The High Court of Australia has shaken up the native title landscape with an important decision on the Commonwealth’s liability for acts which extinguished native title in Commonwealth of Australia v Yunupingu [2025] HCA 6 (12 March 2025).
Until now, the prevailing view was that compensation was only payable under the Native Title Act 1993 (Cth) (NTA) for acts which occurred after the commencement of the Racial Discrimination Act 1975 (Cth). This case exposes the Commonwealth to liability for compensation for acts done much earlier than 1975, potentially as far back as Federation in 1901.
First, a refresher on ‘past acts’
To understand the significance of Commonwealth v Yunupingu, it’s useful to revisit some native title basics.
I often start my ‘Native Title 101’ training sessions by explaining that when the Native Title Act commenced on 1 January 1994, it marked the government drawing a line in the sand. It said that from 1 January 1994 onwards (1 July 1993 onwards for any legislative acts), any act which affects native title, such as the grant of a mining lease, must be done in accordance with the NTA. These are called ‘future acts’.
This was the line in the sand, looking towards the future.
But the NTA also looked backwards. It also validated past acts, done prior to the NTA. By ‘validate’ we essentially mean ‘make lawful and effective against native title’. So, acts which had extinguished or impaired native title rights and interests in the past were deemed to be valid and effective. To balance this, the NTA says that compensation is payable to native title holders for validated past acts.
However, compensation is not payable under the NTA for acts which are already valid – only those which took their validation from the NTA. This is where the Racial Discrimination Act comes in. On the commencement of that Act, it became unlawful to discriminate against Aboriginal and Torres Strait Islander people on the basis of race.
So, it was clear that after 1975, an act such as the grant of a mining lease was ‘invalid’ insofar as it affected native title, because this offended the Racial Discrimination Act. The NTA’s past act regime validated the grant and imposed a compensation liability on the Commonwealth, State or Territory responsible for it. However, it was not clear that acts done prior to the Racial Discrimination Act needed to be validated, because it was not thought they were invalid.
The important question at the heart of Commonwealth v Yunupingu is whether acts done prior to 1975 were invalid because of the guarantee under the Australian Constitution that property cannot be acquired except on ‘just terms’. If these acts were invalid, then they could be validated by the NTA and compensation would be payable.
Background to the Gumatj Clan’s claim
The Gumatj Clan or Estate Group of the Yolngu People (the Gumatj Clan) have made a claim for a determination that they hold native title in an area of the Gove Peninsula in the Northern Territory, and a claim for compensation for past acts including appropriations to the Commonwealth and grants to third parties of interests in land.
The High Court’s decision is on a ‘separate question’ in that claim: i.e. a legal question that must be resolved before the claim can proceed. The Full Court of the Federal Court found in favour of the Gumatj Clan in 2023, and the Commonwealth appealed the decision to the High Court.
The other piece of the puzzle is that the Northern Territory did not gain self-government until 1978, so the reason why the Commonwealth is the appellant is because the laws in question were made by the Commonwealth, pursuant to s 122 of the Australian Constitution. Section 122 is known as the ‘Territories power’ and allows the Commonwealth to ‘make laws for the government of any territory’.
The Constitutional questions
The Gumatj Clan’s arguments were that certain acts were invalid under the Australian Constitution. In particular, they argued:
- The Commonwealth’s ‘Territories power’ does not extend to making laws which breach the requirement in s 51(xxxi) of the Constitution that any acquisition of property must only be done on ‘just terms’; and
- The appropriation or grant of an interest in land which was inconsistent with native title rights and interests was a law with respect to the acquisition of property, which was not done on ‘just terms’.
Is the Territories power subject to the ‘just terms’ requirement?
The Constitutional arguments are complex and go to the construction of the Constitution, but the crux of the Commonwealth’s argument was that a law that is supported only by s 122 (the Territories power) is not subject to s 51(xxxi) (the requirement that acquisition of property must be on just terms).
The High Court roundly rejected this argument, with the majority saying:
‘The time has come for it to be finally and authoritatively declared that the power conferred on the Commonwealth Parliament by s 122 of the Constitution to make laws for the government of a territory does not extend to making a law with respect to an acquisition of property otherwise than on just terms within the meaning of s 51(xxxi) of the Constitution.’
Was the extinguishment of native title an acquisition of property under s 51(xxxi)?
The Commonwealth argued that the extinguishment of native title rights and interests was not an acquisition of property under s 51(xxxi) of the Constitution because it did not involve the ‘taking’ of property. It relied on statements in previous cases that native title was inherently susceptible to a valid exercise of the Crown’s sovereign power and that native title is ‘inherently fragile’.
Again, this was rejected by the High Court.
The High Court found that native title rights and interests do constitute ‘property’ for the purposes of s 51(xxxi). In His Honour’s separate judgement, Edelman J noted that that ‘property in s 51(xxxi) has the widest of connotations’.
The High Court found that the common law rule of recognition of native title rights and interests is an absolute rule, in that the rights are recognised, but if there is a subsequent lawful exercise of power which is inconsistent with native title, this will have the effect of withdrawal of recognition (i.e. ‘extinguishment’). A grant or act which extinguishes native title rights and interests is the ‘taking’ of rights, and can amount to the acquisition of property within the meaning in s 51(xxxi).
The High Court rejected the argument that native title rights and interests are inherently defeasible at common law. The Court noted that s 51(xxxi) is a ‘constitutional guarantee’ and ‘a very great constitutional safeguard’.
Implications of the decision
This is a significant decision for native title holders and for the Commonwealth. For native title holders in the Northern Territory and other Commonwealth territories, it opens up the possibility of making claims for compensation for acts done much earlier than previously thought, possibly as early as Federation.
In its submissions, the Commonwealth said that the liability to pay compensation for extinguishment of native title rights and interests pursuant to an indeterminate number of grants of interests in land in the Northern Territory would have ‘enormous financial ramifications’ for the Commonwealth.
The case does not have any immediate implications for other States or for proponent parties. The ‘past act’ compensation provisions in the NTA make the government liable for compensation, depending on which government the act is attributable to. Notably, in Queensland, there is no ‘just terms’ guarantee under the Queensland Constitution.
There is a still a long way to go for the Gumatj Clan. This case considered only the legal questions. From here, the case will go back to the Federal Court for consideration of the Gumatj Clan’s claim for a determination that they hold native title and if they do, the amount of compensation for any past acts.