Supreme Court of the NT|1992-03-11|Before: Kearney J

Northern Territory v Northern Land Council [1992] NTSC 12; 81 NTR 1; 2 NTLR 8; 106 FLR 254 (11 March 1992)

COURT IN THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA KEARNEY J HRNG DARWIN, 5 December 1991 #DATE 11:3:1992 Counsel for plaintiff: T I Pauling QC with G C McCarthy Solicitors for plaintiff: Solicitor for the NT Counsel for first defendant: P G Minogue Solicitors for first defendant: Australian Government Solicitor Counsel for 2d and 3d defendants: F X Costigan QC with R W Blowes Solicitors for 2d and 3d defendants: B I Midena Counsel for 4th defendant: D Morris Solicitors for 4th defendant: Ward Keller ORDER Declarations made as sought. JUDGE1 THE RELIEF SOUGHT KEARNEY J The plaintiff seeks a declaration that Articles 32 and 2.13 of a Deed of Exploration, set out in Appendix 2 to this judgment, are contrary to Part IV of the Aboriginal Land Rights (Northern Territory) Act (Cth) (herein "the Land Rights Act") and, therefore, wholly void. THE BACKGROUND 2. On 22 August 1988 the fourth defendant (herein "the Applicant") wrote to the Northern Territory Minister for Mines and Energy. It applied under the Mining Act for a grant of two Exploration Licences, subsequently numbered 6284 and 6285, in respect of certain Aboriginal land in the Cox River region. 3. The third defendant (herein the "Aboriginal Corporation") and the Applicant agreed to form a joint venture. Its purpose was to explore the Licence land and, if warranted, mine it for minerals. 4. About 3 months after receiving the application, the Minister for Mines and Energy wrote on 5 December 1988 to the second defendant (herein "the Land Council") and the Applicant. He advised them that he consented to the Applicant negotiating with the Land Council to obtain its consent to the grant of the proposed Exploration Licences to the Applicant. 5. About 1 month later, in January 1989, the Applicant applied to the Land Council in writing, under s.41 of the Land Rights Act, for its consent to the grant. Such an application has to "set out a comprehensive proposal": see the details required, by ss.41(6). Making the application also set in train the "negotiating period", which lasts a statutory minimum of 12 months (ss.42(13)). During this time the Land Council had to decide whether or not to consent to a grant of the Exploration Licences. To decide that, it had first to consult with the traditional Aboriginal owners of the land and other Aboriginal groups affected by a grant (ss.42(2) and (4)). It also had to agree with the Applicant on the terms and conditions to which a grant of the Licences would be subject, before it could consent (s.42(6)). 6. About 21 months later, on 25 October 1990, the Land Council forwarded to the Minister for Aboriginal Affairs an unexecuted "Deed for Exploration" to which the parties are the Land Council, the Aboriginal Corporation and the Applicant. The Deed is a complex document. It comprises some 99 pages containing 32 Articles. There are a further 23 pages, containing 7 Annexures. A list of the Article and Annexure headings is Appendix 1 to this judgment. 7. About 1 month later, on 26 November 1990, the Minister for Aboriginal Affairs signed a document titled "Consent of the Minister for Aboriginal Affairs to the Grant of Exploration Licences 6284 and 6285, Cox River, Northern Territory". In it he stated that pursuant to para.40(a) of the Land Rights Act he consented to the grant of the proposed Exploration Licences. On the same day, in purported compliance with s.42(8) of the Land Rights Act, he wrote to the Land Council. The material part of that letter states:- "You wrote to me on 25 October forwarding a deed of agreement between the Northern Land Council, Stockdale Prospecting Limited and the Nuralindji Aboriginal Corporation in relation to proposed Exploration Licences 6284 and 6285. I hereby approve, pursuant to of the (the Act), that the Northern Land Council enter into the said agreement. I also hereby consent, pursuant to paragraph 40(a) and of the Act, to the grant of Exploration Licences numbered 6284 and 6285. I note, however, that article 32 of the deed of agreement includes provisions which purport to override the provisions of the Act and other relevant legislation in certain circumstances relating to negotiations for mining in these areas. In particular, I note that article 32.1(b) introduces a requirement for the Land Council's consent to the grant of a mineral lease when such a consent is not a prerequisite under the Act. I wish to inform you that the Attorney-General's Department has advised that provisions of this sort in exploration agreements cannot override the provisions of the legislation. The Northern Territory authority responsible for the grant of mineral leases is not envisaged as a party to the agreement and its powers are unaffected by arrangements between the parties contained in the agreement." 8. The Minister also wrote that day in similar terms to the Applicant. 9. About 4 months later, on 25 March 1991, the Land Council, the Aboriginal Corporation and the Applicant executed the Deed for Exploration. On the same day the Land Council executed a document titled "Consent of the Northern Land Council to the Grant of Exploration Licences 6284 and 6285, Cox River, NT". This consent is conditional, since it is expressed to be "subject to the terms and conditions set out in Paragraphs 3 and 4 " the material parts of which are as follows:- "3. The Land Council would not have given the consent if (a) the terms and conditions for the giving of the consent were otherwise than as are contained in the Deed for Exploration; and 4. It is a condition of giving of the consent that - (a) any mining works that may be proposed or undertaken in relation to minerals discovered be undertaken subject to the applicable terms and conditions included in the Deed for Exploration; and (b) an agreement under of the (Land Rights Act ) relating to such mining works be negotiated in accordance with and subject to the applicable terms and conditions included in the Deed for Exploration." 10. The Minister for Mines and Energy has not yet granted the Exploration Licences sought some 3 years ago on 22 August 1988. On 26 August 1991, some 5 months after the Land Council's consent of 25 March, the plaintiff issued the Writ herein, seeking the declaratory relief mentioned on p.1. The case was tried on 5 December. It stands for judgment today. THE STATUTORY REGIME APPLICABLE (a) The current regime 11. The actions by the parties, recounted above, are explicable in terms of the legal regime controlling the exploration for minerals on Aboriginal land. As far as statute law is concerned this regime is constituted by the Land Rights Act and the Mining Act. The relevant individual provisions of those Acts are set out in (c) and (d) below. The general thrust of the Land Rights Act provisions first may be briefly stated. 12. Part IV of the Land Rights Act deals with mining. It comprises ss.40-48J. It was inserted by Act No. 75 of 1987, with effect from 5 June 1987. It provides that there can be no exploration on Aboriginal Land unless the Land Council and others first consent; see para.40(a), ss.42(6) and (8). An agreement on the terms and conditions of exploration must be entered into; see s.42(6)(c). Time limits are set. There is provision for 'national interest' cases; these are of no concern in these proceedings except that the fact that provision is made, in para.40(b) and s.43, indicates that the grant of an exploration licence is a subject which may attract consideration of the national interest. If the only problem about giving consent relates to the terms and conditions of consent, a conciliation/arbitration process is provided in s.44. There are limits on the amount of compensation to be paid at the exploration stage; see s.44A(1). Once all necessary consents are given, and an Exploration licence is granted, an explorer who discovers an extractive mineral deposit and seeks a mining interest in the land to mine that deposit, does not have to obtain consent to mine. That is to say, as far as the Land Rights Act is concerned, the only problem for the intending miner at that stage is reaching agreement with the Land Council on the terms and conditions to which the grant of his mining interest will be subject (para.45(a)), a matter on which he is entitled to recourse to conciliation/arbitration under ss.46(7)-(13). (b) The former regime 13. It is convenient at this point to note that under the former Part IV of the Land Rights Act, in force until June 1987, a 'mining interest' (defined, importantly, so as to include an exploration licence) could be granted only if both the Minister for Aboriginal Affairs and the Land Council consented. Part XI of the Mining Act, which deals with the grant of exploration licences and mining tenements over Aboriginal land, contemplates two stages: an exploration stage pursuant to an exploration licence granted under s.16, and a mining stage under a mining tenement granted under s.60, s.101 or s.112. 14. Accordingly, the effect of the former Part IV of the Land Rights Act was that (apart from s.40(2) applications) the traditional Aboriginal owners could give or withhold consent both at the exploration stage and at the mining stage. A consent to explore did not entail a consent to mine any minerals discovered. 15. Under s.45(1), if the Minister for Aboriginal Affairs was satisfied that the Land Council had "refused - -- to give its consent to the grant of a mining interest by reason that the applicant for the grant will not enter into an agreement proposed by the Land Council in consideration for the giving of its consent to the grant" there was provision for arbitration "to determine the terms and conditions of the agreement." It can be seen that s.45(1) did not erode the absolute "veto"; it applied only where the non-consent was due purely to a failure to agree on terms and conditions of consent, as is the case with s.44 of the current Part IV. 16. Two consents were required before there could be mining, except where the former s.40(2) was utilized. This provided that once consent was given to an applicant's proposal for an Exploration Licence, which included "proposals for exploration - - - and the recovery of any minerals found as a result of the exploration", a second consent at the mining stage would not be required, if the mining interest to be granted was "in substantial accordance with those proposals". 17. In fact, the regime instituted by the former Part IV rusted in its tracks; only 1 agreement was concluded in the 10 years it was in force. As Mr Costigan Q.C., senior counsel for the defendant, put it, Part IV did not sensibly allow for consultation between miners and traditional owners, or for exploration for and recovery of minerals. In his Report on the Land Rights Act, "Seven Years On" (1983), Toohey J stated that there were "practical difficulties" in the operation of s.40(2); see paras.512-515 of the Report. His Honour discussed possible solutions before making remedial recommendations at para.554; they were not implemented. (c) The current Land Rights Act provisions 18. Section 40 provides for the grant of exploration licences, as defined; the material provisions are:- "40. An exploration licence shall not be granted to a person in respect of Aboriginal land unless: (a) both the Minister (for Aboriginal Affairs) and the Land Council for the area in which the land is situated have consented, in writing, to the grant of the licence; ... and the Land Council and the person (here, the Applicant) have entered into an agreement under this Part as to the terms and conditions to which the grant of the licence will be subject." 19. Section 42 also deals with the exploration stage and provides, inter alia

