNTS and members of the First NT Group: see ¶23 and annexure SR 16 of Rind Affidavit. In particular, ¶23 of the Rind Affidavit states as follows: “At this meeting THE GRANTEE PARTY: a. outlined the sorts of activities it proposed to carry out on its mining interests in the PKKP claim area; b. identified on a map where THE GRANTEE PARTY’s current activities in the PKKP claim area are taking place including identifying the area of land the subject of the application by THE GRANTEE PARTY M47/1404; and c. discussed its proposed subject matter of a Land Access Agreement in general terms”
36 12 Nov 07	Shaz Rind (PNTS) receives letter dated 7 November 2007 from Paola O’Neill (GovP) requesting advice whether the First NTP wished the Government Party to engage in negations with the First NTP concerning the grant of the Tenement: see ¶24 and annexure SR 17 of Rind Affidavit and GP Doc 28
37 14 Nov 07	Shaz Rind (PNTS) receives letter dated 9 November 2007 from Alexa Morcombe (GP) advising that the Grantee Party intended making an application under s 35 of the NTA as agreed under the Heritage Agreement: see ¶25 and annexure SR 18 of Rind Affidavit
38 23 Nov 07	The Grantee Party lodged the S35 Application with the NNTT
39 4 Dec 07	Shaz Rind (PNTS) forwards letter to Grantee Party which requests the Grantee Party to pay the costs of “economic” advice concerning the value of the Grantee Party’s proposed mining activities in the First NTP’s claim are: see ¶26 and annexure SR19 of Rind Affidavit
40 6 Dec 07	Shaz Rind (PNTS) forwards email to Alexa Morcombe (GP) requesting a response to Shaz Rind’s letter dated 4 December 2007: see ¶27 and annexure SR 20 of Rind Affidavit
41 6 Dec 07	Blair McGlew forwards email to Shaz Rind (PNTS) confirming that the Grantee Party will pay the professional fees of the First NTP’s economic advisor: see ¶28 and annexure SR 21 of Rind Affidavit
42 17 Dec 07	PNTS receive from the NNTT a copy of the S35 Application
43 02 Jan 07(sic)	PNTS receives letter dated 24 December 2007 from Briony McGinty (GP) advising that the Grantee Party: 1. had filed the S35 Application: 2. was committed to negotiation a claim wide agreement see ¶30 and annexure SR22 of Rind Affidavit and GP Doc 29

”

The facts disclose that since February 2007 the grantee party and the first native title party have been negotiating a Land Access Agreement (“LAA”) which in return for certain benefits provided by the grantee party, the first native title party would consent to, and cooperate for the grant of all “Project Tenure” over the first native title party’s claim area. The term “Project Tenure” is defined in the draft LAA to mean railway, port and mining tenure. Mining tenure in turn is defined to include an exploration licence, ancillary licence, mining lease and water extraction authority. The grantee party provided a copy of an email sent on 7 March 2007 and I have proceeded on the assumption that the forwarding of this email marks the starting point of the broader negotiations between the grantee party and the first native title party.
On 22 April 2007 the grantee party wrote to the first native title party enclosing a map of current and proposed exploration and mining activity on the claim area. The letter was couched in general terms and the map was of the wider claim area with no particular emphasis given to the proposed tenement. This correspondence was supplemented by a further letter of 7 May 2007 (enclosing a Mineralisation Report) from the grantee party referring to the proposed tenement and requesting a meeting. The representatives of the first native title party and the grantee party met on 29 May 2007. The grantee party wrote to the first native title party on 31 May 2007 outlining the key outcomes of this meeting. Outlined below are some of the relevant Outcomes:
“Parties
·FMG confirmed its wish to conduct negotiations for Land Assess Agreements with the PKKP, Yindjibarndi, KM and the Njamal (depending on the progress of the grant of the exploration tenements).
Formalisation of a Negotiation Protocol
·All parties agreed that a negotiation protocol should govern the conduct of negotiations.
·The protocol will cover matters such as, the formation of a negotiation committee from each of the groups (of about 5 or 6 people), timing and number of meetings including frequency for negotiation group to report back to the working group, location for meetings, costs and communication.
·Graham and Shaz agreed to draft a negotiation protocol based on some existing PNTS models.
·A draft to be forwarded to FMG in the next few weeks and agreed on in principle before the next meeting.
Land Access Agreement
·Shaz indicated that he was in the process of reviewing FMG’s current agreements with the Nyiyaparli, Karriyarra and Palkyu. He has already identified some areas where he considers improvements can be made, particularly in implementation of the agreement
·FMG indicated its willingness to consider any amendments ….
Further meeting
·A further meeting was proposed for 14 or 15 June 2007. This meeting is to include the PNTS claim lawyers for the relevant groups, Rainer Matthews and Sunil Sivarajah.
·The aim of the meeting is to agree on the negotiation protocol and formalise a time line and process going forward.”

The grantee party also agreed to pay for the involvement of Mr Graham Castledine in the negotiations on behalf of the first native title party. The extent of the commitment of the grantee party was outlined in a subsequent letter dated 12 June 2007.

While broader discussions on the questions of a Negotiation Protocol and Land Access Agreement were taking place, the grantee party also sought to include in the negotiations the grant of specific exploration and mining tenements. Thus on 29 June 2007 the grantee party wrote to the first native title party about the grant of enumerated exploration tenements. This was followed by correspondence dated 9 July 2007 and forwarded to the government party and copied to both native title parties requesting the government party to commence negotiations with the grantee and native title parties over the grant of the proposed tenement. Subsequently the government party wrote to each of the other negotiation parties on 16 July 2007 outlining key information about the proposed tenement, relevant regulatory and statutory information, mapping and good faith negotiations. In response to a request by the government party in that letter, the grantee party wrote to the first native title party on 24 July 2007 enclosing specific information about the proposed tenement, including the mining proposal, mineralisation report and a copy of the 2006 annual report of the Fortescue Minerals Group Ltd. The grantee party also advised that where proposed activities would be high impact in nature, heritage surveys would be carried out.
By email on 3 August 2007 Ms. Alexa Morcombe of the grantee party forwarded an amended draft negotiation protocol and a proposed LAA to Mr. Shaz Rind, the representative for the first native title party. The grantee party requested the supply of financial information in order to finalise the grantee party’s amendments to the draft negotiation protocol. The draft negotiation protocol was a document 11 pages in length with three Schedules. The draft LAA was 56 pages in length with four Schedules. The changes proposed to the negotiation protocol by the grantee party were extensive, although seemingly reasonable.
From the documents filed with the Tribunal, it would appear that on or about 13 August 2007 the grantee party meet with representatives of various claim groups in the Pilbara region to discuss negotiations for LAAs between those claim groups and the grantee party (see email from Mr Castledine to Ms Morcombe of 24 August 2007). One of those claims groups was the first native title party. The first native title party contends (SCNTP1 at para 4(i)(iii)) that the grantee party did not mention the proposed tenement at this meeting. The status of the negotiations at this point of time is best illustrated by a letter dated 24 August 2007 from Mr McGlew (Head of Land Access) of the grantee party to Mr Rind:
“FOLLOW UP FROM MEETING ON 13 AUGUST 2007
On behalf of Fortescue Metals Group Ltd (Fortescue), thank you for meeting with Bruce Larson and me on 13 August in Onslow. I felt the meeting helped in starting a long lasting and very positive relationship between the Puutu Kunti Kurrama & Pinikura (PKKP) and Fortescue.
Further Information
At the meeting, I promised to provide some further information to assist you in thinking about the next stage of our discussions to establish an agreement for our long-term relationship.
Attached to this letter, you will find:
1.       Maps showing your claim area along with Fortescue’s tenements and mining interests;
2.       Discs containing videos that I played at the meeting;
3.       Hard copies of the powerpoint presentation that I used at the meeting;
4.       Documents explaining the key features of the draft Agreement in plain English.
We have previously provided copies of a draft Land Access Agreement to the Pilbara Native Title Service (PNTS) as a basis for discussion.
The maps will show that Fortescue has applied for a mining lease in your country (M47/1404).
We have previously provided information to you (via PNTS) about our application for M47/1404. The State has also requested we provide ….sic (the remainder of this sentence was not completed in the version provided to the Tribunal)
We would like to tell the State that we don’t need them to participate directly in our negotiations about the M47/1404 at this stage. However, we will keep the State informed about our progress in reaching an agreement about the grant of M47/1404.
Next meeting
These documents, maps and videos will not limit the matters that can be considered in our discussions regarding a long-term agreement. Those matters are for you to think about and then discuss with us at our next meeting, which I understand will be held on 24 September in Onslow. I look forward to discussing these matters then.
As discussed at the meeting, Fortescue wants to make a long-term agreement with the PKKP people to ensure it has access to all the land that it needs in your country to continue building its iron ore mining operations.
In the past, the major issues that are included in these long-term agreements are:
·guarantees of access to land by Fortescue;
·compensation for this access – this could include financial compensation, guaranteed jobs and business development;
·protections for Aboriginal cultural heritage and the environment; and
·establishment of a working group of PKKP people to manage the issues that arise in our relationship.
Outcomes of the last meeting
I would be pleased if you or the Pilbara Native Title Service could provide me with the outcomes of the last meeting, as there were some important matters discussed.
In particular, I would like to know if Fortescue is able to proceed with the grant of the following exploration and prospecting tenements:
E47/1300               E47/1301               P47/1400
P47/1403               E47/1302               P47/1401
P47/1404               P47/1398               P47/1402
P47/1270               P47/1399
As discussed at the meeting, Fortescue will sign a heritage agreement to facilitate the granting of these tenements.
Once again, I was very pleased with our recent meeting and I look forward to meeting you again next month, when we can continue our discussions about our long-term relationship.”
The representatives continued to meet (including on 6 September 2007), and on 12 September 2007 Ms Morcombe emailed Messrs. Rind and Castledine. According to Ms Morcombe the negotiation protocol put to the various native title working parties on 13 August 2007 was not the version inclusive of the amendments sought by the grantee party. In particular, the grantee party was concerned with the confidentiality clause, wanting to ensure that negotiations would be able to be relied upon in any good faith arbitral hearing before the Tribunal. Subject to resolution of this issue, the grantee party was prepared to execute the negotiation protocol. Of particular significance, Ms Morcombe then deals with the outcomes of the 6 September 2007 meeting. Twelve outcomes are listed, including Outcome 3:
“3. FMG confirmed that it would like to include negotiations for the mining lease (M47/1404) in the overall negotiations with PKKP for the wider Land Access Agreement.”

