FEDERAL COURT OF AUSTRALIA

Weribone on behalf of the Mandandanji People v State of Queensland (No 4) [2013] FCA 758

THE COURT ORDERS THAT:

1.    Orders 2 to 10 made on 15 March 2013 be discharged.

2.    The papers in these proceedings be referred to the Registrar to investigate whether any proceedings for contempt should be brought with respect to any failure to comply with orders 2-10 made on 15 March 2013.

3.    Mandandanji Ltd, Mandandanji Enterprises Pty Ltd and Mandandanji Cultural Heritage Services Pty Ltd be released from further compliance with their respective undertakings given on 5 July 2013.

4.    The proceedings be referred to the Deputy Registrar for case management conference at a time to be appointed by the Deputy Registrar.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(REVISED FROM THE TRANSCRIPT)

1    On 1 March 2013, I dismissed two competing applications for the replacement of the dysfunctional applicant in these proceedings. For the reasons I gave at that time Weribone on behalf of the Mandandanji People v State of Queensland [2013] FCA 255, and later in Weribone on behalf of the Mandandanji People v State of Queensland (No 2) [2013] FCA 485, I made orders that sought to control the use and application of moneys and benefits derived by or through the then dysfunctional applicant by virtue of its status in order to protect them for the benefit of the persons ultimately found to be native title holders.

2    On 15 March 2013, I remade the orders of 1 March 2013 with some minor amendments. The orders that are relevant to this application are orders 2-10 made on 15 March 2013 (the 15 March 2013 orders).

3    Following an authorisation meeting that was held in Roma on 25 May 2013, I appointed a replacement applicant that was representative of the whole of the disparate interests within the claim group: Weribone on behalf of the Mandandanji People v State of Queensland (No 3) [2013] FCA 662.

4    The new applicant has now had access to the various agreements made by its predecessor and three companies that were constituted by its predecessor, being Mandandanji Limited, Mandandanji Enterprises Pty Limited and Mandandanji Cultural Heritage Services Pty Limited (the Mandandanji companies), as well as the benefit of an independent accounting report prepared by Robert Buker and Paul Green of Vincents Chartered Accountants. That report reviewed, without auditing, the financial statements of the Mandandanji companies. The accounting report identified some matters of concern that the Mandandanji companies’ accountant generally answered in a manner that Mr Buker and Mr Green considered not unreasonable although general in nature.

5    The new applicant, the Commonwealth and the Mandandanji companies sought an order discharging the 15 March 2013 orders. No party opposed that application. Its basis was that the new applicant was properly authorised and representative of the claim group which had voted (with a significant minority) on and rejected the inclusion of Dolly Clark as an apical ancestor at the 25 May 2013 meeting before unanimously approving the new applicant as a replacement applicant: Weribone (No 3) [2013] FCA 662 at [10]-[13].

6    The new applicant contended that the protective purpose of the 15 March 2013 orders, while appropriate when there was no replacement applicant capable of representing the claim group effectively, are no longer necessary because the circumstances have now changed. It noted that it has now been able to examine the agreements and accounting material affecting the claim group’s interests and can now deal effectively with issues that may concern the various constituents of the claim group.

Consideration

7    Notably, on 1 March 2013, I dismissed the Binge applicant’s interlocutory application to be made the replacement applicant. The Binge applicant had sought the inclusion of Dolly Clark as an apical ancestor in the description of the claim group. Subsequently, the meeting of 25 May 2013 refused to recognise Dolly Clark as an apical ancestor of the native title claim group for the whole area the subject of the application for a determination of native title. No attempt has been made by persons seeking to claim through Dolly Clark to be joined as respondents or to oppose the recent application under s 66B of the Act that resulted in the new applicant replacing its dysfunctional predecessor.

8    I am satisfied, in all the circumstances, and by the new applicant’s submissions, that the 15 March 2013 orders should now be discharged. However, there are two concerns that the evidence reveals that should be addressed.

