(a) Ground 1 - Issue of construction
50 The contemporary approach to statutory construction in Australia is well settled. It is described by Kiefel CJ, Nettle and Gordon JJ in SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; 91 ALJR 936 (SZTAL) at [14] (footnotes omitted):
14. The starting point for the ascertainment of the meaning of a statutory provision is the text of the statute whilst, at the same time, regard is had to its context and purpose. Context should be regarded at this first stage and not at some later stage and it should be regarded in its widest sense. This is not to deny the importance of the natural and ordinary meaning of a word, namely how it is ordinarily understood in discourse, to the process of construction. Considerations of context and purpose simply recognise that, understood in its statutory, historical or other context, some other meaning of a word may be suggested, and so too, if its ordinary meaning is not consistent with the statutory purpose, that meaning must be rejected.
51 The recent observations of Gageler J in ESSO Australia Pty Ltd v The Australian Workers' Union [2017] HCA 54 at [71] are also relevant to the task of construction in the particular circumstances here (footnote omitted):
71. Difficult though it is, the constructional choice can and must be made in the application of workaday interpretative methodology. Nothing simpler or more sophisticated is involved than attempting sympathetically to determine which construction of the contested statutory text better fits the context of the statutory scheme of which that text forms part. Linguistic indications are important. More important is the "purpose and policy" reasonably attributed to the provision within the statutory scheme.
52 The Preamble to the NT Act, as well as the objects set out in s 3 provide important context. The relevant parts of the Preamble are as follows (emphasis added):
…
Justice requires that, if acts that extinguish native title are to be validated or to be allowed, compensation on just terms, and with a special right to negotiate its form, must be provided to the holders of the native title. However, where appropriate, the native title should not be extinguished but revive after a validated act ceases to have effect.
It is particularly important to ensure that native title holders are now able to enjoy fully their rights and interests. Their rights and interests under the common law of Australia need to be significantly supplemented. In future, acts that affect native title should only be able to be validly done if, typically, they can also be done to freehold land and if, whenever appropriate, every reasonable effort has been made to secure the agreement of the native title holders through a special right to negotiate. It is also important that the broader Australian community be provided with certainty that such acts may be validly done.
A special procedure needs to be available for the just and proper ascertainment of native title rights and interests which will ensure that, if possible, this is done by conciliation and, if not, in a manner that has due regard to their unique character.
…
53 As the primary judge noted at [5], two of the main objects of the NT Act are (emphasis added):
(1) to provide for the recognition and protection of native title; and
(2) to establish ways in which dealings affecting native title may proceed and to set standards for those dealings.
54 There can be no dispute that the right to negotiate has been, and remains, an important part of the fabric of the NT Act since its enactment. This reflects the explicit reference in the Preamble that future acts which affect native title should only be able to be validly done "if, whenever appropriate, every reasonable effort has been made to secure the agreement of the native title holders through a special right to negotiate" (emphasis added). That is balanced by the reference in the Preamble to the importance to the broader Australian community of "certainty" that such acts may validly be done. In North Ganalanja at 637 McHugh J described the right to negotiate as a "valuable" one. And in Cox, Spender, Sundberg and McKerracher JJ accepted at [18] that "the right to negotiate regime is an element of the protection of native title which is one of the main objects of the Act and that it is not to be narrowly construed".
55 The beneficial nature of the NT Act, as well as its Preamble and objects clause, are important aids in the task of statutory construction, but they cannot be used to cut down the plain and unambiguous meaning of a provision if that meaning, in its textual and contextual surroundings, is clear (see, for example, Wacando v The Commonwealth [1981] HCA 60; 148 CLR 1 at 15-16 per Gibbs CJ; I W v City of Perth [1997] HCA 30; 191 CLR 1 at 12 per Brennan CJ and McHugh J and S v Australian Crime Commission [2005] FCA 1110; 144 FCR 431 at [22] per Mansfield J). That well-recognised qualification appears to have limited application here, however, given the absence of any plain or unambiguous language in the NT Act which indicates whether or not the obligation to negotiate in good faith terminates upon the making of a s 35 application.
56 In our respectful view, the following matters support a different construction from that preferred by the primary judge. First, the obligation to negotiate in good faith which is imposed by s 31(1)(b) is defined by reference to a particular possible outcome (i.e. the agreement of each of the native title parties to the doing of the act, whether subject to conditions or not), but is not explicitly subject to any particular point in time or cut-off date, such as when a s 35 application is made (or accepted).