Mr Rind responded on 20 September 2007, confirming that the un-amended negotiation protocol had been circulated at the 13 August 2007 working group meetings, and that it would be necessary to circulate the proposed version at the next meeting of the working group of the first native title party which was due to be held on 24 September 2007. Mr Rind also confirmed that the working group had agreed on 13 August 2007 to enter into negotiations about Land Access Agreements, to execute the negotiation protocol (in the version considered on that date) at the 20 September 2007 working group meeting, and that the LAA negotiations include current grantee party tenements. Further Mr. Rind stated: “We confirm that negotiations in relation to M47/104 tenement application will be included in the overall LAA negotiations.”

The next working group meeting proceeded on 24 September 2007, and representatives of the grantee party attended. In correspondence from Ms. Morcombe to Mr. Rind dated 26 September 2007 the meeting was described as “productive and useful”. Further, Ms Morcombe confirmed that the working group endorsed the negotiation protocol with minor amendments (Mr. Rind confirmed that the negotiation protocol was executed by the first native title party in correspondence dated 3 October 2007). Ms Morcombe also specifically referred to ten exploration and prospecting tenements (E47/1300 - E471302, P47/1270, P47/1400 – P47/1402, P47/1404 – P47/1406) that the grantee party wanted to be granted as soon as possible so that it could progress its exploration program. Other matters raised in the letter were heritage issues and payment of attendance fees. The question of the proposed tenement is not mentioned in this correspondence and the first native title party contends (SCNTP 1 at para 4(l)(iii) that the grantee party did not mention the proposed tenement at the 24 September 2007 meeting.
Ms Morcombe again wrote to Mr. Rind on 16 October 2007 when she confirmed the execution of the negotiation protocol by the grantee party, and that the grantee party “looks forward” to the next meeting with the working group of the first native title party on 5 November 2007. She further confirmed that the first native title party had consented to the grant of the prospecting and exploration tenements outlined above. Again, there was no mention of the proposed tenement in this correspondence. In his response of 22 October 2007, Mr. Rind confirmed the 5 November 2007 working group meeting, and said that
“FMG will be requested to present on the following in relation to the proposed LAA:
·More detailed presentation on its activities on PKKP country
·Detailed tenement information and location;
·LAA contents, terms and conditions and
·What’s on offer from FMG to PKKP?”

A number of other matters were dealt with, but the letter concluded with a reference to the proposed tenement. Mr. Rind reconfirmed that the negotiations in relation to the proposed tenement would be included in the overall LAA negotiations.

One of the documents attached to the Affidavit of Mr. Rind is the minutes of the working group meeting of 5 November 2007. I have noted from those minutes that representatives of the grantee party were in attendance, gave a presentation and there were general discussions about proposed exploration and mining activities over the area of the first native title party’s claim. The first native title party contends (SCNTP1 at para 4(m)(i)) that this was the first time it had discussed the proposed tenement with the working party. On 7 November 2007 the government party wrote to the legal representatives of the first native title party stating, inter alia: “On 2 November 2007, the Grantee Party being FMG Pilbara Pty Ltd, advised the Tenure and Native Title Branch that the Grantee Party does wish to undertake negotiations with the Government Party in respect of M47/1404, as bipartite negotiations are currently progressing between the Grantee Party and the Native Title Party.” The general tenor of the letter was seeking confirmation of the status of the negotiations so the government party could participate in an appropriate manner. The last correspondence produced to the Tribunal that was generated prior to the grantee party making its application for arbitration was from Ms Morcombe to Mr. Rind on 9 November 2007 in relation to seeking a consent determination from the Tribunal in regard to certain prospecting and exploration tenements. Mr. Green states at para 37 of the Statement of Facts quoted above that Ms Morcombe advised the first native title party that the grantee party intended to make an application under section 35. This statement is correct, but only insofar as the letter dealt with prospecting and exploration tenements. There was no suggestion in that letter that the grantee party was going to seek a non-consensual determination by arbitration for the proposed tenement.

History of Negotiations with the Second Native Title Party

The grantee party has also helpfully produced a document entitled “Statement of Facts Relevant to the Second Native Title Party”. Like the Statement in relation to the First Native Title Party it is both exhaustive and objective. The précis of the facts relevant to negotiations between the grantee and second native title party are based on that document unless otherwise indicated.
Commencing in late March 2006, negotiations were undertaken between representatives of the second native title party (initially Desert Management Pty Ltd) and the grantee party for a whole of claim agreement to facilitate the granting of prospecting, exploration and mining tenements. From the beginning the parties were attempting to settle a negotiation protocol with the aim of concluding an Indigenous Land Use Agreement. The initial negotiations resulted in the conclusion of a “Negotiation Protocol for Regional Commercial Agreement” on 6 November 2006. On that date there was a meeting between the grantee party and the negotiation committee of the second native title party where the negotiation protocol, heritage protocol and related issues were discussed. The representatives of the grantee party and second native title party met on 1 December 2006, and Mr. Frewen, on behalf of the second native title party, advised on 21 March 2007 that negotiations could re-commence in May 2007.
By letter dated 1 May 2007 Mr. Frewen wrote to Ms Morcombe advising that the second native title party had received notice from the government party of the proposed grant of Mining Lease M47/1404, and indicated that as there was a Negotiation Protocol in place, it would be assumed that negotiations would proceed between the parties accordingly.
Representatives of the grantee party and the negotiation committee (and representatives) of the second native title party met in Karratha on 22 June 2007. The notes of the meeting indicate that there was a robust exchange of views about the terms of an overall commercial agreement between the parties to facilitate the granting of exploration and mining tenements. The notes do not disclose any specific discussion about the grant of the proposed tenement.

On 16 July 2007 the government party wrote to each of the negotiation parties with its standard “negotiation letter” which, as previously mentioned, included information on the proposed tenement, including a copy of the tenement application, a topographic plan of the proposed tenement, a copy of the search of the Register of Aboriginal Sites and related information on the obligation to negotiate in good faith. Mr. Frewen wrote to Ms Morcombe on 23 July 2007 in which he said, inter alia:
“It is noted that the parties have a Negotiation Protocol in place, and unless we are advised otherwise, this particular matter is assumed to be included within the current negotiations proceeding between the parties.”

