FMG Pilbara Pty Ltd/ Ned Cheedy and Others on behalf of the Yindjibarndi People/ Western Australia
[2009] NNTTA 38
•24 April 2009
NATIONAL NATIVE TITLE TRIBUNAL
FMG Pilbara Pty Ltd/ Ned Cheedy and Others on behalf of the Yindjibarndi People/ Western Australia, [2009] NNTTA 38 (24 April 2009)
Application No: WF08/31
IN THE MATTER of the Native Title Act1993 (Cth)
- and -
IN THE MATTER of an inquiry into a future act determination application
FMG Pilbara Pty Ltd (grantee party/applicant)
- and -
Ned Cheedy and Others on behalf of the Yindjibarndi People WC03/3 (native title party)
- and -
The State of Western Australia (Government party)
DECISION ON WHETHER THE TRIBUNAL HAS POWER TO CONDUCT AN INQUIRY
Tribunal: Daniel O’Dea, Member
Place: Perth
Date: 24 April 2009
Catchwords: Native title – future act – application for a determination in relation to mining lease – jurisdiction – whether Government and grantee parties have negotiated in good faith – scope of the obligation to negotiate in good faith (s 31(2)) – no obligation on Government party to negotiate in good faith about compensation or s 33(1) payments – conduct to be judged from the negotiations overall – Government and grantee parties have negotiated in good faith.
Legislation:Aboriginal Heritage Act 1972 (WA) s18
Native Title Act 1993 (Cth) ss 29, 31, 33, 35, 36(2), 38, 39, 109, 155,
Mining Act 1978 (WA) s 125
Cases:Angelina Cox & Ors on behalf of the Puutu Kunti Kurrama & Pinikura People/ Wintawari Guruma Aboriginal Corporation/Western Australia/FMG Pilbara Pty Ltd, NNTT WF07/40, [2008] NNTTA 90 (11 July 2008), John Sosso
Brownley v Western Australia, (1999) 95 FCR 152
Cameron v Hoolihan (2005) 196 FLR 37
Daniel v State of Western Australia [2005] FCA 536
Doxford/Janice Barnes, Jessie Diver, Owen McEvoy, Deree King, Patrick Fisher (Wangan and Jagalingou)/State of Queensland, NNTT QF08/1, [2008] NNTTA 54 (28 April 2008), John Sosso.
Griffin Coal Mining Co Pty Ltd v Nyungar People (Gnaala Karla Booja)/Western Australia, [2005] NNTTA 100; (2005) 196 FLR 319; Hon C J Sumner, Deputy President
Gulliver Productions Pty Ltd/ Western Desert Lands Aboriginal Corporation (Jamukurnu-Yapalikunu)/Darcy Hunter & Ors on behalf of Nyangumarta People/Karajarri Traditional Lands Association (Aboriginal Corporation)/Western Australia, NNTT WF05/1, [2005] NNTTA 88 (30 November 2005), Hon C J Sumner, Deputy President
Hughes v Western Australia (2003) 182 FLR 362
Minister for Lands, State of Western Australia/Marjorie May Strickland and Anne Joyce Nudding on behalf of the Maduwongga People/Brian and Dave Champion, Cadley and Dennis Sambo, George Wilson and Clem Donaldson for their respective (Gubrun) families/Dorothy Dimer, Ollan Dimer and Henry Richard Dimer on behalf of Mingarwee (Maduwonjga) People, NNTT WF97/4, [1997] NNTTA 31 (10 December 1997), Hon C J Sumner, Member.
Minister for Mines, State of Western Australia/Kevin Peter Walley on behalf of the Ngoonooru Wadjari People, NNTT WF97/5, [1998] NNTTA 4 (25 March 1998), Hon C J Sumner, Member
Placer (Granny Smith) Pty Ltd & Anor v Western Australia/Ron Harrington Smith & Others on behalf of the Wongatha People [1999] NNTTA 361; (1999) 163 FLR 87, Hon C J Sumner, Member
Repochi v the Minister for Immigration and Ethnic Affairs (1979) 26 ALR 247, Brennan J
Risk v Williamson, (1998) 87 FCR 202
Rita Dempster & Ors (Southern Noongar)/Bayside Abalone Farm Pty Ltd & Anor/Western Australia, NNTT WF99/1, [1999] NNTA 235 (27 August 1999), Hon E M Franklyn QC
Townson Holdings Pty Ltd and Joseph Frank Anania/Ron Harrington-Smith & Ors on behalf of the Wongatha People/June Ashwin & Ors on behalf of the Wutha People/Western Australia, [2003] NNTT WF03/2, NNTTA 82 (9 July 2003), Hon C J Sumner
Western Australia v Taylor [1996] NNTTA 34; (1996) 134 FLR 211
Western Australia/Champion & Ors/Resolute Ltd, NNTT WF97/8, [1998] NNTTA 6 (27 July 1998), Member Lane
Hearing dates: n/a
Counsel for the
native title party: Mr George Irving
Solicitor for the
native title party: Mr Simon Millman, Slater and Gordon Lawyers
Solicitor for the
grantee party: Mr Sukhpal Singh, FMG Pilbara Pty Ltd
Counsel for the
Government party: Mr Matthew Pudovskis, State Solicitor’s Office
Representative of the
Government party: Ms Paola O’Neill, Department of Mines and Petroleum
REASONS FOR DECISION ON WHETHER THE TRIBUNAL HAS POWER TO CONDUCT AN INQUIRY
Background
On 23 April 2008, the State of Western Australia (‘the Government party’) gave notice under s 29 of the Native Title Act 1993 (Cth) (‘the Act’/‘NTA’) of a future act, namely the grant of mining lease M47/1413 (‘the proposed lease’) under the Mining Act 1978 (WA) to FMG Pilbara Pty Ltd (‘the grantee party’).
The proposed lease comprises some 1037.12 hectares of vacant crown land situated 45 kilometres west of Wittenoom in the Shire of Ashburton and is 100 percent overlapped by the registered claim of the Yindjibarndi People (WC03/3, registered from 8 August 2003). Two underlying exploration licences held by the grantee party since 2 June 2007 completely overlap the proposed lease (E47/1447 and E47/1334). There is no history of any other mining or exploration activity over the area.
The native title party in respect of these proceedings is as follows.
·Mr Ned Cheedy, Ms Mavis Pat, Ms Aileen Sandy, Ms Edie Whalebone, Mr Thomas Jacob, Ms Sylvia Allen, Mr Alum Cheedy, Mr Michael Woodley, Name Withheld for Cultural Reasons and Name Withheld for Cultural Reasons on behalf of the Yindjibarndi People (WC03/3) (‘the native title party’)
On 28 November 2008, being a date more than six months after the s 29 notice was given, the grantee party made an application pursuant to s 35 of the Act for a future act determination under s 38 (‘the Application’). The Application was made on the basis that the negotiation parties had not been able to reach agreement within six months of the Government party giving notice of its intention to do the act.
At the preliminary conference on 15 December 2008 the native title party advised the Tribunal that it intended to allege that the grantee and Government parties had not negotiated in good faith with the native title party in accordance with s 31(1)(b) of the Act and accordingly, pursuant to s 36(2), the Tribunal did not have jurisdiction to make the determination requested in the application. In consequence, a series of orders were made relating to the presentation of materials relevant to the conduct of the negotiations to the Tribunal in order that it might determine this jurisdictional issue. There were a series of requests for extensions of time by the native title party and consequent extensions to the other parties. The Tribunal was also provided with extensive audiovisual materials relevant to a meeting that had taken place between the grantee and native title parties. All parties have filed extensive submissions and affidavit evidence germane to the issue. No party indicated on the listing date that they sought to have the matter dealt with other than on the papers and I believe it appropriate to do so in the circumstances.
Before I proceed further, it is important to understand that while this application seeks a determination pursuant to s 38 of the proposed lease (ie M47/1413), during all of the discussions and negotiations considered below, that lease was always discussed as one of a batch of three such mining lease applications. The proposed lease was the only one entirely within the native title party’s claim area. The other two sat astride the native title party’s claim and the determined native title area of the Eastern Guruma People. Those other two mining lease applications are the subject of a separate s 35 application (WF09/1). For the purposes of clarity, I set out the details of each of these mining lease applications below:
MINING LEASE APPLICATION APPLICANT S 29 NOTIFICATION DATE 6 MONTH DATE M47/1409 FMG Pilbara Pty Ltd 7 November 2007 7 May 2008 M47/1411 FMG Pilbara Pty Ltd 30 January 2008 30 July 2008 M47/1413 FMG Pilbara Pty Ltd 23 April 2008 23 October 2008
Good faith negotiations – jurisdiction
The Tribunal must be satisfied as a pre-condition to determining a s 35 application that parties have negotiated in good faith as required by s 31(1)(b) of the Act. Once the issue has been raised, the Tribunal must deal with it in order to satisfy itself that it has the jurisdiction to proceed to make a determination under s 38. This is so, even if the issue is raised belatedly (Townson Holdings Pty Ltd and Joseph Frank Anania/Ron Harrington-Smith & Ors on behalf of the Wongatha People/June Ashwin & Ors on behalf of the Wutha People/Western Australia, [2003] NNTT WF03/2, NNTTA 82 (9 July 2003), Hon C J Sumner (at 12-16) ).
The Tribunal has ruled that the effect of s 36(2) is to place an ‘evidential burden’ on the party alleging lack of good faith in negotiations which would normally require that party to produce evidence to support its allegations. The Tribunal is not required to adopt strict rules on the burden of proof but any party alleging a lack of good faith in negotiations must provide contentions and documents which specify in detail the matters it relies on (Rita Dempster & Ors (Southern Noongar)/Bayside Abalone Farms Pty Ltd & Anor/Western Australia, NNTT WF99/1, [1999] NNTTA 235 (27 August 1999) Hon E M Franklyn QC, Deputy President (at pps 4, 21); Placer (Granny Smith) Pty Ltd & Anor v Western Australia/Ron Harrington Smith & Others on behalf of the Wongatha People, [1999] NNTTA 361 (1999); 163 FLR 87; Hon C J Sumner, Member at [21]-[28]).
Good faith negotiations – legal principles
The obligation to negotiate in good faith is contained in s 31 of the Act:
‘31 Normal negotiation procedure
(1)Unless the notice includes a statement that the Government party considers the act attracts the expedited procedure:
(a)the Government party must give all native title parties an opportunity to make submissions to it, in writing or orally, regarding the act; and
(b)the negotiation parties must negotiate in good faith with the view to obtaining the agreement of each of the native title parties to:
(i) the doing of the act; or
(ii) the doing of the act subject to conditions to be complied with by any of the parties.
Note:The native title parties are set out in paragraphs 29(2)(a) and (b) and s 30. If they include a registered native title claimant, the agreement will bind all of the persons in the native title claim group concerned: see subsection 41(2).
Negotiation in good faith
(2)If any of the negotiation parties refuses or fails to negotiate as mentioned in paragraph (1)(b) about matters unrelated to the effect of the act on the registered native title rights and interests of the native title parties, this does not mean that the negotiation party has not negotiated in good faith for the purposes of that paragraph.’
In Gulliver Productions Pty Ltd/Western Desert Lands Aboriginal Corporation (Jamukurnu-Yapalikunu)/Darcy Hunter & Ors on behalf of Nyangumarta People/Karajarri Traditional Lands Association (Aboriginal Corporation)/Western Australia, NNTT WF05/1, [2005] NNTTA 88 (30 November 2005), Hon C J Sumner, Deputy President, (‘Gulliver’), the Tribunal considered the applicable legal principles to the issue of negotiation in good faith (at [8]-[20]). The Tribunal further explored the law surrounding the scope of the obligation to negotiate in good faith in Griffin Coal Mining Co Pty Ltd v Nyungar People (Gnaala Karla Booja)/Western Australia, [2005] NNTTA 100; (2005) 196 FLR 319; Hon C J Sumner, Deputy President (‘Griffin’) (at 328-329/[31]-[35] and 331-334/[39]-[47]). I adopt those findings for the purposes of this inquiry.
Contentions and evidence
The native title party has provided the following evidence and submissions supporting its contention that the Government and grantee parties did not negotiate in good faith regarding the doing of the act:
·Native title party’s statement of contentions, lodged with the Tribunal on 12 February 2009
·Affidavit of Michael Woodley, lodged 12 February 2009 and sworn on 24 February 2009, dealing with the negotiations between March 2008 and 26 November 2008, and attaching a draft Yindjibarndi Heritage Agreement and correspondence dated between 14 March 2008 and 20 May 2008 – annexures ‘MW1’ to ‘MW6’
·Affidavit of Simon Alexander Millman, sworn on 12 February 2009, dealing with the negotiations between 14 May 2008 and 26 November 2008, and attaching correspondence from that period – annexures ‘SM1’ to ‘SM18’
·Native title party’s reply to the Government party, lodged with the Tribunal on 16 March 2009
·Native title party’s reply to the grantee party, lodged with the Tribunal on 16 March 2009.
·Native title party’s statement of contentions in reply to the grantee party’s statement of facts, lodged with the Tribunal on 31 March 2009
The grantee party’s evidence and submissions in relation to the good faith issue comprised the following documents:
·Grantee party’s statement of contentions lodged 3 March 2009
·Grantee party’s statement of facts lodged 3 March 2009 comprising a history of negotiations initially over a whole of claim land access agreement (‘WOCLAA’) and subsequently over the proposed lease from 7 February 2007 until 28 November 2008 (lodgement of the Application) and supporting documents –‘GP1’ to ‘GP55’
·Affidavit of Blair William McGlew, sworn 24 February 2009, dealing with the above negotiations between February 2007 until an unspecified time after June 2008, and attaching correspondence and other documents dated between 30 May 2007 and 12 September 2008 – annexures ‘BM1’ to ‘BM17’
·Grantee party’s response to the electronic audiovisual evidence, lodged with the Tribunal on 26 March 2009
·Grantee party’s response to the native title party’s contention that the grantee party’s statement of facts is inadmissible, lodged with the Tribunal on 1 April 2009
The Government party’s evidence and submissions in relation to the good faith issue comprise the following documents:
·Government party’s statement of contentions, lodged with the Tribunal on 3 March 2009
·Affidavit of Paola O’Neill, sworn 3 March 2009, providing an overview of negotiations, and attaching correspondence and other documents dated between 14 December 2007 and 27 November 2008 – annexures ‘PON1’ to ‘PON19’
Additionally, at the request of the grantee party and with the consent of all parties, on 6 March 2008 the native title party provided the Tribunal and the parties with an audiovisual recording of a three day negotiation meeting held on 10-12 June 2008 in Roebourne between the grantee party and the native title party (‘the June 2008 Meeting’). The audiovisual recording was edited by the native title party in order to remove any material involving private conversations amongst the native title party and their legal representatives that might have been legally professional privileged or otherwise confidential. The remaining material related solely to the discussions between the native title party and the grantee party and their respective representatives on 11 and 12 June 2008. The audiovisual recording is the subject of a s 155 order prohibiting its disclosure to any other person and limiting its use for the purposes of the inquiry into the Application and another related application also before the Tribunal (WF09/1).
The native title party objected to the reception of the grantee party’s statement of facts as being inadmissible as evidence in this matter. The document in question contained an extensive list of events, frequently, but not always, referenced to the documents contained in a lengthy list of documents also provided by the grantee party in this matter. The native title party contended that the grantee party’s statement of facts was more in the nature of a chronology of events, not all of which were referenced documents and many of which, in the explanatory column, asserted a state of mind as to the grantee party’s apparent intentions at the time. In addition, the native title party asserted that the statement of facts concerned was not an affidavit and because no one had attested to the truth of the facts contained within, it therefore should not be considered by the Tribunal in making its assessment in this matter. The grantee party contested the native title party’s submissions, asserting that, of the 64 events listed, only eight were not supported by documentary evidence, and those eight referred to either matters that were ‘self evidently correct or manifestly true’. Some of the matters refer to events, which I do not take to be in dispute, such as event 10 relating to the grant of mining tenements by the Government party, event 38 being the fact that the notification day for M47/1413 was 23 April 2008, event 53 noting the handing down of a decision in relation to another matter by the Tribunal (Angelina Cox & Ors on behalf of the Puutu Kunti Kurrama & Pinikura People/ Wintawari Guruma Aboriginal Corporation/Western Australia/FMG Pilbara Pty Ltd, NNTT WF07/40, [2008] NNTTA 90 (11 July 2008), John Sosso(‘Angelina Cox’), event 55 being the filing of a Notice of Appeal in the Angelina Cox case by the grantee party, event 59 as the expiry of the 6 month notification period for the proposed lease being 23 October 2008, and event 64 as the lodgment of the s 35 application in this matter on 28 November 2008. In any event, pursuant to s 109 of the NTA, the Tribunal, in carrying out its statutory functions, has a wide degree of latitude and is not bound by the rules of evidence. The Tribunal must make a determination on the facts properly before it and it is entitled to have regard to any evidence which is logically probative, whether it is legally admissible or not (see Repochi v the Minister for Immigration and Ethnic Affairs (1979) 26 ALR 247 per Brennan J at 256-7). The fact that the Tribunal is not bound by the rules of evidence does not necessarily mean that it will not utilise those rules when making an assessment as to the logically probative nature of evidence before it. Irrespective of the rules relating to evidence, the Tribunal is bound by the rules of natural justice and, consequently, every party must be given an opportunity to be heard and make submissions before a fair, thorough and impartial assessment will be made (see Hughes v Western Australia (2003) 182 FLR 362 at 365).
In my view, all of the material provided by the grantee party is properly before the Tribunal albeit the matters that are contained in the grantee party’s statement of facts is not primary evidence in the technical sense. I have examined both the list of events and the documents which, in most cases, are associated with them in the party’s list of documents and come to the conclusion that most of the documents to which the native title party specifically contends are inadmissible, are, irrespective of their inadmissibility, largely irrelevant to my necessary deliberations, being the question as to whether the parties have negotiated in good faith in relation to the proposed lease. In my view the events listed in the statement of facts prior to event 37, (which makes reference to the application by the grantee party for the mining lease in question) or the listed documents prior to document 32, (which is a letter from the grantee party to the native title party dated 1 May 2008 making reference to a meeting that took place on 23 April 2008), are for the main irrelevant for the purposes of this inquiry.
There is one caveat to the proposition concerning the relevance to the material prior to 16 April 2008. Although the material is not relevant to discussions concerning the proposed lease, it does shed light on the previous relationship between the parties and the nature of their discussions. However, it is not until the letter of 16 April 2008 and the subsequent meeting on 23 April 2008, that the parties began to address the question of the proposed lease. As Member Sosso has observed (Cameron v Hoolihan (2005) 196 FLR 37 at 47):
‘There is no restriction on the Tribunal to receive into evidence past conduct of a negotiation party, if it is relevant to the issue of good faith. It would be wholly artificial to limit material to conduct arising after the commencement of good faith negotiations. Clearly parties engaged in such negotiations are influenced by a range of factors, and past negotiations and conduct may well be relevant not only to assessing the negotiations but also the overall tenor of the proceedings. The Tribunal and Federal Court have recognized that relationships do change once negotiations start, and if a party was so influenced by past negotiations that they did not approach the new negotiations with an open mind and a preparedness to reach a reasonable accord, they would be the party failing to negotiate in good faith [47].’
Consequently I have had regard to the material prior to 16 April 2008 for the limited purposes discussed above.
Native title party’s statement of contentions
In its statement of contentions, the native title party contends at para 2.16 that, despite the 10-12 June 2008 Meeting held in Roebourne (‘the June 2008 Meeting’) and other meetings held between the native title party and the grantee party, the grantee party failed to negotiate in good faith because:
1) The grantee party’s focus prior to June 2008 on a Whole of Claim Land Access Agreement (WOCLAA) ‘obfuscated negotiations concerning the tenement so that the Yindibarndi were unaware of the need to focus on it and when it might be made the subject of s 35 determination application’ (citing in support Angelina Cox);
2) Once the native title party was made aware of the need to focus on the proposed lease, there was no grantee party representative present at the June 2008 Meeting with the authority to negotiate and make a counter offer on the native title party’s request for an uncapped, rather than capped, royalty rate (citing in support Doxford/Janice Barnes, Jessie Diver, Owen McEvoy, Deree King, Patrick Fisher (Wangan and Jagalingou)/State of Queensland, NNTT QF08/1, [2008] NNTTA 54 (28 April 2008), John Sosso (‘Doxford’));
3) The grantee party delayed for nearly three months after the June 2008 Meeting before making the counter offer on the native title party’s request for an uncapped, rather than capped, royalty rate (citing in support Doxford); and
4) The counter offer ‘was an unreasonable retreat from what had previously been offered’ (citing in support Doxford).
The native title party also contends that the Government party failed to negotiate in good faith. It contends the Government party invited the native title party’s submission on all the matters set out in s 39 of the Act (‘s 39 submission’) (a requirement under s 31(1)(a) of the Act), but in its response of 26 November 2008 the Government party ‘addressed only one aspect [of the s 39 submission] and ignored the rest’ (native title party’s statement of contentions, para 3). That ‘aspect’ was the native title party’s request that the Government party impose an annual 2.5 percent FOB royalty payable by the grantee party to the native title party as a condition of grant of the proposed lease. In responding that the scheme of the Mining Act 1978 (WA) and regulations does not contemplate the imposition of such conditions, the native title party contends that the Government party ‘offered no opening for further discussions but simply applied a policy to control its participation in negotiations’ (para 3, citing Brownley v Western Australia, (1999) 95 FCR 152 (‘Brownley’) at 169/[54]-[55].
Grantee party’s statement of contentions
In response to the four contentions of the native title party, the grantee party contends that:
1) The native title party concedes in its statement of contentions that it did not consider negotiations over the proposed lease ‘obfuscated’ from the period of June 2008 to the lodgement of the application and that it ‘cannot complain about a state of affairs which the Grantee Party corrected five months prior to the ... application’ (grantee party’s statement of contentions, para 5.4);
Whether the native title party was ‘unaware’ of the ‘need to focus’ on the proposed lease and of when a s 35 determination application may be made are contentions not supported by the requirements under s 31(1)(b) of the Act nor by Angelina Cox or any other authority (para 5.5) and in any event, it considers that Angelina Cox was ‘wrongly decided’ and has argued such by way of an appeal heard before the Full Federal Court with determination pending (WAD 169 of 2008) (paras 5.8 to 5.10);
2) Mr McGlew attended the June 2008 Meeting with the authority to negotiate on behalf of the grantee party and that the native title party ‘confused “authority” with willingness to make an immediate and specific proposal’ because ‘he had to work out the figures’ for an uncapped royalty rate before providing a counter offer to the native title party (paras 6.2-6.7);
3) Negotiations continued following the June 2008 Meeting culminating in a counter offer sent on 2 September 2008 and that the delay in responding was due to a number of factors including illnesses in the grantee party’s office; Mr McGlew taking annual leave; the need for ‘time to put together an uncapped payments offer, which is something that FMG had never been previously asked to do’; and the Angelina Cox decision (and subsequent appeal by the grantee party) which made it ‘plainly necessary for the Grantee Party to consider its negotiating position’ - all factors that were communicated to the native title party (para 7);
4) The grantee party advised the native title party on a number of occasions that it ‘was only willing to pay a premium for a WOCLAA’ and that a counter offer ‘limited to the grant of the mining leases specified’ would be ‘therefore less than what was proposed in the context of Land Access Agreement negotiations which cover a broader scope’. The comparison between a capped and uncapped royalty ‘is not easily determined ... [and] certainly cannot be determined by simple reference to the rates involved’ (paras 8.6 and 8.4).
In addition, the grantee party contends that:
5) The native title party failed to negotiate in good faith ‘by reason of its continued refusal to provide copies of the video recordings of the negotiation meetings ... particularly in circumstances where the Grantee Party paid for the recordings to occur’. The ‘refusal’ denied the grantee party the opportunity to have its advisors review the content and that ‘the alleged delay in forwarding the 2 September 2008 letter [counter offer] might reasonably have not occurred if the Grantee Party’s advisors had been able to review the video recording of the June 2008 Meeting, particularly in circumstances where Mr McGlew was on annual leave and Ms McGinty had left the employ of the Grantee party’ (para 9.1)
6) The ‘refusal’ also denied the grantee party the opportunity to prepare its documents for the Application (para 9.1)
7) The grantee party has satisfied the requirements of s 31(1)(b) of the Act and has negotiated in good faith because:
a)‘At a very early stage’ the grantee party provided ‘a detailed and comprehensive’ draft WOCLAA ‘which clearly contemplated the grant of the Tenement’;
b)It ‘was willing to fund an experienced lawyer’ for the native title party;
c)It ‘was willing to accommodate the NTP’s demands that negotiations occur only with the Grantee Party’s Chief Executive, Mr Andrew Forrest’;
d)It ‘was willing to pay the NTP to attend negotiations meetings’;
e)It provided an uncapped royalty counter offer as requested by the native title party;
f)At least nine meetings were held between representatives of the grantee party and the native title party; and
g)
‘Multiple proposals have been put and considered. The negotiations ... have included numerous communications and meetings. A number of detailed and comprehensive draft agreements have been proposed by the Grantee Party and has been the subject of discussions between the NTP and the Grantee Party’
(para 10)
Government party’s statement of contentions
In response to the native title party’s contention that the Government party failed to negotiate in good faith, the Government party contends that:
1) Section 31 of the Act contains two obligations:
a)The Government party must give all native title parties an opportunity to make submissions to it, in writing or orally, regarding the future act - s 31(1)(a)
b)The negotiation parties must negotiate in good faith with a view to obtaining the agreement of the native title parties to the doing of the future act with or without conditions - s 31(1)(b) (para 4)
and that the Government party is obliged only to negotiate about the effect of the act on the registered native title rights and interests. It contends that s 39 of the Act is a reasonable practical guide to what the Government party (and grantee party) is required to negotiate about (para 15, citing in support Minister for Mines, State of Western Australia/Kevin Peter Walley on behalf of the Ngoonooru Wadjari People, NNTT WF97/5, [1998] NNTTA 4 (25 March 1998), Hon C J Sumner, Member, p.48) and that it has negotiated in good faith as required by s 31(1) of the Act (para 8);
2) The Tribunal has found the ‘evidential burden’ is on the party alleging lack of good faith negotiations (para 6, citing Risk v Williamson, (1998) 87 FCR 202) and the native title party has not provided ‘any other evidence in support of its contention’ other than providing the Government party’s 26 November 2008 response to the native title party’s s 39 submissions (para 19);
3) ‘Negotiation in good faith does not mean the Government party must capitulate or accept the other side’s position or that agreement must be reached’ (para 17, citing in support Western Australia v Taylor [1996] NNTTA 34; (1996) 134 FLR 211 (‘Njamal’), p.15, and Minister for Lands, State of Western Australia/Marjorie May Strickland and Anne Joyce Nudding on behalf of the Maduwongga People/Brian and Dave Champion, Cadley and Dennis Sambo, George Wilson and Clem Donaldson for their respective (Gubrun) families/Dorothy Dimer, Ollan Dimer and Henry Richard Dimer on behalf of Mingarwee (Maduwonjga) People, NNTT WF97/4, [1997] NNTTA 31 (10 December 1997), Hon C J Sumner, Member, p.10)
4) The native title party’s assertion that it did not negotiate in good faith is based solely upon its 26 November 2008 response to the native title party’s request that a condition regarding royalties be imposed. The native title party has not contended that it did not negotiate in good faith generally, had a subjective lack of honesty or sincerity, or failed to make any reasonable or substantive offers (paras 22-23)
5) The reasonableness of its 26 November 2008 response to the native title party’s s 39 submission ‘must be judged in light of the fact the grantee party lodged a s 35 application on 28 November 2008. The Conduct of the Government Party after that time is irrelevant to whether it negotiated in good faith in this inquiry’ (para 25, citing in support Angelina Cox at [31])
6) The native title party’s s 39 submission is ‘expressed in very general terms’ and, besides the request that a condition regarding royalties be imposed, contains no other substantive proposals or suggestions as to how the Government party might assist or involve itself (paras 27-46). Therefore ‘in all the circumstances’ its response was reasonable because:
a)It dealt with the only substantive proposal contained in the native title party’s s 39 submission;
b)Its response to the proposal was reasonable; and
c)It did not refuse to negotiate further and expected further communications on the s 39 submission (para 26)
7) The native title party cites Brownley at para [54]-[55] ‘in support of its contention that the Government Party refused to negotiate about the Proposal’ however ‘there is no factual or legal foundation for the (apparent) contention’ because:
a)Brownley was based on the Act before the 1998 amendments which did not contain s 31(2) of the Act and was decided without reference to s 125A of the Mining Act 1978 (WA) which was not in effect at the time the decision ‘appealed’ from was made by the Tribunal (paras 49-53, citing in support Griffin at 333[41]-334[45]).
b)The Government party did not ignore or refuse to consider the proposal, but assessed and considered its response by undertaking internal discussions in the Department of Mines and Petroleum and seeking legal advice from the State Solicitor’s Office as to whether the proposal was legally possible (para 54).
8)The Government party’s position on the Proposal ‘was not expressed to be Final. It expected the Native Title Party’s reply, but this did not eventuate ... [and] [a]t all times the Government party was ready, willing and able to negotiate further about the Proposal, or any aspect of the submission’ (paras 55-56)
9)Addressing its conduct against all the Njamal indicia of failing to negotiate in good faith, it negotiated in good faith generally (paras 59-82)
10)The conduct of the native title party and grantee party, in choosing bilateral rather than trilateral negotiations ‘is a relevant consideration which the Tribunal should take into account when determining whether the Government Party has satisfied its obligation to negotiate in good faith’ (para 86)
Native title party’s replies to the grantee and Government parties’ contentions
In its reply to the grantee party’s statement of contentions, the native title party also contends that:-
1)Any negotiations that occurred between the grantee party and the native title party prior to the s 29 notification date are irrelevant to the question of whether or not the grantee party negotiated in good faith
2)That the Act stipulates a period of six months for negotiations, and only five months of negotiations occurred during which the grantee party delayed during ‘three of those five months’ and that the issue before the Tribunal is not whether the parties have acted in ‘bad faith’ but whether they have engaged in ‘good-faith negotiations’ for a six-month period (paras 4.3-6.3)
3)There is no evidence to suggest that the native title party agreed to provide a copy of its video recording to the grantee party or that its refusal was in any way connected to the delay in forwarding its counter offer letter of 2 September 2008 (para 8.2)
In its reply to Government party’s statement of contentions, the native title party contends that a Government exercising sovereign power and a claimant to native title are not on equal terms, that s 31 of the Act is directed to ‘obtain an accord between a Government and a native title claimant’ for the exercise of that power involving a moral duty (para 2.4-2.7, citing in support Brownley at [21]-[23]). It also contends that the purpose of the s 39 submission was ‘to articulate the concerns of the Yindjibarndi People as a first step in the negotiation process. What the native title party anticipated in response ... was an acknowledgement of those concerns and an expression of the Government Party’s concerns in relation thereto’ (para 4.1). Citing the Njamal indicia of failing to negotiate in good faith it contends the Government party adopted a rigid non-negotiable position, failed to make counter proposals and failed to do what a reasonable person would do in the circumstances (para 4.13).
