Native title, s 51(xxxi) and conceptual carve-outs: why ‘inherent defeasibility’ is inherently unworkable
This post is part of a series of commentaries presented at the Gilbert + Tobin Centre of Public Law seminar on ‘Native Title and the Constitution: Past and Future Prospects’.
31.10.2024
Like the other contributors to this series, I had the privilege of travelling to Darwin to attend the High Court hearings for Commonwealth v Yunupingu (D5/2023) on August 7th, 8th and 9th. This post offers a set of reflections based on attending those hearings. My focus is on the second ground of the appeal: namely, whether native title rights fall outside the scope of s 51(xxxi) because they are ‘inherently defeasible’. This issue consumed most of the parties’ time and attention in argument over these three days, and my instinct is that the appeal is likely to be determined on this basis.
Background: the place of categories of exemption in s 51(xxxi) jurisprudence
In order to understand the arguments about the ‘inherent defeasibility’ issue it will be helpful to begin by saying a few general things about s 51(xxxi) jurisprudence and the place of categories of exemption within that jurisprudence. (For a more comprehensive discussion, see my publications here and here.)
The High Court’s overall approach to s 51(xxxi) has the following three features:
1. First, the Court relies on characterisation analysis, meaning that the focus is on legal character and issues concerning values and reasonable limitations are downplayed.
2. Second, the Court uses a ‘definitional’ approach, meaning that everything turns on characterisation: there is no threshold finding that triggers limitations analysis; if there is an acquisition of property, then compensation is required.
These first two features distinguish s 51(xxxi) jurisprudence from other constitutional guarantees. In other areas:
the Court is more explicit about the relevant values at stake (ie, the reasons why a given interest is afforded constitutional protection); and
the Court articulates reasonable limitations through some form of limitations analysis (whether structured proportionality or some variation of ‘reasonably appropriate and adapted’), which considers legitimate means, ends and means-end fit.
3. Third, and finally, the Court defines ‘property’ and ‘acquisition’ extremely broadly as encompassing effectively any interest in a thing — tangible or intangible, whether or not strictly proprietary in character — that has value, and defines ‘on just terms’ extremely narrowly, as market-based compensation.
Cumulatively, these three features of s 51(xxxi) jurisprudence create a problem: namely, the range of laws that potentially require the Commonwealth to pay compensation is extremely wide.
As a result, the Court has necessarily had to find ways to limit the scope of this liability.
The main way that the Court has done this is to define categories of exemption: types of laws that appear to effect an acquisition of property but do not require compensation because of some disqualifying feature.
The ‘inherently defeasible’ or ‘inherently susceptible to variation’ category (‘ID/ISV category’), at issue in this case, is one such conceptual carve-out.
What is ‘inherent defeasibility’ or ‘inherent susceptibility to variation’?
The Court has never clearly articulated the rationale for this category, but there are several examples of the types of interests that have been found to be ID/ISV that provide some clues. These include:
a right to sue under workers’ compensation legislation (Attorney-General (NT) v Chaffey (2007) 231 CLR 651);
an entitlement to Medicare benefit payments (Health Insurance Commission v Peverill (1994) 179 CLR 226);
licenses to take or explore for natural resources under a regulatory regime (Commonwealth v WMC Resources Ltd (1998) 194 CLR 1, ICM Agriculture Pty Ltd v Commonwealth (2009) 240 CLR 140 – although cautiously applied); and
parliamentary ‘perks’ (Cunningham v Commonwealth (2016) 259 CLR 536).
What these interests have in common is that they are creatures of statute, often in a regulatory setting, that are amenable to change from time to time.
Application to native title: observations from the hearings
So, why think that native title falls within the ID/ISV category?
The Commonwealth’s argument rests on the vulnerability of native title to extinguishment. At common law, when the Crown grants a property interest in land, there is a presumption against inconsistent grants: subsequent grants do not derogate from earlier grants. However, because native title does not have its source in Crown grants (as it is not a common law property right), no such presumption applies to Crown grants that affect native title rights: inconsistent grants extinguish native title (see, Mabo v Queensland (No 2) (1992) 175 CLR 1 at [74] (Brennan J)). For this reason, the Court has sometimes described native title as ‘inherently fragile’ (see, eg, Western Australia v Ward (2002) 213 CLR 1 at [91] (joint judgment)). And you might think, well, ‘inherent fragility’ sounds a lot like ‘inherent defeasibility’.
