If your mining, pastoral or term lease from the Crown was granted before 1975, you may be interested to understand the implications for you of a very recent High Court judgment.

These types of leases will not extinguish native title unless they allow you to exercise rights of exclusive possession.

They may also have been dealt with in the last few years under another less recent judgment of the Full Federal Court,De Rose v South Australia [No 2] (2005) 145 FCR 290, a decision which the High Court has recently found  to have been wrongly decided. These dealings may have resulted in an assessment that native title has been extinguished in places where it was not in fact extinguished.

In this Alert, Partner Jonathan Fulcher and Solicitor Kylie Panckhurst explain the potential implications of the High Court’s decision for lease holders, and outline what action they should take going forward.

Western Australia v Brown [2014] HCA 8

The High Court last week clarified that a pre-1975 lease only extinguishes native title where the lease gives the lessee exclusive possession at the time the lease rights were granted.  

The judgement of Western Australia v Brown [2014] HCA 8 overturned the earlier decision of De Rose v South Australia [No 2] (2005) 145 FCR 290 and provides certainty to lease holders and native title groups alike.

The judgement is relevant for lease holders whose lease pre dates 1975. Leases granted prior to 1975 are not subject to the Racial Discrimination Act 1975 (Cth) or the “past acts”, “intermediate period acts” or “previous exclusive possession acts” provisions of the Native Title Act 1993 (Cth). In such circumstances, common law determines whether native title is extinguished.

The Court relied on the two step common law extinguishment test set out in Western Australia v Ward [2002] HCA 28. Firstly, the legal nature and content of the rights granted to the leaseholder and native title holder/claimant must be identified. The next step is to compare the lease and native title rights to determine whether they were inconsistent at the time the lease rights were granted. The Court emphasised that:

  • the identification and comparison of the rights is an objective inquiry; and
  • inconsistency between the two sets of rights turns on the legal nature and content of the rights at the time granted, not on the manner and exercise of such rights. 

If the rights are inconsistent, there will be extinguishment of the native title rights to the extent of the inconsistency.

What does this mean for lease holders?

This means that:

  • you will need to get advice about the status of such leases; and
  • as part of that advice, you will need to understand if you have proceeded on land where native title has not, in fact, been extinguished in a manner which may have affected that native title adversely.

There are ways to fix these things under the Native Title Act 1993 (Cth) so that you do not adversely affect any relationships you may have developed with existing indigenous stakeholders.

What action should lease holders take?

Lease holders should review their lease terms. To the extent that a lease grants exclusive possession rights over the entire area the decision will not change the status quo that native title is extinguished. Where the lease does not provide such rights, then native title rights and interests may need to be considered.