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Willheim, Ernst --- "The Reeves Report and Acquisition Issues" [1999] IndigLawB 32; (1999) 4(20) Indigenous Law Bulletin 12


The Reeves Report and Acquisition Issues

by Ernst Willheim

In this article I argue that the implementation of a number of important recommendations contained in the Reeves reports would constitute an acquisition for the purposes of s 51(xxxi) of the Constitution. A s 51 acquisition requires the Federal Government to pay compensation on just terms to the owners of the property being acquired.

The Acquisitions Power

Section 51(xxxi) of the Constitution confers on the Parliament power to make laws with respect to: The acquisition of property on just terms from any Stare or person for any purpose in respect of which the Parliament has power to make laws.

Whether and to what extent the acquisitions power would apply to the proposed amendments of the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) ('the Land Rights Act') to implement the recommendations in the Reeves report raises a difficult question about what constitutes an acquisition of land where that land is located in a Territory. Until recently, it was thought that because the territories power (s 122) is an unqualified power of Parliament, a Commonwealth acquisition in a Territory did not require the payment of compensation on just terms. Since the High Court's decision in Newcrest Mining (WA) Ltd v The Commonwealth 2 it would appear that because the Land Rights Act is a law enacted under s 51, s 51(xxxi) will apply to acquisitions made pursuant to it.

If the Parliament were to act on a narrower view of the application of s 51(xxxi) than this, and implemented Reeves' recommendations without provision for just terms compensation, the legislation would generate uncertainty until the application of s 51(xxxi) was judicially resolved. In relation to native title issues a key objective of the Parliament has always been to remove uncertainty. It seems difficult to conceive that the Parliament would now choose to enact amending legislation that will generate new uncertainty in relation to Aboriginal land.

Whether the proposal that RLCs hold all Aboriginal land would constitute an acquisition from Land Trusts

Under the Land Rights Act, an estate in fee simple is granted to a Land Trust by the Governor-General on receipt of a recommendation by the Minister.3 A Land Trust is a body corporate.`' Its main function is to hold title to land vested in it in accordance with the Act and to exercise its power as owner for the benefit of the Aboriginals concerned.5 I emphasize the words 'as owner' because it is important to appreciate that the Land Trust is owner of an estate in fee simple.

Reeves proposes a radical change to the way Aboriginal Land granted under the Land Rights Act is to be held. He recommends the establishment of a system of Regional Land Councils ('RLCs') 6 One of the three main functions of a RLC would be 'to hold in trust all Aboriginal land in its region '.7 Land granted under the Land Rights Act would be held by these new RLCs instead of the Land Trusts.8

Implementation of this recommendation would, in my view, amount to acquisition of the Land Trusts' title in Aboriginal land and conferral of that title on the RLC. The Land Trust, the current owner of the fee simple, would cease to be owner. The RLC would become the new owner. In substance, there would be an acquisition from the Land Trust requiring provision of 'just terms'. Bearing in mind that Reeves also recommends changed decision-making arrangements and changes to the class of persons for whose benefit the land is held,9 it cannot be said that the quantum of 'just terns' would be negligible.

Whether proposals for modification of rights relating to Aboriginal Land would constitute an acquisition

Reeves recommends numerous modifications of the statutory regime now applying to Aboriginal land. These proposed modifications include:

1. Repeal of s 67, removing the current protection against
compulsory acquisition;
2. Repeal of s 70, removing the current prohibition of entry on
Aboriginal land;
3. Repeal of s 74 (which prevents application to Aboriginal land of
Northern Territory laws that are incapable of operating concurrently with the Act) and wider application of Northern Territory laws, including the Local Government Act, to Aboriginal land in the Northern Territory, and;
4. New provision for licences to enter Aboriginal land to carry out low-level exploration activities. The proposed RLCs would not have any power to veto an application or to require any payment.10

In relation to conventional (fee simple) title, changes of this kind would probably be characterized as regulatory, or as an adjustment of competing rights and would therefore not be considered an acquisition for the purposes of s 51(xxxi). In relation to the Land Rights Act, a different characterization of these changes is required for the reason that the Land Rights Act establishes a new and unique form of statutory title. The effect of the proposed modifications, either individually or collectively, would be to so diminish essential elements of that title as to constitute an acquisition. 'Property, in relation to land, is a bundle of rights exercisable with respect to land'.11 In relation to Aboriginal land granted under the Land Rights Act, the relevant 'bundle of rights' is to be found not only in the fee simple title but also in the special statutory regime established by that Act, including the statutory rights and the protection of those rights. In the same way as the acquisition of less than the fee simple was in Dalziel found to be an acquisition of property, so may be the extinguishment of significant aspects of the bundle of statutory rights relating to Aboriginal land.