(As an aside: it was striking in this regard that all of the Respondent parties’ written submissions on this issue accepted the Commonwealth’s framing of the category purely in terms of ‘defeasibility’ rather than ‘susceptibility to variation’. During argument, the two phrases were used interchangeably. But it isn’t obvious that these terms mean the same thing, and the ‘defeasibility’ framing at least arguably gives the Commonwealth the upper hand.)
Now, the important thing to see here is that characterisation analysis is what makes the Commonwealth’s argument from ‘fragility’ to ‘defeasibility’ possible. That is because the analytical focus is on metaphysical characteristics (ie, legal ontology) and not on constitutional values.
I have always argued that this approach is unhelpful and misleading because it suppresses values-based considerations that are inevitably in play and, indeed, that are appropriate for the analysis of a constitutional guarantee.
For example, ideas about legitimate expectations, public interest, and the social distribution of benefits and burdens seem to underpin the ID/ISV category. The better approach, in my view, would be to back off of the metaphysics and openly acknowledge and examine these kinds of values-based considerations.
Evaluation: three takes on ‘defeasibility’
Turning back to Yunupingu: my overall take-away from the hearings is that the application of the ID/ISV category to native title rights is, in effect, a kind of reductio ad absurdum of that category and exposes deficiencies of the Court’s overall approach to s 51(xxxi).
Over the course of the hearings, three different views emerged about the application of the ID/ISV category, none of which was satisfying.
1. Defeasibility take one: source of the interest (statutory vs non-statutory)
The first approach focussed on the source of the interest: whether or not an interest is a creature of statute. This was the main point of emphasis in all of the written submissions for the Aboriginal parties on the Respondent side, but it fell over in argument.
The trouble is that once it is accepted (as it must be) that not all statutory rights are ID/ISV, then there is pressure to explain what, exactly, the disqualifying feature is. But once you’ve answered that question, then the next logical question to ask is: ‘aren’t some non-statutory rights like that, too?’
More broadly, the difficulty with this kind of argument is that general law rights do not exist in a vacuum, isolated from statute law. The complex interaction between the general law and statute law in the common law world means that there is a sense in which all general law rights are ‘defeasible’ or ‘susceptible to variation’ by statute. This is so even accounting for rights-protective interpretive presumptions, such as the principle of legality.
McHugh J makes this kind of point in dissent in Georgiadis v Australian & Overseas Telecommunications Corp (1994) 179 CLR 297 (at 325-328), where he draws attention to this interaction between general law and statute law. That case concerned the statutory extinguishment of a general law cause of action analogous to the statutory cause of action in Chaffey, but a majority of the Court reached the opposite conclusion. Roughly, the point McHugh J makes is that the Commonwealth is immune to lawsuit only in the absence of a statute that provides otherwise, so it doesn't really make sense to say that the right to sue is purely a function of general law.
Unsurprisingly, then, this work-around quickly proved unworkable. This led to a shift toward emphasis on the character of the interest itself.
2. Defeasibility take two: the character of the interest itself (metaphysical properties)
Emphasis on the character of the interest itself as the central determinant of ‘defeasibility’ emerged most strongly in the arguments from the First Respondent. In particular, the First Respondent emphasised the enduring, and even temporally transcendent, intergenerational character of native title interests as a form of spiritual connection between people and land.
This, too, ultimately appeared to be unworkable both conceptually and practically. Conceptually speaking, the central point being made is about values and ways of valuing. Through the reductive lens of characterisation analysis, however, the focal point is metaphysical: facts about the existence of tangible, quantifiable relationships between persons and things from time to time. Moreover, even if it made sense to approach issues concerning the character of native title interests as a purely ontological question, this would leave open the possibility that some native title interests might be inherently defeasible. Given this possibility, such an approach would seem to require extensive fact-finding, substantially increasing the cost of litigation (a familiar complaint about the native title determination process), and thus also raises practical concerns.
