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10 December, 1997
Facts:
In accordance with s. 29 of the Native Title Act 1993 (Cth) ('the Act'), the Western Australian State Government ('the Government party') issued a notice in April 1996 stating that it proposed to compulsorily acquire all the native title rights and interests in certain land in the Shire of Coolgardie in Western Australia. Such an acquisition is a valid future act so long as the right to negotiate provisions in the Act are properly applied in relation to the acquisition.
At the end of the two month notice period, provided for by the right to negotiate provisions in the Act, three native title parties were registered on the Register of Native Title Claims: the Maduwongga, Gubrun and Mingarwee native title parties. As there was no third party on whose behalf the Government party was intending to acquire the land, the negotiating parties (in relation to the negotiation about the compulsory acquisition) were the Government party and the three native title parties.
In August 1997, the Government party applied to the Native Title Tribunal under s. 35 of the Act for a determination in relation to the proposal to acquire the native title rights and interests in the relevant land. The earliest such an application may be made is six months after the original notice under s. 29 was issued. There is no limit on the time within which such an application may be made. In this case, the application was made one year and four months after the original notice was issued.
A preliminary issue to be determined in future act applications under s. 35 of the Act, is whether the Government party has negotiated in good faith with the native title parties as required by s. 31 of the Act. The Native Title Tribunal may not make any determination in relation to an application made under s. 35 of the Act unless it is satisfied that the Government party has fulfilled its obligation to negotiate in good faith with other relevant negotiation parties. In this application, the Maduwongga native title party submitted that the Government party had not negotiated in good faith with them, although the Mingarwee native title party agreed that the Government party had negotiated in good faith and the Gubrun native title party did not contest the issue.
Held:
The Tribunal was satisfied that the Government party had negotiated in good faith with the native title parties and thus that it had jurisdiction to make a determination in relation to the application under s. 35 of the Act.
Editor's note: References to AILR on p. 264 denote the Australian Industrial Law Reports.
The Hon CJ Sumner:
Reasons For Decision on Whether the Government Party has Negotiated in Good Faith
The Native Title Act 1993 (Cth) ('the Act') provides that where the Commonwealth, a State or Territory ('the Government party') proposes to do certain permissible future acts (including the compulsory acquisition of native title rights and interests for the purpose of conferring rights and interests on persons other than the Government party), the 'right to negotiate' provisions in Subdivision B, of Div 3, of Pt 2 (ss. 26-44) of the Act apply, and must be followed to ensure that the act can be validly done.
In summary, the Government party is required to give notice of its intention to do the act (s. 29). A 'native title party' is defined to include any registered native title claimant (s. 29(2)(b)) in relation to the land or waters that will be affected by the act. A 'grantee party' is a person who has requested or made application for the act to be done (s. 29(3)(d)). Except where the expedited procedure is attracted (which is not the case in this matter), the Government party must negotiate in good faith with the native title parties and grantee parties (s. 31(1)(b)) who are all 'negotiation parties'. In the case of the compulsory acquisition of native title rights and interests any negotiation party may apply to the arbitral body (in this case the National Native Title Tribunal ('the Tribunal')) for a determination in relation to the act if there is no agreement within six months of the notice being given (s. 35).
Unless an agreement is reached by the negotiation parties and a copy of it given to the Tribunal, the Tribunal must conduct an inquiry and make one of the following determinations, namely, that the act must not be done, that the act may be done, or that the act may be done subject to conditions to be complied with by any of the parties (ss. 34, 37, 38). The Tribunal must take all reasonable steps to make a determination, in the case of a compulsory acquisition, within six months of an application being made and advise the Commonwealth Minister if it does not do so (s. 36(2)). Section 39 sets out the matters that must be taken into account in making a determination.
(1) The Government Party proposes to compulsorily acquire all the native title rights and interests in certain land in the Shire of Coolgardie in Western Australia. The land is Jaurdi locations 80, 81 and 82 (being vacant crown land except for certain mining tenements issued under the Mining Act 1978 (WA)) and is located approximately 13 km north east of Coolgardie and 26 km south west of Kalgoorlie south of the transcontinental rail line.
The purpose of the acquisition is to enable the establishment of a heavy industrial estate ('the Mungari Industrial Park'). The land was acquired from the Mungari and Mt Burgess pastoral stations, following an assessment and analysis in 1990 of potential industrial sites.
The area was identified in 1992 as a suitable site for the purpose of facilitating regional industrial activity in the Goldfields. Environmental approval to proceed was given in 1993.
The acquisition is being effected pursuant to the Land Acquisition and Public Works Act 1902 (WA) which authorises acquisitions for industrial and public purposes where the use and development of the land will confer an economic or social benefit on the State or relevant region or locality. Notice of the proposed acquisition has been given under that Act.
On acquisition the Minister of Lands will grant freehold title to the Western Australian Land Authority (LandCorp) a statutory authority established by the Western Australian Land Authority Act 1992 (WA), which will develop, subdivide and dispose of the land to private interests for industrial purposes.
Mr Greg McIntyre, representing the Maduwongga native title party questioned whether LandCorp was a 'grantee' party, in these proceedings. He suggested that LandCorp was not part of the State and could not be included as a part of the Government party. Section 5 of the Western Australian Land Authority Act establishes LandCorp as 'an agent of the crown in right of the State' and s. 24 provides that the 'Minister for Lands may give directions [to LandCorp] ... either generally or in relation to a particular matter'. Mr Stephen Wright, representing the Government party, argued that the Government party has treated the compulsory acquisition which is effected by the Governor in Executive Council under the Land Acquisition and Public Works Act and the subsequent freeholding of the land to LandCorp as effectively one proposal and hence only one permissible future act. The purpose of the acquisition (and subsequent freeholding to LandCorp) is to confer rights or interests in relation to the land on persons other than the Government party (ie on the private interests that will occupy the Mungari Industrial Park).
If LandCorp is not part of the Government party then potentially it could be a grantee party. On the other hand, if LandCorp is a part of the Government party and the only relevant act is the compulsory acquisition then it could be argued that the right to negotiate provisions do not apply as there is no third party involved (s. 26(2)(d)). If this were the case the Government party could acquire the land without reference to the right to negotiate provisions but use the Land Acquisition and Public Works Act to give native title holders the same procedural rights as are given to freehold title holders. Where the right to negotiate provisions do not apply (as in the case of a compulsory acquisition for Government purposes) the Act provides that native title holders have the same procedural rights as would holders of ordinary (ie freehold) title (s. 23(6) of the Act). For the purpose of these proceedings I regard LandCorp as part of the Government party and consider it appropriate and consistent with the purposes of the Act that the Government party has treated the compulsory acquisition and subsequent freeholding as in effect one permissible future act and utilised the right to negotiate provisions.
A grantee party is defined by s. 29(1)(2)(d) of the Act as a person who requests or applies for the act to be done. There is no suggestion, let alone evidence, that LandCorp falls into this category. In the end, Mr McIntyre did not pursue his submission and I find that there is no grantee party in these proceedings.
At least one private company (ICI) has expressed interest in purchasing land if the Mungari Industrial Park goes ahead.
(2) The proposed compulsory acquisition of native title rights and interests is a permissible future act which is covered by s. 26(2)(d) of the Act.
(3) The Government party gave notice on or before 11 April, 1996, in accordance with s. 29, of its intention to do the proposed act.
(4) On 19 April, 1994 Marjorie May Strickland and Anne Joyce Nudding on behalf of the Maduwongga peoples ('the Maduwongga native title party') made application for determination of native title (WC94/3).