section 41 for consent to the grant of an exploration licence in respect of particular land, it shall, before the end of the negotiating period (defined in ss.42(13)) in respect of that application: (a) either consent, or refuse to consent, to the grant of an exploration licence authorising the proposed exploration program, and (b) notify the applicant, the Minister (for Aboriginal Affairs) and the Northern Territory Mining Minister, in writing, of its decision." ... (6) ... the Land Council shall not consent to the grant of the licence unless: (a) it is satisfied that the traditional Aboriginal owners

(if any) of the land understand the nature and purpose of the terms and conditions and, as a group, consent to them; (b) it is satisfied that the terms and conditions are reasonable; and (c) it has agreed with the applicant upon the terms and conditions." ... (8) Where the Land Council consents to the grant of the licence, the Minister (for Aboriginal Affairs) shall determine whether he or she also consents to the grant, and shall notify the applicant and the Land Council, in writing, accordingly, within 30 days, or such other period as is prescribed, after: (a) the receipt by the Minister of the notice under subsection (1); or ...". 20. If and when it comes to the mining stage, s.46 provides, inter alia, for mandatory conciliation/arbitration at the initiative of either the intending miner or the Land Council, if they fail to agree on terms and conditions for mining, viz:- "(7) If the intending miner and the Land Council fail, within the period referred to in subsection (3), to agree upon the terms and conditions, either or both of them may, by writing, request the Minister to refer the matters in dispute to a person appointed by the Minister as a Mining Commissioner for resolution of those matters by conciliation, or, failing that, by arbitration. (8) Where a request is made to the Minister (for Aboriginal Affairs) under subsection (7), the Minister shall, ... appoint ... as a Mining Commissioner and that person shall thereupon try, by conciliation, to assist the intending miner and the Land Council to resolve the matters in dispute. (9) If the Mining Commissioner becomes of the opinion that there is no reasonable prospect (of) conciliation, - - - he or she shall notify both parties, in writing, that he or she is so satisfied and, unless either party objects, proceed, by arbitration of the matters in dispute, to determine the terms and conditions that should, in his or her opinion, be acceptable to both parties. (10) If either party objects under subsection (9), the Minister shall, as soon as practicable, appoint another person under section 48F as a Mining Commissioner and that person shall, by arbitration of the matters in dispute, determine the terms and conditions that should, in his or her opinion, be acceptable to both parties. (11) The Mining Commissioner shall determine terms and conditions that are fair and reasonable and that, in his or her opinion, should have been negotiated by the parties in commercial arms' length negotiations conducted in good faith. (12) Where the intending miner is willing to enter into an agreement with the Land Council setting out the terms and conditions determined under this section, the Land Council shall enter into that agreement. (13) Where the Minister is satisfied that the Land Council has refused, or is unwilling, to enter into an agreement in the circumstances referred to in subsection (12), the Minister shall, in the name of, and on behalf of, the Land Council, enter into such an agreement. (14) Where an agreement is entered into under this section concerning the terms and conditions, the terms and conditions are binding upon the parties and their heirs, successors or assigns. (15) Nothing in this Part shall be taken to imply that the intending miner must enter into an agreement with the Land Council to give effect to any terms and conditions determined by the Mining Commissioner under this section, but, if the intending miner does not enter into the agreement, within 90 days after the determination or such longer period as the Minister may determine on application, within that period of 90 days, by either party, the licence or lease referred to in subsection (1) is cancelled." (d) The Mining Act provisions 21. Subsection 137(1) of the Mining Act provides:- "137. (1) A person shall not enter into negotiations with a Land Council for the consent of that Council to the grant to him of an exploration licence in respect of Aboriginal land - (a) unless he has first lodged with the (responsible Northern Territory) Minister an application for an exploration licence in respect of that land; and (b) except with the consent of the Minister and in accordance with any conditions imposed by the Minister." THE PLAINTIFF'S SUBMISSIONS 22. The basic submission by Mr Pauling QC, senior counsel for the plaintiff, was that Part IV of the Land Rights Act, considered in its context and read as a whole, is a legal code regulating mining on Aboriginal land. That is, it exclusively states the whole of the law on that topic, when read with the Mining Act. He submitted that ss.40-48J together constitute a significant, tight, comprehensive and compulsory legal regime regulating exploration and mining on Aboriginal land; they set out in detail steps which must be taken, specify time-limits on taking those steps, state rights the exercise of which cannot be waived and duties which must be observed, detail guidelines and impose prohibitions. Accordingly, the only way in which an Exploration Licence or a (subsequent) mining interest can be obtained is by strictly following the path delineated by the steps set out in Part IV, and only those steps. Mr Pauling submitted that in the present case the Land Council had sought to avoid those steps, and had marked out a different path, by purporting to make its consent to explore (a step required by para.40(a)) conditional on the Applicant and the Land Council observing - and exclusively observing - the terms and conditions in the Deed of Exploration, one of the provisions of which (Article 32) purports to over-ride the statutory regime instituted by Part IV; see pp.5 and 55. 23. Mr Pauling submitted that it was implicit in the approach taken by the Land Council in the Deed - that the Applicant could contract out from or waive certain provisions of Part IV - that the regime instituted by ss.40-48J was directory or permissive only; in truth, he submitted, that regime was mandatory or obligatory, and could not be waived or departed from by the Applicant or the Land Council. In this respect, see, for example, Article 32.3(a) and (b) at pp.57-58: they purport to apply "notwithstanding the rights which (the Applicant or the Land Council) may have under the Land Rights Act", and to replace the statutory regime of rights and duties by contractually agreed rights and duties. That is, they replace the statutory regime with a different contractual regime. Mr Pauling submitted that this cannot be done; Part IV does not permit a contracting out from its provisions. 24. Mr Pauling's supporting submissions were as follows. 25. (1) The self-contained legislative scheme in Part IV to regulate mining on Aboriginal land comprises 2 regimes: an exploration regime and a mining regime. The exploration regime controls the grant of an Exploration Licence. The Minister for Aboriginal Affairs and the Land Council can each veto the grant; see para.40(a). In fact, there can be no grant of an Exploration Licence unless the traditional owners (s.42(6)), the Land Council (para.40(a)), the Minister for Aboriginal Affairs (s.42(8)) and the responsible Northern Territory Minister (who decides under s.16 of the Mining Act whether to grant the Licence), all consent. Further, there can be no grant of an Exploration Licence unless the Land Council first agrees with the Applicant on terms and conditions of the grant which it considers reasonable (para.42(6)(b) and (c)). 26. However, Mr Pauling submitted, Part IV imposes a "once only" structure of consent; that is, the requirement for various consents exists only at the exploration stage. This "once only" consent structure is the first vital feature of Part IV. Mr Pauling observed that the word "consent" appears 39 times in Part IV, always in relation to exploration and never in relation to mining, except for para.45(b). He submitted that the detail and nature of Part IV showed that the Parliament did not envisage that an applicant could contract out from its provisions by agreement with a Land Council, or that a Land Council could reserve by agreement with an applicant its right to withdraw its consent under para.40(a) after it had been given. If such contracting out were permissible, it was pointless to have written the provisions of Part IV in such detail. 27. The second regime in Part IV, the regime controlling the grant of a mining interest (following successful exploration under an Exploration Licence), does not involve any such regime of necessary prior consents. Only the consent of the Minister for Aboriginal Affairs is required; see para.45(b). An intending miner must nevertheless seek to reach agreement with the Land Council on the terms and conditions to which the grant of a mining interest will be subject; see para.45(a). However - and this is the other vital feature of Part IV - ss.46(7) provides for compulsory conciliation/arbitration at the intending miner's option if they cannot reach agreement. Mr Pauling submitted that there is nothing in Part IV which empowers a Land Council to prevent by contractual agreement an intending miner going to arbitration under ss.46(7) or which contemplates that a Council may do so; for example, Part IV does not say that the Council can prevent recourse under ss.46(7) by declining to consent to arbitration. 28. (2) As an example of the comprehensive nature of the statutory regime in Part IV Mr Pauling pointed to the very considerable detail required both of a person seeking the grant of an Exploration Licence, and of an intending miner seeking the grant of a mining interest. See the non-exhaustive list of 13 "particulars" in para.41(6)(d) which the Applicant is required to include in its "comprehensive proposal" when it applies to the Land Council for consent to the grant of an Exploration Licence, as well the matters in paras.41(6)(a)-(c), (e) and (f). See also the non-exhaustive list of 13 (different) particulars required to be included in the "comprehensive proposal in relation to the mining works", which an intending miner is required to submit to a Land Council under para.46(1)(a). 29. (3) Pursuant to para.15AB(2)(f) of the Acts Interpretation Act 1901 (Cth), and for the purpose of assisting in ascertaining the meaning of Part IV, Mr Pauling referred to the Second Reading speech by the Minister for Aboriginal Affairs when introducing the Bill which became Act No. 75 of 1987; see Hansard, House of Representatives, 3 June 1987, at pp.3874-3877. At p.3874 the Minister said that the Bill:- "- - - sets out the Government's proposals for a new regime to cover exploration and mining on Aboriginal land which is the first fruit of that further process of analysis and discussion." 30. Mr Pauling submitted that the words emphasized indicated that the purpose of introducing the new Part IV was to provide a new code for mining on Aboriginal land. 31. Mr Pauling submitted that there were further statements by the Minister in his Second Reading speech which supported the proposition that the new Part IV is a mining code, viz:- p.3874 "Consultation with the various interested parties has been extensive. - - - The Government has sought, to the maximum practicable extent, to accommodate the views of all parties. Where this has not been possible, best efforts notwithstanding, it has sought to follow a course that strikes a fair and equitable balance between competing interests, while preserving at all times the essential purpose of the Act - that is, to enable Aboriginals in the Northern Territory to claim land of traditional significance, and to control activities undertaken on that land - - -. By reducing the potential for continued tension and conflict between Aboriginals and non-Aboriginals in the Territory, the amendments will reinforce and strengthen the real and lasting benefits that Aboriginals in the Northern Territory have gained from this legislation.

