Instead of paying a percentage of the production value, FMG pays dollars and even cents: 2.5 per tonne in the case of an agreement signed by six Nyiyaparli elders.
Vance Hughston says that the recent decision in the Timber Creek case indicates that the compensation for his Yindjibarndi client could be very large because the Federal Court is now looking at compensation in the same way as it would with personal injury claims. That case, which was settled on appeal in July, involved 1.27 square kilometres of land where native title had been extinguished by the building of government infrastructure on sacred sites. The court awarded $500,000 for the value of the land (plus interest of $1.5 million), and another $1.3 million for the hurt the community had suffered due to the government’s actions. And in that case the traditional owners had only secured non-exclusive native title.
Hughston says the Yindjibarndi would seek compensation based on section 51 of the Native Title Act, which talks about “just terms” compensation. He explains, “When the Federal Court looked at [Timber Creek], it questioned whether there was a value in the land. They said the proper approach is to compensate the native title holders for their hurt, the effect it has had on them and their community. They used the analogy of a personal injury claim where the court tries to assess an amount of general damage which is compensation for the pain and suffering.
“It’s important to see here that we [the Yindjibarndi] have native title rights and interests of the strongest kind. That’s why exclusive possession is so important, a recognition that you do have the right to control who comes onto your land and what they do on your land. But more importantly, it recognises that your connection, your spiritual connection, is of such a magnitude that it gives you this right of exclusive possession. We’re looking at not a single person, we’re looking at compensating the whole of the Yindjibarndi community. There’s probably about 800 people, you’ve got to compensate them for past suffering over this mine, and you’ve got to compensate future generations.”
Hughston says the Timber Creek ruling talked about the principle of the defendant, in this case the developer, being able to say they had done the fair thing. If doing the fair thing means paying the 0.5% that other miners have paid, then the cost over the life of the Solomon project would be in the order of billions. “We are talking a lot of money, yes.”
“The real difficulty for FMG,” says Hughston, “is it has no idea what is going to happen in any future compensation claims because there is no precedent. The argument that we will put forward is a perfectly sound legal argument. It may not ultimately be accepted, but I think it has pretty good prospects.”
But Greg McIntyre, a senior counsel whose decades of native title experience includes acting as the solicitor on the Mabo case, says the Yindjibarndi win puts native title into uncharted territory.
“Other than Timber Creek, there are no cases on how you value compensation. In the case of mining, there’s no precedent,” he explains.
FMG’s Nev Power agrees there’s very little legal precedent to go on. He also cites the Timber Creek case, and adds that the company already pays a lot of money to the state in royalties, including $629 million in the 2016 financial year.
Importantly, too, he notes that “Native title expressly excludes reference to the value of minerals from calculations of compensation.”
McIntyre concurs that any compensation to be paid to the Yindjibarndi would have to be linked to the value of the land, but that would exclude the mineral rights.
“When you are talking about mining leases, the question is to what extent does the mining impede the capacity to exercise native title rights. They can make a compensation application but it’s not going to be based on the value of the iron ore.” But Deakin University’s Jon Altman, who was called as an expert witness in the Timber Creek case, says the decision affirms that compensation can be paid for non-economic pain and suffering, as well as the economic loss.
Asked about the role of Justice Rares, McIntyre wonders about the impact of the tactics used by FMG that have left the Yindjibarndi community deeply divided.
“Rares was pretty concerned about a mining company getting as heavily involved in internecine disputes. That’s good, it’s good that the courts keep an eye on those things.”