On 27 July, 1995 Brian and Dave Champion, Cadley and Dennis Sambo, George Wilson, Clem Donaldson for their respective (Gubrun) families ('the Gubrun native title party') made application for determination of native title (WC/95/27).
On 2 February, 1996 Dorothy Dimer, Ollan Dimer and Henry Richard Dimer on behalf of the Mingarwee (Maduwongga) people ('the Mingarwee native title party') made application for determination of native title (WC96/10).
Each native title party was registered by the Tribunal as a native title claimant in relation to the whole of the land to which the compulsory acquisition related and was so registered at the time that the notice under s. 29 was given.
(5) On 20 August, 1997, being a date more than six months after the Government party gave notice of its intention to do the proposed act, the Government party applied to the Tribunal for a determination in relation to the proposed compulsory acquisition ('the s. 35 Application').
(6) No agreement between the Government party and the native title parties as to the doing of the proposed act has been given to the Tribunal.
Before embarking on an inquiry the Tribunal must be satisfied that the Government party has fulfilled its obligation to negotiate in good faith with the other negotiation parties.
In Walley v Western Australia [1996] FCA 490; (1996) 137 ALR 561 ('Walley') the Federal Court decided that the obligation to negotiate in good faith imposed on the Government party by s. 31(1)(b) of the Act was a condition precedent to the making of an application under s. 35 and the Tribunal has no jurisdiction to make a determination unless the obligation has been fulfilled. If the Government party has not complied with its obligation then the application made under s. 35 should be dismissed under s. 148 of the Act on the basis that the applicant is unable to make out a prima facie case in relation to the application.
The Maduwongga native title party submitted that the Government party has not negotiated in good faith with them. This matter must be decided as a preliminary issue prior to the Tribunal embarking on hearings into the s. 35 Application.
Following receipt of the s. 35 Application the Tribunal convened a preliminary conference to consider directions for the inquiry. To enable the native title parties to consider the question of good faith negotiations the Government party was required to provide a statement (with documents) of the steps taken which it relied on to establish that it had negotiated in good faith.
Following receipt of this material the Maduwongga native title party submitted that the Government party had not fulfilled its obligation to negotiate in good faith and that the s. 35 Application should be dismissed. The Mingarwee native title party agreed that the Government party had negotiated in good faith with them and the Gubrun native title party did not contest the issue.
Where the negotiation parties agree or do not contest or take issue with the fact that the Government party has fulfilled its obligation to negotiate in good faith the Tribunal will normally accept this as sufficient to establish the condition precedent to its jurisdiction unless it appears on the face of it that there is no reasonable basis for the agreement or there is an obvious factor which denies it jurisdiction (see Walley at 572-3). I find that the Government party has fulfilled its obligation to negotiate in good faith with the Gubrun and Mingarwee native title parties.
Following the Federal Court decision in Walley, the Tribunal in Western Australia/ Taylor (Njamal People)/Mullan, NNTT WF96/4, Hon CJ Sumner, 7 August, 1996 ('Njamal') dismissed an application made by the Government party on the basis that it had not negotiated in good faith. Njamal is different from the present matter in that it involved a proposal to grant a mining lease and there was a grantee party involved. It is not necessary to repeat in full the analysis in those decisions but I have been guided in this matter by the following principles and propositions derived from them. With one qualification, which I deal with below, they were generally accepted by Mr McIntyre and Mr Wright.
(1) Negotiation is central to the future act process (Walley at 576). The Preamble to the Act states that every reasonable effort must be made to secure the agreement of the native title holders to future acts of this kind through a special right to negotiate.
(2) Section 31 of the Act imposes the obligation to negotiate in good faith:
Normal negotiation procedureGovernment party to negotiate
31.(1) Except where the notice includes a statement that the Government party considers the act attracts the expedited procedure, the Government party must:
(a) give all native title parties an opportunity to make submissions to it, in writing or orally, regarding the act; and
(b) negotiate in good faith with the native title parties and the grantee parties with a view to obtaining the agreement 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.
(2) If any of the negotiation parties requests the arbitral body to do so, the arbitral body must mediate among the parties to assist in obtaining their agreement.
Sub-section 31(1) imposes on the Government party (and no other party) two clear obligations. The first, contained in s. 31(1)(a), is to give the native title parties an opportunity to make submissions to it (either in writing or orally) regarding the act (s. 31(1)(a)).
The second obligation, contained in s. 31(1)(b), is to negotiate and to do so in good faith with both the native title parties and the grantee parties (if there are any) with a view to obtaining the agreement of the native title parties to the doing of the act with or without conditions.
Negotiation in good faith may be considered to have begun upon a communication from the Government party to the native title party and not only when there is a response to the Government party's initial approach (Walley at 576). Whether the opportunity to make submissions which must be given by the Government party to the native title party pursuant to s. 31(1)(a) can be regarded as the commencement of negotiations will depend on the circumstances. (Njamal at 44).
There is no legal obligation to negotiate in good faith after a s. 35 Application has been lodged although the parties may voluntarily continue to do so (Njamal at 7).
(3) The words 'negotiate in good faith' are not defined in the Act and must be given their normal meaning having regard to the statutory context and principles of statutory construction (Njamal at 9).
The following definitions are relevant:
'Negotiate'New Shorter Oxford English Dictionary, 1993 ed, at 1900:
communicate or confer (with another or others) for the purpose of arranging some matter by mutual agreement; have a discussion or discussions with a view to some compromise or settlement.
Macquarie Dictionary, 2nd ed, at 1192:
1. to treat with another or others, as in the preparation of a treaty, or in preliminaries to a business deal.
2. to arrange for or bring about by discussion and settlement of terms ... .
Negotiation involves communicating, having discussions or conferring with a view to reaching an agreement.
'Good faith'New Shorter Oxford English Dictionary, 1993 ed, at 908: 'honesty of intention; sincerity'.
Macquarie Dictionary, 2nd ed at 754:
1. honesty of purpose or sincerity of declaration: to act in good faith;
2. expectation of such qualities in others: to take a job in good faith.
While subjective honesty of purpose or intention and sincerity are essential to good faith negotiations, they are not necessarily sufficient ingredients of them. It is necessary to consider whether what is done is reasonable in the circumstances. The Government party must make every reasonable effort to negotiate and reach agreement with the native title parties (Njamal at 19).
(4) The dictionary definitions of the word 'negotiate' include discussions or communications towards a compromise or an agreement. Section 31(1)(b) of the Act makes it clear that the negotiations must be 'with a view to obtaining the agreement of the native title parties to the doing of the act ...'. Some preparedness to shift position or compromise in order to achieve agreement appears to be an important part of good faith negotiations in its ordinary meaning. In Asahi Diamond Industrial Australia Pty Limited v Automotive, Food Metals and Engineering Union (1995) AILR 1165; 59 IR 385 ('the Asahi Case') the Full Bench of the Industrial Commission in considering the provision in the Industrial Relations Act 1988 (Cth) which dealt with negotiations in good faith in the context of industrial collective bargaining said in relation to the meaning of the work 'negotiate' (at 172):
An agreement is normally preceded by negotiations. Negotiation normally involves the making of concessions so as to achieve an agreement.
(5) In Public Sector Professional Scientific Research, Technical, Communications, Aviation and Broadcasting Union v Australian Broadcasting Commission (1994) 36 AILR 419 ('the ABC Case'), the Full Bench of the Industrial Commission in considering provisions in the Industrial Relations Act 1988 (Cth) which dealt with negotiations in good faith in the context of industrial collective bargaining said (at 421):
However, the determination of whether or not a negotiating party is 'negotiating in good faith' may depend on the conduct of the party when considered as a whole. For example if a party is only participating in negotiations in a formal sense, but not bargaining as such then they may not be 'negotiating in good faith'. Negotiating in good faith would generally involve approaching negotiations with an open mind and a genuine desire to reach an agreement as opposed to simply adopting a rigid, predetermined position and not demonstrating any preparedness to shift.