On 24 July 2007 Ms Jonsson on behalf of the grantee party wrote to the second native title party. This letter was in response to the government party’s letter of 16 July 2007 and set out the information requested. The letter was in similar terms to that sent to the first native title party on the same day. The Tribunal has not been supplied with any information about negotiations occurring in the period from July to September 2007. The next activity was the forwarding on 5 September 2007 of letters by Mr. Green on behalf of the grantee party to both Mr. Frewen and the government party. The letter to Mr. Frewen was in response to his correspondence to the grantee party of 23 July 2007. Mr Green said, inter alia:
“FMG Pilbara is pleased to confirm the proposed grant of M47/1404 is a matter to be included in the current negotiations between the FMG Group and the Eastern Guruma People.
FMG Pilbara accepts your suggestion that the Department of Industry and Resources (“DOIR”) should be advised of the negotiations between the FMG Group and the Eastern Guruma People. In this regard, I have forwarded the attached letter dated 5 September 2007 to DOIR confirming that their involvement in the negotiations (including with respect to M47/1404) is not required. If you have any comments concerning my letter to DOIR, please let me know accordingly.”

The attached letter of 5 September 2007 to the government party contained the following statements by Mr Green:

“I am pleased to inform you that the Eastern Guruma Native Title Party and FMG Pilbara are parties to a Negotiation Protocol dated 6 November 2006 under which they have agreed to negotiate in good faith with a view to agreeing a regional commercial agreement which, among other things, will provide for the grant of mining tenements within areas which the Eastern Guruma People claim, or have been determined to hold, native title.
Accordingly, the proposed agreement will encompass the grant of M47/1404.
The Eastern Guruma Native Title Party has suggested that the Government Party should be informed of the above…
Whilst it is acknowledged that under s31(1)(b) of the Native Title Act 1993, the Government Party has an obligation (along with the Grantee Party and the Native Title Parties) to undertake ‘negotiations in good faith’ with a view to all parties agreeing the grant of M47/1404, please accept this letter and the attached letter from Desert Management Pty Ltd as confirmation that:
1.   FMG Pilbara and the Eastern Guruma Native Title Party wish to continue bipartite negotiations with a view to agreeing, amongst other things, the grant of M47/1404;
2.   neither FMG Pilbara nor the Eastern Guruma Native Title Party wish at this time to have discussions with the Government Party. In the event, that either of them wish to have such discussions, they will advise you accordingly in writing. Until further notice, neither party has any expectation that the Government Party will participate further in the negotiations for the grant of M47/1404; and
3.   in light of the above, the Eastern Guruma Native Title Party do not intend providing the submission requested in the Government Party’s letter dated 16 July 2007.”

A final meeting took place on 12 September 2007 between representatives of the grantee party and the second native title party. The minutes of the meeting do not disclose any specific discussion of the grant of the proposed tenement. The meeting was largely dominated by proposals and counter-proposals by the representatives on the nature and amount of compensation that would be paid as part of the commercial agreement. The meeting ended with no agreement reached and no proposal for any further meetings. In fact the Tribunal has not been provided with any further information about any further discussions or meetings prior to the grantee party making application under sections 35 and 75.

Legal Principles

[26] Each negotiation party is obliged to negotiate in good faith with a view to obtaining the agreement of each of the native title parties to the doing of the proposed future act either conditionally or unconditionally – s.31(1)(b). If any of the negotiation parties satisfies the Tribunal that any other negotiation party (other than a native title party) has not negotiated in good faith, then the Tribunal must not make a determination on the application – s.36(2).

[27] The practical effect of s.36(2) is to place an “evidential burden” on the party (or parties) alleging lack of good faith. The grantee party drew the Tribunal’s attention to the following statement of law by Deputy President Sumner in Mt Gingee Munjie Resources Pty Ltd v Victoria (2003) 182 FLR 375 at 389: “The Tribunal is not required to adopt strict rules on burden of proof but any party alleging a lack of good faith negotiations must provide contentions and documents which specify in detail the matters it relies upon.” This matter has proceeded on that basis and both native title parties have provided contentions and, in the case of the first native title party, documentary material, in support of their allegation.

[28] A very helpful and succinct statement of what constitutes negotiating in good faith is provided by Deputy President Sumner in Placer (Granny Smith) v Western Australia (1999) 163 FLR 87 at 93-94. It should be noted that references to the government party having an obligation to negotiate in good faith should now be read to apply to all negotiation parties; subject to that caveat I adopt the following statement of law for the purpose of this matter:

“Negotiation involves ‘communicating, having discussions or conferring with a view to reaching an 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 has 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 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 parties have fulfilled their obligation and may impose a lesser standard on them.”

[29] Deputy President Sumner referred to the indicia of good faith outlined in Western Australia v Taylor (1996) 134 FLR 211(at 224-225), which have been quoted on numerous occasions in later Tribunal determinations. For the purpose of this matter I adopt those indicia as matters that can be considered in assessing whether a negotiation party, or parties, has or have negotiated in good faith. I also adopt the later explanation of those indicia by Member Lane in Western Australia v Dimer (2000) 163 FLR 426 at 445/[102]. In particular, I agree with Member Lane’s view that the overarching principles governing good faith negotiations are honest and reasonable behaviour (at 446/[108]). What is reasonable in any given context depends on a range of factors and circumstances. The capacity of the parties, the external environment in which they are operating, the behaviour exhibited during the negotiations and even the past history of their relations, are all relevant in ultimately assessing whether a negotiation party had engaged in good faith negotiations. In every case the Tribunal is required to evaluate the material presented in a commonsense fashion to determine if the party or parties who are alleged not to have negotiated in good faith have in fact engaged with an open mind and acted honestly and reasonably. The concept of reasonableness does not require a grantee party to engage in altruistic behaviour or to make concessions not warranted by standard commercial practices. To impose on a grantee party a standard of negotiating which bears no relation to the wider commercial environment in which that party operates would be inappropriate and counter-productive.

[30] The grantee party also set out (GPSC at paras 2.3 – 2.7) other legal principles which guide the Tribunal which were not contested by any other party. Those principles were:

(a) the Tribunal may, but is not obliged to, have regard whether the grantee party has made reasonable offers or concessions if it assists in the overall assessment of its negotiating behaviour;
(b) the adoption of a negotiating position which governs the approach of the negotiating party to settlement is no indication of a lack of good faith, unless it demonstrates improper motives or is so unreasonable as to indicate a lack of sincerity in reaching agreement;
(c) the Tribunal will take a commonsense approach to the standard of conduct required and not impose some unattainable ideal standard;
(d) the making of a request for arbitration under sections 35 and 75 does not demonstrate lack of good faith; and
(e) if a native title party fails to negotiate in good faith, that may impose a lesser standard on the other negotiation parties.

[31] Once an application is made under sections 35 and 75 for the Tribunal to arbitrate, evidence of subsequent negotiations between the parties are not relevant and admissible – WMC Resources Limited/Western Australia/Evans on behalf of the Koara People [2000] NNTTA 259 at [11]. When one of the negotiation parties alleges the absence of good faith the conduct to be evaluated is that conduct prior to making of the request to arbitrate. The mandatory obligation to negotiate in good faith ceases upon the lodging of Future Act Determination Application (Form 5). As was stated in Cameron v Hoolihan (2005) 196 FLR 37 at 47/[38]: “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.” In this matter despite the grantee party lodging a Form 5 it has continued to negotiate with both native title parties. The task of the Tribunal is to evaluate the status of the negotiations between the parties as they stood at 23 November 2007 not as they stand when this decision is delivered. The negotiation parties are at liberty to continue to negotiate even though a Form 5 has been lodged, and the Act is drafted to recognise this fact (s.37(a)) and to facilitate it by the Tribunal convening, when requested, section 150 conferences to aid the parties to reach an accord. The decision of the grantee party to continue negotiations after making the request for arbitration is not material to the question of whether it had negotiated in good faith prior to lodging the Form 5. However, when the Tribunal decides that it does not have jurisdiction to make a section 38 determination because there have not been good faith negotiations at the time the Form 5 was originally lodged, this does not mean that the subsequent negotiations cannot be taken into account if there is a subsequent request for arbitration by the lodging of a further Form 5. When that subsequent request for arbitration is made the negotiations being assessed will be those extant at the time the second Form 5 was lodged.

