Native Title Amendment (Indigenous Land Use Agreements) Bill 2017 - Commentary on Ministerial Responses [2017] AUSStaCSBSD 115 (29 March 2017)

• Native Title Amendment (Indigenous Land Use Agreements) Bill 2017
• Retrospective application

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Native Title Amendment (Indigenous Land Use Agreements) Bill 2017

Purpose	This bill seeks to amend the Native Title Act 1993 following a decision of the Full Federal Court in McGlade v Native Title Registrar [2017] FCAFC 10, regarding area Indigenous Land Use Agreements (area ILUAs) to: • confirm the legal status and enforceability of agreements which have been registered by the Native Title Registrar on the Register of Indigenous Land Use Agreements without the signature of all members of a registered native title claimant (RNTC); • enable registration of agreements which have been made but have not yet been registered on the Register of Indigenous Land Use Agreements; and • ensure that in the future, area ILUAs can be registered without requiring every member of the RNTC to be a party to the agreement
Portfolio	Attorney-General
Introduced	House of Representatives on 15 February 2017
Bill status	Before Senate
Scrutiny principle	Standing Order 24(1)(a)

2.21 The committee dealt with this bill in Scrutiny Digest No. 3 of 2017. The Minister responded to the committee's comments in a letter dated 27 March 2017. Set out below are extracts from the committee's initial scrutiny of the bill and the Attorney-General's response followed by the committee's comments on the response. A copy of the letter is at Appendix 1.

Retrospective application

Initial scrutiny – extract

2.22 In McGlade v Native Title Registrar^[9] (McGlade), handed down on 2 February 2017, the Full Federal Court held that it was necessary for all members of a 'registered native title claimant' (RNTC) to sign an Indigenous Land Use Agreement (ILUA) for that agreement to be validly registered by the Native Title Registrar. The purpose of this bill is to expunge the consequences which flow from the decision in McGlade and to reinstate the law as previously interpreted,^[10] which did not require unanimity amongst the RNTC. The explanatory memorandum does not give details about the number of ILUAs which may have been invalidly registered on the (now mistaken) basis of the law as previously understood.

2.23 As the explanatory memorandum explains, the bill makes various amendments to the Act in order to:

(a) secure existing agreements which have been registered on or before 2 February 2017 but do not comply with McGlade;

(b) enable registration of agreements which have been made and have been lodged for registration on or before 2 February 2017 but do not comply with McGlade; and

(c) clarify who must be a party to an area ILUA in the future unless the claim group determines otherwise.^[11]

2.24 The amendments associated with the first two objectives operate retrospectively. The bill preserves the position prior to McGlade for agreements registered under the Act or that were pending registration on or before the date of the McGlade decision. The bill also prospectively overturns the position in McGlade that every person who comprises the RNTC must to be a party to an ILUA in relation to agreements. According to the explanatory memorandum:

The amendments to ILUA requirements support the integrity of authorisation processes, by ensuring that native title claim groups can nominate who will carry out the will of the claim group and execute the agreement. The amendments also give primacy to the role of authorisation, reflecting the view that authorisation, along with other check and balances established under the Act, provides sufficient protection for the claim group.^[12]

2.25 The fact that a court overturns previous authority is not, in itself, a sufficient basis for Parliament to retrospectively reinstate the earlier understanding of the previous legal position. In saying this, the committee recognises that when precedent is overturned this itself necessarily has a retrospective effect and may overturn legitimate expectations about what the law requires. Nevertheless, the committee considers that where Parliament acts to validate decisions which are put at risk, in circumstances where previous authority has been overturned, it is necessary for Parliament to consider:

• whether affected persons will suffer any detriment by reason of the retrospective changes to the law and, if so, whether this would lead to unfairness; and

• that too frequent resort to retrospective legislation may work to sap confidence that the Parliament is respecting basic norms associated with the rule of law.

2.26 In justifying the retrospective application of the amendments which are designed to reinstate the law as understood prior to McGlade, the explanatory memorandum states:

These amendments preserve the status quo for agreements registered on or before the date of the McGlade decision, providing certainty about interests granted and benefit paid in reliance on the agreement. It will also allow for consideration of agreements which had been lodged for registration on or before McGlade and ensure that the will of the native title claim group in authorising the agreement is not frustrated only because of the effect of the McGlade decision.^[13]

2.27 However, the explanatory materials do not sufficiently explain the necessity, appropriateness and fairness of the proposed retrospective application of amendments in this bill. No indication is given of the number of ILUAs affected or likely to be affected. No context is provided as to why the agreements challenged in McGlade proved controversial within the RNTC group (or whether or not there were significant factual differences between the McGlade case and the earlier Bygrave case). Nor is there any discussion of the severity of the consequences thought to arise from McGlade in light of any alternative means for addressing those consequences. It is noted that if the bill is held by a court to involve an acquisition of property, then the Commonwealth will be liable to pay a reasonable amount of compensation, as provided for in clause 13 of the bill.

2.28 As Justice Mortimer in the McGlade case noted, an area ILUA may deal with the extinguishment of native title rights and interests by their surrender to the Commonwealth, a state or a territory.^[14] The committee considers the retrospective extinguishment of native title for persons who do not agree to the ILUA to be a significant consequence for such individuals.

2.29 The committee has a long-standing scrutiny concern that provisions that apply retrospectively challenge a basic value of the rule of law that, in general, laws should only operate prospectively. This bill seeks to preserve the position prior to the recent case of McGlade for Indigenous Land Use Agreements registered (or pending registration) on or before the date of the McGlade decision, in order to remove uncertainty. The committee notes that the fact that a court overturns previous authority is not, in itself, a sufficient basis for Parliament to retrospectively reinstate the earlier understanding of the previous legal position.