In Njamal (at 12) this proposition was accepted by the parties and the Tribunal as a reasonable guide to the meaning of negotiate in good faith in s. 31(1)(b) of the Act.
This test gives recognition to the fact that each element of a party's negotiation behaviour alone may not indicate whether a party has negotiated in good faith. However, when the overall conduct of the party is examined it may be clear that the party has or has not negotiated in good faith. The relative weight of any individual element of conduct in that overall assessment depends upon the circumstances.
(6) What constitutes good faith negotiations depends on the legislative and factual context and must be considered in the unique circumstances of native title and future act negotiations which are required under the Act (Njamal at 14-15).
(7) Negotiation in good faith does not mean that the Government party has an obligation to capitulate or to accept the other side's position, or mean that a negotiated agreement must be reached between the parties (Njamal at 15).
(8) The Government party cannot refuse to enter into negotiations because it believes there is a matter which is fatal to another party's position (Njamal at 15).
(9) To determine whether the Government party has negotiated in good faith it is necessary to look at the conduct of the party as a whole. However, to aid in this process it is legitimate to look at certain indicia which may point to whether the obligation to negotiate in good faith has been fulfilled. Such a list cannot be prescriptive or exhaustive and the weight given to any item must depend upon the circumstances of the matter (Njamal at 17-18).
Using a common sense approach to the context and purpose of the right to negotiate provisions in the Act, the following may be useful indicia of whether the Government party has negotiated in good faith:
(i) unreasonable delay in initiating communications in the first instance;(ii) failure to make proposals in the first place;
(iii) the unexplained failure to communicate with the other parties within a reasonable time;
(iv) failure to contact one or more of the other parties;
(v) failure to follow up a lack of response from the other parties;
(vi) failure to attempt to organise a meeting between the native title and grantee parties;
(vii) failure to take reasonable steps to facilitate and engage in discussions between the parties;
(viii) failing to respond to reasonable requests for relevant information within a reasonable time;
(ix) stalling negotiations by unexplained delays in responding to correspondence or telephone calls;
(x) unnecessary postponement of meetings;
(xi) sending negotiators without authority to do more than argue or listen;
(xii) refusing to agree on trivial matters eg a refusal to incorporate statutory provisions into an agreement;
(xiii) shifting position just as agreement seems in sight;
(xiv) adopting a rigid non-negotiable position;
(xv) failure to make counter proposals;
(xvi) unilateral conduct which harms the negotiating process, eg issuing inappropriate press releases;
(xvii) refusal to sign a written agreement in respect of the negotiation process or otherwise;
(xviii) failure to do what a reasonable person would do in the circumstances (Njamal at 17-18).
(10) The Tribunal may take into account that while the obligation to negotiate in good faith is only imposed upon the Government party, much of the content of the negotiations and any agreement must involve the native title party and depending on the circumstances it may be that the Government party has little that it is able to offer in resolution of the dispute (Njamal at 18).
(11) If the native title party acts unreasonably then there may be a lesser standard on the Government party depending on the circumstances of the particular case (Njamal at 51). If the other parties refuse to negotiate then all that may be required of the Government party is that it check with the other parties periodically to see if anything has changed (Njamal at 50-51; Walley at 576).
(12) The Government party should actively participate in the negotiation process, including providing information in relation to the proposed act (Njamal at 48).
(13) Negotiation in good faith may require more than just facilitating discussions. In general it will involve the Government party actively participating in discussions. It may require the Government party to make proposals about things that it is prepared to do in order to achieve an agreement (Njamal at 48).
(14) The Tribunal should not set an unrealistic standard for what is required to satisfy the obligation to negotiate in good faith (Njamal at 52).
(15) The Tribunal must satisfy itself on the balance of probabilities that the Government party has negotiated in good faith. There is no legal or evidentiary onus on any party in that regard (Njamal at 19-20).
Firstly, with respect to propositions (10) and (13), the extent to which the Government party will have little to offer or be required to make substantive proposals will depend on the circumstances and will need to be worked out on a case by case basis over time. There is likely to be a significant difference in what is involved in the obligation to negotiate in good faith between a proposal for a prospecting or exploration licence; a mining lease to be used for further exploration (as the case in Njamal); a mining lease to be used for a known project; or a compulsory acquisition which could be for a large variety of purposes.
Secondly, proposition (8) is a response to the Government Party's submission in Njamal (at 15) that negotiation in good faith did not impose an obligation to disregard or ignore a matter which in its view was determinative or fatal to the 'other side'. The Tribunal rejected this submission insofar as it could be interpreted to mean that the Government party does not have to enter into negotiations because it believes there is an issue of fact or law which defeats the other party's case. Specifically, the Tribunal said that the Government party could not refuse to negotiate on the basis that, in its view, native title had been extinguished. Such an attitude would not be consistent with negotiations in good faith involving a willingness to compromise. It would be adopting a rigid predetermined position. However, the proposition does not mean that the Government party is obliged to disregard the strong points in its case. These could be deployed in arbitration and can legitimately influence the offers which the Government party is prepared to make in the negotiation phase. The arbitration process establishes the legal framework within which the negotiations occur.
Section 38(1) of the Act states:
Except where s. 37 applies, the arbitral body must make one of the following determinations:(a) a determination that the act must not be done;
(b) a determination that the act may be done;
(c) a determination that the act may be done subject to conditions to be complied with by any of the parties.
However, the power of the Tribunal to act pursuant to s. 38(1)(c) is limited by s. 38(2) in the following terms:
The arbitral body must not determine a condition under paragraph (1)(c) that has the effect that the native title parties are to be entitled to payments worked out by reference to:(a) the amount of profits made; or
(b) any income derived; or
(c) any things produced;
by any grantee party as a result of doing anything in relation to the land or waters concerned after the act is done.
Section 39 of the Act provides:
Criteria for making determinationsCriteria
39. (1) In making its determination, the arbitral body must take into account the following:
(a) the effect of the proposed act on:
(i) any native title rights and interests; and
(ii) the way of life, culture and traditions of any of the native title parties; and
(iii) the development of the social, cultural and economic structures of any of those parties; and
(iv) the freedom of access by any of those parties to the lands or waters concerned and their freedom to carry out rites, ceremonies or other activities of cultural significance on the lands or waters in accordance with their traditions; and
(v) any area or site, on the land or waters concerned, of particular significance to the native title parties in accordance with their traditions; and
(vi) the natural environment of the land or waters concerned;
(b) any assessment of the effect of the proposed act on the natural environment of the land or waters concerned:
(i) made by a court or tribunal; or
(ii) made, or commissioned, by the Crown in any capacity or by a statutory authority;
(c) the interests, proposals, opinions or wishes of the native title parties in relation to the management, use or control of the lands or waters concerned;
(d) the economic or other significance of the proposed act to Australia and to the State or Territory concerned;
(e) any public interest in the proposed act proceeding;
(f) any other matter that the arbitral body considers relevant.
Laws protecting sites of significance etc not affected
(2) Taking into account the effect of the proposed act on areas or sites mentioned in subpara. (1)(a)(v) does not affect the operation of any law of the Commonwealth, a State or Territory for the preservation or protection of those areas or sites.
