Australias first High Court native title compensation decision

The Timber Creek decision is a landmark, as the first ever judicial assessment by the High Court of native title compensation in Australia. Further, the appeal was heard by the Full Bench of the High Court in Darwin in September 2018, the first time the Court has sat in the Northern Territory in its history.

Ashurst partner Tony Denholder commented:

"Today's decision by the High Court has reduced the total award in the Timber Creek case from nearly A$2.9 million to A$2,530,350," Denholder said.

"Importantly the Court upheld the A$1.3 million for loss of spiritual attachment. The Court thought this amount was not manifestly excessive, and was not inconsistent with acceptable community standards. The total award of just over A$2.5 million is still very significant in an Australian context.

"It is likely that nationally, the liability for native title compensation will run into the billions of dollars.

"The Court reduced economic loss to 50 per cent of the freehold value of the land, compared to the 65 per cent used by the Full Federal Court. That the small area of Timber Creek still triggered a compensation liability of over A$2.5 million, will have strong implications for the more than 2.8 million square kilometres of native title land holdings across the rest of Australia.

"Today's decision has provided direction about assessing compensation for a few categories of impacts, however more case law is required to understand how native title compensation will be assessed for many other impacts, including mining projects, pastoral leases, agricultural development and other land uses partially inconsistent with native title.

"The High Court's decision will likely to trigger compensation applications from many of the hundreds of native title holder groups around Australia, who finally have clarity – albeit limited – on how they might quantify the compensation owed to them for impacts on their native title."

"All stakeholders will need to confront the procedural complexities and cost of managing claims to native title compensation on a parcel by parcel basis.  There is an added complexity in circumstances where liability for State action rests with a third party.  It is not clear how the Federal Court will manage such litigation."

Partner Clare Lawrence added:

"The High Court's decision marks the beginning of a new phase in the relations between native title holders and the governments and third parties that deal with and use native title land," Lawrence said.

"A methodology for determining the quantum of native title compensation is only one part of the picture.  Now that the High Court has handed down its decision, the focus should move to efficiently managing the expected influx of claims from native title holders in the more than 370 determinations of native title around Australia. 

"The certainty of the High Court's Timber Creek decision is likely to look illusory as the reality of prosecuting and responding to the myriad of factual circumstances that give rise to a native title compensation entitlement unfolds.  A system will be established and things will normalise.  In the meantime, the experience will not be dissimilar to the years of uncertainty that followed the enactment of the Native Title Act 1993 (Cth) in 1994."