57 Secondly, although the obligation to negotiate in good faith is imposed on all the negotiation parties, it is explicitly stated to be directed to obtaining the agreement of each of the native title parties to the specified matters. It is evident that the object of the obligation is directed to protecting the native title parties. This is further reflected in the fact that the s 36(2) prohibition on the arbitral body making a s 35 determination operates by reference to any negotiation party (i.e. Government party, grantee party or native title party) satisfying the arbitral body that any other negotiation party, other than a native title party, did not negotiate in good faith as mentioned in s 31(1)(b). Thus, while a native title party has an obligation to negotiate in good faith pursuant to s 31(1)(b), this is a matter of imperfect obligation and appears not to carry any relevant consequences under the NT Act if the native title party fails to discharge that obligation. This stands in sharp contrast to the statutory consequences for the other two categories of negotiation party.
58 Thirdly, the legislative regime plainly contemplates the possibility that the parties may voluntarily continue to negotiate notwithstanding that a s 35 application has been made. This is reflected, for example, in the terms of:
(1) s 34, which expressly provides that an agreement of the kind mentioned in s 31(1)(b) has no effect in relation to the future act if it is made after the making of a determination under, relevantly, s 38;
(2) s 35(3), which expressly provides that, even though a s 35 application has been made to the arbitral body, the negotiation parties may continue to negotiate with a view to obtaining an agreement of the kind mentioned in s 31(1)(b) before a s 38 determination is made;
(3) s 36(4), which provides that the relevant Minister may give a written notice to the arbitral body where an application has been made under s 35, four months have lapsed and before either the negotiation parties have made an agreement of the kind mentioned in s 31(1)(b) or the arbitral body has made a determination under s 38; and
(4) s 38(1A), which contemplates that an arbitral body determination under s 38 may, with the agreement of the negotiation parties, provide that a particular matter be the subject of further negotiation.
As Sheffield point out, s 35(3) was not in the original Native Title Amendment Bill 1997, but was subsequently inserted by way of an amendment to that Bill in 1998. The effect of s 35(3) is explained in the Supplementary Explanatory Memorandum to Government Amendments moved in July 1998 to the Native Title Amendment Bill 1997 (No 2), which stated at page 25:
This amendment to section 35 in the Bill makes it clear that negotiations for acts covered by the right to negotiate may continue even after one of the parties has applied to the arbitral body for a determination. The fact that negotiations are continuing should not delay the determination by the arbitral body. The parties are free to reach an agreement until such time as a determination is made under section 36A or 38…
That Supplementary Explanatory Memorandum went on to explain at page 25, in relation to the proposed insertion of s 35(3), that:
Matters which have been agreed between the negotiating parties, but which do not completely satisfy paragraph 31(1)(b), can be disclosed to the arbitral body, which must take them into account under subsection 39(4) if the negotiating parties consent.
59 Merely because there is no obligation on the Government party or a grantee party to continue to negotiate once a s 35 arbitral determination has been made does not necessarily mean that the obligation to negotiate in good faith, as imposed by s 31(1)(b), does not apply as a matter of implication where the parties do agree to continue to negotiate. It is significant that s 35(3), which contemplates that the negotiation parties may voluntarily agree to continue to negotiate after the making of a s 35 application, describes the objective of those post-s 35 application negotiations as being to obtain an agreement of the kind mentioned in s 31(1)(b) before an arbitral determination is made. An agreement of that kind is an agreement which results from good faith negotiations as to the doing of the future act with or without conditions. The good faith obligation is an integral part of the process which is directed to the objective of making an agreement with the native title parties. That obligation subsists even though an agreement may not ultimately be reached.
60 Section 35(3) operates to deem a s 35 arbitral application to have been withdrawn if the parties voluntarily agree to negotiate in parallel and then reach an agreement of the kind set out in s 31(1)(b). Given this significant effect on the arbitral process of the making of such an agreement, it is more likely that the legislature intended that any such agreement be one which has been arrived at after good faith negotiations and not otherwise, consistently with s 31(1)(b).
61 Fourthly, the past tense used in s 36(2) (i.e. "did not negotiate…") is not a determinative factor in favour of the construction preferred by the primary judge. That is particularly so because the possibility of post-s 35 application negotiations being voluntarily conducted is plainly contemplated in the statutory scheme and, where that occurs, s 36(2) continues to apply. Thus the issue whether any other negotiation party (other than a native title party) did not negotiate in good faith as mentioned in s 31(1)(b) may involve consideration by the arbitral body of conduct which occurred in negotiations carried out both pre and post the making of the s 35 application. This construction is consistent with the use of the past tense in s 36(2).
62 Fifthly, there is a question concerning the reach of s 31 having regard to its heading, "Normal negotiation procedure". Does this heading mean that the contents of s 31 are confined to a discrete procedure or process, namely negotiations conducted before the point in time when a s 35 application is made? If so, this would mean that s 31 has no application after that point in time, which is the view favoured by the primary judge.