2.30 Although the committee recognises that the appropriateness of retrospective legislation may in some cases give rise to reasonable disagreements, in considering this bill the committee considers Senators would be assisted by a more comprehensive treatment of the appropriateness of the retrospectively applied provisions. The committee therefore seeks the Attorney-General's advice as to:

• the number of ILUAs affected or likely to be affected by the amendments in this bill;

• the number of people likely to be adversely affected by the retrospective application of these amendments and how they will be affected, including the effect on the claimants in McGlade;

• the severity of the consequences thought to arise from McGlade and whether there are any alternative means for addressing those consequences.

Attorney-General's response

2.31 The Attorney-General advised:

The number of ILUAs affected or likely to be affected by the Bill
An estimated 126 ILUAs were registered in reliance on QGC v Bygrave (No 2) [2010] FCA 1019; (2010) 189 FCR 412 (Bygrave) based on a preliminary audit by the National Native Title Tribunal (NNTT) and are addressed by this Bill.
In addition, there may be ILUAs registered prior to the Bygrave decision in 2010 which do not include the signatures of all members of the Registered Native Title Claimant (RNTC) because a member was deceased. The number of ILUAs affected by this issue is unknown; the NNTT has been unable to confirm whether their records accurately reflect where this issue arose.
Adverse effects of the Bill
The claimants in McGlade are not affected by the retrospective provisions of the Bill. The ILUAs which were the subject of McGlade are carved out of the retrospective operation of the Bill, to avoid legislative interference in a judicial decision.
However, those agreements are prospectively validated by the Bill. Accordingly, the parties may decide to re-apply for the registration of those agreements, which will be subject to a further objections process.
The number of people adversely affected by the retrospective provisions of the Bill is not possible to ascertain. This is because it is not known why individuals did not sign the 126 ILUAs registered in reliance on Bygrave – whether because they were deceased, incapacitated, unavailable or did not agree with the ILUA.
In the event that the retrospective validation of existing ILUAs results in an acquisition of property, provision has been made for compensation to be available.
Severity of the consequences of McGlade
ILUAs are a mechanism allowing native title holders and claimants and third parties to agree about the doing of things on land subject to native title. While the exact subject matter of the affected ILUAs is commercial-in-confidence to the parties of those ILUAs, ILUAs can cover a range of matters including agreement about the doing of acts that may affect native title, how native title and other rights in the area will be exercised including how parties will be notified and consulted, and agreement on compensation and other benefits. The effect of the decision has been to bring into doubt the agreements that have been reached on these and other issues, and to raise doubts about the validity of acts done in reliance on the agreement and of benefits transferred or to be transferred in the future. This leaves the ILUAs open to legal challenge.
Allowing the affected ILUAs to remain open to challenge creates great uncertainty about whether agreements struck can continue to be relied upon for both native title holders and third parties. It also raises the prospect of significantly increased costs for the sector both in the form of litigation about the status of affected agreements, which may divert resources away from progressing claims for native title, and potentially the need to re-negotiate ILUAs which may have already taken several years and significant resources to negotiate. Given these consequences I am satisfied that effective alternative measures are not available.

Committee comment

2.32 The committee thanks the Attorney-General for this response. The committee notes the Attorney-General's advice that an estimated 126 ILUAs were registered in reliance on the Bygrave decision, but there may be more ILUAs affected by the decision in McGlade. The committee also notes the advice that while the claimants in McGlade are not retrospectively affected by this bill, is not possible to ascertain how many other members of ILUAs may be adversely affected as it is not known why individuals did not sign the registered ILUAs. The committee notes, in particular, the Attorney-General's advice that the reasons for why agreements may not have been signed could include where people 'did not agree with the ILUA'.

2.33 The committee also notes the Attorney-General's advice that ILUAs can cover a range of matters, including agreements about the doing of acts that could affect native title, how native title and other rights will be exercised and agreements on compensation and other benefits. The Attorney-General has also advised that allowing the affected ILUAs to remain open to challenge creates great uncertainty about whether the agreements can continue to be relied on, raises the prospect of increased costs for the sector and the potential need to re-negotiate ILUAs, and that he is satisfied that effective alternative measures are not available.

2.34 The committee notes that the retrospective validation of existing ILUAs could have significant consequences for native title claimants. In particular, where native title claimants disagree with the terms of the ILUA, the retrospective application of these amendments will remove any process for objecting to the registration of the ILUA.

2.35 As ILUAs cover agreements regarding how native title is to be exercised (including the extinguishment of native title rights and interests), the committee considers the retrospective application of these amendments could significantly and adversely affect the interests of certain native title claimants.

2.36 The committee requests that the key information provided by the Minister be included in the explanatory memorandum, noting the importance of these documents as a point of access to understanding the law and, if needed, as extrinsic material to assist with interpretation (see section 15AB of the Acts Interpretation Act 1901).

2.37 The committee draws its scrutiny concerns to the attention of Senators and leaves to the Senate as a whole the appropriateness of the retrospective application of these measures.

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[9] [2017] FCAFC 10.

[10] QGC Pty Ltd v Bygrave (No 2) [2010] FCA 1019; [2010] 189 FCR 412.

[11] Explanatory memorandum, p. 3.

[12] Explanatory memorandum, p. 4.

[13] Explanatory memorandum, p. 4.

[14] McGlade, Mortimer J at [398].