Native Title Year in Review 2022-2023

What you need to know

• Although the general position remains that parties bear their own costs in the native title jurisdiction, the Federal Court will make costs orders in the face of unreasonable conduct.
• Unreasonable conduct is not limited to the courtroom – unreasonable conduct in mediation may lead to an order for wasted costs.
• The court seems increasingly willing to entertain costs orders against individuals responsible for unreasonable conduct.  It has said it would consider applications for personal costs orders against members of a native title applicant and the solicitor for a local council.
• The court has also held that a native title party's lawyers were entitled to enforce their equitable right to solicitor/client costs in the course of a long running dispute about an existing Indigenous Land Use Agreement (ILUA).  

What you need to do

• Take note of timetables and procedural obligations - the court has indicated it is willing to order costs against a party where unreasonable conduct derails its processes. 
• Be aware of potential personal liability – the Federal Court has foreshadowed ordering costs against individuals responsible for unreasonable conduct..  

We have followed native title costs decisions for many years

We follow native title costs decisions in our annual Native Title Year in Review to identify new principles and trends.

We reported on a number of costs decisions with adverse outcomes for some parties in our Native Title Year in Review 2021-2022 article "Costs Update: it doesn't matter who you are, unreasonable conduct risks a costs order"..

In 2022, we saw fewer costs applications.  However, the decisions handed down provide guidance on what the court considers unreasonable conduct in native title matters. 

A reminder of the provisions governing costs in native title proceedings

The Federal Court has discretionary power to award costs:  section 43 of the Federal Court of Australia Act 1976 (Cth);

In addition, section 85A of the Native Title Act 1993 (Cth) provides:

1. Unless the Federal Court orders otherwise, each party to a proceeding must bear his or her own costs.

2. Without limiting the Court’s power to make orders under subsection (1), if the Federal Court is satisfied that a party to a proceeding has, by any unreasonable act or omission, caused another party to incur costs in connection with the institution or conduct of the proceeding, the Court may order the first-mentioned party to pay some or all of those costs.

Refusing to honour in-principle agreements made in mediation could lead to an order for wasted costs

The Mullewa Wadjari People have made a native title claim near Geraldton in Western Australia.  Their claim overlaps with claims brought by the Nanda and Wajarri Yamatji peoples.

The resolution of the overlapping claims was referred to mediation.  The Mullewa Wadjari representatives entered into in-principle agreements with the Nanda and Wajarri Yamatji claim groups relatively early in the mediation process.  The agreements provided that the Mullewa Wadjari applicant would withdraw their claim over the overlapping areas in exchange for certain concessions by the other claim groups. 

More than three years into the mediation process, the Mullewa Wadjari applicant informed the two other native title parties that they would not implement the in-principle agreements.  At that point, the other claim groups had started taking action to uphold their side of the agreement.  

The Federal Court found that this conduct was unjustifiably oppressive and an abuse of the Court's mediation processes (see Papertalk on behalf of the Mullewa Wadjari People v State of Western Australia [2022] FCA 221).  

Court ordered that other native title applicants could file an application for wasted costs if the claim group refused to honour the agreements 

The court ordered that the claim group hold a meeting to decide whether to honour the in-principle agreements or not.

The court said that if the Mullewa Wadjari claim group decided not to honour the agreements, the court could consider whether there should be compensation (by way of a costs order) for the "tremendous amount of legal time and resources the Wajarri Yamatji and Nanda parties have expended, in reliance on the actions of the Mullewa Wadjari applicant, but which would have been thrown away." (at [239]).  

The court foreshadowed that the Nanda and Wajarri Yamatji claim groups could make an application for a personal costs order against the representatives of the Mullewa Wadjari applicant present at each of the mediations, or each of the members of the Mullewa Wadjari applicant who are responsible for instructions given to their lawyers.

The court made orders granting the two other claim groups leave to file an application for wasted costs in the event that the claim group refused to honour the in-principle agreements and the filing of material in relation to that application. 