Collectively, the proposed changes would substantially alter the rights attaching to Aboriginal land. 12 Without Aboriginal consent and without compensation, these changes would combine to effect so significant a diminution of the 'bundle of rights' attaching to Aboriginal land as to constitute an acquisition. Aboriginal people would no longer be able to use and manage their lands in such a way as to allow their traditional relationship with their country to be enjoyed and their traditional obligations in respect of their country to be fulfilled.

Whether the proposal that a grant under the Land Rights Act should extinguish native title would constitute an acquisition

Reeves recommends that the Native Title Act 1993 (Cth) (the 'Native Title Act') be amended to provide that '[A) past or future grant of land under the Land Rights Act extinguishes all native title rights and interests in that land'.13 The intention is to legislatively overrule the decision of the Full Court of the Federal Court in Pareroultja v Ticknerl'1 that a grant under the Land RightsAct is not inconsistent with the continued existence of native title and that native title is not extinguished.15

That native title may be extinguished by inconsistent grant was clearly established by Mabo v Queensland [No. 2].1G However, the majority did not address the application of s 51(xxxi) of the Constitution. It seems reasonably clear that native title rights are legal rights, legislative extinguishment of which by the Commonwealth would constitute an acquisition for the purposes of s 51(xxxi). This was the view of Justice Gummow in Newcrest Mining (WA) Ltd v The Commonwealth,17 citing the judgments of Justices Deane and Gaudron in Mabo [No 2] as authority for the proposition that:

legislation ... which is otherwise within power but is directed to the, extinguishment of what otherwise would continue as surviving native title (or which creates a 'circuitous device' to acquire indirectly the substance of that title), may attract the operation of s 51(xxxi).18

The unanimous decision of the Federal Court in Pareroultja was reached in a fully reasoned judgment after careful consideration of Mabo [No 2], including consideration of the nature of native title, the circumstances in which native title may be extinguished and the examples given in Mabo [No 2] of

legislative and executive acts which would be consistent with the preservation of native title. The Court concluded that:

Native titles may be extinguished by grants of freehold because such grants are inconsistent with the continued preservation of native title. A grant of an estate in fee simple to a Land Trust under the Land Rights Act is not however a grant that extinguishes native title; indeed the two co-exist harmoniously. Land is granted to Land Trusts under the Land Rights Act to preserve native titles and Aboriginal interests and is not inconsistent with the continued enjoyment of native title.19

In my view, that conclusion (and the detailed reasoning that preceded it) is correct.

Reeves notes that the High Court refused special leave to appeal from the decision of the Full Court of the Federal Court. He also notes the majority's statement that their refusal to grant leave should not necessarily be interpreted as their agreement with the conclusion of the Full Court that the grant of an estate in fee simple to a Land Trust under the Land Rights Act is consistent with the preservation of native title to the land. He casts doubt on the Full Court's decision. This doubt is not supported by authority. Pareroultja has been cited and applied.20

Special leave to appeal having been refused, and having regard also to subsequent applications of the case and the fact that the High Court has not taken the opportunity to express disapproval, Pareroultja remains authoritative. A grant of an estate in fee simple to a Land Trust under the Land Rights Act does not give rise to the inconsistency necessary for extinguishment of native title. New provision for legislative extinguishment would, it seems, confer a benefit on the state through the expansion of radical title.21 Implementation of Reeves' recommendation for legislative extinguishment would constitute an acquisition requiring provision for compensation.

Quantification of the compensation, having regard to the cause of extinguishment, would raise questions of some difficulty. On the basis that Aboriginal people place special value on native title (which is held as of right rather than in consequence of grant), it would not be safe to assume that compensation would be nominal.