63 In accordance with s 13 of the Acts Interpretation Act 1901 (Cth), as "material" that is part of the NT Act (and in the absence of any contrary intention), the heading to s 31 must be taken into account in construing it and other related provisions. On one view, the heading might suggest that s 31 is confined to a particular process, namely the "normal negotiation procedure", which is the process which occurs prior to the making of a s 35 application. Adoption of such a construction would confine the mediation role of an arbitral body under s 31(3) to the period before a s 35 application is made. Thus there would be no capacity for the NNTT, even at the request of the parties, to mediate in the course of negotiations which take place after a s 35 application is made notwithstanding that the NT Act plainly contemplates that such negotiations may voluntarily occur. It is difficult to see how such construction promotes the purpose or object of the legislation.
64 The NT Act contemplates that the ongoing negotiations and s 35 arbitral determination proceedings may be concurrent. What purpose is served by preventing the NNTT from undertaking, at the request of a negotiating party, a mediation role in any post-s 35 negotiations? The same question might be asked vis-à-vis the obligation of good faith in s 31(1)(b). Why, in the absence of clear and unambiguous language, confine that obligation to the period preceding the making of a s 35 application and not beyond? All the more so in circumstances where any continuing negotiations as the parties voluntarily engage in will be for the same purpose as specified in s 31(1)(b), namely to obtain the agreement of each of the native title parties to the doing of the act, with or without conditions. In short, given that the possibility of voluntary ongoing negotiations occurring after the making of a s 35 application, what purpose is served by freeing such negotiations from the constraints and requirements (or standards) which apply to negotiations conducted in the period before the making of the s 35 application? Why should the native parties in particular lose the protections which they enjoy in respect of negotiations carried out in that earlier period?
65 Some significance also attaches to the fact that the only express exception to the "normal negotiation procedure" in s 31 is where the "expedited procedure" applies (see s 32). Subdiv P expressly contemplates that negotiations must be conducted prior to the making of a s 35 application, and may be conducted after such an application is made. If the good faith obligation was not intended to apply to the latter negotiations it would have been very easy to add that as another express exception to s 31.
66 Sixthly, the better view, and one which promotes the purpose or object of the NT Act (see s 15AA of the Acts Interpretation Act 1901 (Cth)), is to regard any post-s 35 voluntary negotiations as negotiations which are carried out under Subdiv P and to which the standards imposed by that subdivision apply. This construction means that:
(1) s 31 continues to apply to any such voluntary negotiations, including important beneficial provisions such as ss 31(1)(b) and (3) and (4);
(2) s 34 would also apply, which would clarify that an agreement reached as a result of a voluntary post-35 application negotiation would have no effect in relation to the act for the purposes of Subdiv P of Div 3 of Pt 2 if the agreement resulting from those negotiations is made after the making of the s 38 determination;
(3) s 36(2) would also operate in respect of any post-s 35 application negotiation, so as to encourage the relevant negotiation parties to negotiate in good faith (as reflected in s 31(2));
(4) s 41A would apply, such that any agreement obtained as a result of a post-s 35 application negotiation would have to be provided by the negotiation parties to the arbitral body and they would also have to advise the relevant Minister in writing of the making of such an agreement; and
(5) the reference to an "agreement" in both ss 39(4) and 40(b) should be construed as a reference to an agreement which has been arrived at after good faith negotiations. Having regard to the terms and effect of those provisions, it is difficult to see why they should be construed as including an agreement which has been reached by the negotiation parties otherwise than as a result of good faith obligations.
Significantly, the primary judge's preferred construction does not produce these consequences, nor promote the beneficial objects of the legislation. Nor does it produce harmony in the operation of the relevant provisions in Subdiv P, in contrast with the alternative construction.
67 Seventhly, in our respectful view, too much can be made of the distinction between "process" and "outcome" in s 31(1)(b). That distinction is still preserved if the word "agreement" is construed therein as referring not only to the objective of obtaining an agreement before a s 35 application is made, but also an agreement which is reached after that event as long as the agreement is finalised before the making of the s 35 determination by the arbitral body.
68 Eighthly, in our respectful view, the central issue of construction here is not relevantly assisted by Carr J's observations in Walley. That is because:
(1) That issue did not arise there. Rather, the primary issue in Walley was the meaning of the phrase "no such agreement" in s 35 of the NT Act (as it then stood) and whether compliance with s 31(1)(b) was a condition precedent to the making of an application under s 35.