The board meeting costs

9    As I raised with the legal representatives of the parties, I am concerned about the expenditure of the sum of $309,000 for the current 12 months as board meeting costs, as well as a total expense for those costs of $733,000 for the three year period, revealed in the report of Mr Buker and Mr Green. The explanation offered by the Mandandanji companies’ accountant to Mr Buker and Mr Green was:

“Expenses incurred to hold meetings including but not limited to travel, meal and accommodation and venue hire, as well as expenses incurred to hold meetings with various resource companies regarding compensation. Meetings held with resource companies are reimbursed.”

10    It may be that the total sum or a significant part of it has been, in some way, reimbursed, but it is not clear from the explanation as to how that could happen, or why the holding of board meetings should be as expensive as that.

11    Given that the corpus administered by Mandandanji Limited, as trustee, was in the order of $3.7 million, those board meeting costs are very significant and require some consideration. The new applicant has every reason to inquire into why those costs were so significant and, if appropriate, to take proceedings for repayment of any of those expenditures that may have been improperly incurred. It is difficult to see the basis on which the charitable trust could have spent over $300,000 on board meetings in a year, where its corpus was only about 10 to 12 times that sum, in proper discharge of its functions. However, I have not heard from the parties, and in particular the Mandandanji companies, as to what reasons may have existed for this apparently disproportionate expenditure on board meetings.

Possible contempt of Court

12    I was also concerned by developments that had been put in evidence before me on previous occasions as to non-compliance with the orders made on 1 and 15 March 2013. Those non-compliances related to the requirement, under order 2 made on 15 March 2013, for payment of moneys to the registrar and the obligation of persons, in particular, who had been those comprising the applicant, under order 8, to give an account of any benefits they had received in virtue of being connected to the making of the native title claim in these proceedings.

13    One example that gave rise to this concern is the Indigenous Land Use Agreement between QGC Pty Limited and the previous applicant, who contracted “in their capacity as registered native title claimant for the Mandandanji People’s native title claim” (the QGC ILUA). The QGC ILUA was registered with the Native Title Tribunal on 12 May 2011. Clause 1.1 of annexure 3 to the QGC ILUA provided:

“The parties agree to establish the nominated entity [which became Mandandanji Limited] to be used for the purposes of holding the Financial Benefits provided under this Agreement for the Mandandanji People.” (emphasis added)

14    Another example is the agreement that Santos Limited entered into with Mandandanji Cultural Heritage Services Pty Limited that appears to have come into effect at some time prior to 24 August 2011. On the latter date a variation was made under which Mandandanji Cultural Heritage Services agreed to perform cultural heritage work that entitled nominated cultural heritage officers to remuneration and Mandandanji Cultural Heritage Services to receive an overhead percentage.

15    Both of those agreements involve the payment of very significant amounts of money to persons that appear to arise directly because of their connection to the applicant in these proceedings and fall within the 15 March 2013 orders. No money at all was paid to the registrar under the 15 March 2013 orders. It will be a matter for the registrar to consider whether any monies payable under them, in fact, were caught by the 15 March 2013 orders.

Conclusion

16    For these reasons, it seems to me that the 15 March 2013 orders have served their purpose of being protective of the interests of the claim group, albeit that, in the sense I have already described, they do not appear to have been obeyed.

17    Accordingly, I should now order that orders 2-10 made on 15 March 2013 be discharged. I will also order that the papers in these proceedings be referred to the registrar to investigate whether any proceedings for contempt should be brought with respect to lack of compliance with orders 2-10 made on 15 March 2013. That question can be dealt with by the registrar and another judge if and when it arises.

Associate:

Dated:    1 August 2013

SCHEDULE

QUD 366 OF 2008

BETWEEN:

LESLIE WERIBONE, WAYNE WERIBONE, VINCENT ANDERSON, TRACY LANDERS, THERESA MANNS, RODNEY LANDERS, NEVILLE MUNN, LEIGH HIMSTEDT, ALEXANDRA COMBARNGO, JUDE SALDANHA, MAX MCDONALD AND ALEX COSTA

Applicant

AND: