FMG Pilbara Pty Ltd v Cox

The matter before the court was an appeal by FMG Pilbara Pty Ltd against a decision of the National Native Title Tribunal (the Tribunal) that FMG had not negotiated in good faith in relation to a future act as required by section 31(1)(b) of the Native Title Act 1993 (Cth). The future act in question was the proposed grant of a mining lease (the Proposed Tenement) to FMG. The Tribunal had found that due to this failure, it lacked jurisdiction to conduct an inquiry and make an arbitral determination under section 38 of the Act. The appeal to the court was limited to questions of law, with no challenge to the facts found by the Tribunal.

The central legal issues the court had to address were whether FMG had fulfilled its obligation to negotiate in good faith and if the Tribunal was correct in concluding that FMG was required to negotiate specifically about the Proposed Tenement after broader negotiations failed. FMG argued that the negotiations were in good faith and that there was no obligation to continue negotiating beyond the six-month period specified in section 35 of the Act or to engage in specific negotiations about the Proposed Tenement after broader negotiations had broken down.

The court found that the Tribunal's conclusion that FMG had not negotiated in good faith was based on the Tribunal's view that FMG had not sufficiently advanced the negotiations before applying under section 35 of the Act. However, the court held that the requirement of good faith did not mandate that negotiations reach a certain stage or result in agreement before FMG could apply under section 35. Additionally, the court held that the Act does not prescribe the manner in which negotiations are to be conducted, provided they are in good faith. The Tribunal had erred in concluding that FMG's reliance on failed general negotiations, which did not specifically address the Proposed Tenement, was unreasonable and contrary to the requirements of section 31(1)(b) of the Act.

The court allowed the appeal, set aside the Tribunal's decision, and made no order as to costs. The decision underscores that while negotiations must be in good faith, the Act does not dictate the specific manner or scope of those negotiations, provided they are directed towards achieving agreement.