Native Title Year in Review 2022-2023

What you need to know

• 2022 was a big year for good faith challenges in the context of the right to negotiate.  Three out of the six challenges resulted in a finding that a grantee party had failed to negotiate in good faith.  
• In each good faith challenge, the Tribunal found that various kinds of conduct evidenced a lack of good faith, namely: a pattern of aggressive and unconstructive negotiation correspondence from the grantee party's representative; a pattern of unreasonable negotiating behaviour and a failure to engage in adequate information sharing with the native title party; and the grantee party's unilateral approach to negotiations.
• The good faith requirement in the right to negotiate process appears to be a struggle for some small-scale miners.

What you need to do

• A proponent's conduct during the right to negotiate process is always under scrutiny.  Proponents must make genuine attempts to seek native title parties' agreement and be prepared to show the Tribunal that they have done so.
• Proponents must constructively engage in negotiations, including by appropriate information sharing, providing timely responses, and engaging with any concerns raised in relation to cultural heritage.
• Smaller operators should not assume that their size will exclude them from the good faith requirements in responding to requests for information.  

Three out of six good faith challenges successful 

Of the six good faith challenges brought before the National Native Title Tribunal in 2022, the Tribunal found that the relevant mining proponent had failed to negotiate in good faith in three cases.  In these three cases, the Tribunal dismissed the application under section 148 of the Native Title Act 1993 (Cth) on the basis that it lacked jurisdiction.

Recap of the right to negotiate process and "good faith"

The right to negotiate (RTN) process in the Native Title Act applies to the grant of mining and petroleum tenements in certain circumstances.  Where the process applies, the applicant (ie the grantee party) and the relevant state government are required to negotiate with the native title party in good faith with a view to obtaining the native title party's agreement to the grant of the tenement.

If the parties have not reached agreement within six months of the notification day specified in the section 29 notice, any of the negotiation parties can apply to the Tribunal for a determination as to whether the tenement may be granted.   

The Tribunal has no jurisdiction to determine the matter where the native title party satisfies the Tribunal that one of the other parties has not negotiated in good faith.

Miner's pattern of aggressive and inflexible conduct demonstrates an absence of good faith

In Kevin Alfred de Roma v Western Yalanji Aboriginal Corporation RNTBC [2022] NNTTA 40, the Tribunal found that the mining lease applicant (Mr de Roma) failed to negotiate in good faith as a result of behaviour that was "aggressive", "inflexible", and based on misconceptions about native title.

Mr De Roma commenced negotiations with Western Yalanji Aboriginal Corporation (WYAC), following the issue of the section 29 notice by the State in March 2021.  After more than six months of negotiation, the parties had not reached agreement and Mr de Roma applied to the Tribunal for a determination that the future act may be done.

During the Tribunal proceedings, representatives for WYAC alleged that Mr de Roma had failed to negotiate in good faith.  Although noting that the nature of the native title party's contentions made it difficult "to understand the basis for its assertion of a lack of good faith by the grantee party", the Tribunal agreed that Mr de Roma had not negotiated in good faith.

The Tribunal considered the whole of Mr de Roma's conduct on an objective basis.  In doing so, it noted that Mr de Roma's representative, Mr Withers, showed a pattern of aggressive and unconstructive negotiation correspondence.  For example, Mr Withers had mocked the native title party, refused to assist with consultation and consent costs, and had taken an inflexible stance based on a misunderstanding of WYAC's native title rights.  Overall, the grantee party had failed "to constructively engage in negotiations" which had an "overall negative impact on the negotiation process".  

As a result of Mr de Roma's failure to constructively engage in negotiations and Mr Withers' vehement commentary, the Tribunal concluded that the grantee party's overall behaviour evidenced a lack of good faith.

"Small and impecunious" gemstone miner fails to negotiate in good faith

In Pathfinder Exploration Pty Ltd v Malarngowem Aboriginal Corporation RNTBC [2022] NNTTA 52, the Tribunal considered whether a small mining company (Pathfinder) failed to negotiate in good faith due to deficiencies in engagement with the native title party and sharing information.

Pathfinder had applied for a mining lease in respect of an area north of Halls Creek in Western Australia in which it intended to mine for iolite, a semi-precious gemstone.  The State issued a section 29 notice on 25 September 2019, at which time the relevant native title parties were the Malarngowem people and the Ngarrawanji people.  

The parties subsequently commenced negotiations. However, these stalled at several points as a result of:

• complications associated with COVID-19 and with the involvement of two native title parties; and
• the initial negotiation budget put forward by the native title parties, which Pathfinder considered "staggering" and which in its view required "reconsidering the potential economics of the project", but which the native title holders considered was not intended to be prohibitive but was to meet the costs of obtaining free, prior and informed consent.

The parties were ultimately unable to reach agreement, and on 7 December 2021 Pathfinder made a future act determination application to the Tribunal.

During the Tribunal proceedings, the native title parties alleged that Pathfinder did not negotiate in good faith.  The Tribunal ultimately agreed on the basis that Pathfinder had, at various points, failed to engage properly with the native title parties or provide sufficient information in a timely manner.  

In failing to respond to the native title parties' requests for further information, the Tribunal observed "a lack of regard for their basic information [and/or] negotiation requirements".  Further, the fact that Pathfinder was a "small and impecunious" miner did not assist their case, as the Tribunal observed that there was no compelling reason why it could not have provided the information requested.  

Miner's "unilateral" approach to negotiations demonstrates an absence of good faith

In Mobile Concreting Solutions Pty Ltd & Another v Wintawari Guruma Aboriginal Corporation RNTBC [2022] NNTTA 56 the Tribunal found that the grantee party had failed to negotiate in good faith because it had taken a "unilateral" approach to negotiations.

In this case, Mobile Concreting sought a mining lease for a small area located northwest of Tom Price, Western Australia, in respect of which Wintawari Guruma was the relevant native title party.  The application was notified by the State under section 29 on 28 May 2021 and the parties subsequently commenced negotiations.

The parties were unable to reach agreement, and on 3 March 2022, Mobile Concreting made a future act determination application to the Tribunal seeking a determination that the act can be done.  

During the proceedings, the native title party alleged that Mobile Concreting had failed to negotiate in good faith because it engaged in unilateral conduct and failed to engage with the native title party's concerns regarding cultural heritage.  

The Tribunal ultimately agreed that Mobile Concreting had failed to negotiate in good faith because its conduct "did not reflect a subjective honesty of intention and an objective standard of overall reasonableness in the circumstances".  

The Tribunal made this finding on the basis of a pattern of unreasonable negotiating behaviour by Mobile Concreting, including:

• "unilateral conduct which [harmed] the negotiating process", evidenced by, for example, its failure to confer with the native title party in relation to mediation, or its willingness to assist with negotiations; and
• failure to engage with the native title party's concerns in relation to cultural heritage, including by seeking a section 18 approval in lieu of cultural heritage protections, and provision of draft agreements to the native title party that did not adequately address cultural heritage protections.

Santos passes the good faith test

In a good faith challenge brought by the Gomeroi native title party against Santos in relation to petroleum production leases required for the Narrabri Gas Project, the Tribunal concluded that there was no basis for finding that Santos had failed to negotiate in good faith.  An appeal from this decision will be heard by the Full Federal Court in August 2023.  For more information, see our article "Santos wins strongly in National Native Title Tribunal, but Full Federal Court will hear Gomeroi appeal"

Authors: Samantha Marsh, Lawyer, Joel Moss, Senior Associate and Clare Lawrence, Partner.