Exploration and Mining on Aboriginal Land The single most controversial aspect of the Act over the last five years has been the set of provisions (that is, the former Part IV) regulating the exploration for, and mining of, minerals and in particular the operation of the mining veto on Aboriginal land. However, it is fair to say that it has not been the existence of the veto power which has produced the present situation where only one agreement between Aboriginals and companies has been concluded under the Act since its enactment. Rather, the major reason is that the implicit conjunctive structure and direction of the Act - requiring, in effect, that agreement be reached on exploration and mining arrangements at the outset (a clear reference to s.40(2) type applications) - tended to work against the finalisation of exploration licence applications and the resolution of disputes. The new scheme embodied in this Bill recognises the need to clearly set out the rights and obligations of the councils and companies and requires them to work within a set of firm parameters. The new scheme will ensure that Aboriginal traditional owners are able to control exploration and mining activity on their land. As well, it will allow those Aboriginals wishing to negotiate agreements with companies for the grant of exploration and mining interests to do so with greater certainty of the process and time limits within which those negotiations take place. In summary, the new scheme will provide clear guidelines governing the granting of a once-only consent at the exploration stage and the negotiation of terms and conditions at the exploration and mining stages. The Exploration Stage p.3875 The land council will be required to either consent, or refuse to consent, to the grant of an exploration licence in accordance with the wishes of the traditional Aboriginal owners. In general, where consent is refused, no further exploration licence applications will be able to be made in relation to that land for five years. p.3876 The Mining Stage The central feature of the Bill as it relates to the mining stage is that a further consent is not required to enable the successful explorer to proceed to develop a mineral deposit. It is necessary however that a terms and conditions agreement be entered into by the parties and be approved by the Minister before a mining licence (sic) can be granted by the Northern Territory mining Minister. (This was also the case under the previous Part IV) The intending miner will have to submit to the land council a written statement setting out a full range of specified

particulars concerning the proposed mining activity and its impact on Aboriginal land and on Aboriginal people. The parties will have 12 months, or such longer time as they agree, within which to endeavour to reach agreement. As at the exploration stage, the Bill requires land councils to consult with traditional owners and other affected persons, and to provide full opportunities for representatives of the mining company to present and explain their proposal. If the parties fail to agree within 12 months, either the intending miner or the land council or both may request the Minister to refer the matters in dispute between them to a person appointed as a mining commissioner. That person shall be a Federal Court judge appointed by the Attorney-General in consultation with the Commonwealth Ministers responsible for Aboriginal affairs and resources and energy. The mining commissioner shall attempt to conciliate between the parties on the matters in dispute but, where such conciliation is not successful, he shall proceed, by arbitration of the matters in dispute, to determine terms and conditions that are fair and reasonable and which in his opinion would have been negotiated by the parties in commercial arm's length negotiations concluded in good faith. (This is now expressed in s.46(11)). The mining commissioner will not be limited by the Act as to what matters to take into account; for example, he will be able to take into account the value of minerals likely to be mined. (There is no reference in the mining provisions of the new Part IV to taking into account the value of minerals; the basis of the commissioner's determination is his opinion as to the results of "commercial arms' (sic) length negotiations" - see s.46(11), and compare S.44A(1) in relation to terms and conditions of exploration licences). Where the intending miner is willing to enter into an agreement on the terms and conditions determined by the mining commissioner, the land council shall enter into that agreement failing which the Minister shall enter into it on the council's behalf. There will also be a provision to guard against a situation where a miner puts forward either an exploration program or a mining proposal so as to obtain the consent of the traditional owners and, after that consent is gained, departs substantially from the original proposal. If such a situation occurs, the relevant land council will be able to apply to the Minister who will have a discretion to decide that the departure from the original proposal was such as would have led to the traditional owners refusing their consent. If he so decides the mining interest is invalidated and it is open to the Northern Territory Minister to provide the opportunity for another application to be made to the land council. This Bill represents the culmination of a most intensive and thorough process of review and consultation. The compromises that have been reached may not please everybody. What is now required, however, is that all parties recognise that each has legitimate interests, and that the changes proposed represent both an attempt to address in an equitable manner the structural deficiencies in the present Act, and a genuine effort to balance the interests involved, whilst maintaining the fundamental rights that Aboriginal people are able to exercise in relation to their land in the Northern Territory." 32. Mr Pauling submitted that everything in the Minister's speech pointed to Part IV establishing a new regime which was an exclusive code regulating mining on Aboriginal land. Nothing there suggested that an intending miner could agree, as the Applicant had agreed in Article 32.1(b)(i), to subject himself to a (second) Land Council consent (or 'prior approval') at the mining stage; to do so would be directly contrary to "the central feature of the Bill as it relates to the mining stage", as the Minister put it (p.19). More generally, there was nothing in the Minister's speech to suggest that anyone could contract out of the legal regime instituted by Part IV. 33. (4) Mr Pauling submitted that Part IV reflected the Minister's statement (p.20) that the changes represented a "genuine effort to balance the interests involved". This balancing aspect accounted, for example, for the language of ss.46(12) and (13), clearly mandatory in nature and not simply directory. The mandatory provisions in Part IV mean that the Land Council and the Applicant cannot contract out of those provisions, once the process for which Part IV provides is set in train. Yet that was precisely what the Land Council and the Applicant had purported to do here: under the Deed of Exploration the Applicant, assuming it had (successfully) explored under its Exploration Licences (when granted), would not be able to apply for any mining interest at any stage without the prior consent of the Land Council, although Part IV did not require it and the Minister had described it (p.19) as "the central feature" that "a further consent is not required". See recital F in the Deed for Exploration, the definitions therein of "Authorisation", "Feasibility Report", "Mining Agreement", "Mining Interest", "Project", "Section 46 Statement" and "Serious Default", and Articles 2.2.3., 2.2.7., 2.2.11., 2.2.13 and the various provisions of Article 32. 34. (5) Mr Pauling went through each of the provisions in Part IV, stressing the detail in which the various steps and processes are spelled out. He noted by way of example that s.47 instituted a regime whereby an Exploration Licence or a mining interest could be cancelled if the Minister for Aboriginal Affairs concludes that the explorer acted "otherwise than in accordance with" the proposed exploration program submitted to the Land Council under para.41(6)(d), or that the intending miner's proposals under par.46(1)(a) "are not in accordance with" the description set out in its exploration proposal as required by para.41(6)(e). Mr Pauling submitted that since s.47 provided in detail for the steps which could ultimately result in such cancellations, that topic could not be dealt with differently by consensual provisions in a Deed for Exploration between the Land Council and the Applicant, the observance of the provisions of which is expressed to be a pre-condition to the giving of consent under para.40(a) by the Land Council. See paras.3 and 4 of the Consent on p.5, and Article 32.1(a) and 32.3(a). 35. (6) Mr Pauling submitted that Article 32.3(a) of the Deed for Exploration sought to deny to both the Land Council and the Applicant the access to compulsory conciliation/arbitration provided for by s.46 of the Act; and Article 32.3(b)(iv) reinforced that exclusion, as regards the Applicant. That is to say, Article 32.3(a) and (b) derogated from the parties' statutory rights under s.46 to compulsory conciliation/arbitration. Article 32.3(b)(iv) sought to oust the effect of an arbitrator's determination under s.46(7), if despite Article 32.3(a) there was an arbitration, by a covenant by the Applicant designed to prevent s.46(12) coming into operation. Mr Pauling submitted that these contractual provisions were contrary to public policy in that they proceeded on the wrong assumption that the parties could contract out from the provisions of Part IV. 36. As to the latter, Mr Pauling submitted that Article 32.1(a) read with 32.2 clearly assumed that the Applicant could contract out from the provisions of the Act, and in particular its "central feature" (p.19) that at the mining stage a further consent is not required. Article 32.1(b) read with Article 32.2 spelled out some specific aspects of that contracting out, the Applicant agreeing to the need for the Land Council's "prior approval" at the mining stage, and to its approval of the matters set out in Article 32.1(b)(ii) "notwithstanding the provisions