The Initial Contentions of the Native Title Parties

[32] The first native title party made the following contentions (SCNTP1 at paras 6 and 7) in relation to its allegation that the grantee party had not negotiated in good faith:

“6. It is necessary in the circumstances to determine the question whether FMG has negotiated in good faith over the grant of M47/1404 against the background of ongoing negotiations between FMG and PKKP for a Claim Wide Agreement. Reasons to support this are:
a.     at almost all relevant times FMG’s communication, discussions and conferences with PKKP have been about a Claim Wide Agreement;
b.     FMG agreed to include negotiation of the grant of M47/1404 in the negotiation for a Claim Wide Agreement; and communication, discussions and conferences about other ‘right to negotiate matters’ in the PKKP claim area, that is the Priority Mining Tenement Applications, took place within the Claim Wide Negotiations.
7.Against the background of the Claim Wide Agreement Negotiations FMG has not   negotiated in good faith with PKKP over the grant of M47/1404 because:
a.     compared to FMG’s Priority Mining Tenement Applications FMG has not meaningfully communicated, discussed or conferred with PKKP with a view to reaching agreement about the grant of M47/1404 – FMG has simply not raised the grant of M47/1404 except to provide basic information by mail and to mention it in passing at Claim Wide Negotiation meetings;
b.     during negotiations for a Claim Wide Agreement FMG did not identify the grant of M47/1404 as a priority – unlike the Priority Mining Tenement Applications which FMG raised in correspondence with PKKP and at every meeting with PKKP until agreement was reached about them;
c.     further to paragraph 7(b) above, FMG did not notify PKKP about the Determination Application. Although FMG was not required to do this, having regard to the reasons listed at paragraph 6(a)-(c) and the fact that as a gesture of goodwill in the Claim Wide Agreement negotiations PKKP did everything necessary to allow the grant of the Priority Mining Tenement Applications, it was reasonable that FMG would have, at least, given it notice of the Determination Application (or, more properly given the background of the Claim Wide Negotiations, identified M47/1404 as a Priority Mining Tenement Application at an earlier stage).
d.     Outlines of draft Claim Wide Agreements which FMG presented to PKKP at the 13 August 2007 and 5 November 2007 meetings did not refer specifically to the grant of M47/1404;
e.     All of the reasons listed in paragraphs 7(a)-(d) above created a reasonable expectation by PKKP that the grant of M47/1404 would be dealt with in due course during the Claim Wide Negotiations – there was nothing to suggest during the Claim Wide Negotiations that the grant of M47/1404 was such an urgent matter for FMG that it would make the Determination Application.”

The second native title party contended that at all material times there was a negotiation protocol in place between it and the grantee party. The protocol was designed to facilitate and guide negotiations of a “whole of claim” agreement by which, inter alia, the grantee party would be relieved of engaging in individual “right to negotiate” proceedings for each new relevant future act. However, unless and until the parties reached agreement on a “whole of claim” accord, the negotiation requirements of the Act would continue to apply – SCNTP2 at paras 4 – 11. The grantee party did not contest this statement of fact and law – GPSC at para 9.3(1) and (2).
The second native title party then stated (SCNTP2 at para 12) that it disagreed with a contention of the grantee party that it was orally agreed when the negotiation protocol was executed that while the “whole of claim” agreement was being negotiated, the grantee party was “free to apply for any type of tenement as decided from time to time by the Grantee Party.” In later paragraphs this statement is clarified, and it appears that the thrust of the contention is that the execution of the negotiation protocol did not relieve the grantee party of the obligation to negotiate in good faith. A reading of the protocol does not support any suggestion that the grantee party was limited in applying for exploration and mining tenements. Moreover, a reading of the protocol, as pointed out by the grantee party (GPSC at para 9.3(3)) inferentially leaves open (at cl. 29) the right of the grantee party to apply under sections 35 and 75 for arbitration because relevant communications can be produced to, and considered by, the Tribunal in any good faith jurisdictional challenge.

Contentions of the Second Native Title Party regarding subsection 33(1)

Subsequently, the second native title party contended (NTP2RGPR at paras 2-6) that the grantee party had not negotiated in good faith because the “financial package” proposed by the grantee party did not contain any component based upon the amount of profits made, any income derived or any things produced. In this regard reference was made to s. 33(1). The second native title party contended that the financial package put forward was limited to tonnages of “things produced” which excluded any role for profits made and income derived. It was contended that having regard to the nature and scale of iron ore mining and related activities being undertaken by the grantee party there was nothing reasonable or substantive in the financial package offered. Indeed, it was contended that the grantee party’s negotiation position was “unreasonable and insubstantial”.
It is indisputable that the Act contemplates that the parties can negotiate about profit or royalty type payments by a grantee party as a result of doing anything in relation to the relevant land and waters after the future act is done. The section also outlines a non-exhaustive list of matters that can be taken into account in those negotiations. Subsection 33(1) stands in contrast to subsection 38(2) which specifically prohibits the Tribunal from making a determination which contains a condition requiring payments of the type outlined in s. 33(1). In short, s. 33(1) is not a mandatory provision that requires a grantee party to negotiate about profit or royalty type payments. Instead, it is designed to allow such a matter to be discussed voluntarily because it cannot be imposed involuntarily by the Tribunal. Accordingly s. 33(1) of itself does not provide any basis for suggesting that the royalty payments must be negotiated or that a failure to reach agreement on such payments can be in any way conclusive of the question of good faith negotiations. The position was summed up by Deputy President Sumner in South Blackwater Coal Ltd v Queensland (2001) 165 FLR 232 when he said (at 254): “the provision does nothing more than confirm that negotiations for s 33 payments are not prohibited by s 38(2).”
However, although there is no statutory obligation for a government or grantee party to negotiate profit or royalty type payments, the failure to agree to negotiate such payments may in some circumstances be an indication of a failure to negotiate in good faith. In Brownley v Western Australia (1999) 95 FCR 152 Lee J said (169/[54] – [55]):
“If the State had a policy that it would not reach an accord with a registered native title claimant to facilitate an agreement with a grantee party for the making of payments described in s 33, and that policy were applied to control the participation of the State in negotiations prescribed in s 21(1)(b), it may be said that the State would not be negotiating in good faith with the native title party.
If, in negotiations with native title parties for the obtaining of the agreement of those parties to the grant of a mining lease, the State maintained an inflexible position that ‘it would not pay compensation’ and relied upon that position to decline to engage in negotiations in respect of the matters provided for in s 33, it may be said that the State would not be participating in negotiations in good faith. The Sate is not obliged to reach agreement on such a matter but it is required to receive, and consider, a proposal from a registered native title claimant in a manner that has regard to the particular facts of the case and to the merit of the proposal in all the circumstances.”

The Tribunal has, in a series of good faith decisions, followed the above interpretation of the law and, accordingly, the obligation imposed on a grantee party is to receive and consider fairly, dispassionately and proportionately any proposal from a native title party for a payment of the type outlined in s. 33(1), but without an obligation to “capitulate in order to reach agreement.” – Western Australia/Western Australia Petroleum Pty Ltd & Anor/Hayes & Ors on behalf of the Thalanyji People [2001] NNTTA 18 at [37] per Deputy President Sumner.
The history of the negotiations between the second native title party and the grantee party do not demonstrate that the grantee party adopted an unreasonable negotiating position in regard to profit or royalty type payments. The grantee party and the second native title party exchanged a number of offers. On its face the grantee party received and considered a number of proposals from the second native title party involving the payment of sums of money under various headings. The grantee party made a series of counter-offers which were considered and responded to by the second native title party. The history of negotiations does not disclose that the grantee party approached the second native title parry with a closed mind or a fixed and unreasonable negotiating position. For example, at the meeting of 22 June 2007 the grantee party made three separate and different commercial payment offers and the second native title party in turn made three counter-offers. For the purposes of this decision I do not intend to set out in detail the many offers and counter-offers, although I have perused and considered them. Suffice it to say, the commercial negotiations between the grantee party and the second native title party were vigorous and entrepreneurial, and no imputation could be made that either of the parties approached those negotiations with fixed and immovable bargaining positions.
The key guiding principle in evaluating good faith negotiations is to determine if, having regard to all of the circumstances, the relevant parties have acted reasonably. There is no obligation on a grantee party to strike a deal involving payments of the type outlined in section 33. The refusal of a grantee party to make such payments may or may not, in the circumstances, be unreasonable. The fact that the mining activities of a grantee party will be very profitable is a factor that should be given proper weight. For example, a small miner with a marginally profitable enterprise is in a far more precarious position and its capacity to participate in negotiations, let alone make significant concessions or payments, is very limited. What is a reasonable offer from such a grantee party would be different to that of a large miner with greater resources and capacity. But even allowing for this, just because commodity prices are high, the relevant grantee party is financially secure and the proposed exploration and mining activity will be profitable does not mean that a grantee party is required to submit to demands for payments based on a nominated proportion of profits made income derived, or things produced. Evaluating the reasonableness of negotiating conduct by reference solely or significantly to movements in commodity prices and the Share market is incorrect and inserts into the evaluation of negotiating conduct potentially irrelevant and distorting considerations.
In this matter, I find that the failure of the grantee party to reach agreement with the second native title party on s. 33(1) type payments was not unreasonable, and this fact alone would not result in a finding that the grantee party failed to negotiate in good faith with the second native title party.