Good faith negotiations – Government party
The Government party’s evidence is contained in the affidavit of Paola O’Neill, the Government party’s lead negotiator. The negotiations between the Government party and the native title party were conducted by the native title party’s solicitor Mr Simon Millman of Slater and Gordon Lawyers and barrister Mr George Irving.
The Government party effectively commenced its negotiations on 20 May 2008, less than one month after giving s 29 notice by sending a letter to the other parties.
The Government party’s letter emanates from the suggestions made by the Tribunal in Njamal (at 249) and the Tribunal is aware that is consistent with its normal practice in matters of this kind, the details of which have been listed in previous Tribunal decisions (for example Griffin at 325[20]). For the purpose of completeness, I have included the details below. The letter includes the following:-
·a copy of the application for the proposed lease;
·a Tengraph plan of the proposed lease;
·a topographical plan of the proposed lease;
·a copy of the search of the Register of Aboriginal sites;
·an extract of s 39(1) of the Act;
·a guide to what constitutes negotiation in good faith;
·a copy of the Government party’s Negotiation Protocol; and
·the contact details for each of the parties.
The Government party’s letter of 20 May 2008 also:
·alerted parties to the fact that s 31(1)(b) of the NTA imposes an equal obligation on the Government party, the grantee party and the native title parties to negotiate in good faith;
·encouraged the parties to actively pursue the negotiations;
·advised the parties that they may contact each other directly in order to advance the negotiations (although parties were requested to copy all correspondence to each of the other parties for their information) and that meetings may take place without all the parties being present if issues to be discussed concerned only some of the parties;
·offered parties the opportunity, at any stage of the negotiations, to make enquiries of the Government party, or to make suggestions as to how the Government party could assist in the negotiations; and
·reminded parties that under s 31(1) of the NTA, any party may at any time request the Tribunal to mediate to assist in obtaining the agreement of the parties.
The Government party’s letter also pointed out the Government party’s obligation under s 31(1)(a) of the Act to give all native title parties an opportunity to make submissions to it regarding the act. To enable the native title party to make these submissions the grantee party was requested to provide to the native title party (and Government party) within 14 days by registered mail an outline of the proposed work program, copies of the grantee party’s last annual report, advice as to whether Aboriginal heritage surveys within the proposed lease are proposed or have been completed, any company policies or information which may be relevant to the native title party and a suitable map of the project area.
The letter then outlined the Government party’s proposal and enclosed:
·a copy of four additional conditions for discussion;
·a copy of Administration and Operation of Exploration Licences, Prospecting Licences, Mining Leases, General purpose Leases and Miscellaneous Licences in Western Australia (Department of Industry and Resources – July 2006) outlining the legislative provisions relating to minerals exploration and development in Western Australia and the relevant administrative processes involved;
·‘Fees and Charges: Information on Mining Tenements’ (Department of Industry and Resources); and
·‘Mineral Exploration and Productive Mining, Approvals and Responsibilities required by Government’ (Department of Industry & Resources – August 2002).
The four additional conditions which are customarily offered by the Government party in negotiations about the grant of mining tenements and petroleum titles, deal with native title party rights of access; provision to the native title party of any notice under s 18 of the Aboriginal Heritage Act 1972 (WA) for permission to disturb a site and any proposal for exploration and production; and ensuring any assignee of the proposed lease is bound by the conditions.
The Government party’s initiating letter of 20 May 2008 then requested the native title party to make their submission regarding the act by no later than 8 July 2008 with copies to other parties. Its stated the submission:
‘... should include details of all native title parties’ views on the effects which the act will be likely to have on their native title rights and interests as detailed in s 39 of the NTA. The NNTT has recommended that it is these submissions, which will form the basis of the negotiations, which will follow between the parties as listed below.’
On 3 July 2008, the Government party sent a second letter to the native title party (cc’d to the grantee party) enclosing a copy of the draft conditions and endorsements for the tenements in accordance with the Mining Registrar’s recommendations; noting that the submission from the grantee party had been sent to the Government party and native title party; reminding the native title party of the due date for their submission outlining the native title party’s views in relation to the effects the future act will have on their registered native title rights and interests (8 July 2008); and again offered the opportunity, at any stage, to make enquiries of the Government party, or to make suggestions as to how the Government party could assist in the negotiations.
No submission from the native title party was received by the due date of 8 July 2008. On 10 July 2008 via email Mr George Irving on behalf of the native title party requested an extension until 31 July 2008. On 11 July 2008 the Government party confirmed via email that it agreed to the extension. No submission was received by 31 July 2008. On 11 August 2008 Mr Millman on behalf of the native title party requested a second extension until 15 August 2008 and stated via email ‘I confirm that YAC will be in a position to lodge submissions ... on or before Friday 15 August’. On 13 August 2008 the Government party confirmed via email that it agreed to the second extension. On 15 August 2008 Mr Millman advised there were delays in the native title party completing their fieldwork for the submission and stated ‘We therefore can undertake to get the submissions to you by COB on Friday 22 August 2008. We apologise for the delay but that is the best we can do.’ No submission was received by that date. On 16 October 2008 the native title party forwarded its submission in relation to the proposed lease. Paragraph 1.5 of the submission notes:
‘The delay, in responding to the Department’s invitation, is due to a number of factors, including:
1.5.1 The Yindjibarndi were without legal representation prior to June 2008;
1.5.2 The high volume of applications, for grants of tenure, permits and licenses being made by resource companies and Government Departments, which affect the registered Native Title rights and interests of the Yindjibarndi and which make similar demands on their limited resources’
There is no other evidence before the Tribunal which explains the eight week delay between the third extension to 22 August 2008 and the date the submission was finally lodged. I accept that some delay may be attributable to the limited resources of the native title party, however, I cannot accept the lack of legal representation as a factor contributing to the delay: The Government party’s initial negotiation letter was sent on 20 May 2008 and Mr Millman affirms in his affidavit that he commenced acting for the native title party on or about 9 May 2008 (para 4).
The submission provided by the native title party to the Government on 16 October 2008 was a detailed document of some 25 pages setting out, in a comprehensive fashion, the nature of Yindjibarndi culture and relationship to land, including references to the findings of the trial judge in their determination of native title, which is in an area adjacent to the claim in which the proposed lease exists (Daniel v State of Western Australia [2005] FCA 536)
Throughout the submission and, indeed, in some of the contentions filed in the Tribunal, there does appear to be a confusion between the findings made in relation to the land subject of the determination made by Justice Nicholson in the Federal Court, and the characteristics associated with the land, the subject of the Yindjibarndi #1 native title claim application WC03/3, which is before the Court but not determined. It would not be unreasonable to assume that the nature of the traditional laws adhered to and customs observed by the Yindjibarndi People in the determined area and the adjacent undetermined area in which the proposed lease is situated would be very closely aligned, but it is unhelpful to confuse the two.
In its submissions to the Tribunal, the native title party relies squarely on the determination of Lee J in Brownley. The Tribunal accepted the view of Lee J in Brownley to the effect that it is necessary in order to determine whether a Government has complied with its obligation to negotiate in good faith, to judge its actions objectively and not merely on the basis of whether the Government believes it has acted in good faith. The standard of honest conduct is not set by a subjective belief (see Brownley at 27) and the purposes of negotiation under s 31 of the NTA is directed to obtain an accord between the Government and the native title party for the exercise of the power of the Government in respect of the use of land in a manner that respects connection of indigenous people to the land (see Brownley at 21). Lee J went on in his consideration of the circumstances in that matter to find that the State 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 (see Brownley at 55).
The letter from the Government party to the native title party in response to its submission under the hand of Ms O’Neil dated 26 November 2008 was, indeed, short, and stated in reference to the native title party’s proposal of a 2.5 per cent FOB royalty, the following:
‘the provisions of the Mining Act and Regulations authorise the imposition of conditions on the grant of tenements for the purposes of regulating mining operations, mining safety and mining and environmental protection. The scheme of the Mining Act and Regulations does not include imposing conditions relating to the social and economic welfare of persons who may be affected by the mining operations. For these reasons the State cannot agree to impose the conditions you have proposed on the grant of the tenement’
It is clear that although the Government party did not receive all correspondence exchanged between the native title party and the grantee party, as it had requested, it did receive some significant correspondence between the parties including the critical letters from the grantee party’s solicitors to the native title party’s solicitors dated 2 September 2008, the letter from the native title party’s solicitors to the grantee party’s solicitors dated 20 October 2008 and the letters from the grantee party to the native title party dated 12 November 2008, 24 November 2008 and 27 November 2008. As a result the Government party was clearly aware of the fact that the negotiations which were taking place between the native title party and the grantee party included discussions relating to a compensation package which included, inter alia, an FOB royalty payment. It is notable that Lee J in Brownley found that it was open to the Tribunal to find the conduct of the Government party, in all the circumstances, did not amount to a failure to negotiate in good faith despite the fact that it did not offer to negotiate on the question of compensation, but rather transferred responsibility for it to the grantee party in that matter. It is also notable that Brownley, as has been indicated by the Government party in its submissions, was made prior to the amendments to the NTA which included s 31(2) and amendments to the Mining Act 1978 (WA) which included s 125(A) which are discussed in the decision of Deputy President Sumner in Griffin where it was held that a) the Government party now has no obligation to pay compensation for doing of a future act nor to negotiate about it and secondly ‘the Government party may, however, still need to consider if a proposal is made, whether it would impose a condition requiring the grantee party to make s 33(1) payments if this was agreed between the grantee and the native title party’ (at 334-45). It still may not be negotiating in good faith if it refused to countenance an ancillary agreement between the grantee party and the native title party to include such payments in an agreement between them (see Brownley at 54, Njamal at 250-251 and Griffin at 334-45).
In assessing whether or not a party has negotiated in good faith it is necessary to take into account the totality of their conduct in the context of the circumstances of each particular matter. The evidence before the Tribunal indicates that the Government party at all times corresponded with the native title party promptly and within reasonable time frames. The evidence suggests the Government party conducted considerable deliberation during the 6 weeks between receiving the submission from the native title party and sending the 26 November 2008 response. In her affidavit, Ms O’Neill states ‘Prior to sending the letter I discussed the Proposal internally in the Department of Mines and Petroleum. I also sought legal advice from the State Solicitor’s Office.’ I accept that the deliberation was necessary and that the Government party’s 26 November 2008 response was, in the circumstances, made within a reasonable time frame.