Mullewa Wadjari applicant discontinued their appeal

The Mullewa Wadjari applicant sought to appeal the orders Mortimer J made with regard to costs.  However, on 21 November 2022, the Mullewa Wadjari applicant discontinued their appeal during oral submissions before the Full Court.  The non-State respondents made an application for their costs of the application.

The Mullewa Wadjari claim group decided not to give effect to the in-principle agreement (see Papertalk on behalf of the Mullewa Wadjari People v State of Western Australia [2022] FCA 593).  The other claim groups have filed an application for costs that were thrown away. 

The costs applications in the appeal and first instance proceedings have not yet been decided.

Court foreshadowed a personal costs order for non-compliance with timetabling orders

In Ross on behalf of the Cape York United #1 Claim Group v State of Queensland (No 10) [2022] FCA 1129, the court ordered that if a council's non-compliance with court orders continued, the applicant and the State could make an application for costs against Cook Shire Council or its legal representatives.  

Council's non-compliance with timetabling orders threatened to derail two consent determinations

This matter arose in the context of a council's failure to execute agreements in accordance with timetabling orders made by the court, thereby jeopardising two scheduled consent determinations. 

The determinations were over part of the broader Cape York United #1 claim.  The claim is complex and relates to a large claim area.  The court had made detailed timetabling orders to facilitate the most effective resolution of the claim.  The court emphasised the scale and complexity of the task of keeping the claim on track for the applicant and the State.  The council had a minimal role in progressing the application towards determination.  

Fifteen days after the council was required to sign a section 87A agreement for a consent determination (and one day before it was required to sign another), the council indicated it would not be able to consider the agreements for another week. 

Conduct of council and its representative considered disrespectful to the other parties and the court

During an urgent case management hearing, the council's legal representative initially failed to make any application that would vary the court's orders, instead focusing on the council's "inability" to comply with the existing orders.

The court noted that it was unsatisfactory that the council had not filed an interlocutory application and supporting affidavit relating to its non-compliance, particularly in circumstances where that non-compliance threatened to disrupt an imminent closely programmed proposed determination of native title.

The court held that the conduct of the council, and its legal representatives, imposed considerable burdens on the Applicant and the State, including an additional case management hearing, amendments to the consent determination submission and preparation of additional written submissions regarding non-compliance at short notice.  The Court stated that such conduct was "tardy, inconsiderate, and without any apparent consciousness" of its impact on the parties, and "deserves to be subject to criticism".

The court ultimately extended the deadline for signing the section 87A agreements because it was the most effective way for the court to preserve the likelihood of the determinations going ahead.  

The court noted that if the council did not comply with the amended timetabling orders, the applicant and the State would be required to attend another urgent case management hearing.  The costs of the extra hearings, preparing for them and their consequential effects would exist only because of the council's conduct.  Accordingly, the court ordered that the applicant and/or the State could make cost applications against the council or its legal representatives personally if the non-compliance continued.

Compliance with orders – the determinations went ahead

The council executed the section 87A agreements in accordance with the dates in the amended timetables, and the consent determinations proceeded on time.  Accordingly, neither the State nor the applicant made a costs application against the council or its legal representatives.

Costs application following a successful strike out application 

In Mann obh of Bigambul People #2 v State of Queensland [2023] FCA 450, the Gamilaraay applicant was successful in its interlocutory application seeking orders that the competing overlapping Bigambul People #2 native title determination application be struck out, or summarily dismissed, and they sought costs incurred in connection with the proceedings.

In respect of costs, the Court noted that, "as is plain from section 85A(2) of the Native Title Act, the court must be satisfied that the Bigambul People #2 Applicant has by an unreasonable act or omission caused the Gamilaraay applicant to incur costs in connection with the proceedings".

Authorisation process

The Court held that the authorisation process for the Bigambul people #2 native title determination application was "fatally flawed" because the Bigambul People were not given a reasonable opportunity to participate in the authorisation meeting.

Abuse of process

The court also held that the delay on the part of the Bigambul People #2 applicant in commencing the native title claim constituted an abuse of process.  In particular, the court found that:

• no satisfactory explanation had been given by the Bigambul People #2 applicant for the delay;
• correspondence between the parties supported a finding that the Bigambul #2 application was brought for the ulterior motive of requiring additional descent lines, rather than a genuine claim to the overlapped area; and
• the delay on the part of the Bigambul People #2 applicant seriously prejudiced the consent determination of the Gamilaraay claim, which was vacated four weeks prior to the listed hearing date.  