The Grantee Party’s Negotiations with the First Native Title Party

The grantee party responded in detail to the contentions of the two native title parties. With respect to the first native title party’s contentions, the grantee party suggests (GPSC at paras 4.1 - 4.4) that they are based on the proposition that the grantee party was obliged to negotiate in good faith over the proposed tenement. The grantee party contends that the first native title party misunderstands the obligation imposed by s.31(1)(b). That paragraph requires the parties to negotiate with the view to obtaining the agreement of each of the native title parties to the doing of the act. Therefore “s31(1)(b) of the NTA does not require the Negotiation Parties to negotiate ‘about’ the grant of the tenement.” The grantee party then made the following contentions (GPSC at para 5.3):
(a)if the grantee party negotiated in good faith with the first native title party for the whole of claim agreement, which contemplated the grant of the proposed tenement, it would have satisfied the requirement of s.31(1)(b) in respect of that tenement;
(b)the grantee party went further in any event and disclosed that it regarded the negotiations as directly relating to the proposed tenement and was at all times ready, willing and able to enter into negotiations about the proposed tenement. So while the preference of the grantee party was to negotiate a whole of claim agreement it was prepared to separately negotiate the grant of the proposed tenement but at no time was this requested by the first native title party; and
(c)the conduct of the grantee party must be viewed in the context of the conduct of the first native title party, in particular that the first native title party agreed to negotiate a whole of claim agreement and was willing to enter a negotiation protocol aimed at facilitating a whole of claim agreement and which specifically did not attempt to prohibit the grantee party from making an application under section 35.
It is critical to ultimately determining if the grantee party has negotiated in good faith with the first native title party to put the negotiations about the grant of the proposed tenement in the context of the broader Land Access Agreement negotiations, and then to ascertain to what extent the grantee party has engaged in negotiations to obtain agreement for “the doing of the act”.
The first native title party made the following submission (RNTP1 at para 5):
“5. Turning first to FMG’s contention headed: ‘The first contention: ‘whole of claim negotiations sufficient’. In response to this contention PKKP says that it does not necessarily follow that FMG has negotiated in good faith in relation to M47/1404 just because it might have negotiated in good faith during LAA negotiations. Whether FMG has negotiated in good faith in relation to M47/1404 will depend on the facts and circumstances of the LAA negotiation.
PKKP does not complain about FMG’s conduct in the LAA negotiation to date. But, FMG’s conduct in the LAA negotiation will not necessarily amount to good faith negotiations in relation to M47/1404. One relevant factor will be the status of the LAA negotiation at the time FMG made the Determination Application. Logically, it would be difficult to see how FMG could have negotiated in good faith in relation to M47/1404 if the LAA negotiations are only at an early stage (even in FMG’s conduct to this point could be said to have been in good faith). At the date of the Determination Application the parties had just started substantive negotiations (at the 5 November 2007 meeting FMG said it would make a financial compensation offer if PKKP agreed to seven broad LAA principles). That is, the parties had hardly talked about the substance of a LAA when FMG made the determination application.”
In response (GPR at para 2.2) the grantee party contended:
(a) s.31(1) does not require the parties to reach any particular “status”;
(b) the parties “have up to 6 months” after which an application under section 35 can be made. There is no requirement that a particular “status” is reached before a s.35 application is made;
(c) in reconciling LAA and individual tenement negotiations, the important question is whether the subject matter of the LAA negotiations contemplated the agreement of the native title party to the doing of the relevant future act;
(d)the “status” of negotiation is not easily capable of determination;
(e) the “status” of any negotiation can equally be influenced by any party to the negotiation. It is, therefore, conceivable that a party has negotiated in good faith even if substantive negotiations have never occurred because of the continual refusal of a native title party to participate in the negotiations; and
(f) even if the negotiations were at an early stage (which the grantee party does not express a view on), there is no evidence that this was improperly attributable to the grantee party. It is open to the Tribunal to find that such a status arose as a natural consequence of good faith negotiations or as a consequence of the manner in which the first native title party undertook its negotiations.
Finally the first native title responded to the above contentions as follows (NTP1RGPR at paras 7 -14):
(a)matters that can be subject of good faith negotiations are set out in sections 33 and 39;
(b)genuine negotiations over the proposed tenement must be about the terms and conditions upon which the native title parties would be prepared to agree to the doing of the act;
(c)the grantee party did not negotiate with the first native title party about any matters contained in sections 33 and 39, the use of native title rights and interests, effects of the grant of the future act on those rights and interests or significant sites in the mine area. The grantee party did not make an offer of the kind anticipated by s.33(1)(b);
(d)the bare offer to negotiate in the future in relation to the proposed tenement does not constitute negotiations or outcomes recognised by either the Tribunal or Federal Court;
(e)there were no negotiations about the grantee party’s “project” or “project within the claim area”. The only negotiations that took place prior to the grantee party making application under sections 35 and 75 were discussions about the aspirations of the parties, the grantee party presenting its overall plans for the claim area and signing a negotiation protocol;
(f)the “project act” provisions of the Act are not relevant as the section 29 notice did not identify the project or otherwise state that the acts were project acts; and
(g)the notification received by the first native title party on 16 July 2007 was only for the proposed tenement and not a notice about Project acts.
Before proceeding further, I will dispose of one matter. There is no basis for a suggestion that the section 29 notice in any way identified the proposed tenement as part of a project and that section 42A would apply. While the grantee party used the terms “project” or “project within the claim area” I see no basis for any imputation by the first native title party that the grantee party was attempting to enliven the operation of section 42A, which in any event it could not do. The term “project” is defined in the LAA supplied to the native title parties as including project tenure, project infrastructure and project operations. Each of those terms are then separately defined. Further in the Recitals to the draft LAA it is stated: “FMG has not yet identified the full nature and extent of its Project or the precise location of the activity to the [ ] People.” It was entirely appropriate for the grantee party to seek to negotiate a broader agreement involving all of its “projects” within the relevant claim areas in the Pilbara region. The Tribunal has previously noted in the context of negotiations involving multiple tenements (even though the project act provisions were not invoked by the government party):
“In making a determination it would not make sense for the Tribunal to arbitrate about each tenement in isolation without looking at the impact of all of them when considered together as a project. Likewise it defies common sense to think that the s 31(1)(b) negotiations could be conducted about each tenement ‘in isolation’ or ‘separately’ without regard to the context of the overall project”

- Western Australia/Thomas on behalf of the Waljen People/Anaconda Nickel Ltd [1998] NNTT 8 at p.38.

