In the recent native title decision of Mandandanji People v State of Queensland [2013] FCA 225 (Mandandanji) the Federal Court ordered that payments made by various resource companies in the course of negotiating Indigenous Land Use Agreements (ILUAs) and land access agreements be held and managed by the Court.

Under the Native Title Act 1993, Cth (NTA) rights are conferred on a native title applicant to negotiate ILUAs, land access and other agreements with resource companies and other parties. These rights facilitate the pursuit by proponents of activities on lands and waters that are the subject of unresolved applications for determinations of native title under the NTA. Proponents are expected to pay reasonable and appropriate remuneration and reimbursement to the claimant group for necessary work, expenses and activity undertaken. The Mandandanji People of Queensland first registered their native title claim in 2009. By registering the claim, members of the group gained legal status under the NTA to negotiate with and receive funds from parties seeking access to their lands. Following registration of the claim 31 land access agreements were negotiated and over $2m was paid to the group by resource companies.

For an 18 month period prior to this decision the group was in dispute over its membership. Evidence was put before the court of the substantial differences on the anthropological evidence as to who could properly constitute the claim group. The group’s internal disagreements ultimately led Justice Steven Rares to order all monies received to be paid to the Court and hence protected until a final determination is made as to who rightfully constitutes the group and as such who is entitled to funds. The Court said the rights to negotiate ILUAs or other similar contracts should not be used to enrich the applicant or its members at the expense or to the detriment of the native title claim group as a whole.

The decision requires members of the Mandandanji to apply to the court for disbursements and to fully account for any payments to them. This was ordered in an attempt to avoid misuse and promote transparency and to protect the funds from being dissipated. By imposing these controls over the substantial monetary entitlements, the Court is seeking to protect the rights of those who could ultimately be found to have native title.

The decision is certainly worth keeping in mind for any resource companies that have concerns about where their payments are going.