Whether the proposal that a grant under the Pastoral Land Act (NT) should extinguish native title would constitute an acquisition

Reeves recommends that the Native Title Act be amended to provide that

'[T]he grant of a Community Living Area in favour of an
incorporated association of Aboriginal people pursuant to the Pastoral Lands [sic] Act (NT) ...be deemed to extinguish any existing native title rights and interests in that land' 22

The considerations relating to grants of community living areas are similar to, but not identical with, those relating to grants under the Land Rights Act. Having regard to the need for a clear and plain intention for effective extinguishment of native title, to the examples given in Mabo [No 2] of legislative and executive acts which would be consistent with the preservation of native title, and to the decisions of the Federal Court in Pareroultja and particularly Ward,23 I consider that these provisions do not exhibit the necessary intention to extinguish native title. Implementation of the Reeves recommendation for legislative extinguishment would require provision of compensation.

Whether the proposals for taking over the assets of Royalty Associations would constitute an acquisition

In Chapter 28 of his report, Reeves recommends that '[T]he existing assets and liabilities of the Royalty Associations will be taken over and rationalised' 24 In Chapter 16, he recommends that '...all other income from activities on Aboriginal land should be applied by the proposed Northern Territory Aboriginal Council (NTAC) or the RLCs to particular purposes...'25 The purposes identified in Reeves' report include 'scholarships, housing, health etc'. These are purposes that would ordinarily be seen as responsibilities of government.

I understand these recommendations to mean the acquisition from the relevant incorporated associations and Aboriginal corporations of all of their existing assets, including the assets of many successful businesses and the acquisition from the Land Councils of contractual rights to a wide range of payments. The assets and contractual rights would be transferred to RLCs and perhaps in some cases to NTAC. They would be applied, at least in large part, for governmental purposes.

In my view, the acquisition of assets from associations incorporated under the relevant Commonwealth and Northern Territory laws26 and of contractual and other rights from the Land Councils, as proposed, would constitute acquisition of property for the purposes of s 51(xxxi).

Whether the proposals relating to ownership of living fish and native fauna would constitute an acquisition

Reeves recommends that '[T]he common law position regarding the ownership of living fish and native fauna on Aboriginal land be confirmed in the Land Rights Act.27 He suggests '[T]his confirmation could be achieved by including a reservation to the Crown of the ownership of all living fish and native fauna on Aboriginal land in the Northern Territory similar to the reservations contained ins. 12(2) of the Act’.28

Provided that the proposed reservation is not expressed in a form that purports to extinguish common law native title rights, there is no legal difficulty in implementing the recommendation in so far as future grants are concerned. The making of a grant is itself discretionary. Amendment of the legislation so that future grants confer fewer rights than have been granted in the past does not constitute an acquisition.

In so far as the recommendation is intended to apply also to existing grants, different considerations apply. The recommendation would require the 'reservation', out of the existing title, of 'ownership of all living fish and native fauna'. This recommendation appears to be based on a proposition in an earlier paragraph that '[A]t common law, fish, like other living wild animals, are incapable of being owned until they are killed or caught'.29 The problem with this analysis is that it fails to take account of the usufructuary nature of native title.30 It also fails to take account of relevant Australian authority. Directly relevant is the judgment of President Kirby in Mason v Tritton,31 that 'a "right to fish" based upon traditional laws and customs is a recognisable form of native title defended by the common law of Australia' 32 This passage was adopted by justice Franklyn in Derschaw v R,33 with whom justice Murray agreed.34 In Dillon v Davies (1998),35 Justice Underwood appears to proceed on the same basis (see especially at 146) as does Justice Lee in Ben Ward v State of Western Australia.36 In Fejo v Northern Territory of Australia,37 the High Court was prepared to assume 'that those rights may encompass a right to hunt, to gather or to fish' 38 A similar view has been taken in Canadian authorities.39 It is also the assumption on which ss 211(3) and 223(2) of the Native Title Act are based. Justice Olney, in Yarmirr v Northern Territory of Australia,40 notes that s 223(2) may preserve a right to fish in a case in which native title to possess or occupy land has been extinguished.41 The proposed determination in Yarmirr included a determination that '(T)he native title rights and interests which the court considers to be of importance are the rights of the common law holders... (b) to fish...'42

I therefore consider Reeves' recommendation to be based on a legally incorrect premise. Implementation of the recommendation would constitute acquisition of valuable common law native title rights.