This does not mean that the parties may not move out of this framework in negotiation in order to achieve a settlement (see Njamal at 51 and s. 33 of the Act). In at least one respect the Act permits a negotiated agreement to deal with matters which an arbitral determination cannot. In contrast to s. 38(2), s.33 permits an agreement following negotiations to contain a condition for payments worked out by reference to the amount of profits made, income derived or things produced. The Government party may not be negotiating in good faith if it adopts a position during negotiations which opposes such a condition being agreed to (Njamal at 51). One of the advantages which is claimed for negotiation or mediation over litigation is that parties can resolve issues taking account of mutual interests without necessarily being bound by what a Court of law (or arbitral body) may be obliged to decide on the evidence presented. Negotiation and mediation can accommodate interests which go beyond the strict legal rights of the parties and this approach is to be encouraged in negotiations. However, the Government party cannot be accused of lack of good faith in its negotiations if it uses as a reference point the matters which must be considered in the arbitral phase and the sort of conditions which the Tribunal can impose on any determination that the act can be done.
One difficulty at this stage of the development of the law relating to the right to negotiate provisions is that there is very little precedent on how the Tribunal will take into account the factors in s. 39 and what conditions it will impose (if any) pursuant to s. 38(1)(c) in the event that it determines that the act can be done.
A test case determination (Re Koara People [1996] NNTTA 31; (1996) 132 FLR 73) on a proposal to grant a mining lease was overturned by the Federal Court (Evans v Western Australia, Federal Court, unreported, Nicholson J, 8 August 1997) and awaits redetermination by the Tribunal. There has been no determination in relation to a compulsory acquisition proposal. The principles relating to compensation for mining or compulsory acquisition are quite undeveloped. The fact that the legal parameters within which the parties are working are relatively unknown at present can be taken into account in assessing whether the Government party has negotiated in good faith. What may to one party be an unreasonable position, may to another be a legitimate position on the relatively unknown state of the law and the facts. The Government party is also entitled to consider the facts as they are known to it. If it has evidence that there are very few native title rights and interests, or no impacts on the way of life, culture and traditions which could be affected by the proposed act, then it is entitled to factor this into its negotiating position.
Thirdly, one factor in good faith negotiation which was not fully considered in Njamal was the need for frankness and openness in dealing with other parties. Indicium (9)(viii) refers to the failure to respond to reasonable requests for relevant information. Although not the subject of argument in this case, I consider that another more direct indicium could be added to the list, namely 'unreasonably failing to disclose facts or legal argument which the Government party intends to rely on in an arbitral inquiry'. Where the Government party is in possession of information or has a view on the law which it intends to use in an arbitral inquiry then it would be consistent with good faith negotiations under the Act for the other parties to be informed of it. These factors may legitimately influence the Government party's negotiating position but if they do then the other parties are entitled to know about it. This is not normal private commercial litigation where tactical gamesmanship may be acceptable. There are public policy considerations which underpin the Act, of which good faith negotiations is an essential part, and support the early and frank disclosure of the Government party's position.
Fourthly, the major qualification on the Government party's acceptance of the above stated principles and propositions was that the obligation to behave 'reasonably' (proposition (9)(xviii)) applied only to the procedural and not the substantive aspects of the negotiations.
In Njamal (at 44 and 48) the Tribunal decided that at the very least, good faith negotiation involves the active facilitation of discussions and negotiation between the parties. Failure to take procedural steps to ensure that this occurs will almost certainly mean that the Government party has not negotiated in good faith. Because Njamal was decided on the basis of the inadequacy of the Government party's procedures in this respect, the Tribunal did not give full consideration to what further steps may be required to ensure that the obligation is fulfilled. The Tribunal commented that the facilitation of negotiations will not necessarily ensure that the Government party has negotiated in good faith. Active participation by the Government party may also be necessary. The Tribunal also said (Njamal at 48-49):
Negotiation in good faith ... may well mean more than just facilitating and actively participating in discussions. It may require the Government party to make proposals about things it is prepared to do in order to achieve an agreement.
Njamal was different from the present matter in that it involved a proposal to grant a mining lease and there was therefore a grantee party involved. In this matter the fact that negotiations were conducted directly between the Government party and native title party raises more directly than in Njamal the question of what it must do to fulfil its obligations beyond the essential procedural steps.
The Government party argued that:
The Government party sought support for its propositions in the current practice of the Industrial Relations Commission under the Industrial Relations Act 1988 (Cth). The role of the Industrial Relations Commission is to facilitate the negotiation process and not to intervene in the substance of negotiations, nor to force the parties to negotiate. (The ABC Case, the Asahi Case and Australian Rail, Tram and Bus Industry Union v Public Transport Corporation of Victoria, AIRC, unreported, Decision 1797 of 1994, 30 September 1994 ('the PTC Case')). These cases deal with the circumstances where the Industrial Relations Commission will intervene because there has been no good faith negotiations in the circumstances where the good faith negotiations are defined largely in procedural terms (see the ABC Case at 420 and the PTC Case at 2). Although the industrial relations context provides some guidance as to the procedures that will constitute good faith negotiations, I do not think these procedures are the only factors which the Tribunal can look at in considering the issue under the Native Title Act.
There also seems to be a difference of opinion in the Industrial Relations Commission on the importance of 'willingness to compromise' as an indication of good faith negotiations. The ABC Case said that adopting a rigid predetermined position and not demonstrating any preparedness to shift was not consistent with good faith negotiations. The Asahi Case said that negotiation 'normally involves making concessions'. On the other hand in the PTC Case Senior Deputy President Hancock said that 'bargaining in good faith does not require a willingness to make concessions' (the PTC Case at 3).
In Njamal (at 12-15), the Tribunal referred to the US cases on good faith negotiation in the industrial relations context. It appears that a willingness to compromise or make a reasonable concession was originally considered by US Courts to be an necessary ingredient of negotiating in good faith as the words are ordinarily understood. The fact that US Courts interpreted negotiations in good faith in this way led the US Congress to amend the National Labor Relations Act to exclude from the duty to negotiate in good faith the requirement that concessions be made.
In my view negotiation in good faith under s. 31(1)(b) of the Act does require a preparedness to shift position, a willingness to compromise or make concessions. The extent to which the Government party will actually need to shift position, compromise or make concessions in order to satisfy its obligations to negotiate in good faith will depend on whether its negotiating position is reasonable in the overall circumstances of the case. Proposals and concessions which are reasonable in the total context of the case need to be made.
The Government party also referred to negotiation in good faith in the context of the law of contract in Australia (see Coal Cliff Collieries v Sijehama Pty Ltd (1991) 24 NSWLR 1, Hooper Bailie Associated Ltd v Natcor Group Pty Ltd (1992) 28 NSWLR 194 and Elizabeth Bay Developments Pty Ltd v Boral Building Services Pty Ltd (1995) 36 NSWLR 709). These cases establish that negotiation in good faith does not mean that the parties have to disregard their own interests or necessarily have to reach an agreement (eg see Kirby J in Coal Cliff Collieries at 28-29) and to that extent are applicable to the context of these proceedings.
'To negotiate' in its ordinary meaning is to have discussions with a view to a compromise or settlement. A compromise involves making concessions and would ordinarily be part of negotiations. Once it is conceded that the willingness to compromise or make concession is an ordinary part of a negotiation process, it follows that in order to decide whether there has been good faith negotiations the Tribunal is entitled to look at the substance as well as the procedural aspects of what has occurred. For example, it may be that the party has a strongly and sincerely held belief that it should not make any concessions in negotiations, yet on any objective analysis of the legal and factual issues involved such an attitude is unreasonable in the circumstances. It may be so unreasonable that what the party is doing is not even negotiating.