- - of the Land Rights Act". In Article 32.2 the Applicant undertook positive and negative general obligations designed "to give effect to" that which it had acknowledged as "fundamental" to the grant of exploration consents in Article 32.1, namely, the paramountcy of the Deed provisions over those of Part IV and the Mining Act.

In determining whether in contracting out Articles 32 and 2.13 of the Deed are contrary to public policy, Mr Pauling submitted that the approach to be followed was laid down in Lieberman v Morris [1944] HCA 13; (1944) 69 CLR 69. In that case a widow claimed against her husband's estate under testators' family maintenance legislation. Although prior to her marriage she had covenanted not to claim, the High Court held that she was not thereby precluded from claiming. At p.90 Williams J said that the question was whether:- " ...the Act is an Act to which the maxim quilibet renunciare potest juri pro se introducto (loosely, a person may renounce a right introduced for his benefit) applies, or the maxim privatorum conventio juri publico non derogat (loosely, a private agreement cannot override a statutory requirement imposed in the public interest). In Admiralty Commissioners v Valverda (Owners) (1983) AC 173 at p.185 Lord Wright, in a speech in which all their Lordships concurred, said:- "Wherever there is a question whether there can be contracting out or waiver of statutory provisions, the problem must be solved on a consideration of the scope and policy of the particular statute. Little help can in general be derived from other statutes.""
As to the "scope and policy" of Part IV, Mr Pauling drew some comfort from Queensland Mines Ltd v Northern Land Council [1990] NTSC 18; (1990) 68 NTR 1. There the plaintiff held an Exploration Licence under the Mining Act over Aboriginal land and, within the geographical boundaries of that Licence, a Special Mineral Lease over a much smaller area under the repealed Mining Act 1939. It had an ore processing plant on the Lease area. The plaintiff sought a declaration that if it found ore within its Licence area and obtained a mining interest to mine the ore body, it could use the plant to process the mined ore; and that as a then "intending miner" under Part IV it could require the Land Council to submit to conciliation/arbitration under s.46(7) of the Land Rights Act, as to the terms and conditions of user of the plant in relation to the mining on the Licence area, if they could not agree. The defendant submitted that the Lease area had in fact been excluded from the Licence area.
Angel J noted that the question was whether the envisaged processing of ore at the plant was a matter which could properly be included in a s.46(1)(a) statement; if it could, then as part of the "comprehensive proposal", it was one of the terms and conditions which were to be settled by agreement under s.46(3) and by compulsory conciliation/arbitration (s.46(7) - (11)), failing agreement under s.46(3). His Honour held that the Lease and the Licence created distinct interests which in fact co-existed over the land the subject of the Lease. Accordingly, when the plaintiff applied for a mining interest "in respect of the Licence area" (one of its rights under para.23(e) of the Mining Act) it would become an "intending miner" in respect of the land which was also the subject of the Lease. In terms of s.46(1) the Lease area would be part of the land "in respect of which that intending miner holds - - an exploration licence", and therefore, in terms of para.46(1)(a), it formed part of "the land" in relation to which the "comprehensive proposal" related. His Honour rejected the argument that s.46(1) is concerned only with "the land" the actual subject of the application for a grant of a mining interest. That finding disposed of the question in issue.

Assuming, however, that the Land Council had been correct in its contention that the Licence area did not encompass the Lease area, his Honour considered that the proposed use of the plant would nevertheless be properly included in the s.46(1) statement because that user was in the nature of an "infrastructure requirement" in terms of subpara.46(1)(a)(xii); and, in any event, the use of the plant was related "to the mining works that the intending miner proposes to conduct on the (Licence) land", in terms of para.46(1)(a). Accordingly, even if the Lease area was not part of the Licence area, terms and conditions in relation to that user would be subject to the compulsory conciliation/arbitration procedure in ss.46(7)-(11), in the absence of agreement under ss.46(3). 41. His Honour noted that the parties had entered into a Deed for Exploration in respect of the Exploration Licence. Article 32.1 of that Deed contemplated the use of the plant on the Lease area to process ore discovered pursuant to exploration under the Licence, and proposed to be mined. His Honour said at p.7:- "The defendant conceded that the words in Art 32.1 do not exclude the operation of s46 of (the Land Rights Act). This being so the question of whether s46 applies is resolved by the construction of that section in light of the plaintiff's respective titles and not by the wording of Art 32.1 - - - It seems to me that the plaintiff's position is resolved by the construction of the Act alone. If my construction of (the Land Rights Act) is correct, superadded to the contractual relationship between the parties is the s46 procedure for conciliation and arbitration." Article 32 of that Deed did not seek to exclude recourse to conciliation/arbitration under s.46. Angel J granted a declaration that the plaintiff had a right of recourse to conciliation/arbitration in relation to the terms and conditions of user of the plant for the processing proposal. As a matter of interest it may be noted that the Consent of the Land Council to the grant of the Exploration Licence in that case was a somewhat similar type of conditional consent to its consent in this case. Article 32 of that Deed of Exploration also set out certain "Fundamental Conditions". 42. An appeal by the Land Council was dismissed; see Northern Land Council v Queensland Mines Ltd (unreported, Court of Appeal, 12 March 1991). The Court held that Angel J was correct in holding that the validity of the Exploration Licence could not be impeached in the proceedings as constituted before him to which the Minister was not a party, and observed at p.12:- "The exploitation of mineral wealth is notoriously a matter affecting the public interest, including interests entrenched by statute." 43. Mr Pauling relied on this observation to support his submission that the statutory right to compulsory conciliation/arbitration under s.46 could not be derogated from by private contract, as Article 32(a) and (b) purported to do. This prohibition flowed by necessary implication from the comprehensive statutory scheme, which required that Land Councils and mining companies "work within a set of firm parameters" as set out in Part IV, which "clearly set(s) out (their) rights and obligations", as the Minister put it; see p.18. 44. (7) Mr Pauling submitted that the parties to the Deed could not thereby do obliquely that which they were prohibited by Part IV from doing directly: that is, the maxim 'quando aliquid prohibetur, prohibetur et omne per quod devenitur ad illud' (see p.31) should be applied. In support, he referred to Collins v Blantern (1767) 2 Wills. K.B. 341; ; In that case the plaintiff sued the defendant upon his bond to pay 700 pounds. The defendant sought to plead that since the transaction which gave rise to the bond involved compounding a prosecution for perjury, the consideration for the bond was illegal and the bond was void. The plaintiff contended that this plea was bad since no unlawful consideration appeared on the face of the bond. The Court held that the bond was void ab initio. Lord Wilmot CJ said at p.349; 852:- " ... the manner of the transaction was to gild over and conceal the truth; and wherever Courts of Law see such attempts made to conceal such wicked deeds, they will brush away the cobweb varnish, and show the transactions in their true light." 45. Here, Mr Pauling submitted, the Court should "brush away" the "cobweb varnish" constituted by Articles 32 and 2.13. Clearly, these provisions do not "gild over and conceal the truth." Mr Pauling's submission was, adapting Maxwell:- "To carry out effectually the object of (Part IV), it must be so construed as to defeat all attempts to do, or avoid doing, in an indirect or circuitous manner that which it has prohibited or enjoined." (12th Edition, 1976, p.137) 46. (8) Mr Pauling submitted that the provisions of Part IV, construed so as to carry out its object, should be considered in relation to the substance of Articles 32 and 2.13 of the Deed. As to this, he drew an analogy with the old statutes against usury, which avoided loans which were usurious, whether directly or indirectly; in Floyer v Edwards (1774) 1 Cowp.112; ; Lord Mansfield CJ at pp.114-5; 996 stressed:- "We must get at the nature and substance of the transaction - - where the real truth is a loan of money, the wit of man cannot find a shift to take it out of the statute." 47. Mr Pauling conceded that to keep outside Part IV was not to evade it, and that the substance of Part IV is to be ascertained only from its statutory language. He submitted that here the policy of the Act was in fact co-extensive with its language. That is, it creates only one path to obtain a grant of an exploration licence and a mining interest, a path which involves a once-only consent; see generally pp.13, 14. If it were otherwise, in his submission, the detail set out in Part IV is pointless. 48. (9) Mr Pauling submitted that the effect of Part IV, so construed, was that the contractual provisions in the Deed which were inconsistent with Part IV were void. He relied on Caltex Oil (Australia) Pty. Ltd. v Best In that case an Act dealing with franchise agreements specifically provided that it applied notwithstanding any agreement to the contrary, and that provisions in franchise agreements inconsistent with the Act were void, to the extent of the inconsistency. Mason CJ, Gaudron and McHugh JJ said at pp.522-3:- "The most obvious and direct form of contracting out of a statute is the case in which a party covenants under seal or agrees for valuable consideration not to make a claim for a benefit for which the statute provides: see Lieberman v Morris (supra) ... (Mr Pauling submitted that this is precisely the case here). But contracting out of a statute is not limited to cases in which a party simply foregoes or waives a benefit directly conferred upon the party by the statute. Contracting out may take many forms. They will vary with the nature, subject-matter and object or purpose of the statute, as well as the means selected with a view to escaping from its provisions or its operation. A express statutory prohibition against contracting out renders void or inoperative contractual provisions which are inconsistent with the statute. Inconsistency between contract and statute is not confined to literal conflicts or collisions between the contractual provisions and the statutory provisions. Inconsistency in this context arises whenever there is a conflict between a contractual provision or the operation of such a provision and the purpose or policy of the statute. So, if the operation of a contractual provision defeats or circumvents the statutory purpose or policy, then the provision is inconsistent in the relevant sense and falls within the injunction against contracting out. (Mr Pauling submitted that Articles 2.13 and 32 of the Deed were inconsistent with Part IV, in this sense). The principle that it is not permissible to do indirectly what is prohibited directly, which is expressed in the maxim quando aliquid prohibetur, prohibetur et omne per quod devenitur ad illud is a more traditional general statement of the same proposition. It has been acknowledged that, in conformity with this principle, the adoption of a circuitous device with a view to avoiding the need to comply with a constitutional requirement will be of no avail: Bank of N.S.W. v The Commonwealth ; , at pp.349-50; Grannall v Marrickville Margarine Pty. Ltd. ; , at p.78; Wragg v New South Wales ; , at pp.387-88; Attorney-General (Cth) v Schmidt ; , at p.371. The critical question then is whether the Act, on its true construction, manifests a purpose or policy which is at odds with the right which cl. 17.4 purports to confer on Caltex." 49. Mr Pauling submitted that in the present case there were "literal conflicts or collisions between the contractual provisions (in the Deed) and the statutory provisions (in Part IV);" this is seen by comparing s.46 with Article 32. Further, accepting that the "purpose or policy of the statute" was that which its language made clear (see p.13), Mr Pauling submitted that the present case revealed a "conflict between a contractual provision -