These difficulties led to a third and final iteration, which was to focus on the status of the interest within the common law.
3. Defeasibility take three: status of the interest within the common law (recognition, remedies and relativity)
This third and final take on defeasibility focused on the idea of ‘recognition’ by the common law: including the remedies that recognition attracts, as well as notions of relativity. This appeals to an underlying idea — implicit throughout much of the argument, and seemingly accepted by all parties (although articulated in different ways) — that the status of a given interest within the common law ought to somehow ‘map on’ to the scope of s 51(xxxi).
However, it is unclear why this should be so. As observed at the outset, ‘property’ for s 51(xxxi) purposes is extremely broad: encompassing interests that are not proprietary (eg, choses in action) and that generally do not attract proprietary remedies (eg, licences). Moreover, and more importantly, this appeal to status is fundamentally indeterminate: it ultimately turns on what is made of ‘recognition’. But what one makes of ‘recognition’ is an irreducibly normative question that defies characterisation-type reasoning. It is a question about constitutional values, not about metaphysics.
And this impasse, I think, is where things finally landed on the end of the third day.
On the one hand, the argument from the final set of Respondents was effectively a suggestion that the Court retreat from the ID/ISV category, emphasising the idea of ‘recognition’ as conferral of a common law remedy and ‘extinguishment’ as the loss of that remedy that confers a corresponding benefit on the Commonwealth. If this is correct, then all extinguishment of native title is an acquisition of property for the purposes of s 51(xxxi).
On the other hand, in reply, the Commonwealth emphasised native title’s vulnerability to extinguishment as an aspect of recognition by the common law. If this is correct, then the extinguishment of native title would never be an acquisition of property for the purposes of s 51(xxxi). In other words, native title would be categorically excluded from the category of constitutionally protected ‘property’.
The latter position strikes me as highly problematic and untenable both as a matter of law and as a matter of political morality. On a personal note, this more limited understanding of recognition advanced by the Commonwealth — and the repeated emphasis on the ‘fragility’ of native title and its susceptibility to extinguishment as a reason why it shouldn’t receive constitutional protection — was an extremely uncomfortable aspect of the hearing for me. The pain it must have caused for the First Nations people in the courtroom was tangible: a blind spot of the common law qua settler-colonial legal order rendered visible for all to bear witness. As if to answer this call, there was an eerie moment toward the very end of the third day where the hearing was interrupted by an apparent power surge, with a bright flash of light. I know it all sounds a bit ‘woo-woo’, but it really felt like a signal.
Conclusion: ‘on just terms’
In summary, the parties’ submissions in Yunupingu, on both sides, drew attention to the untenability of the ID/ISV category, as well as to the wider difficulties with the Court’s overall approach to s 51(xxxi), in a particularly acute way.
The resulting all-or-nothing stand-off between the Commonwealth and the Aboriginal parties highlights why a different approach to s 51(xxxi) is urgently needed: an approach that would bring s 51(xxxi) jurisprudence in line with the High Court’s approach to other constitutional guarantees. One possibility, which Rosalind Dixon and I argue in favour of in our Before the High Court Column (and which I have considered in greater length, here) is to revisit the ‘on just terms’ requirement and give it a broader and more flexible interpretation. This would reduce, if not absolve, the need to rely on implausible and unsustainable conceptual carve-outs — such as the ID/ISV category — to address concerns about the potentially unlimited scope of the Commonwealth’s obligation to pay fair market compensation for any and all laws that otherwise appear to result in an acquisition of property.
Lael K Weis is an Associate Professor at Melbourne Law School.
Suggested citation: Lael K Weis, ‘Native title, s 51(xxxi) and conceptual carve-outs: why “inherent defeasibility” is inherently unworkable’ (31 October 2024) <https://www.auspublaw.org/blog/2024/10/native-title-s-51xxxi-and-conceptual-carve-outs>