The requirement to negotiate in good faith is not an open-ended obligation. The obligation is limited to negotiating about the effect of the proposed future act on the registered native title rights and interests of the native title party. Indeed s.31(2) explicitly states that a refusal or failure by a negotiation party to negotiate about matters unrelated to the effect of the proposed future act on registered native title rights and interests does not mean that the party so refusing or failing has not negotiated in good faith. Nonetheless in undertaking negotiations a range of matters can be legitimately considered. For example, section 33 makes it clear that not only can profit and royalty type payments be negotiated, but so too can the nature and extent of existing non-native title rights and interests. Also the criteria outlined in section 39 provide, potentially, some guidance about the type of issues that can be legitimately brought to the negotiating table. Carr J observed in Walley v Western Australia (1999) 87 FCR 565 (at 576) that the s.39 “list has as its common theme a relationship with the likely impact of the future act in question.” However while the Act provides a platform for the parties to engage in broad ranging negotiations, and places no limit either in time or scope on what can be discussed, the legislative requirement for evaluating the statutory good faith element of those negotiations is the link between the doing of the proposed future act and its possible impact on registered native title rights and interests. In evaluating good faith negotiations it is important to appreciate as Carr J said in Walley v Western Australia (at 575-576): “the obligation to negotiate in good faith should be set squarely in the statutory context.” The nexus is the possible impact of the doing of the particular future act in question on registered native title rights and interests and not any demand or issue brought to the negotiation table by one of the negotiation parties, no matter how remote, tenuous or legally doubtful it may be. Accordingly there is no requirement to negotiate (for example):
(a) about changing the legal effect of the future act – Risk v Williamson (1998) 87 FCR 202 at 222 per O’Loughlin J;
(b) about off-site infrastructure associated with the future act, but which is not authorised by that act – Williams v Minister for Land and Water Conservation (2003) 128 FCR 517; and
(c) about land and waters outside of the claim area or land and waters over which there are no registered native title rights and interests – Dann/Western Australia/Empire Oil Company (WA) Limited [2006] NNTTA 153 at [52], [76] – [77] and [82].
The statutory context for requirement to negotiate in good faith is clear. The obligation is imposed on each of the negotiation parties. The negotiation parties are statutorily prescribed by s. 30A. The obligation is to negotiate about “the doing of the act”. The obligation does not extend beyond negotiating about the effect of the act on the registered native title rights and interests of the native title parties. As explained above the negotiation parties are at liberty to engage in broader ranging discussions, but the focus of the negotiations must be focused on the future act on registered rights and interests.
A grantee party and native title parties can agree to negotiate not just for the doing of a particular future act, but for a broader agreement that will provide a more streamlined and comprehensive means of facilitating the doing of future acts over a larger area. The scheme of Division 3 of Part 2 recognises and facilitates this. Parties are at liberty to negotiate an Indigenous Land Use Agreement, and in which case s. 24EB(1)(c) ensures that the parties can modify the operation of Subdivision P if they choose.
In this matter the grantee party has been attempting to negotiate LAAs with various native title claim groups in the Pilbara region. As a first step Negotiation Protocols have been discussed. The first native title party pointed out that the negotiation of LAAs are necessarily more complex and time consuming than individual native title agreements. Nonetheless the successful negotiation of a LAA has advantages for both the grantee party and native title parties. It is understandable that the grantee party is seeking to obtain some certainty and a comprehensive series of agreements with native title parties so it can progress its exploration and mining activities in the Pilbara Region. Equally understandable is the desire of native title parties to engage in negotiations so that individual time consuming negotiations can be replaced by an agreed consistent process which will provide protections, benefits and the basis for long term relationships with the grantee party.
The grantee party contends that s.31(1)(b) does not require negotiations about the grant of the proposed tenement, but rather obtaining agreement to the doing of the act. As previously stated, it is open to the negotiation parties to subsume individual right to negotiate discussions into broader claim wide discussions. It is likewise open to the negotiation parties to reach agreement about individual proposed future acts in the context of broader claim wide negotiations. However, it is not correct to go further and contend that the negotiation parties are totally relieved of the obligation to negotiate about the proposed future act and that the question whether the grantee party has negotiated in good faith is to be assessed purely by reference to the broader claim-wide negotiations. Section 31 requires the parties is to negotiate about the doing of the future act in the context of its effect on the registered native title rights and interests of the native title party and this cannot be avoided unless there is an explicit agreement to that effect. There is no such agreement in this matter.
The first native title party makes no complaint about the conduct of the grantee party in the context of LAA negotiations to date. However it contends that one relevant factor is the status of LAA negotiations at the time the grantee party applied for the future act determination. Conversely, the grantee party contends that the Act does not require the parties to reach any particular status before an application under section 35 has been lodged.
The contention of the first native title party is preferable. There is a “status” which must be reached before any negotiation party seeks arbitration, and that “status” is that the non-native title parties have negotiated in good faith. Such “status” is not easy to determine, but if the jurisdiction of the Tribunal is challenged, the Act itself mandates that an assessment must be carried out to determine if either the government or grantee parties have not negotiated in good faith. Likewise when making that assessment, the Tribunal will look at the behaviour of the negotiating parties, and if (for example) a native title party has not negotiated in good faith that will be a factor taken into account when assessing the behaviour of the other negotiation parties.

[55] Having regard to the material lodged with the Tribunal, it is clear that the grantee party has approached the negotiations with both native title parties in a professional and pro-active way. The Tribunal makes no adverse finding about the conduct of the grantee party generally or its negotiators or the manner in which they have performed their duties. The documentation indicates that the grantee party negotiators operated in an honest and competent manner. In this regard it is noted that the first native title party conceded that it had no complaints about the negotiations with the grantee party up to the point when a future act determination application was lodged.

However, the key issue here, as contended by the first native title party, is whether the obligation to negotiate in good faith had been met when the future act determination application was lodged. It is the conclusion of the Tribunal that so far as the first native title party is concerned the requirement to negotiate in good faith was not met at the time an application for arbitration was made pursuant to sections 35 and 75.
First, the documents filed with the Tribunal support the first native title party’s contention that, while there had been productive negotiations on the LAA, they were still at any early stage when the grantee party made its future act determination application. Substantive negotiations had only been advanced at the 5 November 2007 meeting. As outlined earlier, it was at the 31 May 2007 meeting that the grantee party confirmed its desire to negotiate a LAA with the first native title party and that a negotiation protocol would govern the conduct of negotiations. It was only by the 6 September 2007 that representatives of the grantee party confirmed that they wanted to include negotiations for the proposed tenement in the overall negotiations for a claim wide LAA. The next meeting of the first native title party working party with the grantee party was held on 24 September 2007 at which time the negotiation protocol was endorsed. Of importance, the grantee party specifically raised various prospecting and exploration tenements, but no mention was made of the proposed tenement. The next meeting with the working party took place on 5 November 2007, and again this was a productive exercise. It was at this meeting, for the first time, that mention was made of the proposed tenement. The grantee party was advised by Mr Rind on 5 November 2007 that amongst other things the grantee party would be asked to present on “LAA contents, terms and conditions” and in addition “What’s on offer from FMG to PKKP?”
The LAA negotiations were proceeding in an amicable and positive fashion, but as the above summary account highlights, they were only at a relatively early stage by November 2007. If the grantee party seeks to rely on those negotiations to support the proposition that it had negotiated in good faith for the doing of the future act, it would need to establish that those negotiations had reached such an advanced stage that it would be reasonable to infer that there had been dialogue which addressed the requirements of s 31(1)(b), namely discussions about the doing of the future act. It is clear that the discussions on the claim wide LAA by November 2007 had not advanced to such a stage that it could be said that those general discussions of themselves would satisfy the good faith negotiation requirements of s.31(1)(b).
Second, and irrespective of the general negotiations, a grantee party could satisfy the requirements mandated by s.31(1)(b) if it could demonstrate that, despite the relatively early stages of negotiations about a wider LAA, nonetheless under the general framework of those discussions there were advanced negotiations on the doing of the relevant future act. In short, when negotiations involve a general agreement and also specific future acts, it is possible to disaggregate out of the general discussions negotiations about particular tenements. Accordingly, even if the general discussions have not advanced to a stage where agreement is near those discussions may have provided a forum for advanced considerations of particular prospecting, exploration or mining tenements.
During the negotiations on the Negotiation Protocol and LAA the grantee party specifically raised the issue of a number (approximately 10) of enumerated high priority prospecting and exploration licences. Those prospecting and exploration tenements were the subject of discussions at both the 13 August and 24 September 2007 LAA negotiation meetings. Clearly the grantee party while seeking to negotiate a broader agreement with the first native title party, was understandably concerned to progress current tenement applications. The general discussions for a LAA provided the forum and opportunity for the high priority prospecting and exploration licences to be successfully resolved.
A reading of the documentation lodged with the Tribunal gives no equivalent sense of urgency about the proposed tenement. It was inserted into the LAA negotiations, and information was exchanged, but no serious or advanced negotiations occurred. Unless one of the native title parties refuse to participate in negotiations, in order for a grantee party to satisfy the obligation to negotiate in good faith, there must be some evidence that there has been at least some substantial discussions about the doing of the future act.
The proposed tenement was likewise inserted into the general LAA negotiations, but by the time that the future act determination application was made there were only cursory discussions about the proposed tenement.
The grantee party, however, made some other submissions which it contends would lead to the conclusion that it has negotiated in good faith. The grantee party contended (GPSC at para 5.15):
“On at least two occasions, the first NTP agreed the negotiations for the whole of claim agreement included negotiations concerning the Tenement: see GP Facts 26, 29 and 33 and ¶17 of Rind Affidavit. That is, the First NTP agreed it did not wish to enter into specific negotiations with respect to the Tenement, but rather wished to pursue negotiations for the whole of claim agreement. As the First NTP did not wish to negotiate directly concerning the Tenement, the Grantee Party must be taken to have acted ‘honestly and reasonably with a view to reaching an agreement on whether or not the act should go ahead.’”