and the purpose or policy of the statute." In short, mining for minerals was to be regulated by Part IV and not by the private agreement of the parties.

Dealing with the argument in Caltex Oil that nothing in the franchise agreement was inconsistent with the operation of the Act, because it was only when a clause was operating that any question of inconsistency arose, Toohey J said at p.531:- "It is true that the Act does not in terms prohibit parties from entering into an agreement containing such a provision. However, it does not follow, from the absence of a prohibition on the making of such an agreement, that the Act therefore is confined to striking down clauses when they are invoked or are in operation. What does follow is that 2.7 is concerned with the content of an agreement. Caltex appears to have assumed that, as s.7 does not seek to prevent the parties from agreeing to include a provision such as cl.17.4 but strikes only at the provision itself, therefore s.7 does not strike down a clause of an agreement by which the parties have agreed that at some time in the future one of them may invoke that clause, even though the clause would be inconsistent with the operation of a provision of the Act were it not for its inchoate nature. However, as s.7 is concerned with the content of an agreement, a clause in an agreement, by which it is agreed that conduct inconsistent with the operation of the Act is permissible, is of necessity itself inconsistent with the operation of the Act. Inconsistency must be tested when an agreement is entered into, assuming that the agreement is a franchise agreement to which the Act applies.

Furthermore, the notion that the parties to an agreement to which the Act applies can, as it were, agree that in certain circumstances a step may be taken so that the Act no longer applies, would be to set s.7 at nought. The parties to an

agreement, faced with a section such as s.7, cannot agree that the Act shall not apply and that means that they cannot agree that one of them may take steps aimed at ensuring the Act does not apply." 51. Mr Pauling submitted that the same principle applied here, as Part IV contemplated that the explorer who found an ore deposit had the certainty of knowing that he could mine it subject only to agreeing on terms and conditions for mining, or having those terms set by an arbitrator. The Deed "aimed at ensuring that (Part IV) does not apply" and was inconsistent with it. 52. Mr Pauling also relied on the analysis by Rice J in Territory Insurance Office v Kerin [1986] NTSC 65; (1986) 84 FLR 1. That case involved the question whether an applicant for benefits under the Motor Accidents (Compensation) Act was entitled to compromise her right to receive compensation for, inter alia, medical and rehabilitation expenses. At p.4 his Honour said:- " ... it is submitted that she is not purporting to contract out of her rights to medical expenses under s18 but merely seeking to contract with the plaintiff not to enforce her rights. In added support of this submission, it is pointed out that the Act contains no provision against contracting out and hence I should apply the principle expounded by Windeyer J in Brooks v Burns Philp Trustee Co Ltd [1969] HCA 4; (1968-69) 121 CLR 432 at 456 and reiterated by him in Felton v Mulligan [1971] HCA 39; (1971) 124 CLR 367 at 386, viz: "When a statute creates and confers rights and imposes corresponding duties, persons for whose benefit this was done may by contract waive or renounce their rights, unless to do so would be contrary to the statute. It may be seen that it would be so, because of an express prohibition against 'contracting out', or because the provisions of the statute, read as a whole, are inconsistent with a power to forego its benefits: or the policy and purpose of the statute may shew that the rights which it confers on individuals are given not for their benefit alone, but also in the public interest, and are therefore not capable of being renounced." 53. In Lieberman v Morris [1944] HCA 13; (1944) 69 CLR 69, Rich J at 84 made the following observation: "Speaking generally, public policy may be said to be policy in the observance of which the welfare of the community is involved: Wilkinson v Osborne [1915] HCA 92; (1915) 21 CLR 89 at 97. Whenever a statute creates new rights, public policy in a broad sense is always involved, because the legislature must be assumed to have thought it desirable in the public interest that the rights should be brought into existence. But it does not necessarily follow that an agreement to release or abandon rights so conferred should be regarded as opposed to public policy in general or even to the policy of the particular Act. As was pointed out in Admiralty Commissioners v Valverda (Owners) (1938) AC at 185, 'the problem must be solved on a consideration of the scope and policy of the particular statute'." It is necessary, therefore, to turn to a consideration of the nature and extent of the rights created by the relevant legislation as well as its scope and policy." 54. Mr Pauling relied in particular on the words emphasized, as applicable to this case. He also relied on his Honour's conclusion at p.9 that he was there dealing with a legislative scheme inconsistent with the power of a claimant under it to forego its benefits; Mr Pauling submitted that those remarks applied mutatis mutandis to this case. 55. (10) On the allied question whether the contractual provisions in Articles 32 and 2.13 were unenforceable as contrary to public policy, Mr Pauling relied on A and Ors v Hayden [1984] HCA 67; (1984) 156 CLR 532. In that case a security training exercise arranged by ASIS went astray, and criminal offences were allegedly committed. Members of ASIS who were employed by the Commonwealth on terms which required that their identities be kept confidential, sought to restrain the Commonwealth from disclosing their identities to State Police, who required that information in order to investigate the alleged crimes. The High Court refused to grant the injunctions sought. The majority (6-1) held that although disclosure to the Police would breach the contractual term requiring confidentiality, that term was unenforceable. Mason, Wilson, Deane and Dawson JJ considered that the Court would not lend its aid to the enforcement of the contractual obligation, when the effect of doing so would be to obstruct the administration of the criminal law, because that would be contrary to public policy. Mason J said at p.553:- " ... if the promise is void or unenforceable, it is not because it is inconsistent with the duty imposed on the Commonwealth by law but because the promise seeks to impose an obligation which is at variance with a fundamental head of public policy - the public interest in the enforcement of the criminal law and in the administration of justice. That there is a powerful public interest in the enforcement of the criminal law as an important element in the administration of justice does not admit of debate." 56. At page 556 his Honour said:- "At first glance it might be thought that the making of a contract not to disclose information which may prove to be relevant to the investigation of a crime is no more than an exercise of the citizen's freedom of action to which I have referred, but this is to ignore the element of public policy. Generally speaking, the making of a contract is no more than a exercise of the citizen's freedom to take such action as he thinks is appropriate, at least in those areas in which he enjoys liberty of action. Undertaking to act in a particular way in the future is not ordinarily regarded as