In the context of the Native Title Act there are important reasons adopting the proposition that good faith negotiations must be looked at from the substantive as well as the procedural aspects. Under the Act, negotiation and mediation are regarded as central to the resolution of disputes. Kirby J in the High Court in North Ganalanja v Queensland [1996] HCA 2; (1996) 135 ALR 225 said (at 269):
It is important to emphasise that the purpose of the tribunal is to facilitate negotiation, discussion and agreement, if at all possible.
Lee J in the Federal Court in North Ganalanja v Queensland (1995) 132 ALR 565 also referred to the central role of mediation in the native title process (at 580):
underlying the Act is an acknowledgment by Parliament that unless mediation or consultative processes are provided by the Act for the purpose of encouraging parties to use direct and less costly means of resolving their differences, the prosecution of inter partes litigation on a 'parcel by parcel' basis will incur great cost and tend to prolong uncertainty about the existence and effect of native title. ... The procedures introduced by the Act includes the establishment of the tribunal and a system of mediation and negotiation that offers an alternative to adversarial litigation.
Carr J in Walley emphasised the importance of negotiation (at 29):
The matter of negotiation is clearly important and central to the permissible future act process. Failure to comply with the obligation to negotiate in good faith could be just as exclusive, in practical terms, as failure to give notice to such parties....
The situation, as I see it, is that Parliament has dictated in the clearest mandatory terms (including the use of the word 'must') that a certain process or activity should take place as part of the procedure leading to the possible doing of a future act. That process (negotiating in good faith) is of central importance.
It is clear that the legislature saw negotiation and mediation as a critical and essential aspect of the functioning of the future act process. Given the large number of future acts around the nation which have the potential to attract the right to negotiate, it is obvious that a litigious resolution of them all would seriously undermine the Act as it was intended to work. Negotiation is a central part of the future act process and not just an adjunct to normal litigation.
It is also true that the Government is not 'any old party' to the proceedings. It has a special role in the process and an interest in ensuring that the Act approved by the Australian Parliament works as effectively as possible. Further, by virtue of its election, the Government is an agent of the whole community and must look to the public interest. In this respect it will have regard to what is a proper use of taxpayers funds but its considerations may go beyond the narrow commercial interests which might be paramount in a private dispute.
In my view, the resolution of issues by discussion will not be encouraged if the Government party is able to make unrealistic substantive offers. The purpose of the Act will be enhanced if the obligation to negotiate in good faith imposed on the Government party involves taking both reasonable procedural steps and making reasonable substantive offers.
This does not mean the Tribunal in considering the good faith point will conduct an inquiry of the kind required in a determination, and then make a decision that there has not been good faith negotiations because the negotiations did not come to the same conclusion as the Tribunal would have in a determination. The preliminary issue for the Tribunal is the reasonableness of the negotiating behaviour overall, taking account of the matters described above. In practice, this should generally be ascertainable from the documentary evidence. The fact that the Tribunal might come to a different conclusion in a determination after inquiry is not determinative of the good faith point.
Whether there is a preparedness to compromise must also be considered in the overall context of the particular case. If on any objective consideration of the facts and law a native title party has a strong case it may be inimical to good faith negotiations for minimal offers to be made in the first place so that there is adequate room to make further compromises. On the other hand, the Government party may in its initial proposal make a genuinely realistic offer. The fact that it may not be prepared to shift greatly from this position may not compel a finding that it has failed to negotiate in good faith. The proper conclusion will depend on all the circumstances. Put simply, the reasonable range for an assessment of compensation might be $80,000 to $100,000. If an initial offer of $10 was made and increased in stages to $1,000 this would not demonstrate a preparedness to compromise. On the other hand an initial offer of $80,000 may well do so.
Once it is conceded that the Tribunal can consider whether the Government party has been willing to compromise, it follows that it must also look at the substance of the negotiations, what proposals were made, and whether they were reasonable in the circumstances. The Tribunal will need to examine the proposals and counter proposals for settlement and whether a rigid non-negotiable position was adopted or whether a preparedness to compromise was demonstrated. What is reasonable in this circumstance (Indicium (9)(xviii)) will need to be examined both from a procedural and substantive aspect.
In summary, the statement of the Full Bench of the Industrial Relations Commission in the ABC Case quoted above is a reasonable guide to the meaning of negotiate in good faith in s. 31(1)(b) in the Native Title Act. This means that the Government party should approach negotiations 'with an open mind and a genuine desire to reach an agreement as opposed to simply adopting a rigid pre-determined position and not demonstrating any preparedness to shift' (ABC Case at 421). Further, what the Government party must do is make every reasonable effort to negotiate and to reach agreement with the native title parties. A reasonable effort to negotiate involves taking necessary procedural steps as well as making realistic substantive offers and concessions in the circumstances.
The Government party's negotiations were conducted by Peter John McNally ('Mr McNally') the Regional Manager South East for the Department of Land Administration (DOLA) and Stephen Norman Wiencke ('Mr Wiencke') a Senior Project Manager with the Western Australian Land Authority (LandCorp) who has been Project Manager for the Mungari Industrial Park project since February 1992. Their evidence was contained in affidavits and supplemented by information provided at the hearing. An affidavit from Alan William Newton ('Mr Newton') of Newton Vincent Solicitors for the Maduwongga native title party was also tendered.
The s. 29 notice was published by the Government party on or before the 11 April, 1996 and the s. 35 Application lodged on the 20 August, 1997, thus providing a 16 month period within which negotiations could occur.
Initially the negotiations involved three other compulsory acquisition proposals in the Kalgoorlie/Boulder area - a subdivisional development including the provision of services (such as water, power, roads) and land for light industrial purposes and a subdivisional development including the provision of services (such as water, power, roads, sewerage) and land for housing, recreational, public, community and commercial purposes, both projects in the Shire of Kalgoorlie/Boulder; and an explosives reserve and solid industrial waste disposal site near the Mungari Industrial Park. In April 1997, DOLA proposed that the Kalgoorlie proposals be withdrawn from discussions and later a decision was made not to proceed with the explosives reserve and industrial site at this time. The s. 35 Application relates only to Mungari Industrial Park. No criticism can be levelled at the Government party for wishing to proceed with the Mungari proposal, even though the negotiations were initially attempting to resolve the other issues in the Kalgoorlie/Boulder area, as it has an active interest from a company (ICI) wishing to locate a facility in the Park. During negotiations all four proposals were discussed together and proposals in relation to them had certain common features. This needs to be borne in mind when assessing the nature of the negotiations for the purpose of determining the good faith issue in this application which is now only confined to the one project.
The Commencement of Negotiations
On the 28 June, 1996, DOLA sent to all native title parties a letter which
There are a number of observations to make about this letter. Firstly, the letter complied with the Government party's obligation under s. 31(1)(a) in that it gave all native title parties an opportunity to make submissions in writing or orally regarding the act. Secondly, in Njamal the Tribunal did not regard the initiating letter from the Government party as necessarily commencing the negotiations. Whether the initial letter complying with obligations under s. 31(1)(a) can also be regarded as the effective start of the negotiations will depend on the circumstances. A letter which simply invites a submission may not do so. In Njamal the Tribunal suggested that it is possible for the initial letter to both fulfil the obligations under s. 31(1)(a) and effectively commence negotiations by setting out proposals for their future conduct. In this case I think the letter did commence the negotiations as it contained information about the project and invited contact to be made with DOLA. In Njamal the Tribunal suggested that the initiating letter sent to comply with s. 31(1)(a) could start the negotiations either by proposing a time and place for a meeting with a suggested agenda or containing a proposed negotiating protocol and timetable which would involve a proposal for an early meeting between the parties, a timetable for follow up meetings and information about what is expected of the parties during the negotiation period. The Tribunal suggested the Government party prepare such a document for distribution and I understand that something of this kind now occurs. The initiating letter in this case preceded the decision in Njamal but as basic information about the project was provided along with an invitation to enter discussions. I am satisfied that this letter did effectively commence the negotiations.