In the negotiations the Government party generally acted reasonably. Examples of action taken by the Government party are that it reminded the native title party of the submission due date by letter dated 3 July 2008 and promptly agreed to the requests for extension. It is also apparent from Ms O’Neill’s affidavit and other evidence that bilateral negotiations were occurring directly between the grantee party and native title party, which the Government party was not invited to participate in, and at times was not aware of, given it was excluded from some correspondence.
What the Government party did was consistent with what has become common practice in Western Australia in the case of negotiations involve the grant of mining tenements (Griffin at 327[27]). The factual circumstances in particular cases and the nature of the future act can be taken into account in assessing what the Government party is obliged to do as part of good faith negotiations. The practice in Western Australia whereby substantive negotiations occur between the native title party and grantee party sometimes without the knowledge of the Government party which leads to an Ancillary Agreement between them is also relevant. Often the Government party’s substantive involvement is limited to finalising matters by way of a State Deed which is an agreement of the kind mentioned in s 31(1)(b) of the Act between all three negotiation parties. However, in this matter the State was aware the grantee party and the native title party were engaged in serious negotiations, specifically focussing on the payment of royalties as the compensation component of a comprehensive agreement, as can be seen by reference to the attachments to Ms O’Neill’s affidavit.
The most potent complaint of the native title party is its contention that in declining the proposal that the Government party impose an annual 2.5 percent FOB royalty to be paid by the grantee party to the native title party, the Government party ‘simply applied a policy to control its participation in negotiations’ (native title party’s statement of contentions, para 3.4.2). The question as to whether the Government party’s obligation to negotiate in good faith includes an obligation to negotiate about royalty payments used to compensate a native title party for the effect of a future act on native title rights and interests has been considered by the Tribunal previously. I refer to the Tribunal’s analysis in Gulliver (at [38]-[48]) regarding the effect of compensation or s 33(1) payments for petroleum titles granted under the then Petroleum Act 1967 (WA) (subsequently amended to the Petroleum and Geothermal Resources Act 1967 (WA)) and in Griffin at (330/[37]-[38] and 334/[45]) regarding the same for mining tenements granted under the Mining Act 1978 (WA). I am persuaded that the Government party acted in a reasonable manner in the circumstances of this negotiation in that it considered the proposal in relation to the FOB royalty and responded, rejecting it. The evidence suggests that the negotiator, on behalf of the Government party, took the proposals to her superiors in the Department and sought legal advice from Government solicitors. The question of whether, in providing the response they did, the Government did not simply restate a standard policy position is not illegitimate. It may well be that the answer will invariably be the same, but if proper consideration is given to the circumstances of the matter, including its statutory environment, a congruity of outcome is not determinative of a lack of good faith.
The native title party contends that the Government party ‘ignored the rest’ of the s 39 submission and ‘offered no opening for further discussions’ (native title party’s statement of contentions, para 3) and that the purpose of the s 39 submission was ‘to articulate the concerns of the Yindjibarndi People as a first step in the negotiation process. What the native title party anticipated in response ... was an acknowledgement of those concerns and an expression of the Government Party’s concerns in relation thereto’ (native title party’s reply to the Government party’s contentions para 4.1). Citing the Njamal indicia of failing to negotiate in good faith it contends the Government party adopted a rigid non-negotiable position, failed to make counter proposals and failed to do what a reasonable person would do in the circumstances (para 4.13).
In her affidavit, Ms O’Neill states:-
‘In responding to the proposal I was not ignoring the other aspects of the Submission. However, I did not perceive that any other elements of the Submission required a response, at least in the first instance. This is because apart from the Proposal there were no concrete suggestions or proposals for how the Government Party could advance the negotiation process.
I did not expect my letter of 26 November 200 to be the last letter on the subject of the Submission and I expected the Native title party to respond with further comment or perhaps an alternative proposal to the one advanced’ (paras 38-39)
The native title party’s contention that the Government party ignored all issues other than the question of the royalty payment is three pronged:
a) only the royalty issue was addressed in the letter of 26 November;
b) there was no further invitation to discuss;
c) no further discussions occurred.
There is substance in the Government party’s contention that it is difficult to see from the native title party’s submission what could be specifically addressed in a response. The FOB proposal was the only concrete request. The Government party may well have asserted in response to the general submission concerning the enormous significance the native title party attached to its land and culture and the need for the culture and land to be respected by making reference to the four conditions it had indicated in its originating letter. All those conditions, as inadequate as the native title party might find them, were designed to minimise the impact of the proposed lease and the exercise of activities under it upon the rights and interests of the native title party in the land. The fact there was no reference in the letter to these conditions does not alter the fact they were to be incorporated as conditions on the lease, should it be granted.
Whilst it would have been preferable for the letter of 26 November to be more explicit in relation to the possibility of further discussions. Ms O’Neill has deposed to her expectations of ongoing discussion in her affidavit at (39-40). Neither Mr Woodley or Mr Millman have deposed to any matter or view in their affidavits which would contradict that position (see Affidavit of Mr Millman at para 20 and Affidavit of Mr Woodley at para 32). The native title party contends the purpose of a submission of this nature is to ‘alert’ the Government party to its interests and to ‘fully articulate’ its ‘concerns’ as part of seeking to reach an accord with the Government party for the doing of the Act in a manner that respects those interests (see contention 4.12-4.14). In the native title party’s view, a proper response would be for the Government party to acknowledge those concerns and raise any of its own. The native title party’s submission to the Government was lengthy and general. It made very little specific reference to the area of the proposed lease (or, indeed, the other two mining lease applications). The central points forcefully made were:
·to grant the lease without an agreement would be highly offensive (7.8)
·a social impact survey should be conducted but the grantee party refuses (8.1 & 8.2)
·the Government should impose a FOB royalty of 2.5 percent (8.12)
·sites might be damaged if mining activities are undertaken without agreement (10.2)
As the Government party was aware of negotiations between the grantee party and the native title party, there was little it could say about dot point one and four above. The concerns expressed about the need for a social impact survey culminated in the request for the FOB royalty condition, not a request for the Government party to conduct a survey and consequently, no comment was made. The request for a royalty was addressed. That being said, I agree with the contentions of the native title party to a very large extent. The letter of 26 November 2008 did not acknowledge the concerns raised and only addressed the royalty question in a fairly abrupt fashion. Nevertheless, I do not believe, particularly in light of Ms O’Neill’s affidavit, that the Government intended to close off further negotiations. The delay in the provision of the native title party’s submission had already limited the time available. In any event, the actions of the grantee party in filing the s 35 application two days later, put an end to questions for the purpose of this determination.
Given the overall circumstances of the negotiations (which were confined to correspondence), including the conditions offered and the Government party’s awareness of the bilateral native title/grantee party negotiations, I cannot accept that the deficiencies of the letter of 26 November 2008 amount to a failure to negotiate in good faith. In consequence, I find the Government party has negotiated in good faith.
Good faith negotiations - grantee party
The first contention of the native title party is that in its eagerness to negotiate a WOCLAA, the grantee party ‘obfuscated negotiations’ concerning the proposed lease in a way which made the native title party unaware of the need to focus on that tenement in the negotiations and consequently of the peril it might face should a s 35 application be lodged six months after the notification date. The native title party cites Angelina Cox as authority for the proposition that should such a situation arise, the grantee party has, in fact, failed to negotiate in good faith.
As I have indicated previously, from the documentation up until the s 29 notification date, which would include all materials contained in the documents provided to the Tribunal by the grantee party up to document 30, provide little assistance in resolving this question. If anything, it would appear that both parties were keen to proceed to negotiate what has been referred to interchangeably as a WOCLAA or a Land Access Agreement (LAA), rather than specifically discuss any existing or proposed tenement applications. Even in the letter from the grantee party to the native title party dated 1 May 2008, which made reference to a meeting between the native title party and the grantee party which took place on 23 April 2008, there is no specific reference concerning the proposed tenement, other than in the heading of the letter. That letter in its final paragraph makes reference to the upcoming meeting proposed for June which was characterised as a ‘negotiation meeting’.
In a letter dated 13 May 2008 (document 32), the grantee party wrote to the native title party indicating that they were seeking three mining leases, including the proposed lease which had a s 29 notification date of 23 April 2008 and enclosing relevant information. In a letter from the native title party’s solicitors to the grantee party on 14 May 2008 (document 33), there is reference only to a potential LAA albeit that there is a suggestion in the final paragraph that, as a sign of good faith, the grantee party should put on hold all outstanding matters while negotiations take place.
The meeting which took place between the grantee party and the native title party on three days between 10-12 June 2008 is critical to understanding the nature and tenor of the negotiations which took place between the native title party and the grantee party during this time. The meeting was funded by the grantee party.
On the first day of the negotiations the native title party met separately and discussed matters of an unspecified nature, but presumably generally relevant to discussions with the grantee party. There is no record before the Tribunal of the contents of any discussions that took place on that day. On the two subsequent days, 11-12 June 2008, the native title party and its representatives met for extended periods during the day with the grantee party and its representatives. As has been indicated earlier, the native title party, with the funding assistance of the grantee party, had created an audiovisual recording of that meeting. The recording is taken by what appears to be a static camera placed at the top left hand side of the room looking back over the heads of the grantee party’s representatives towards a group of the native title party members and their representatives. The camera is very occasionally panned across the room, but for most of the tape, remains static. The oral quality of the tape is variable and sometimes it is difficult to hear comments coming from the floor. It is possible, however, to clearly understand what is being said by the representatives of the grantee party and a number of prominent members of the native title party including Michael Woodley and the representatives from the native title party, throughout the entirety of the tape. Notes of the meeting were taken by a solicitor employed by the grantee party and are set out in document 36. In my estimation the notes represent an accurate, if not entirely complete, record of what was said during the meeting.
I have viewed the audiovisual material provided in its entirety and considered it carefully. At the beginning of the meeting the grantee party, through its chief negotiator, Mr McGlew, made it abundantly clear that it was the grantee party’s preference to negotiate a WOCLAA and that if they were able to do so, the benefits that could be offered would be much greater than those offered if the negotiation was confined to the three mining leases which were put on the board. The numbers of those mining leases had been written on the board at the insistence of the native title party, particularly Mr Woodley. At one point on the first disc on 11 June 2008 at point 25, Mr McGlew suggests that he ‘thought that they were talking about all a whole of claim negotiation’ when he was informed by Mr Woodley that it was not the case and that the three mining leases were the focus for the native title party.. At that point Mr McGlew, on behalf of the grantee party, indicated that he acknowledged that the native title party was not prepared to discuss a WOCLAA and wished to focus on the three mining leases in question. It did, however, prove difficult for the grantee party throughout the balance of the meeting to disguise its marked preference for a WOCLAA. The grantee party repeatedly attempted to keep open the question as to whether the native title party might accept a WOCLAA rather than focus on the three mining leases in question, particularly by repeated reference to the fact that any compensation for a WOCLAA would be significantly greater than a more narrowly focussed agreement. On disc three on the second day at point 30-31, the native title party’s barrister made it very clear that there was a need to focus on the three mining leases concerned because of the negotiation in good faith issues which would have to be addressed. Similarly, later in that day, there was a good deal of discussion about the question of the grantee party agreeing to forego its right to bring a s 35 application six months after the s 29 notification date in order that negotiations in good faith could be conducted in relation to the three mining leases. This was particularly crucial because the two of those s 35 applications could have been made immediately or soon after the meeting, although an application in relation to the proposed lease, being dealt with in this decision, could not have been made until 23 October 2008.