For these reasons, the court considered it appropriate to hear the parties further in respect of costs.

On 7 June 2023, the court made orders requiring the issue of costs to be determined on the papers, and set out a timetable for the Gamilaraay applicant and Bigambul #2 applicant to serve submissions on costs and evidence in June 2023.  

Costs application following a successful interlocutory application

In Alvoen obh Wakaman People #5 v State of Queensland (No 4) [2023] FCA 837, the applicant was successful in its interlocutory application seeking orders to remove a respondent party from the proceedings.

The applicant sought the removal of the respondent party in circumstances where the respondent party had previously agreed with the contents of a section 87A agreement for a consent determination, and then sought amendments to that agreement only weeks before the programmed consent determination date.  

The court held that the interests of the respondent party were adequately protected by the section 87A agreement, and it was not entitled to insist on the inclusion of requested amendments.  Further, the court held that the conduct of the respondent party was "unjustifiably oppressive" and had constituted an abuse of process, such as to warrant its removal as a respondent to the proceeding.  

For these reasons, the court considered it appropriate to hear the applicant and the State further in respect of the costs of the interlocutory application.  On 24 July 2023, the court made orders requiring the issue of costs to be determined on the papers, and set a timetable for the applicant, the State and respondent party to serve submissions on costs in August 2023.  We will report on the outcome in our Native Title Year in Review 2023-2023. 

Federal Court enforces equitable right to solicitor/client costs in ILUA case

In QGC v Alberts (No.2) [2021] FCA 540, which we reported on in our Native Title Year in Review 2021-2022 article "Federal Court declares implied term in ILUA", QGC commenced proceedings due to concerns that the "nominated entity" under the ILUA, BCJWY Aboriginal Society, was no longer capable of receiving or distributing the monies payable by QGC under the ILUA. 

Before then, the native title party had appointed a legal firm to act for it in relation to seeking a replacement nominated entity.  The course of action undertaken by the legal firm to establish the new nominated entity was ultimately unsuccessful.  However, that failure provoked the solution that the parties ultimately decided to pursue in agreeing to entity establishment orders and their subsequent implementation.

In QGC v Alberts (No.4) [2022] FCA 1590, the Federal Court was required to consider whether the legal firm appointed by the native title party had an equitable lien over, or other enforceable right in respect of, the financial benefits that QGC had paid into court on behalf of the native title party.

In doing so, the court considered whether the legal firm's course of action to replace the nominated entity (which was ultimately unsuccessful) created a sufficient causal link to the eventual successful resolution of the matter (being the creation of 11 replacement entities to which the monies held in court can be paid), to justify the legal firm's claim for the equitable right to be paid out of those monies.

The court held that the legal firm's conduct was instrumental in obtaining the result of substantial compliance with the entity establishment orders.

The court applied the principles of Roam [1997] FCA 980 and held that "the fact the solicitors’ retainer had ended before their client negotiated the compromise did not break the chain of causation that the solicitors’ work had led, at least in part, to a compromise and thus they were entitled to enforce their equitable right to be paid out of the settlement".

As a result, the court held that each of the 11 nominated entities was liable for its one eleventh share of the legal firm's costs out of the monies held in court and any monies due but unpaid by QGC.  

The court declared that the firm was entitled to enforce its equitable right to $299,348.18 as the taxed solicitor/client costs recoverable on their claim against the monies held in court.  As a result, that sum reduced the amount that each of the 11 nominated entities ultimately received.

On 3 February 2023, the court made orders requiring that the funds paid into court by QGC plus any interest accrued from the funds being held by the court be distributed: first, $299,348.18 to be paid to the legal firm; and second, the balance to be distributed by payment in 11 equal shares to the 11 nominated entities.

Authors: Roxane Read, Senior Associate; Sophie Pruim, Graduate; Libby McKillop, Senior Associate.