(2) Importantly, provisions such as ss 31, 34, 35, 36, 37 and 38 have been significantly amended since Walley was decided (as is also the case with respect to Lee J's decision in Brownley v Western Australia (No 1) [1999] FCA 1139; 95 FCR 152 (Brownley), which contains observations at [16]-[27] regarding the obligation of the Government party to negotiate in good faith prior to a s 35 application being made). This is reflected in the terms of those provisions as in force prior to the 1998 amendments (i.e. the relevant time for the purposes of Walley and Brownley), and noting in particular the different terms of s 35:
31 Normal negotiation procedure
Government party to negotiate
(1) Except where the notice includes a statement that the Government party considers the act attracts the expedited procedure, the Government party must:
(a) give all native title parties an opportunity to make submissions to it, in writing or orally, regarding the act; and
(b) negotiate in good faith with the native title parties and the grantee parties with a view to obtaining the agreement of the native title parties to:
(i) the doing of the act; or
(ii) the doing of the act subject to conditions to be complied with by any of the parties.
Arbitral body to assist in negotiations
(2) If any of the negotiation parties requests the arbitral body to do so, the arbitral body must mediate among the parties to assist in obtaining their agreement.
…
34 Parties to give copy of any agreement to arbitral body
If, at any time before any determination is made by the arbitral body under section 38, the negotiation parties make an agreement of the kind mentioned in paragraph 31(1)(b) or subsection 32(5), they must give a copy of it to the arbitral body.
35 Application for determination
Any negotiation party may apply to the arbitral body for a determination in relation to the act if there is no such agreement within:
(a) if the act is the grant of a licence to prospect or explore for things that may be mined - the period of 4 months starting when the notice under section 29 is given; or
(b) in any other case - the period of 6 months starting when the notice is given.
36 Determination to be made within specified period
All reasonable steps to be taken
(1) Subject to section 37, the arbitral body must take all reasonable steps to make a determination in relation to the act within:
(a) if the act is the grant of a licence to prospect or explore for things that may be mined - the period of 4 months starting when the application is made; or
(b) in any other case - the period of 6 months starting when the application is made.
Report to Commonwealth Minister
(2) If the arbitral body is the NNTT and it does not make the determination within the period, it must, as soon as is reasonably practicable after the end of the period, advise the Commonwealth Minister in writing of the reason for it not doing so.
37 No determination if agreement
If, before it makes a determination, the arbitral body is given a copy of an agreement in accordance with section 34, it must not make the determination.
38 Kinds of determination
Kinds of determination
(1) Except where section 37 applies, the arbitral body must make one of the following determinations:
(a) a determination that the act must not be done;
(b) a determination that the act may be done;
(c) a determination that the act may be done subject to conditions to be complied with by any of the parties.
…
(3) It is particularly significant that s 35(3) was not in force when either Walley or Brownley was decided. As noted above, it makes specific and express provision for the negotiating parties to continue to negotiate voluntarily with a view to obtaining an agreement of the kind mentioned in s 31(1)(b) notwithstanding that one of them has made an application under s 35. Justice Carr's reference in Walley at 382 to "the next stage of making an application under s 35 for a determination" should not be read as denying that the negotiation parties may continue to negotiate with a view to obtaining the agreement of the native title parties notwithstanding that an application for a determination has been made to the arbitral body. Nor should it be read as stating that there is no ongoing obligation to negotiate in good faith in any such negotiations which issue, as noted above, simply did not arise there.
69 Ninthly, it is difficult to see how the issue of construction is affected by consideration of the "muddying" ramifications as referred to by the primary judge (see [43(d)] above). Those ramifications also arise under the primary judge's preferred construction, because of the relevance under that analysis of post-s 35 application conduct in informing an assessment of the pre-s 35 application conduct.
70 Finally, we do not accept Sheffield's submission that this construction of the relevant provisions of the NT Act is inconsistent with the Full Court's decision in Cox. Significantly, the specific issue of whether there is a continuing obligation to negotiate in good faith notwithstanding the making of a s 35 application did not arise for determination in Cox. The observations of the Full Court in [19], [21] and [22] (as set out in [27] above) must be read accordingly.
71 In Cox, two questions of law were identified by the Full Court at [17] as arising in the appeal. The relevant observations were plainly directed to the first of those questions, which was whether, on the proper construction of s 35 of the NT Act when read with s 31(1)(b), the NNTT has the power to make a determination under s 38 regardless of the stage at which negotiations had reached provided that the six-month period referred to in s 35(1)(a) had expired and the negotiation party had negotiated in good faith during that period. No issue arose there as to whether the obligation of good faith continued in any negotiations which are voluntarily conducted after a s 35 application had been made. The reference in [19] of Cox to there being "no further obligations after the completion of the six-month period on a party which wishes to lodge a notice under s 35 of the Act", is a reference to obligations relating to the arbitral process and not obligations which attach to any ongoing negotiations conducted by the negotiation parties voluntarily and in parallel with the arbitral process. This is reflected in the example which is given by the Full Court in [19], namely that there is no need for the negotiating party who makes an application under s 35 "to give further warning of the intention to do so".