It is clear from the audiovisual material that the meeting over these two days did address a number of issues other than the negotiation of the three particular mining leases that the grantee party was seeking, including the proposed lease. After the first break on the first day, in response to a request from the native title party’s barrister as to what exactly it was that the grantee party was asking for, Mr McGlew stated clearly that his concerns related to a) heritage approvals for the three exploration tenements, b) railway authorisation, c) the taking of additional material from the exploration areas and d) the three mining leases and the terms that were on the table should the native title party reject the whole of claim approach. The subsequent discussion which took place during the meeting focused specifically on the extent of the development of the company’s plans for mining and the question of why it was that the native title party’s proposal for an uncapped royalty was not acceptable to the company. The second day of the meeting commenced with Mr Woodley rejecting the company’s offer from the previous day and reasserting the offer that it had proposed in March 2008, which, although not entirely clear, was probably an offer which related to a whole of claim proposal.
In order to make it clear what offers were discussed at the meeting, I set them out below:
a)During the June 2008 Meeting, the grantee party modified the monetary component of its WOCLAA offer as follows:
·No royalty free period
·5 percent FOB value royalty (capped at $3 million annually)
·8 cents per tonne VTEC royalty (up to $2 million annually)
·$350,000 signing payment
(Affidavit of Michael Woodley para 17, grantee party’s statement of facts para 36 and supporting document 36)
b)In response to the native title party’s preference for an agreement that would deal only with the three proposed mining leases within the perimeter of E47/1333, E47/1334 and E47/1447 (being M47/1409, M47/1411 and the proposed lease) and not the whole claim area, the grantee party made two offers for such an agreement. The first being:
·3 year royalty free period
·5percent FOB value royalty (capped at $1 million annually)
·4 cents per tonne VTEC royalty (up to $1 million annually)
·$50,000 payment upon grant of mining leases
And the second being:
·No royalty free period
·5percent FOB value royalty (capped at $1.5 million annually)
·8 cents per tonne VTEC royalty (up to $1.5 million annually)
·$50,000 payment upon grant of mining leases
(Affidavit of Michael Woodley para 18, grantee party’s statement of facts 45 and supporting documents 36 and 43)
There were a number of other discussions of significance which I will refer to in dealing with some of the other contentions of the native title party in relation to good faith, but for the purposes of the question of whether or not the parties had negotiated about the effect of the proposed lease specifically, it would seem to me that the two day meeting clearly identified the central subject of negotiations as relating to the three mining leases, including the proposed lease, and the terms upon which the native title party could agree to their grant. Subsequent correspondence between the parties continued to focus on the specific issues relating to the terms of an agreement relevant to the three mining leases. Consequently, I find that both parties were clear from at least 11 June 2008 that the focus of the negotiations which they were required to undertake related to the three mining leases, including the proposed lease. Consequently, this is a matter that can be clearly distinguished from the situation that occurred in Angelina Cox where it was found that there had been no negotiation specifically relevant to the tenement that had been the subject of the s 35 application and that all such negotiation had been subsumed in a broader whole of claim negotiation. In this matter it is apparent from previous correspondence, the transcripts and audiovisual material of the meeting and subsequent correspondence that both parties were keenly aware of the impact that a situation such as that which arose in Angelina Cox could have on the capacity of a party to bring s 35 application and acted accordingly.
The second primary contention of the native title party is that once the native title party was made aware of the fact that it needed to focus on the proposed lease, there was no person present at the meeting with the requisite authority to properly negotiate or respond to the native title party’s request for an uncapped royalty rate. The native title party cites Doxford at para 36 as authority for the proposition that this failure would constitute a lack of good faith. I presume the specific reference is to item xi, which is ‘sending negotiators without authority to do more than argue or listen’.
The question of the structure of the negotiations between the grantee party and the native title party in relation to the proposed lease and to negotiations in general between the two, were the subject of correspondence going back to 15 November 2007, when the Yindjibarndi Aboriginal Corporation on behalf of the native title party had written to Mr Andrew Forrest, the Chief Executive Officer of the grantee party, indicating that they were only prepared to negotiate with him personally as the prime decision maker for Fortescue Metals Group (grantee party’s document 13). By letter of 10 January 2008, Mr McGlew, on behalf of the grantee party, wrote to the native title party, indicating that Mr Forrest would participate personally in the negotiations, except in circumstances of urgent travel, in which his brother would participate on his behalf, but only in circumstances where he was to negotiate directly with Mr Stanley Warrie, the chairperson of the Yindjibarndi Aborginal Corporation Prescribed Body Corporate. In other circumstances he would delegate his role (grantee party document 14). Subsequently, in a document dated 14 January 2008, Mr Warrie, in a letter to Mr McGlew, indicated their desire to negotiate the agreement directly with Mr Forrest (grantee party document 15). On 15 January 2008 the grantee party wrote to the native title party indicating that if heritage surveys commenced, Mr Forrest would participate directly with the negotiations or alternatively, his brother would attend if he was unavailable (grantee party document 16). There was further correspondence in relation to the number of meetings which took place between the representatives of the native title party including Mr Yarrie and representatives of the grantee party, including Mr Andrew Forrest, which focussed around heritage agreements. In his affidavit, Mr Michael Woodley stated at paragraph 21:
‘on several occasions in the course of the meeting, I asked Mr McGlew if he had authority to negotiate an “uncapped” royalty and to conclude an agreement with Yindjibarndi at this meeting and he assured us that he did. However, despite these assurances, it was apparent during the course of the negotiation that Mr McGlew did not have authority to negotiate an uncapped royalty agreement and was limited in his capacity to propose alternative negotiated outcomes. I do not believe that Mr McGlew was fully authorised to engage in the negotiations. His priority was getting the Yindjibarndi to participate in heritage surveys and securing their consent to the excess tonnage and railway investigation licence’.
Mr McGlew, on the other hand, deposes in his affidavit at paragraph 23 and making specific reference to Mr Woodley’s affidavit, states:
‘in response, I categorically state that I was fully authorised by Fortescue’s Chief Executive Officer, Andrew Forrest, to engage in all negotiations on behalf of Fortescue, including the June 2008 meeting. In particular, at a meeting with Yindjibarndi in March 2008 Mr Forrest stated very clearly that I had always had and continued to have full and complete negotiation authority on behalf of Fortescue. At annexure BM17 of my affidavit is a copy of Fortescue’s notes of the June 2008 meeting and I refer in particular to page 3 of that annexure’.
Mr McGlew goes on to say in paragraph 24:
‘Mr Woodley’s contention is incorrect and I believe this is because he has wrongly interpreted my unwillingness to present a particular counter offer at the June 2008 meeting as a lack of authority to present a counter offer. I refer to annexure BM17 of my affidavit for support’.
The passage referred to by Mr McGlew in BM17 which was the grantee party’s notes of the June 2008 meeting says as follows:
‘Michael: do you have authorisation to make agreement?
Blair: Andrew said back in March, me authority to make decisions, I have authority to make decision but want Dave Forrest here, we have to make call, being in room from day one, continue to come to meetings as have been at all meetings, took your comment very seriously’.
Again, I make reference to my viewing of the audiovisual material. It is clear to me, from that material, that Mr McGlew was authorised to represent the Company, make agreements and alter proposals. He indicated early on the first disc that:
‘Andrew has entrusted me with the native title negotiations but you wanted to see him at the last meeting and he came’ (at point 7 of tape).
At point 43.11 he was asked by Michael Woodley:
‘there are no decision makers here. We have our decision makers. Are you authorised to sign off on an agreement today?’
Blair McGlew’s reply:
‘I have the authority to sign off’.
Irrespective of the assertions of the parties, I was greatly assisted in coming to conclusions about this matter by the viewing of the audiovisual material. It is clear from that material that during the course of the meeting the original proposal from the native title party was tabled and discussed and two alternative proposals were put by the grantee party, the first relating to propositions concerning a WOCLAA and one focussed specifically on the three tenements in question, including the proposed lease. Secondly, a further counter proposal put by Mr McGlew on the second day of the meeting which increased the offer that had been made the previous day, albeit that it remained capped. During the course of the meeting there was considerable discussion between the parties, particularly on the second day, relating to the reasons why it was that the native title parties sought an uncapped royalty. In essence, those reasons were a) a royalty was being paid to the Government and would be paid to any buy-in partner and consequently a native title party should be entitled to the same consideration, and b) an capped royalty was not really a royalty at all, but rather a form of rent. During the course of those discussions, the grantee party stated that they were prepared, albeit reluctantly, to consider making a proposal which would include an uncapped royalty. They did, however, indicate that such a royalty would be at a significantly lesser percentage rate than what was currently on the table. It would seem to me, from the course of the discussions that the native title party was aware that an uncapped royalty would be at a much lower percentage than a capped royalty then being proposed. It would have been unreasonable to expect otherwise. At one point during the course of the meeting, it was put from the floor of the meeting by a member of the native title party that, in relation to the uncapped royalty:
‘they were talking about matters that would greatly impact on their native title rights and interests. That the Yindjibarndi Group understood the value of their country and the sorts of figures being proposed by the grantee party insulted his culture, insulted him as a law practitioner and a language speaker. He stated ‘we know that what we are asking for is way higher than anyone else, but it has to be considered’.
During the course of the discussion, representatives of the native title party made it clear that they were not asking for a figure for uncapped royalty to be produced on that day. The barrister for the group at tape point 44.10 said
‘there is no need to come up with a number on the run’.
At disc point 53 it was indicated by Mr McGlew on behalf of the grantee party that he would return to the grantee party’s office and consider the question of what an uncapped royalty would be. He further indicated that:
‘we will negotiate a royalty figure but it will be risk averse. I will do that as soon as I can. I can put an offer in a week which will be much lower. We will meet as often as we need to to finalise this stuff’.