an illegitimate impairment of the individual's freedom to decide for himself what action he will take, even though is undertaking commits him contractually to a course of action in advance of the projected event. This is because no element of public policy is involved which would require that the exercise of the freedom should not be qualified or impaired by entry into some antecedent commitment or some antecedent commitment of a particular kind." 57. At pages 558-9 his Honour said:- "It was acknowledged in Egerton v Brownlow [1853] EngR 885; (1853) 4 HLC 1 (10 ER 359) that the common law principle which I have been discussing was based on public policy. It has at times been fashionable to criticise public policy: see Janson v Driefontein Consolidated Mines Ltd (1902) AC 484; Fender v St. John-Mildmay (1938) AC 1, at pp.10-11, 38-41. Indeed in Egerton v Brownlow itself Crompton J thought that varying notions of public expediency would make it impossible to determine its scope and would introduce uncertainty into the ascertainment of legal rights (1853) 4 HLC, at pp.70-71 (10 ER, at p.388). Other judges, anxious to distance themselves from questions of policy because they are thought to fall within the province of the legislature have asserted that public policy is a species of judicial legislation. However, the place of public policy in the formulation of the common law has been recognized by the greatest judges from early times: see, for example, the opinion of Lord Mansfield in Jones v Randall (1774) 1 Cowp. 37, at p.39 [1774] EngR 24; (98 ER 954, at pp 955-956). In In re Morris (dec'd) [1943] NSWStRp 43; (1943) 43 SR (NSW) 352, at pp 355-356, a decision which was affirmed by this Court in Lieberman v Morris [1944] HCA 13; (1944) 69 CLR 69, Jordan CJ said:"... the phrase 'public policy' appears to mean the ideas which for the time being prevail in a community as to the conditions necessary to ensure its welfare; so that anything is treated as against public policy if it is generally regarded as injurious to the public interest. 'The "public policy" which a court is entitled to apply as a test of validity to a contract is in relation to some definite and governing principle which the community as a whole has already adopted either formally by law or tacitly by its general course of corporate life, and which the courts of the country can therefore recognise and enforce. The court is not a legislator: it cannot initiate the principle; it can only state or formulate it if it

already exists': Wilkinson v Osborne [1915] HCA 92; (1915) 21 CLR 89, at p.97. It is well settled that a contract is not enforceable if its enforcement would be opposed to public policy: Mogul Steamship Co. v McGregor, Gow and Co. (1892) AC 25, at pp.39, 51. Public policy is not, however, fixed and stable. From generation to generation ideas change as to what is

necessary or injurious, so that 'public policy is a variable thing. It must fluctuate with the circumstances of the time': Naylor, Benzon and Co. v Krainische Industrie Gesellschaft (1918) 1 KB 331, at p.342. New heads of public policy come into being, and old heads undergo modification." In Egerton v Brownlow Pollock L.C.B. pointed out that he would be abdicating the functions of his office if he were to discard public welfare from consideration and thought that he ought not to shrink from applying its principles to "any new and extraordinary case that may arise" (1863) 4 HLC, at p.149 (10 ER, at p.419). He conceded that (1863) 4 HLC, at p.151 (10 ER, at p.419) "it may be that Judges are no better able to discern what is for the public good than other experienced and enlightened members of the community; but that is no reason for their refusing to entertain the question, and declining to decide upon it". Notwithstanding the criticism of these remarks by Lord Wright in Fender v St. John-Mildmay (1938) A.C., at pp.40-41, I find them compelling. The refusal of the courts to enforce contracts on grounds of public policy is a striking illustration of the subordination of private right to public interest. The problem is one of formulating with any degree of precision the criteria or the circumstances which will justify a court in refusing to enforce a contract on the ground that there is a countervailing public interest amounting to public policy. The difficulties in ascertaining the existence and strength of an identifiable public interest to which the courts should give effect by refusing to enforce a contract are so formidable as to require that they "should use extreme reserve in holding such a contract to be void as against public policy, and only do so when the contract is incontestably and on any view inimical to the public interest", to use the words of Asquith LJ in Monkland v Jack Barclay Ltd. (1951) 2 KB 252, at p.265.". 58. Wilson and Dawson JJ, dealing with the question of whether enforcement of the Commonwealth's obligation of confidentiality would be contrary to public policy, said at p.571:-, "It is accepted that the underlying principle is that expressed by Isaacs J in Wilkinson v Osborne [1915] HCA 92; (1915) 21 CLR 89, at p.97: "In my opinion the 'public policy' which a Court is entitled to apply as a test of validity to a contract is in relation to some definite and governing principle which the community as a whole has already adopted either formally by law or tacitly by its general course of corporate life, and which the Courts of the country can therefore recognize and enforce. The Court is not a legislator; it cannot initiate the principle; it can only state or formulate it if it already exists. The rule of law as to contracts against public policy is constant - namely, that every bargain contrary to such a social governing principle is regarded as prejudicial to the State, or, in other words, contrary to 'public policy', or, as it is sometimes called, 'policy of the law', and the State by its tribunals refuses to enforce it." And Isaacs J continued (1915) 21 CLR at p.98: "The Courts refuse to give effect to such a bargain, not for the sake of the defendant, not to protect any interest of his - indeed, they do not fail to notice that his failure to abide by his agreement sometimes adds dishonesty to illegality

but they refuse to enforce the bargain for the sake of the community, who would be prejudiced if such a bargain were countenanced.""

Mr Pauling submitted that the enacting into law of Part IV in 1987 meant that there was thereby established a "definite and governing principle which the community as a whole has - - adopted formally by law." The contrary "bargain" struck by the Appellant and the Land Council should not be given effect to, "for the sake of the community ... prejudiced if such a bargain were countenanced."
(11) In summarising the plaintiff's case, Mr Pauling submitted that the first question was whether Part IV was intended to be a code on the topic of exploration and mining on Aboriginal land. To determine that question required an examination of the mischief Part IV was designed to overcome; this was clearly spelled out in the Minister's Second Reading speech (pp.17-20). The proper conclusion was that the provisions of Part IV provided a one-only pathway in relation to its subject matter. Accordingly, Articles 32 and 2.13 were void because as contracting-out provisions they were contrary to the intention of Parliament. Part IV was peremptory in its terms as to what was to occur in relation to the grant of a mining interest following the grant of an exploration licence; this was consistent with its object of a "once-only" veto. It would be wholly inconsistent with that object to have a consent to exploration made conditional upon a further consent to mining; that could not possibly be a permissible term or condition. After a consent is given, Part IV says that the Land Council cannot refuse; it cannot therefore contract for a right to refuse. THE DEFENDANT'S SUBMISSIONS
Mr Costigan submitted that to put the argument in terms that Part IV was a code did not meet the specific problems which needed to be addressed. His submissions were as follows.
(1) It is possible to construe Part IV without adopting a purposive approach. He referred to observations by Burchett J on s.15AA of the Acts Interpretation Act 1901 (Cth) in Trevisan v Commissioner of Taxation (1991) 29 FCR 157 at p.162; his Honour said:- "Section 15AA requires a court to prefer one construction to another. Such a requirement can only have meaning where two constructions are otherwise open. The section is not a warrant for redrafting legislation nearer to an assumed desire of the legislature. It is not for the courts to legislate; a meaning, though illuminated by the statutory injunction to promote the purpose or object underlying the Act, must be found in the words of Parliament."
Mr Pauling, I interpose, had no quarrel with what his Honour had to say about s.15AA. Mr Costigan submitted that it was not necessary to utilise s.15AA because the words of Part IV are sufficiently clear: only one construction is open and that is a construction which permits the Applicant and the Land Council to do what they purported to do in the Deed.