The response of the first native title party was that it was wrong to suggest that it did not wish to negotiate in relation to the proposed tenement because it agreed to include it in the wider LAA negotiations. Rather “PKKP considered it would be convenient to do this given that FMG wanted to negotiate a native title agreement that included all current and future mining tenement applications in the PKKP area…. If M47/1404 was a priority for FMG it could have singled it out for discussion at meetings like it did for the Priority Mining Tenement Applications.” (RNTP1 at para 7)

The grantee party submits (GPR at para 2.4(1)) that it is open to the Tribunal to conclude that the first native title party did not want to negotiate in relation to the proposed tenement because it chose to include it in the wider LAA negotiations and gave preference to the wider discussions. The evidence supports the contention that the first native title party agreed to include negotiations about the proposed tenement in the broader discussions, and it also supports the suggestion that the main focus of the discussion was the broader agreement. However, there is no evidence to suggest that the first native title party did not wish to negotiate about the proposed tenement. The agreement of the first native title party to include negotiations about the grant of the proposed tenement in the broader discussions was no more than a sign of common sense and goodwill on its behalf and not an abdication of its right to negotiate about the future act. The grantee party’s contentions confuse appropriate negotiating behaviour by the first native title party with surrender of rights.
The grantee party also submitted (GPR at para 2.2(6)) that, if the negotiations were at an early stage with respect to the proposed tenement it was open to the Tribunal to find this arose as a consequence of the manner in which the first native title party undertook its negotiations.
It was the grantee party who was at all relevant times the proponent of exploration and mining activity. It was the grantee party who wished to negotiate a claim wide agreement. It was the grantee party who was in the best position to explain what was proposed by the grant of the tenement and how this would impact on registered native title rights and interests.
The grantee party is not a small explorer or miner, it is a large corporation. It has a staff of well qualified professional persons and associated professional advisors. If it has wished to “fast-track” negotiations on the proposed tenement, as it did with other prospecting and exploration tenements, it could have done so at any time. The overall tenor of the negotiations until November 2007 lead to the conclusion that such a request would have received a positive response from the first native title party.
The first native title party sensibly agreed to incorporate negotiations about the proposed tenement into the wider LAA negotiations. Both the grantee party and the first native title party were diligent in advancing those negotiations. The negotiating environment applying in this matter was not simply bilateral negotiations about one future act, but complicated negotiations involving multiple claim groups over a comprehensive compact dealing with large scale mining and infrastructure projects involving whole claim areas in the Pilbara region. Any suggestion that fault could be attributable to the first native title party in terms of the status and progress of negotiations for the proposed tenement is not supported by the evidence before the Tribunal. In the scheme of things it would have been reasonable to expect, from the viewpoint of the first native title party that if the grantee party wanted to separate out from the higher level discussions a particular prospecting, exploration or mining tenement it would have done so. The reason that negotiations on the proposed tenement were only at an early stage is that the grantee party was attempting to negotiate with numerous native title parties for comprehensive agreements, but at the same time disaggregate from those discussions particular tenements that it wanted resolved immediately. As mentioned previously, this approach has many commercial advantages and no adverse inference can or should be drawn from this state of affairs against the first native title party. The initiative and responsibility for “fast-tracking” negotiations on individual proposed future acts in this context lay squarely with the grantee party. The fact that it did not energetically seek to advance negotiations on the proposed tenement before making a future act determination application reflects on the priorities and approach of the grantee party and not the first native title party.
The first native title party contended (RNTP1 at para 10) that during negotiations for the claim wide agreement the grantee party did not identify the grant of the proposed tenement as a priority, as distinct to the priority prospecting and exploration tenements previously discussed. The implications flowing from this were said to be as follows:
“This is a relevant reason because FMG’s conduct in relation to the Priority Mining Tenement Applications made it reasonable for PKKP to expect that FMG would raise other priority tenement applications in a similar way. FMG’s prior conduct together with its agreement to include M47/1404 in the LAA negotiation (about a month before the right to negotiate period expired) certainly made it reasonable that FMG would have raised M47/1404 as a priority.”

The grantee party, however, contends that if there was an expectation that it would negotiate separately for the grant of any mining lease (including the proposed tenement) there was no evidence that the first native title party had that expectation, and if it did, it was unreasonable to have done so. The grantee party contends (GPR at para 2.6(4)(b)) that it never stated that it would not make a section 35 application, that even if it sought to deal specifically with some other tenements this would not give rise to a broader expectation and it was equally reasonable to hold the view that the grantee party would exercise is entitlements under section 35 as soon as six months elapsed from the notification day.

Commonsense would lead a reasonable person to the view that a grantee party who is negotiating in good faith would act in an open, transparent and consistent manner. A reasonable and honest grantee party negotiator would, when seeking simultaneously to reach a claim wide accord and expedite the grant of individual tenements, disclose those tenements to, and seek to reach an accord with, the native title party. The grantee party did this with respect to various prospecting and exploration tenements. A reasonable native title party would expect that a similar approach would be adopted in the future unless the grantee party otherwise indicated. In short if the first native title party held an expectation that the grantee party would proactively seek to negotiate about the proposed tenement if it wished to expedite its resolution in a manner similar to the grantee party’s approach to the prospecting and exploration tenements, then it was an expectation reasonably and appropriately held. The contentions of the grantee party to the contrary could lead, in fact, to a view being held that it was engaging in unsatisfactory and potentially misleading behaviour. The Tribunal does not make such a finding, but the contentions of the grantee party paint, ex post facto, a less than satisfactory picture about the manner in which the grantee party was approaching negotiations.
This leads to the contention of the first native title party that the grantee party had “engaged in disingenuous conduct amounting to obfuscation and pettifoggery”. The following examples were provided by the first native title party to support this suggestion (NTP1RGPR at para 28):
“ (i)The GP represented to the FNTP that the mining lease would be negotiated at a later time but then applied for a determination without telling the FNTP that it intended to do so, thus avoiding any meaningful negotiations in relation to mine production or royalties.
(ii)The GP claimed that the promise to negotiate in respect of the granting of M47/1404 at a future time was in itself a negotiation in respect of the granting of M47/1404 and hence a fulfilment of its obligation to negotiate under s 31(1)(b).
(iii)The GP remained silent when it was aware that the false representation that negotiations of M47/1404 would occur in the future was being relied upon by the FNTP to its detriment.
(iv)The GP wrote to the Government Party stating that it was negotiating with the FNTP in respect of the grant of M47/1404 (Affidavit of Shaz Rind sworn 8 February 2008 paragraph 11, Attachment SR6) while assuring the FNTP that the negotiations would be deferred to future negotiations over a whole of claim agreement.
(v)The GP told the Government party that there was no need for the Government Party to be actively involved in the negotiations between the GP and the FNTP (Affidavit of Shaz Rind sworn 8 February 2008 paragraph 24, Attachment SR17) and then filed a s35 application so that the government party was unable to fulfil its obligations to try to facilitate an agreement or carry out any good faith negotiations itself.”

[72] In Brownley v Western Australia (1999) 95 FCR 152 Lee J observed (at 162-3/[25]): “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.”