Delay until the 2 month notification period expires
Thirdly, the letter of 28 June, 1996 stated that the negotiations should be completed within six months of the date of the s. 29 notification. In Njamal the Tribunal said that where there is a registered native title claimant at the time the s. 29 notice is given, then the Government party should give them an opportunity to make submissions and commence negotiations immediately and not wait for two months to see whether there are other people who become registered native title claimants. The six month negotiation period should not as a matter of general policy be shortened to four months on the basis of waiting to see whether there will be additional parties. The Act provides that anyone who becomes a registered native title claimant within two months of the notice being given also is a native title party and has the right to negotiate. Although the letter gave six months from the 11 April, 1996 as the time for completion of negotiations the Government party subsequently extended the negotiating period well beyond that date. Where as a matter of convenience the Government party decides to wait for the expiry of the two months notification period before commencing negotiations it would be consistent with good faith negotiations to extend the negotiation period for two months. If this is done no criticism can be levelled at the Government for failing to negotiate in good faith with the native title parties known to exist in the two month notification period. The Government party's decision to wait until the end of the two months notification period before commencing negotiations meant that the effective date for their commencement was 11 June, 1996. The initiating letter was sent on 28 June, 1996, 17 days later. In this matter that delay is of no consequence, because negotiations went on well beyond the six month statutory period. In general the Government party should conscientiously attempt to avoid delay, even of the relatively small kind which occurred here.
In Njamal the Tribunal suggested ten days from the s. 29 notice as the appropriate time within which to send the initiating letter.
Delay generally
The Government party acknowledged that there was a three month delay in responding to Mr Newton's request for written reports of heritage surveys which had been carried out previously and were in the possession of the Government party. Because of the extension of the negotiating period, this delay is of less significance than it might be in other contexts. Heritage and site information will always be of crucial importance to future act negotiations. A delay of this kind in the provision of important information which is in the possession of the Government party would assume much more significance in the overall context of the negotiations, if the Government party made a s. 35 Application as soon as the statutory six month negotiating period had expired.
The native title party complained of other instances of delay. There was a two month delay in the provision of an acknowledgment of confidentiality by DOLA and LandCorp. There was a dispute about the terms of this acknowledgment which is a part explanation for the delay. The request was made by Mr Newton on 9 December ,1996. DOLA provided the acknowledgment on 9 January, 1997 and LandCorp on 6 February, 1997. It is difficult to see why it took LandCorp an extra four weeks to provide the acknowledgment. Once again this delay assumed much less importance given the extra time devoted to negotiations.
The delay in making a proposal until 30 October, 1996, over four months into the effective negotiation period, also falls into this category.
The policy of the Act is to provide a defined timetable within which future acts can either proceed by way of agreement after negotiation or be the subject of a determination after arbitration. In many cases six months will not be a long time within which to complete complex negotiations. The Government party must ensure that delays are kept to a minimum if it wishes the statutory framework to be adhered to. A number of separate instances of delay, which on their own may not be significant, can when taken overall effectively reduce the negotiating period available. The Government party should ensure that its information procedures alert its officers to the potentially adverse consequences of delay in the negotiating process.
The Government party's request to the Tribunal to mediate
On 30 July, 1996 Mr McNally wrote to the Maduwongga native title party suggesting a meeting to outline the project, answer questions and have discussions on how the project might be progressed. Following a response from Mr Newton dated 20 August, 1996 a further letter was sent by Mr McNally confirming the earlier offer of a full briefing and making suggestions about times when it might occur. This letter advised that the State had asked the Tribunal to mediate on the proposal. The Maduwongga native title party, in its written submissions, argued that the mediation request was premature and thus inconsistent with good faith negotiations. The Act specifically provides that any negotiation party may request the arbitral body to mediate among the parties to assist in obtaining their agreement (s. 31(2)) and it is perfectly consistent with good faith negotiations for the Government party to do this at an early stage of the negotiations.
Procedural good faith negotiations - General
I have come to the conclusion that in the procedural sense the Government party fulfilled its obligation to negotiate in good faith and it is not necessary to recite all the steps that were taken. It is sufficient that I find that:
The cessation of negotiations
The Maduwongga native title party submitted that the manner in which the Government party ceased negotiations and made the s. 35 Application was inconsistent with good faith negotiations. By letter dated 19 August, 1997 which appears to have been sent simultaneously with the s. 35 Application, DOLA advised the native title parties of its intention to make the application. It also expressed its preparedness to continue negotiations. This was the first form of contact between DOLA and Mr Newton since a letter dated 23 June, 1997 from Mr Newton to Mr McNally. That letter expressed the view that the Government terms of settlement were too uncertain and proposed that it commence negotiations by reference to a proposition outlined in Mr Newton's earlier correspondence. By this time negotiations had effectively broken down (see below). There was no agreement on what set of proposals should form the basis of negotiations. In my view more could have been done by the Government party during this two month period to attempt to meet and flesh out its proposals. The fact they did not was understandable given the history of the negotiation and Mr Newton's expressed desire 'to keep negotiation meetings and correspondence to a minimum' (see letters dated 7 April, 1997 and 23 June, 1997) and is not of great weight in the overall circumstances. I also think that as there had been no contact for some two months, the Government party could have provided the native title party with a final opportunity to put submissions or meet within a specified time and advised of the added urgency, because of the interest expressed by ICI in locating on the Park, before making its s. 35 Application. In the context of this case the failure to do this does not produce a conclusion that overall the Government party failed to negotiate in good faith.
Other matters
The Maduwongga native title party submitted that there were other factors which militated against the Government party's assertion that it negotiated in good faith. I have considered them but do not regard them as of importance.
General
The major issue for determination in this matter is whether there was substantive as well as procedural good faith negotiations. The following documents chart the essential elements of the discussions. On 30 October, 1996 Mr McNally wrote to Mr Newton responding to requests he had made for plans and aerial photographs. The letter also included the following document described as 'an extract from my file that outlines the position of DOLA in relation to the residential and light industrial developments in Kalgoorlie' and requested Mr Newton's clients claim proposal:
LAND ACT PROPOSALS IN THE CITY OF KALGOORLIE/BOULDERNORTH WEST STRUCTURE PLAN WEST KALGOORLIE LIGHT INDUSTRIAL
1. The State is prepared to negotiate further on the following matters:
(a) involvement of Aboriginal people in the process of naming features, including roads and parks, in accordance with current policy and procedures adopted by the Geographic Names Committee of Western Australia.
(b) involvement of Aboriginal people in the identification and planning of public open space and other areas to be retained within the north west structure plan area having regard for cultural and heritage issues, including the provision of heritage trails and other facilities as appropriate.
(c) the State meeting the requirements of State Aboriginal heritage legislation and involving Aboriginal people in the completion of appropriate heritage and cultural surveys.
(d) consideration of possible sites within the structure area for the benefit of the Aboriginal community. However, negotiations in this respect will be limited to sites for specific purposes such as a cultural centre and aged persons housing. Progress of this matter will be dependant on negotiations with all relevant native title parties.
2. The State is not prepared to:
(a) grant serviced lots (other than in the context of 1(d) above) within subdivisional development nodes in either the north-west structure area nor the West Kalgoorlie light industrial subdivision.