otherwise, the parties could with impunity enter into the contract with full knowledge of the contravention and the contract would none the less be valid. The direction would be nugatory. Of course, if the contract is rendered void by the statute and one of the parties is innocent of any personal contravention of the statute, it is or will often be unjust to that party to allow the other party to avoid his obligations under the contract: see Glanville L. Williams, "The Legal Effect of Illegal Contracts", Cambridge Law Journal, vol.8 (1942), p.51 and R.A.Buckley, "Implied Statutory Prohibition of Contracts", Modern Law Review, vol.38 (1975), p.535, esp. at pp.539-540. There is a natural reluctance to attribute an unjust operation to a statute which does not expressly prohibit a contract of a particular class when a party who enters into such a contract in breach of the statute relies on the statute to avoid his contractual obligations. Whether the statute has that operation depends on its purpose." 70. I interpose here to note that Mr Pauling relied on the passage in their Honours' judgment which immediately followed:- "If the purpose of prohibiting entry by a party into contracts of a particular class is the protection of the

public interest and if the purpose would be frustrated by giving effect to contracts of that class, the statute sterilizes those contracts. The public interest prevails over the private interest of the contracting parties. In such a case, the rule is as stated by Lord Hodson speaking for the Judicial Committee in Chai Sau Yin v Liew Kwee Sam (1962) A.C. 304, at p.311. "If ... the contracts were prohibited by law and the prohibition was made in the public interest, no claim can be entertained: 'The court must enforce the prohibition even though the person breaking the law relies upon his own illegality': see In re Mahmoud and Ispahani (1921) 2 KB 716, at p 729."" 71. Mr Costigan also referred to St. John Shipping Corporation v Joseph Rank Ltd. (1957) 1 QB 267. In that case a shipmaster was fined for overloading. The fine was paid by the defendant cargo-owners; they withheld that sum from freight due. When sued, they contended that the ship owners could not recover as they had performed the charter in an illegal manner. Devlin J held that the infringement of a statute in the performance of a contract which was legal when made did not render the contract illegal unless the contract, as performed, was one which the statute meant to prohibit. At p.288 his Lordship said:- "In my judgment, contracts for the carriage of goods are not within the ambit of this statute at all. A court should not hold that any contract or class of contracts is prohibited by statute unless there is a clear implication, or "necessary inference," as Parke B. put it, (Cope v Rowlands [1836] EngR 49; 2 M.and W. 149; 150 ER 707) that the statute so intended. If a contract has as its whole object the doing of the very act which the statute prohibits, it can be argued that you can hardly make sense of a statute which forbids an act and yet permits to be made a contract to do it; that is a clear implication. But unless you get a clear implication of that sort, I think that a court ought to be very slow to hold that a statute intends to interfere with the rights and remedies given by the ordinary law of contract. Caution in this respect is, I think, especially necessary in these times when so much of commercial life is governed by regulations of one sort or another, which may easily be broken without wicked intent." 72. Mr Costigan submitted that the plaintiff had to show it was a necessary implication from the structure of Part IV that the Land Council and the Applicant could not enter into their Deed. He submitted that it followed from the approach indicated in the authorities cited that no prohibition could be implied in this case. 73. (4) In the light of the above submissions, Mr Costigan submitted that the purpose of Part IV was two-fold. First, it was to preserve the "essential purpose" of the Act, as earlier mentioned. Second, it was to overcome the practical difficulties encountered in the working of the former Part IV scheme, particularly its "implicit conjunctive structure" (p.18) which had precluded the formation of agreements. He submitted that attaining the first and fundamental object would be impeded if the Land Council and the traditional owners were inhibited in their consideration of matters they considered relevant to their consent. They would be inhibited if the Act were construed so as to prevent them from giving a consent to explore subject to certain conditions. To construe the Act in this way would therefore be contrary to its "essential purpose". There was nothing in Part IV limiting the terms and conditions which could be agreed upon; Mr Costigan preferred to put this another way, that there was nothing in Part IV to limit the way in which consent by the traditional owners is to be given. Accordingly, the ability of the traditional land owners to consider all appropriate factors should not be limited, when they are deciding whether to consent. 74. (5) Mr Costigan submitted that ss.46(7)

(11), for example, should be seen as a useful provision, if the intending miner and the Land Council failed to agree. But there was no room for these provisions to operate if they did agree. He pointed out that the Deed embodied an agreement to explore and mine on terms and conditions linked to the consent under para.40(a), which was the basic matter.

(6) In summary, there being no express prohibition in Part IV against the consensual arrangements in the Deed, and no proper basis for implying such a prohibition in Part IV, the traditional owners by the Land Council were entitled to enter into an agreement such as that embodied in the Deed, no provisions of which required the Court's attention.
(7) Mr Costigan submitted that Article 32.1(b) did not usurp s.45 or s.46, despite its opening words. Before it was capable of doing so, it had to be shown that the prior approval of the Land Council to mining is forbidden by Part IV; on the basis of the earlier submissions, that is not the case. If this approach is accepted, Article 2.13 is unexceptionable, for similar reasons, and there is no basis to remove it even if for some reason Article 32 were struck down. SOME GENERAL MATTERS
I have set out in considerable detail the parties' submissions, as they appear to canvass exhaustively all the relevant issues, and arguments and approaches.
I consider it of doubtful utility to seek to characterize Part IV as a code; it is common to refer to mining legislation in this way. What is essential is to ascertain the real intention of Parliament by carefully attending to the whole scope of the Land Rights Act, and Part IV in particular. It is necessary to examine the subject matter and ascertain the general object sought to be attained by Part IV.
It is clear that the present Part IV, like the former Part IV, enshrines (though in a different way) the Woodward recommendation that Aboriginals should have the right to prevent exploration for minerals and mining on their traditional lands. See the Aboriginal Land Rights Commission Second Report, April 1974, p.122.
A matter which was not adverted to by the parties but which I think is of general significance is the fact that all minerals in the Territory vest in the Crown in right of the Northern Territory. That is to say, in practical terms, the minerals are owned by the government on behalf of all the people of the Territory. Woodward put it simply: "minerals belong to all the people" (Report, supra, p.110). They do not belong to the owners of the surface lands; that is to say, in the case of Aboriginal land, they do not belong to the Aboriginal owners. The principle that the minerals belong to the whole community is of great practical and historical importance in Australia. It means that the Territory community as a whole has a right to share in whatever socio-economic advantages flow from the development of the mineral resources of the Territory. As a corollary, a regime regulating mining on Aboriginal land is not a matter in which the only interested parties are the mining companies and the traditional land owners.
Speaking generally, history shows that mining has contributed materially to the growth and stability of those States which possess minerals. It has played a most significant part in Australia's history. The historical importance of mining in Australia has given rise to distinct bodies of law to regulate the prospecting, mining and production of minerals. CONCLUSIONS

Declarations made as sought. When the trial commenced the plaintiff discontinued against the Minister for Aboriginal Affairs, and must pay the Minister's costs. The Applicant submitted to any order the Court might make, and is free of costs. The second and third defendants must pay the plaintiff's costs. APPENDIX 1 ARTICLE 1: DEFINITIONS ARTICLE 2: INTERPRETATION AND OTHER MATTERS ARTICLE 3: CONDITIONS PRECEDENT ARTICLE 4: UNDERTAKING ARTICLE 5: EXPLORATION COMPENSATION ARTICLE 6: LAND COUNCIL AND ABORIGINAL OWNER EXPENSES ARTICLE 7: PROTECTION OF SACRED SITES AND ABORIGINAL IMPROVEMENTS ARTICLE 8: WORK PROGRAMMES

ARTICLE 9: ROADS, MATERIALS AND WATER ARTICLE 10: ENVIRONMENTAL PROTECTION AND REHABILITATION ARTICLE 11: EXPLORATION COMPANY'S FACILITIES ARTICLE 12: EXPLORATION COMPANY PERMITS ARTICLE 13: CO-OPERATION ARTICLE 14: INSTRUCTION ON ABORIGINAL CULTURE ARTICLE 15: LIQUOR ARTICLE 16: EMPLOYMENT AND TRAINING ARTICLE 17: EMPLOYEE TRANSPORT, ACCESS AND ACCOMMODATION ARTICLE 18: MEDICAL TREATMENT ARTICLE 19: INSPECTION ARTICLE 20: INFORMATION ARTICLE 21: LIAISON COMMITTEE ARTICLE 22: INDEMNITY ARTICLE 23: REVISION ARTICLE 24: DEFAULT ARTICLE 25: TERMINATION OF ACTIVITIES ARTICLE 26: SETTLEMENT OF DISPUTES

ARTICLE 27: ASSIGNMENT AND CHARGES ARTICLE 28: FORCE MAJEURE ARTICLE 29: COMMUNICATION ARTICLE 30: CONFIDENTIALITY ARTICLE 31: PREPARATION FOR THE RECOVERY OF MINERALS ARTICLE 32: FUNDAMENTAL CONDITIONS ANNEXURE A - LOCATION MAP ANNEXURE B - EXPLORATION COMPENSATION (ARTICLE 5) ANNEXURE C - ENVIRONMENTAL PROCEDURES (ARTICLE 10) ANNEXURE D - LETTER OF CREDIT (CLAUSE 25.4)

ANNEXURE E - ASSIGNEE'S DEED OF COVENANT (CLAUSE 27.5) ANNEXURE F - CHARGEE'S DEED OF COVENANT (CLAUSE 27.8) ANNEXURE G - DRAFT TERMS AND CONDITIONS OF EXPLORATION LICENCE APPENDIX 2 ARTICLE 32 : FUNDAMENTAL CONDITIONS 32.1 The Exploration Company (that is, the Applicant) acknowledges that it was fundamental to the Aboriginal Owners in giving their consent under sub-section 42(6) of the Land Rights Act to the terms and conditions to which the grant of the Exploration Licence will be subject and that it is fundamental to the Land Council in giving its consent under section 40 of the Land Rights Act to the grant of the Exploration Licence that - (a) all of the Exploration Company's rights, both existing and future, to explore for minerals and to recover minerals from the whole or any part of the Consent Land including without limiting the generality of the foregoing

