Landmark Timber Creek ruling could cost miners, government billions

A landmark ruling in the Federal Court has heralded Australia’s first successfully litigated native title compensation case.

In the decision relating to a compensation claim at Timber Creek, about 350km south of Darwin in the Northern Territory, Judge John Mansfield found that traditional owners were entitled to compensation for lost native title rights equivalent to about five times the freehold value of just 23sq km of their land.

The decision is expected to spark a wave of other compensation claims and a bill for state governments and mining companies that could run into billions.

Lawyers working for mining companies are also closely examining the decision to see what ramifications it has over their tenements which cover vast slabs of Indigenous land right across the continent.

Judge Mansfield awarded the native title holders about $3.3 million – $512,000 for economic loss, $1.5m for interest on that loss and $1.3m for loss caused by traditional owners’ attachment to their country.

Tony Denholder, a partner with Ashurst lawyers, told the Australian Financial Review the ruling would have significant ramifications, given it was in effect the first time a court had assessed native title compensation.

“The focus to date has been on freehold value,” he said. “This judgment exceeds freehold value by a significant multiple.”

Mr Denholder said the Timber Creek judgment could set the terms of other claims. He said compensation would likely be higher where exclusive native title rights had to be extinguished and in coastal areas where land values were higher.

“We’re not talking millions (any more) … I think it’s safe to say the compensation bill nationally will exceed $1 billion,” he said.

Another specialist lawyer, who did not want to be named, said it was a case of Native Title “working its way through the system”.

It’s been 20 years since the Native Title Act was passed by the Keating Government and cases to determine compensation for the extinguishment of native title are only just starting to come before the courts.

The Australian reported that Indigenous groups at Timber Creek applied for compensation of between $4.7 million and $22 million, while the Commonwealth valued compensation at $1.4 million.

But Justice Mansfield ruled $3.3 million was “just” compensation to cover the loss of Aboriginal common law property rights.

Under the Native Title Act, State and territory governments are liable for all compensation claims, but after this recent decision may well be looking to pass on this impost onto mining companies and others who make considerable profits from Aboriginal-owned land.


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