(b) meet the costs of native title parties or their representatives in attending negotiation/mediation meetings and hearings. Native title parties have the opportunity to seek funding on native title issues through the relevant representative body or other Commonwealth organisations such as the Aboriginal and Torres Strait Islanders Commission.
By letter dated 7 November, 1996 Mr Newton sought (among other things) clarification of whether:
On 11 November, 1996, Mr McNally replied, confirming that the extract also related to the Mungari development and that it was 'seen as a guide and is not necessarily a definitive statement. The intent was to provide some answers to queries raised by other claimants and to share the information'. The letter also declined a request which had been made by Mr Newton that land be released for capital raising purposes. This proposal involved subdivided and developed land being made available to the native title parties which they could use to raise funds for developments on other blocks of land that were to be given to them.
On 9 December, 1996, a meeting was held between Mr Newton, Mr McNally and others in relation to the Maduwongga negotiations. Mr Newton outlined a proposal that was nearing completion. The proposal involved:
This proposal was confirmed in its essential elements in a written proposition sent in a letter from Mr Newton dated 28 February, 1997. The proposal for a heritage survey was outlined in much greater detail and involved the claimants, anthropologists and archaeologists and payment for the people conducting the survey by DOLA.
On 12 December, 1996 Mr McNally wrote to Mr Newton responding to the outline proposals that were discussed on 9 December, 1996:
I can inform you that the State is prepared to negotiate further on the matters of:
Until I receive your written proposal on the other topics discussed I cannot specifically respond but generally:
I would appreciate a written proposal from your clients so that we can meet and negotiate the detail of their requirements.
After further correspondence Mr McNally wrote to Mr Newton on 3 April, 1997 in the following terms:
The proposal for land tenure at the Mungari heavy industry site is for freehold sale with a buy back clause. This is to ensure that only heavy industry develops in the estate.I wish to confirm my offer to the Maduwongga claimant group that the State is prepared to offer:
1. The involvement of the claimant groups in heritage and ethnographic studies of the area.
2. The involvement of the claimant groups in the planning and design of the subdivision.
3. The use of aboriginal names for roads, parks and special features in accordance with existing state policies and procedures, and with agreement of the local authority.
4. If land is to be made available, then the use and benefit of that land must be for all people who are party to the claims.
5. The claimant group will reserve the right to compensations if it is proven to be the native title holder of the land.
I am keen to meet with the claimants to further discuss this offer. I look forward to your advice of a suitable meeting date and time.
On 8 April, 1997 Mr McNally wrote to Mr Newton in relation to the Mungari proposed future acts in the following terms:
To date the negotiations for the proposed future acts at Mungari have been included in the general Kalgoorlie negotiations. The need to separate the proposed industrial subdivision, the solid waste disposal site and the explosives area from the residential and light industrial proposals for Kalgoorlie, has become apparent.The intended future use of the Mungari sites makes the allocation of land there difficult, if not impossible to agree to. However the State has indicated its intent to consider the grant of land in line with current state policies and statutory procedures. Any site selected would need to be of a size that would be suited to the need of the group, but a site of 10 square kilometres would not be considered. If the land is granted, it is intended that it be used for heritage, cultural and other appropriate purposes.
The claimants rights to compensation will be preserved if they are proven to be the native title holders and can be dealt with at that time.
The developers of the site have in place a draft strategy for the employment of aboriginal people, and it is the State's intent to promote the employment of aboriginal people in the estate.
Please advise if the claimants you represent would be prepared to enter into an arrangement to allow the Mungari future acts to proceed.
During the ensuing four months or so there was some further correspondence but no further progress in resolving this issue was made.
On 19 August, 1997 Ron Pumphrey, Manager of the Native Title Unit at DOLA wrote to Mr Newton as follows:
The State has reached a stage where despite considerable effort in reaching agreement to enable this matter [Mungari Industrial Park] to proceed, an agreement has not been possible.Therefore the necessary action has been taken to lodge under s. 35 of the Native Title Act a future act determination application with the National Native Title Tribunal (NNTT).
However, this Department representing the State, is prepared to continue negotiations with you in an attempt to reach an agreement enabling the proposal to proceed. In this respect, I repeat previous commitments given to you for consideration by your clients.
(a) The State is prepared to consider the grant of land for heritage and cultural purposes, in line with current State policy and statutory procedures.
(b) Development within the subdivision will have regard for any Aboriginal heritage and cultural matters identified by completed or future surveys of this nature.
(c) The State will promote employment and training opportunities for Aboriginal people as part of its programme in progressing development of the state. One potential development proponent has indicated to the State its willingness to adopt a strategy in this respect.
(d) Any agreement reached in line with (a), (b) and (c), will reserve the right for your clients to compensation should they in the future, be determined native title holders.
The Maduwongga native title party's challenge to whether substantive good faith negotiations had occurred were put on two bases. Firstly, that the Government party stuck to its original negotiating position without shifting and secondly, that the proposals from the Government party amounted to an expression of good intentions and were nothing more than it would have been required to do in any event.
In relation to the first submission, the correspondence indicates that the Government party was prepared to discuss issues further. Its original extract of proposals was to be seen as a guide and was not necessarily a definitive statement. It would be possible for a party to make such a statement as a tactical ploy, when in truth it had no intention of changing its position, so as to be able subsequently to demonstrate that it was not adopting a rigid predetermined position. If this were the statement's purpose then the party would not be conducting negotiations in an honest and sincere way and in good faith. There is nothing to suggest in this matter that these statements were not genuine and there was in fact some movement from the Government party's original negotiating position.
The way in which the negotiations unfolded meant that the parties did not get down to detailed discussions of the Government party's proposals. This was unfortunate but in the circumstances of this case not fatal to the Government party's contention that it negotiated in good faith. Detailed discussions about the Government party's proposals did not occur because the native title party in the months prior to the s. 35 Application being made wanted to proceed on the basis of the proposition which it had put forward. Its proposal was first outlined at a meeting on 9 December, 1996 and committed to writing in the letter from Mr Newton dated 28 February, 1997. In letters dated 7 April, 1997, 29 April, 1997, 15 May, 1997 and 23 June, 1997 Mr Newton asserted that his proposition sent on 28 February, 1997 should be the starting point for negotiations. Mr McNally continued to put the Government party's position and expressed a willingness to meet (see letters of 3 April, 1997 and 8 April, 1997). On 13 June, 1997 Mr McNally sought a response to the proposals in his letter of 3 April, 1997 on which Mr Newton, in his letter dated 15 May, 1997, had said he would obtain his client's instructions. Regrettably during this period there was a stand-off about what proposal would form the basis of discussions and no effective engagement and negotiations between the parties.
Although the broad framework of the propositions remained the same there were some new proposals that were introduced into the discussions by the Government party. The Government party's original proposals in the extract of
30 October, 1996 were altered in two respects, one of which was significant. The extract (para 1(d)) offered consideration of possible sites for the benefit of the Aboriginal community. There was no indication of whether this was in lieu of cash compensation, or in full settlement of any potential compensation claim. Mr McNally's letters dated 3 and 8 April 1997 make it clear that the native title party will be able to pursue a claim for compensation once native title has been established. The land grant (offer of sites) is dealt with as a separate item and appears not to limit in any way the native title party's right to claim compensation or require setting off the value of the land grant from any future compensation.
Another change of position was introduced when Mr McNally in a letter dated 8 April, 1997, introduced the Government party's policy on the employment of Aboriginal people on the Mungari Industrial Park. Although expressed as nothing more than an intention, it was a new element in the discussions, and had the parties been able to engage in more detailed discussions may have been clarified or elaborated on.