In its contentions the grantee party maintains that the native title party misunderstood the grantee party’s representative’s reluctance to respond immediately in relation to the question of an uncapped royalty, as a lack of authority to do so. I believe that this is an accurate assessment of the situation. Mr McGlew, throughout the meeting, although continuing to argue that such an uncapped royalty was unnecessary, agreed that he would consider it and he would put a proposition back to the native title party, albeit that it would be at a considerable lower percentage. Some of the figures discussed indicated that such an uncapped royalty would be configured in a way that the final figure would be much the same as the capped maximum that had previously been put.
Be that as it may, it is quite clear that the grantee party representatives were authorised to meaningfully negotiate with the native title party and, if necessary, to reach an agreement. They certainly came with an authority which was far greater than one which merely confined them to having a capacity to argue or listen. This is demonstrated by the fact that an upgraded offer was put and that consideration was agreed to be given to an uncapped royalty. It is not my understanding that it is necessary in order to be said to be negotiating in good faith that a negotiator must be in a position at all times and at all meetings to sign off on a final agreement without reference to any higher authority. It is clear, even in this situation, that should an agreement have been reached on those days in June 2008, it would have been necessary for confirmation of that agreement to be undertaken, not only by the grantee party, through its board, but also by the native title party through its governing structures. It would be unreasonable to assume that either a native title party or a grantee party had to authorise a negotiator to make unequivocal decisions on behalf of the respective entities that they represent and I do not believe that there is any authority which suggests the contrary. Further, the proposition being put by the native title party, was that an uncapped royalty of five per cent be put in place. This, on the figures agreed by the parties, represented a sevenfold increase in potential payments to the native title party over the life of the mine. Clearly, this was a matter which needed careful consideration before a counter proposal could be put and, in the circumstances, it seems to me quite reasonable that it was not possible for the grantee party to come up with a figure, in the words of the native title party’s representative, ‘on the run’. Consequently, it is my view that there is no basis to suggest, as was asserted by Mr Woodley and the native title party in its contentions, that the grantee party did not have the requisite authority to negotiate an agreement in a manner which reflected the good faith of the grantee party in the process of the negotiation.
The native title party’s third major contention is that the grantee party, in delaying presenting its counter offer in relation to an uncapped royalty for three months after the conclusion of the June 2008 meeting, constituted a failure of the grantee party to negotiate in good faith. Again, it would appear that in citing in support of that proposition, paragraph 36 of Doxford, they are, in fact, making reference to the Njamal indicia referred to in that paragraph being, I take it, (iii) the unexplained failure to communicate to other parties within reasonable time (viii) failing to respond to reasonable requests for relevant information within a reasonable time (ix) stalling negotiation by unexplained delays in responding to correspondence or telephone calls and (xv) failure to make counter proposals.
In its response to the grantee party’s contentions, the native title party at para 4.3 noted that part of its complaint in relation to the delay related to the fact that because of the failure of the grantee party to respond as indicated, they had lost three of the five months, which they say was available to them to negotiate with the grantee party – the five months being the months subsequent to the June 2008 meeting. The Tribunal has consistently found that the negotiation and good faith requirements of the Act does not require any party to negotiate in any physical sense for a period of six months. What is required is that the parties negotiate in good faith with a view to obtaining an agreement with the native title party to the doing of the Act upon conditions and those negotiations are confined to matters related to the effect of the Act on the registered native title rights and interests of the native title party. The actual period of negotiation which would need to take place in order to establish that the parties had negotiated in good faith, is not necessarily related to the length of time spent negotiating. Rather it is the quality of the process that will be determinative of the question of whether the parties have engaged in the process in good faith (see Western Australia/Champion & Ors/Resolute Ltd, NNTT WF97/8, [1998] NNTTA 6 (27 July 1998), Member Lane at 15) .
I now set out below a history of what occurred after the June meeting as revealed in the affidavits and documents of the parties:
a)On 13 June 2008, Mr Millman for the native title party forwarded a letter to the grantee party requesting ‘a short moratorium’ on the lodgement of s 35 applications for the three proposed mining leases until at least 8 October 2008 in return for signing the June 2007 heritage agreement and participating in the requested heritage surveys. The letter also requested information on all tenements applied for by the grantee party, the proposed location of any extra tonnage activity, the anticipated production and ore tonnage prices on all its mining leases and confirmation that the grantee party’s royalty liability to the Government party was 4.7percent uncapped. Additionally, the letter stated that prior to the June 2008 meeting the native title party were:
‘unaware of the fact that their prior discussions with FMG were in any way connected with the timelines imposed under s 31 of the Native Title Act for good faith negotiations in respect of the three mining leases [M47/1409, M47/1411 and the proposed lease], a situation no doubt exacerbated by the fact that the Yindjibarndi have been without legal representation since May 2007’
(Affidavit of Simon Millman annexure 3, grantee party’s supporting document 38)
b)By letter to the native title party dated 25 June 2008, Ms McGinty for the grantee party requested the native title provide copies of audiovisual recordings of prior meetings between the grantee party (including the June 2008 Meeting) within seven days, stating the grantee party had consented to the filming on the basis that it would be provided with a copy of the recordings. (grantee party supporting document 41)
c)On 26 June 2008 Ms McGinty advised Mr Millman by email that a response to his 13 June letter would be shortly forwarded citing ‘a number of illnesses in our office recently which had created some difficulties’. (grantee party supporting document 42)
d)On 27 June 2008 Ms McGinty provided Mr Millman with a response to his 13 June 2008 letter. The letter confirmed the grantee party sought the agreement of the native title party to the grant of various mining tenements including M47/1409, M47/1411 and the proposed lease, the ministerial application to excavate extra tonnage from E47/1333, E47/1334 and E47/1447, the s 91 licence application and their participation in heritage surveys over E47/1333, E47/1334 and E47/1447. The letter also summarised the native title party’s offer and the grantee party’s counter offers presented at the June 2008 meeting, provided the information requested in the 13 June 2008 letter (subject to any prohibitions), and agreed to refrain from making any s 35 application until at least 23 October 2008 provided the native title party consented to the ministerial application for extra tonnage and the s 91 licence application, and immediately recommenced heritage surveys. The letter also requested copies of the audiovisual recordings of prior meetings between the parties. (grantee party supporting document 43)
e)By letter dated 11 July 2008 Mr Millman responded to the grantee party. The letter ‘confirmed’ that at the conclusion of the June 2008 Meeting, the native title party offered to sign the June 2007 heritage agreement and conduct the requested heritage surveys if the grantee party agreed to not lodge any s 35 application for the three proposed mining leases for at least twelve months. The letter again referred to the native title party being ‘unaware’ of the need to focus on the three mining leases prior to the June 2008 meeting, a ‘situation exacerbated by the lack of any legal representation for the Yindjibarndi ... until June 2008’. The letter also confirmed the native title party’s ‘5percent royalty proposal’ and that the native title party was ‘willing to consider any counter proposal you may wish to make regarding uncapped royalty payments, both in respect of the three mining leases and in respect of a WOCLAA.’ (Affidavit of Simon Millman annexure 5, grantee party supporting document 44)
f)By letter to Mr McGlew dated 28 July 2008 Mr Millman referred to his letter of 11 July 2008 and requested confirmation of receipt. (Affidavit of Simon Millman annexure 6)
g)By faxed letter of 3 August 2008, Mr Ken Green for the grantee party advised Mr Millman that Mr McGlew was on annual leave and that following his return a response would be forwarded. (Affidavit of Simon Millman annexure 7, grantee party supporting document 45)
h)On 2 September 2008 the grantee party provided the native title party with a response to the native title party’s 11 July 2008 letter. The letter confirmed the grantee party sought the agreement of the native title party to the grant of various mining tenements including M47/1409, M47/1411 and the proposed lease, the ministerial application to excavate extra tonnage from E47/1333, E47/1334 and E47/1447, the s 91 licence application and their participation in heritage surveys over E47/1333, E47/1334 and E47/1447. The letter also confirmed the grantee party’s tenement applications subject to negotiation pursuant to s 31 of the Act and referred to the recent Angelina Cox decision noting that it ‘has elected to appeal the Decision to the Federal Court’. In referring to the decision, it confirmed M47/1409, M47/1411 and the proposed lease were ‘Priority Tenements’ for the grantee party who wished to:
‘... energetically advance negotiations for the grant of the Priority Tenements in preference to any other tenements .... Please note the above endeavour concerning the priority tenements does not mean that FMG wishes to abandon its desire to reach a WOCLAA with the Yindjibarndi #1 People, just that FMG wishes to accord far greater priority and resource to the grant of the Priority Tenements.... It is clear from the comments of the Yindjibarndi #1 People both, during recent meetings and in recent correspondence, that the prospect of negotiating a WOCLAA appears a somewhat daunting task to the Yindjibarndi #1 People’
(Affidavit of Simon Millman annexure 8, grantee party’s supporting document 46)
The letter attached a comprehensive draft land access agreement relating to the three mining leases (M47/1409, M47/1411 and the proposed lease) which included the following:
·Three year royalty free period
·0.075percent times royalty value of iron ore mined (defined in regulation 85(1) of the Mining Act 1978 (WA) Regulations)
·No VTEC royalty or payment upon grant of mining leases
(Affidavit of Michael Woodley para 24, grantee party’s statement of facts para 56 and supporting document 46)
The letter requested the native title party to identify any:
‘concerns and the manner in which the accompanying agreement is inadequate’
and propose how the concerns might be addressed and noted:
‘it is FMG’s hope that an agreement for the grant of the Priority Tenements can be reach [sic] expeditiously, and in any event prior to 23 October 2008. If an agreement is not reached by that date, FMG will consider whether, in the circumstances, it should make application for a determination under s 35 of the NTA ... [and] accordingly reserves its right to do so.’