Ernst Willheim is a barrister and Visiting Fellow in the Faculty of Law at the Australian National University. This article draws on legal advice provided by the author to the Aboriginal and Torres Strait Islander Commission. It is expected that the Commission will make the-full advice available to the House of Representatives Standing Committee on Aboriginal and Torres Strait Islander Affairs and that the Committee will make this information available on its web site.

notes

1. John Reeves, Building on Land Rights for the Next Generation: Report on the Review of the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth), (1998). Cf Martin Mowbray, 'Redefining Land Rights: The Review of the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth), (1999) 4(18) ILB 9; Graeme Neate, 'Review of the Northern Territory Land Rights Act', (1998) 4(15) ILB 7; Chris Anathasiou, 'Land Rights or Native Title: What's Going on in the Northern Territory?', (1998) 4(12) ILB 15; Katie Haire, 'Review of the Aboriginal Land Rights (Northern Territory) Act (Cth) 1976', (1997) 4(8) 113 11.

2. [1997] HCA 38; (1997) 190 CLR 513.

3. ss 10, 11, 12.

4. s4(3).

5. s 5.

6. Reeves, above n 1, 594.

7. Ibid, 597.

8. Ibid, 482.

9. Ibid, 597.

10. Ibid, 383,410 and 412-413, and 529, 540, respectively. 11. Minister of State for the Army v Dalziel (1944) 68 CLR

261, 285.

12. For instance: removal of the current protection against

compulsory acquisition by the Northern Territory;

removal of the prohibition of entry on Aboriginal land;

removal of the protection against application of

incompatible Northern Territory laws together with

provision enabling application to Aboriginal land of

Northern Territory laws that are incompatible with

traditional use and occupation of that land; and

provision for exploration licenses over Aboriginal land. 13. Reeves, above n 1, 461.

14. [1993] FCA 465; (1993) 42 FCR 32. 15. Ibid 40.

16. (1992) 175 CLRI, 15, 64, 69, 110-111, 195-196. 17. [1997] HCA 38; (1997) 190 CLR 513.

18. Ibid, 613. 19. 42 FCR, 44.

20. Re Gurubana-Gunggandji Peoples (1995) 123 FLR 462,

Ben Ward v State of Western Australia [1998] 1478 FCA

(24 November 1998).

21. Pareroultja v Tickner, above n 15, 60, 69.

22. Reeves, above n 1, 470. The reference to a grant

pursuant to the 'Pastoral Lands Act' appears to be an

error. While Part 8 of the Pastoral Land Act (NT)

establishes the procedures for applications for grants of

community living areas and for the processing of those

applications, the grant of the fee simple to the relevant

association takes effect 'by virtue of subsection 46 (1A)

of the Lands Acquisition Act.

23. (1998) 1478 FCA (24 November 1998), 86. 24. Reeves, above n 1, 609. 25. Ibid, 368.

26. Aboriginal Councils and Associations Act 1976 (Cth),

Associations Incorporation Act 1978 (Cth).

27. Reeves, above n 1, 247. 28. Reeves, above n 1, 232. 29. Ibid.

30. Mabo v Queensland [No 2] [1992] HCA 23; (1992) 175 CLR 1, 51-52. 31. (1994) 34 NSWLR 572.

32. Ibid, per Kirby J, 579. Cf 580-582 and per Priestley JA,

600.

33. (1996) 90 A Crim R 9, 12. 34. Ibid, 36.

35. (1998) 156 ALR 142. 36. (1998) 1478 FCA, 122

37. (1998) HCA 58 (10 September 1998).

38. Ibid, per Gleeson CJ, Gaudron, McHugh, Gummow,

Hayne, Callinan JJ, 47.

39. R v Sparrow (1990) 1 SCR 1075, Van der Peet v R

(1996) 2 SCR 507. 40. [1998] FCA 771; (1998) 156 ALR 370. 41. Ibid, 406. 42. Ibid, 439.


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