 (i) its rights under the Exploration Licence and under any
 Mining Interest over any part of the Consent Land; and

(ii) each of the rights and benefits which it may have under the Land Rights Act or any other law relating to the grant of a Mining Interest over any part of the Consent Land or relating to a Mining Agreement; shall be subject to the terms and conditions of this Deed; and (b) notwithstanding the provisions of sections 45 and 46 or any other provision of the Land Rights Act, or any other law- (i) as between the Parties hereto the prior approval of the Land Council shall be required for the grant to the Exploration Company of any Mining Interest over the whole or any part of the Consent Land; and

(ii) no activities for the purposes of or relating to the recovery of minerals shall at any time be undertaken by the Exploration Company in respect of or on the whole or any part of the Consent Land unless and until - (A) the Land Council has approved the undertaking of such activities, and (B) the Land Council has expressly approved all of the terms and conditions of a Mining Agreement in respect of the relevant Mining Interest permitting the Exploration Company to undertake any such activities, and (C) the Parties have entered the Mining Agreement approved by the Land Council pursuant to Sub-sub-paragraph 32.1(b)(ii)(B). 32.2 Without derogating from any of its other obligations under this Deed, the Exploration Company hereby covenants to take all such actions as are reasonably required of it to give effect to each of the provisions of Clause 32.1 and hereby covenants to refrain from taking any action which is inconsistent with any of the provisions of Clause 32.1. 32.3 Notwithstanding the rights which any Party may have under the Land Rights Act or any other law - (a) each party hereby covenants not at any time by any means and whether directly or indirectly to request or otherwise seek or require to have any matters in dispute between the Land Council and the Exploration Company with respect to the terms and conditions of a Mining Agreement (or any other

agreement which the Land Council and the Exploration Company may be required to enter before a Mining Interest can be granted to the Exploration Company) referred to any person or persons for resolution or attempted resolution by conciliation or arbitration or otherwise and, in particular and without limiting the generality of the foregoing, not to request the Minister for Aboriginal Affairs to refer any such matters in dispute to a person for resolution of those matters by conciliation or arbitration; and (b) unless and until the Land Council has expressly - (i) approved the grant of a Mining Interest; and (ii) approved the terms and conditions of a Mining Agreement; the Exploration Company hereby covenants that - (iii) it shall not enter require or seek to require the Land Council to enter such a Mining Agreement; and (iv) notwithstanding the determination by any person or persons, whether pursuant to any statutory function or otherwise, of the terms and conditions for such a Mining Agreement, it shall refuse and remain unwilling to enter such a Mining Agreement. 32.4 Unless commenced earlier by mutual agreement, promptly after receipt by the Land Council of a Section 46 Statement the Parties shall commence bona fide discussions with respect to the giving by the Land Council of its approval of the grant of a relevant Mining Interest under Sub-paragraph 32.3(b)(i) and, if relevant, bona fide negotiations for the purpose of endeavouring to reach agreement on the terms and conditions of a relevant Mining Agreement. 32.5 Without derogating from any of the Land Council's other rights under this Deed, at any time after the Land Council has received a Section 46 Statement the Exploration Company shall permit an auditor nominated by the Land Council and reasonably acceptable to the Exploration Company to inspect and audit and take extracts and copies from the books, accounts and financial records of the Exploration Company relating to the Project. The Exploration Company shall bear the costs of any such audit. The Exploration Company shall cooperate with the relevant auditor in all reasonable respects to enable the audit provided for herein to be carried out expeditiously. 32.6 Whether or not the Land Council approves of the grant of a Mining Interest or approves terms and conditions of a Mining Agreement, the Exploration Company shall, as they fall due or within a reasonable period thereafter, meet the reasonable costs incurred by the Land Council in connexion with the negotiations for, or in the preparation of, a Mining Agreement, including the costs of consulting

Aboriginals and of any consultants which the Land Council reasonably requires in order to properly consider and negotiate such an Agreement. 32.7 The Exploration Company further covenants that if - (a) for any reason whatsoever (including a change of any law or Force Majeuire) the Exploration Company is unable to perform all or any part of its obligations under this Article 32, or (b) a Mining Interest is granted to the Exploration Company over any part of the Original Deed Area contrary to any provision of this Article 32, then if the Land Council so elects by notice in writing served upon the Exploration Company at any time not later than thirty (30) days after receipt of notice in writing from the Exploration Company that it is so unable or that a Mining Interest has been so granted - (c) the Exploration Company shall forthwith upon receipt from the Land Council of the said notice of election both - (i) apply for a suspension of the need to comply with any conditions (whether statutory or otherwise but other than such conditions as may be excepted in the said notice) requiring the Exploration Company to undertake any Exploration, any Development or any recovery of minerals from any part of the Original Deed Area; and

(ii) suspend the Project and all of its other activities on the Original Deed Area undertaken for the purpose of Exploration, Development or the recovery of minerals from any part of the Original Deed Area (other than any activities which may be excepted in the said notice) and at least until - (A) the Land Council has approved the grant of a relevant Mining Interest; and (B) the Land Council has approved all of the terms and conditions of a relevant Mining Agreement and the Parties have entered such Agreement; and (iii) in the case where a Mining Interest has been so granted and if the said notice of election so requires, surrender that Mining Interest, following which the Exploration Company may apply for a new Mining Interest in accordance with the provisions of this Article 32. 32.8 The Exploration Company agrees that if a Mining Interest is granted to it over any part of the Consent Land contrary to any provision of this Article 32 then - (a) the Land Council may take proceedings in a court for injunctive relief and/or specific performance in order to give effect to the terms and conditions of this Article 32; (b) damages would not be an adequate remedy; and (c) the Exploration Company would not in any such proceedings require or seek any undertaking from the Land Council or any of the relevant Aboriginal Owners or from any person acting on behalf of relevant Aboriginals. 32.9 Any remedy exercised by the Land Council under this Article 32 shall be without prejudice to any other rights it may have under this Deed or at law or in equity (including the right to seek injunctive relief and specific performance). (emphasis mine) ARTICLE 2: INTERPRETATION AND OTHER MATTERS ... 2.13 If any court or other competent authority declares, or if any statute or regulation renders - (a) any part of Article 32 ineffective, void, voidable, illegal or unenforceable or if by reason of a declaration by any court or other competent authority or any statute or regulation this Deed would, if any part of Article 32 were not omitted from this Deed, be ineffective, void, voidable, illegal or unenforceable then either

 (i) (A) if neither the Land Council nor the Exploration
 Company exercises its election hereunder, that part shall,

without in any way affecting the effectiveness, validity, legality or enforceability of the remainder of this Deed,

be severable herefrom and this Deed shall be read and construed and take effect for all purposes as if that part were not contained herein, and (B) the Parties shall attempt to renegotiate, in good faith, that part; or (ii) if either the Land Council or the Exploration Company so elects by notice in writing served upon the other within thirty (30) days of the relevant declaration or the effective date of the relevant statute or regulation, the Exploration Company shall suspend the Project and all other activities on the Original Deed Area (other than any activities which may be excepted in the said notice) until the Parties have agreed upon a substitute part and - (A) following the service of a notice pursuant to this sub-paragraph (ii), the Parties shall enter bona fide negotiations for the purpose of attempting to agree upon a substitute part, (B) failing agreement, arbitration will not be available to any Party without the consent of both the Land Council and the Exploration Company, and (C) the electing Party shall not be liable to pay any damages to any other Party for any loss that other Party may suffer as a result of the electing Party electing to give notice under this sub-paragraph (ii); (b) any part other than is in Article 32 of this Deed ineffective, void, voidable, illegal or unenforceable or if by reason of a declaration by any court or other competent authority or any statute or regulation this Deed would, if any part hereof were not omitted herefrom, be ineffective, void, voidable, illegal or unenforceable then without in any

way affecting the effectiveness, validity legality or enforceability of the remainder of this Deed, that part shall be severable herefrom and this Deed shall be read and construed and take effect for all purposes as if that part were not contained herein and the Parties shall attempt to renegotiate, in good faith, that part."

Land Rights (Northern Territory Act 1976

Interpretation Act 1901

Land Rights (Northern Territory Act 1976

Interpretation Act 1901

Northern Territory v Northern Land Council [1992] NTSC 12; 81 NTR 1; 2 NTLR 8; 106 FLR 254

At a glance

Court

Decision date

Before

Source

Judgment (22 paragraphs)

Northern Territory v Northern Land Council [1992] NTSC 12; 81 NTR 1; 2 NTLR 8; 106 FLR 254 (11 March 1992)

Parties

Legislation Cited (6)

Cases Cited (13)