In conclusion, the letter also referred to the grantee party’s request for copies of audiovisual recordings of prior meetings between the parties, clarifying it requests only those portions involving FMG representatives, and ‘strongly refutes any suggestion that advice was provided to FMG that the recordings were for the sole use of the Yindjibarndi #1 People’ requesting full particulars of any alleged advice. (Affidavit of Simon Millman annexure 8, grantee party’s supporting document 46).
i)By letter dated 6 October 2008, the grantee party noted that no response to the 2 September 2008 letter had been received, and again confirmed that M47/1409, M47/1411 and the proposed lease were ‘Priority Tenements’ for the grantee party who wished to ‘energetically advance negotiations’ with a hope to reach an agreement before 23 October 2008 upon which it would need to consider whether to lodge a s 35 application. The letter requested a response by 13 October 2008. (Affidavit of Simon Millman annexure 9, grantee party’s supporting document 47).
j)By letter dated 20 October 2008, the native title party responded to the 6 October 2008 letter and attached draft land access agreement. The letter confirmed the native title party’s 13 June 2008 letter requested a ‘short moratorium’ on any s 35 application at least until October 2008 in return for its participation in heritage surveys, noted that the grantee party ‘did not revert with its counter offer until nearly three months after it had undertaken to do so’ and that ‘the Yindjibarndi People are not opposed to negotiation a Whole of Claim Agreement’. In response to the attached draft land access agreement the letter notes:
‘FMG’s latest offer taking into account allowable deductions is materially less that the offer that was made and rejected at the June 2008 meeting and, not surprisingly, the new offer is rejected’
(Affidavit of Simon Millman annexure 10, grantee party’s supporting document 48).
The letter offers the following counter offer:
·A signature payment of $5 million upon the grant of each mining lease; and
·An annual payment of 2.5 percent FOB value royalty
The letter also advises the grantee party that the native title party representatives ‘are seeking instructions from the Yindjibarndi People concerning the editing of the video recording’. (Affidavit of Simon Millman annexure 10, grantee party’s supporting document 48)
k)The grantee party responded to the native title party’s 20 October 2008 letter, via letter dated 12 November 2008. Amongst other things, the letter notes the native title party’s counter offer was not acceptable to the grantee party, that it remained committed to energetically pursuing’ the grant of the Priority Tenements’, but ‘is giving serious consideration to making an application for a s 35 determination in relation to these matters.’ (Affidavit of Simon Millman annexure 11, grantee party’s supporting document 49)
l)By letter dated 24 November 2008, the grantee party advised the native title party that it had not received any response and that it:
‘will lodge the application for a s 35 application in relation to the priority tenements as soon as possible, most likely by the end of the week’
and requested a meeting to seek a:
‘negotiated outcome’.
(Affidavit of Simon Millman annexure 12, grantee party’s supporting document 50)
m)Following a number of emails between the parties to schedule a meeting with the native title party, the grantee party confirmed by letter dated 27 November 2008 that it was prepared to fund a 10 December meeting with the native title party to a maximum of $3,000 and that it anticipated lodging s 35 applications the following day. (Affidavit of Simon Millman annexure 13, grantee party’s supporting document 54).
n)The grantee party advised the native title party by letter dated 28 November 2008, that it had lodged the s 35 application in relation to the proposed lease, which
‘in no way reduces our commitment and desire to resolve this matter through negotiations.... We look forward to continuing negotiations with the Yindjibarndi and in particular, your advice as to whether the meeting on 10 December 2008 will proceed.’ (Affidavit of Simon Millman annexure 14).
That correspondence set the tone for the subsequent negotiations which took place, which I think it fair to characterise as ‘testy, somewhat aggressive, and indicative of a less than amicable working relationship’ as DP Sosso observed in a recently decided matter (Cosmos/Western Australia/Mineralogy [2009] NNTTA 35 (17 April 2009) at 74).
As can be seen from the foregoing correspondence, the native title party responded promptly, as it had undertaken to at the meeting, writing to the grantee party on 13 June 2008. On 26 June 2008 the grantee party indicated that there had been illnesses which had created some difficulties in the office and apologised for delaying responding to that letter. On 27 June 2008 the grantee party responded to the letter of 13 June 2008, but predominantly addressed the peripheral issues relating to the negotiation and not with its proposal for an uncapped royalty payment. Nevertheless, it could not be said that that letter was irrelevant to the negotiation process, because it did summarise the position to date and deal with issues relating to any anticipated s 35 application and providing information requested by the native title party in relation to the tenements in question. A further response was sent to the grantee party by the native title party on 11 July dealing with a number of issues relating to the negotiations and requesting a response. On 3 August 2008 Green Legal, on behalf of the claimant group, wrote to the native title group, apologising for the delay, explaining that Mr McGlew was on leave and expecting that a proposal would be put soon. On 2 September 2008 Green Legal, on behalf of the grantee party wrote to the native title party enclosing the proposal. It should be noted that at the meeting on 12 June 2008, Mr McGlew indicated that he would probably take a week or so to get a response to the parties. As it turned out, there was a delay between the meeting and the despatch of the letter containing the proposal in relation to an uncapped royalty payment of 82 days. This is significantly longer than the native title party could reasonably have been expecting to wait to hear from the proposal, given the statements made by the grantee party’s representative at the meeting in June 2008. No doubt the task may well have proved more complex than had originally been anticipated and the question of its complexity had been mentioned during the course of the meeting. A number of reasons had been advanced by the grantee party for that delay. I accept that the making of the decision and the calculation may have been complex, that there were illnesses in the office and people were on holidays. It would also appear that the matter was transferred from in-house legal representation to Green Legal and then back, subsequently, to in-house representation during that time and soon after. I do not accept, as has been suggested by the grantee party, that the delay was caused by any confusion in the mind of the native title party, expressed in some of their correspondence, particularly the letter of 13 June 2008. I accept the grantee party’s contention that the statement in the letter of 13 June 2008 to the effect that the grantee party had ‘finally agreed on what should properly be the basis of a good faith negotiation’ (namely uncapped royalty payments in return for the consent of theYindjibarndi to the grant of the three mining leases) was an overstatement of the situation. While tha subject was a proper basis for negotiation, it was not the only proper basis for negotiation in good faith. Irrespective of that, I do not believe that that assertion significantly affected the capacity of the grantee to respond. A comprehensive proposal was made on 2 September 2008 and there was subsequently some delay in the native title party responding to that offer. On 20 October 2008 the native title party responded by rejecting the offer and putting a counter offer very similar to its original position. There were further discussions and correspondence but no further meetings (largely due to an inability to agree on costings) before the grantee party lodged its application on 28 November 2008, 36 days after it was statutorily entitled to do so.
The question of determining whether or not parties have negotiated in good faith is not a formulaic exercise. The Njamal indicia are exactly that; descriptions of undesirable activities or tactics which, when identified in the context of a negotiation process, will assist the Tribunal in its task of assessing whether the parties have behaved reasonably and fairly to put their minds to reach an accord over the doing of the act. The detection of behaviour, indicative of one or more of the Njamal indicia in a process of negotiation, is not necessarily determinative of the question of whether a party has acted in good faith or not. In this matter there were delays, even lengthy ones, on both sides. The delay that the native title party complains of was significant. However, in the context of the negotiations and in light of my other findings, I do not think that it, in itself, is enough to satisfy me that it prevented the parties from fully exploring the possibility of agreement and, as such, cannot be said to amount to a failure to negotiate in good faith.
The fourth contention made by the native title party was that the offer made by the grantee party in its letter of 2 September 2008 was an unreasonable retreat from what had previously been offered. Again the reference is to Doxford and I take it to refer to the indicia in paragraph 36 mentioned at (xiii) ‘shifting position just as agreement seems in sight’ and perhaps (xvii) failure to do what a reasonable person would do in the circumstances. As the native title party pointed out in its letter of 20 October 2008, (grantee party document 48 at para 5.4), the proposal contained in the grantee party’s letter of 2 September 2008 proposed a compensation package which involved the payment of an uncapped royalty payment equivalent to 0.075 times royalty value, less the allowable deductions. The native title party added that this proposal deleted any reference to signature payments or a VTEC royalty which would have been payable under the earlier proposal which had been included in the last June 2008 offer and reintroduced the three year royalty period which had been removed at the meeting. It is said on this basis that the proposal made by the grantee party on 2 September 2008 was an unreasonable withdrawal of a proposal previously on the table. It is clear from the meeting in June 2008 and from the correspondence subsequent to that that the native title party viewed the proposal by the grantee of an uncapped royalty as central to the negotiations of the compensation package. It is also clear that the grantee party indicated that this would involve a significant reduction in the percentage rate to be payable. The grantee party submits in its contentions at Clause 8.6 that another factor that needs to be taken into account in assessing the reasonableness of the proposal contained in the letter of 2 September 2008 was the question of whether it applied to a WOCLAA or merely to the three mining leases. It had been made clear throughout the process that in a three lease agreement the quantum of any package would be significantly lower than otherwise would be the case. While acknowledging this, it is also clear to me that the original proposal that was being discussed at the meeting in June 2008 did relate to the two alternative propositions, WOCLAA or three mining leases which had different benefits and that both parties were clear that the correspondence of 2 September 2008 and 20 October 2008 related squarely to the three mining leases and not a WOCLAA. The proposal relating to the three mining leases put on 2 September 2008 was a retreat from the three mining lease offer of June 2008. It was also acknowledged in the native title party’s letter of 20 October 2008 at paragraph 5.2.2 that ‘a five percent FOB royalty capped at $1.5 million per annum, which was agreed, translated into an equivalent of an ‘uncapped royalty’ of 0.07 percent FOB royalty’. The uncapped royalty proposed by the grantee party of 0.075 percent is, in fact, consequently, higher than the capped payment that had been proposed. It is difficult to assess whether the additional 0.005 per cent of royalty value would be equivalent over the life of the mining leases to the sums that were payable in respect of the signature payments, the VTEC payments or the removal of the first three year royalty free period. In any event, it is my view that given the fact that the native title party was insistent on an uncapped royalty being central to the compensation package, the proposal put forward by the mining company did not represent an unreasonable retreat. It may or may not have represented in its totality a greater or lesser amount than had been proposed at the meeting in June 2008. It would seem to be difficult to make that call. It may, indeed, be the case that the total package was reduced as a result of the counter proposal, however, it was restructured at the request of the native title party. In the circumstances, I do not believe that the alteration and possible reduction of the compensation package component of the proposed agreement could not be said to be unreasonable, even if it was a retreat. Consequently, it did not constitute a lack of good faith in the circumstances of this particular negotiation.
The final question which was raised in the contentions by the grantee party, related to the bad faith of the native title party, specifically in relation to its alleged failure to provide copies of the audiovisual material when requested. Suffice it to say, the issue that I am required to address is the question of whether the parties have negotiated in good faith and not whether a party has negotiated in bad faith or not. In any event, I do not find that there is any substance to the grantee party’s assertion that the failure to provide the audiovisual material when requested, amounted to bad faith.
Decision
The Government party and the grantee party have negotiated in good faith with the native title party as required by s 31(1) of the Native Title Act 1993 (Cth) and the Tribunal has jurisdiction to conduct an inquiry and make a determination.
Daniel O’Dea
Member
24 April 2009
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