Although there was not a great deal of movement from the Government party's original position, I cannot conclude that it adopted a predetermined position and that it wasn't willing to compromise.
The second submission was that the offers being made by the Government party did not constitute elements of good faith negotiations because they amounted to nothing more than what the Government party would be required to do in any event. There is some substance to this complaint. The commitment to meet the requirements of the State Aboriginal heritage legislation is something which the Government party cannot avoid. There may be room for legitimate discussions about how this could be ensured and the nature of any heritage or site survey to be carried out, including the involvement and payment of the claimants and professional advisers. On this point the Government party agreed with the Goldfields Land Council, who now represent the Mingarwee native title parties, to carry out a new Aboriginal site survey to supplement the one carried out during earlier stages of the project's development. Despite a proposal from Mr Newton for a heritage survey no agreement was able to be reached, once again because the parties were not able to get down to detailed discussions of the issues. On its own, agreeing to comply with State Aboriginal heritage legislation is not a legitimate good faith negotiation position for the Government party to adopt, but coupled with an offer to agree on the means of ensuring compliance may be.
With respect to the proposal for the involvement of Aboriginal people in the process of naming features, including roads and a park, Mr McIntyre argued that the Government party was in no position to make such an offer as it did not control and could not influence the Geographic Names Committee. Once again the failure of the parties to be able to engage in meaningful detailed dialogue on this issue means that what was being offered was not fleshed out in any detail. However, I would be surprised if the Government could not legitimately influence Committee decisions in this respect. At the hearing, Mr Wright confirmed this by informing the Tribunal that the Geographic Names Committee usually accepts the names proposed by the developer (which in this case is the Government).
Mr McIntyre queried what was being offered in relation to the involvement of Aboriginal people in the identification and planning of public open space beyond what would be required under State legislation. It is not clear, nor is it necessary in these proceedings to ascertain what obligations are imposed by State law on the Government party in this respect. Suffice it to say that the nature of this involvement is a legitimate area for negotiation.
The Maduwongga native title party complained that all that was being offered in respect of each of the above matters was 'involvement' and that these offers should have been more specific. For the reasons already explained, effective discussions about the detail of the proposals did not occur. Had discussions been held and the Government party not been prepared to clarify or offer more specific proposals for the involvement of the native title party it could have been open to the charge that it was not prepared to compromise.
Finally, I turn to whether the offer of land and the Government party's approach to compensation was reasonable in the circumstances. At an arbitral hearing the Tribunal may, as a condition of determining that the act may be done, make an order for compensation, which where native title claimants are involved must be paid into a trust (s. 38 and s. 41(3) subject to s. 41(4) of the Act). The money can be paid out if and when the claimant establishes native title (s. 52).
In this case no offer of monetary compensation was made, but the native title parties rights to claim compensation, once native title had been established, were preserved. The Government party contended that the freehold value of the land is low. It has settled with the Mt Burgess pastoral lessee for the acquisition of the pastoral interests on Jaurdi locations 80 and 81 for $1,000 and offered $1,200 to the Mungari pastoral lessee for Jaurdi location 82 and Ngalbain location 109 (which it is acquiring at the same time as the Jaurdi locations). In addition to the retention of rights to claim compensation, there was an offer of 'consideration of possible sites' (see extract accompanying the McNally letter of 30 October, 1996). Had the final offer of the Government party been 'to agree to consider' the sites or the grant of land then the offer would not have amounted to much. The Government party could have considered and decided against it.
Once again what was involved in this offer was not spelled out because of the failure of the parties to discuss details. At the hearing, Mr McNally informed the Tribunal that the offer was for a piece of land to be given to the native title parties. This confirms what can be inferred from the correspondence, especially the letter from Mr McNally of 8 April, 1997. In rejecting a site at the Mungari Industrial Park and rejecting a site of 10 sq km, there is a clear inference that other specific sites would be considered by the Government party.
In my view, the approach of the Government party, given the current state of knowledge of the law relating to compensation for the compulsory acquisition of native title rights and interests, was not unreasonable in the circumstances of this case. An offer of land was being made with future compensation rights preserved. Whether this will remain a reasonable approach will need to be reassessed in future when the law and procedures for payment into a trust become clearer from Tribunal and Court decisions.
The offer of land in relation to Mungari Industrial Park is obviously a long way from the proposal for payment of $900,000 advanced by Mr Newton in the discussion of 9 December, 1996. However, that proposal was put at a time when all the Kalgoorlie/Boulder future act proposals were being considered together, one of which was a subdivision for residential purposes. Mungari Industrial Park will be developed at Government expense to promote industrial development in the Goldfields, and on the evidence provided is not likely to produce a profit for the Government. The Government party was entitled to have regard to this fact in formulating its offer on compensation.
The Government party's proposal that the grant of land must be for the benefit of the Aboriginal Community as a whole. Another area of concern is the Government party's early insistence that any land it granted should be for the benefit of the Aboriginal community as a whole. This is an inappropriate stance to take in these negotiations which involve specified native title parties. The negotiations are conducted with a view of obtaining their agreement. It may be evidence of good faith negotiations for the Government party to offer benefits to the general Aboriginal community (which include the native title parties). However, to say that no benefit will be offered unless the native title party agrees that it is for the whole Aboriginal community (which may include persons who are not native title parties in the particular case) is not appropriate.
The documentary evidence on this point is ambiguous. At some point references are made to the Aboriginal community and in others to the claimants. Mr McNally's letter to Mr Newton of 3 April, 1997 refers to the land being 'for all people who are party to the claims'. I do not think the Government party was adopting a rigid stance on this point. Had it been, then its argument for negotiating in good faith would have been weakened.
In summary, some aspects of the Government party's negotiating behaviour could have been improved. The delay in the provision of some information and the manner in which negotiations were terminated could in other circumstances have weighed more heavily against it and may have led to a conclusion that the negotiations had not been conducted in good faith.
Although the obligation to negotiate in good faith is not imposed on it, some aspects of the Maduwongga native title party's negotiating conduct was less than cooperative and deserves some comment. For the Act to work as it was intended all parties need to conscientiously and energetically engage in discussions. In this case the Maduwongga native title party displayed a reluctance to attend meetings with other native title parties. I accept Mr McIntyre's point that a particular native title party may have reasons for not wishing to disclose its position to other claimants, with whom it is in conflict. However, this should not generally excuse it from failing to attend information meetings arranged by the Government party or meetings which might identify issues to be discussed. Further, it does not excuse failure to attend mediation meetings called by the Tribunal.
During the negotiations, the Maduwongga native title party made it clear that it wanted to keep negotiations meetings and correspondence to a minimum. While this may be a desirable objective in theory, in practice it manifested a reluctance to engage with the Government party in meaningful discussions. To my mind, the only way of resolving this issue was by a period of intensive face to face discussions. In most future act negotiations, once the formal positions have been laid out in correspondence, there will be a need for a period of detailed, personal discussion if resolution of the dispute is to be achieved. In the interests of the proper functioning of the Act, all parties should be prepared to actively and constructively participate in negotiations.
In this case, looking at the conduct of the Government party as a whole I conclude that it has negotiated in good faith with the Maduwongga native title party with a view to achieving its agreement to the doing of the act.
The Tribunal finds that the jurisdictional pre-conditions to the lodging of the s. 35 Application and conducting an inquiry, including the Government party's obligation to negotiate in good faith with the native title parties with a view to obtaining their agreement to the doing of the act, have been satisfied.
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URL: http://www.austlii.edu.au/au/journals/AUIndigLawRpr/1998/21.html