In assessing whether a negotiation party has not negotiated in good faith, the Tribunal is required to look at the totality of the material before it. Moreover “honesty and good faith in the conduct of a government will be judged objectively, not by whether a government believes that it has so acted” – Brownley v Western Australia at 163/[27].
On the evidence produced no finding can be made that the grantee party was deliberately engaging in disingenuous conduct of the type outlined by Lee J. The proper inference to be drawn from the evidence is that the grantee party discharged its duty fairly and conscientiously. There is no evidence that the grantee party deliberately avoided negotiating about the proposed tenement and engaged in deliberately misleading behaviour which was designed to avoid engaging in meaningful negotiations with the first native title party. No inference can be drawn that the grantee party deliberately sought to include the proposed tenement in the wider LAA negotiations so that it would thereby avoid the duty to negotiate in good faith, and would, at the first available opportunity make application for the tenement to be arbitrated.
The inference I draw is that the grantee party has had from the outset a genuine desire to reach accord with the native title parties. It set itself an ambitious target of attempting to reach claim wide agreements with various claim groups and simultaneously advance individual tenement applications. So far as the proposed tenement is concerned, I find that it was included in the broader LAA negotiations without any ulterior and dishonest intentions. I find that there was no intention by the grantee party to avoid the right to negotiate requirements for this tenement. I further find that the grantee party genuinely and honestly attempted to progress negotiations but acted too quickly in lodging its future act determination application.
It is clear that a more sinister interpretation could be placed on the negotiations, but such an interpretation would fail to take into account the broader context of the negotiations relating to the proposed tenement and the way that those negotiations were conducted up until November 2007. As I have previously said, those negotiations, as far as they went, were conducted in a professional and honest manner.
The inference I draw from the evidence is that the grantee party was acting honestly throughout, but made an error of judgment in seeking an arbitrated resolution of the proposed tenement when negotiations over that tenement were only in their infancy. The cause of this precipitate action is unclear, other than a mistake as to the legal entitlements of the grantee party.

The Grantee Party’s Negotiations with Second Native Title Party

I have already dealt with the contentions of the second native title party so far as 33(1) payments are concerned.
The negotiations between the grantee party and the second native title party were somewhat different to those with the first native title party. The evidence discloses that negotiations with the second native title party for a “whole of claim” agreement have been proceeding for a considerable period of time, and at least since July 2006. It would also appear that the major impediment to concluding this agreement has been finalisation of a financial benefits package. The grantee party contended (GPSC at para 11.5) that it met on at least 10 occasions during 2006 and 2007 with representatives of the second native title party in an endeavour to finalise the whole of claim agreement. Since the notification day for the proposed tenement there were two detailed meetings held on 22 June 2007 and 12 September 2007 with representatives of the grantee party and negotiators and representatives of the second native title party.
The clear indication from the evidence is that an impasse was reached at the 12 September 2007 meeting about an appropriate financial package for the LAA and no further meetings were agreed. The material before the Tribunal discloses that there were no substantial discussions between the grantee party and the second native title party about the grant of the proposed tenement.

[81] When negotiations stalled on the LAA, no attempt was made by the grantee party to then separate from those stalled discussions a process for negotiating in good faith about the proposed tenement. The grantee party seeks to rely on those broader discussions to discharge its obligation to negotiate in good faith with respect to the proposed tenement. However, those broader discussions were focused on basically one issue and were not productive.

However, there was an obligation placed on the grantee party if it believed that the broader LAA process was stalled or incapable of being resolved, to then revive the negotiations about the proposed tenement. It would be unreasonable and contrary to the requirements of s.31(1)(b) for the grantee party to claim that it had fulfilled its duty to negotiate in good faith to obtain the doing of the future act, when it relied upon failed general negotiations which never even substantively addressed the proposed tenement.
Further, the negotiations over the LAA had stalled by 12 September, more than two months prior to the grantee party making its future act determination application. At no time during this period did the grantee party seek to commence discussions on the proposed tenement.
It may be that even if the grantee party had disaggregated the proposed tenement from the broader LAA negotiations it would have quickly reached an impasse with the second native title party over the same type of issues that stalled the LAA discussions. In such a case the grantee party could then have (subject to 6 months having elapsed from the notification day) made application for a future act determination pursuant to sections 35 and 75. However, the grantee party has not chosen this path, and the Tribunal is required to assess the question of good faith negotiations based entirely on the more general LAA negotiations.
The broader LAA negotiations did not at any stage deal substantively with the effect of the proposed future act on the registered native title rights and interests of the second native title party. Fundamentally the problem faced by the grantee party is that the only negotiation even entered into with the second native title party about the proposed tenement was an agreement that they could be included in the broader negotiations. While information about the proposed tenement was provided to the second native title party by both the government party and the grantee party, no discussions were ever held.

[86] It is possibly conceivable that even in these circumstances the Tribunal could find that there were good faith negotiations if there was an explicit agreement between the parties at the outset that specific negotiations were not necessary. This would be the case where, for example, there was already a process agreement in place which governed the relations of the parties and ensured that the possible impact of the doing of the future act on the registered rights and interests of the native title party would be appropriately dealt with. Further, if the parties agreed to subsume a right to negotiate process into broader negotiations such as in this case, then in appropriate cases, the broader negotiations may satisfy the right to negotiate requirements of the Act. However, in no circumstances will the requirements of s.31(1)(b) be met when the parties have not concluded a broader agreement, or such negotiations have stalled, but there have been no substantive negotiations on the relevant future act.

The High Court observed in Fejo v Northern Territory (1998) 195 CLR 96 (at 121) that “one important aspect of the protection that the Act gives to native title is the right to negotiate”. The Court also said that “(t)he right is a valuable right that may be exercised before the validity of an accepted claim has been determined.” In the case of the second native title party the right is vested as there has been a determination of native title pursuant to section 13.
In the context of an area where native title has been recognised when the valuable right to negotiate is being considered care has to be taken to ensure that this valuable right is not lost or diminished and that each of the negotiation parties has fulfilled their statutory obligation.

[89] In these circumstances I find that the grantee party has not discharged its obligation to negotiate in good faith with the second native title party.

Conclusion

Section 31 requires the negotiation parties to negotiate in good faith with a view to obtaining an agreement for the doing of the relevant future act. There is ample authority on how to evaluate whether the parties have negotiated in good faith. However, it is important to recognise that even if the parties have commenced negotiating in good faith they may not satisfy the requirement of s.31(1)(b). The Tribunal is required to assess the conduct of the parties until a future act determination application is made. Neither failure to reach agreement or termination of negotiations by the lodging of a future act determination application alone demonstrates a failure to negotiate in good faith. The Tribunal must assess all of the material and reach a view objectively about the way in which the parties have negotiated. It is important to recognise that negotiations take place over time. Parties can approach negotiations honestly and reasonably, yet not meet the good faith requirements of the Act if the negotiations conclude while they are still at an early stage. The Act, when referring to the right to negotiate, is envisaging negotiations which have advanced to such a stage where reasonable efforts have been made to reach an accord. The indicia of good faith negotiation are all centred on the parties meeting, discussing, compromising and actively engaging in discussions. In short the indicia recognise a process which is comprised of numerous activities and negotiations which, unless a native title party refuses to participate, has reached an advanced stage.
I have formed the view that the grantee party approached its negotiations with both native title parties with an open mind and its conduct when viewed against the indicia outlined by Deputy President Sumner in Western Australia v Taylor (1996) 134 FLR 211 suggests that it had commenced to negotiate in good faith. The grantee party did initiate communications, did make proposals, did punctually respond to communications, organised and attended meetings, facilitated and engaged in discussions, made counter-proposals, sent properly authorised negotiators and did not adopt a rigid non-negotiable position. Despite this the grantee party has not met the standard required by s.31(1)(b). It has not met that standard because although it approached the negotiations in a reasonable and honest way it never advanced them to a stage where it could be said that it discharged its duty to negotiate in good faith. The duty to negotiate in good faith requires the parties to constructively engage in a process aimed at obtaining an agreement. The duty is not discharged where one party unilaterally concludes the negotiations which were at a embryonic stage before agreement can be reached (as occurred with the first native title party) or fails to engage in specific negotiations when it became clear that the broader LAA negotiations had stalled (as occurred with the second native title party). In both instances the grantee party offered, and the native title parties agreed, to a process whereby the proposed tenement would be negotiated in the context of broader claim-wide negotiations. In both instances when the negotiations were terminated by the lodging of a future act determination application there was neither a resolution of the claim-wide agreements nor any substantive negotiations concerning the doing of the proposed future act.
While the duty to negotiate in good faith does not require that an agreement must be reached, it does require that the parties engage in negotiations aimed at reaching an agreement. The grantee party chose to incorporate negotiations for the future act in broader ranging discussions. This, however, did not absolve the parties from negotiating about the future act. In both instances the parties had reached agreement on process but never advanced to substance. In so far as the process negotiations were concerned, the grantee party negotiated in good faith, but the negotiations were embryonic and accordingly the obligation imposed by s.31(1)(b) was not met.

Decision

The grantee party did not fulfill its obligation to negotiate in good faith as required by paragraph 31(1)(b) of the Native Title Act 1993 (Cth) and the Tribunal has no jurisdiction to conduct an inquiry and make a determination pursuant to section 38.

John Sosso

Deputy President