Native title year in review 2025-2026

What you need to know

• The Federal Court has ordered Fortescue to pay native title holders slightly more than $150 million compensation for the impact of the Solomon Hub Mine on their native title rights and interests (Yindjibarndi Ngurra Aboriginal Corporation RNTBC v State of Western Australia (No 2) [2026] FCA 585).
• While now the subject of appeal, the judgment at first instance has delivered a wealth of guidance on native title compensation issues, particularly relevant to mining and mining tenure.
• This is the third time a Court has calculated the dollar value of native title compensation (after the High Court's landmark Northern Territory v Griffiths [2019] HCA 7 (Timber Creek) decision in 2019 and the Federal Court's Davey on behalf of the Gudanji, Yanyuwa and Yanyuwa-Marra Peoples v Northern Territory of Australia (No 5) (McArthur River Project Compensation Claim) [2026] FCA 153 (McArthur River) decision earlier this year). This award dwarfs the $2.5 million awarded in Timber Creek and more than doubles the approximately $60 million award in McArthur River, in part due to the relative size of the compensation claim areas.
• The Court rejected the Claim Group's primary case for $800 million economic loss (based on a royalty-derived "exchange value" approach) and like in McArthur River, applied the freehold comparison approach endorsed in Timber Creek to value economic loss at $136,757. For the first time, the Court found that $217,152 compound interest was payable on the economic loss component of the award from the date of the compensable acts, given the Yindjibarndi People's clear evidence demonstrating how the funds would have been used and invested over time.
• The Court awarded $150 million compensation for cultural loss, significantly less than the Claim Group's claim for $1 billion. The Court applied the principles decided in Timber Creek and considered many of the same issues as McArthur River (which has not been appealed). 
• This is the first case to consider the compensation pass through in section 125A of the Mining Act 1978 (WA). The Court rejected Fortescue's argument about the constitutional invalidity of that provision and concluded that Fortescue is liable to pay the compensation. The Yindjibarndi advanced numerous other arguments relating to various components of economic loss and cultural loss, most of which were refused. As a result, the judgment considered and resolved a broad range of possible arguments, significantly enhancing its precedent value.

What you need to do

• Each of Yindjibarndi, the State and Fortescue has appealed aspects of the judgment to the Full Federal Court. 
• Maintain a watching brief of the appeal proceedings to understand its ramifications.

The compensation claim and the Solomon Hub Project

This judgment concerns a claim for compensation brought by the Yindjibarndi Ngurra Aboriginal Corporation RNTBC (YNAC), a registered native title body corporate for the Yindjibarndi People, under the Native Title Act 1993 (Cth) for the effects of 36 mining tenements the State of Western Australia granted to Fortescue companies in the Pilbara region. Those tenements facilitated the development of the Solomon Hub Project in 2012.

The Solomon Hub Project occupies approximately 135 km² of land within the Yindjibarndi People's native title determination area and includes four major open-pit mines. The infrastructure within the project includes conveyor belts, a railway connecting to Port Hedland, waste dumps, a tailings dam, a stockpile area, power infrastructure, and water pipelines. The mine has an expected operational life until 2045, but the company does not expect to complete rehabilitation and relinquish the land until 2100. Beyond the Solomon Hub itself, the total compensation claim area extends across approximately 563 km² of the native title determination area, including an additional 427 km² covered by exploration and prospecting licences not subject to active mining.

This claim was a test case for a number of issues relating to the assessment of native title compensation and who is responsible for paying it.

Preliminary issues relating to the interaction between the Native Title Act and WA Mining Act

The Court held that it must determine economic loss by reference to the freehold value of the land within the compensation claim area, with various allowances addressing how much the mining tenements diminished the native title rights and interests and for how long (having regard to the non-extinguishment principle and the exclusive or non-exclusive nature of the native title rights).

Justice Burley rejected the Claim Group's approach to economic loss and held that the "exchange value" case was not available, having regard to the reasoning in Timber Creek and the structure and terms of the Native Title Act.

Rejection of the "exchange value case"

The Yindjibarndi People's principal claim was that the economic value of the native title rights and interests lost or suppressed by the compensable acts should be calculated by reference to the negotiation or exchange value of those interests. They said that this should be calculated by reference to what miners in the Pilbara commonly agree to pay native title parties for their agreement to mining on their country pursuant to negotiations conducted under the right to negotiate provisions of the Native Title Act.

The Claim Group submitted that this should be assessed at 1% of the FOB revenue¹ from the Solomon Hub Project, relying on evidence that Pilbara iron ore agreements typically include royalty payments in the range of 0.5% to 0.6%. They doubled the proposed rate to 1% to reflect the Yindjibarndi People's exclusive native title rights over a substantial portion of the Solomon Hub Project.

The Court comprehensively rejected the "exchange value" approach because it was not supported by the correct application of section 51(1) of the Native Title Act or Timber Creek. The reasons included:

• The High Court in Timber Creek repeatedly emphasised that the objective economic value of native title rights and interests equates to the objective economic value of the freehold estate in land.
• The Yindjibarndi People's native title rights and interests do not include a right to the minerals, which have belonged to the State since 1899.
• Relying on right to negotiate agreements fixes attention on the benefit to the miner (or the State) from the grant of the future acts, rather than on the value of the native title rights and interests.
• The compensation for the suspension of native title rights and interests under this approach would "far exceed – by a multiplier of over 100,000 – the compensation for economic loss arising had there been a compulsory acquisition and extinguishment" of those rights.
• The approach would introduce a "complex and difficult metric" for compensation, contrary to the High Court's encouragement of simplicity in Timber Creek.
• Section 51(3) requires the Court to apply the WA Mining Act's principles for determining compensation, "whether or not on just terms". By section 123(1) of the WA Mining Act, compensation cannot be based on the value of any mineral or by reference to any rent, royalty or other amount assessed in respect of mining. 

The Court also held that, even if it wrongly rejected the exchange value case, the evidence did not establish it. Justice Burley said that "much is concealed in the seductive simplicity" of the Claim Group's submission that a standard Pilbara royalty rate exists.

Calculation of economic loss on established principles

The Court adopted a lot-by-lot approach to economic loss, assessing the freehold value of the land affected by each of the 36 tenements at its grant date, consistent with Timber Creek. His Honour made the following relevant findings:

• Discount for non-exclusive rights: Exclusive native title rights were equated to full freehold value, and non-exclusive rights to 50% of freehold value. The Court noted that in McArthur River, the Court adopted a 55% figure for non-exclusive rights because those holders had a right to share or exchange resources for commercial purposes but found that the same did not apply in this case. 
• Overlapping tenements: The Court avoided double compensation where tenements overlap because if a mining lease has already wholly suppressed native title rights over a parcel, an overlapping exploration licence causes no additional effect and warrants no further compensation. His Honour identified a hierarchy of impact: mining leases were most significant (wholly suppressing rights within the Solomon Hub area), followed by miscellaneous licences, exploration licences and then prospecting licences. The Court valued any parcel of overlapping land by reference to the tenement with the greatest impact.
• Discount for duration and degree of impairment where native title not extinguished: For land within the Solomon Hub Project, where the impact was most severe and the land would not be returned until as late as 2100, the Court applied only a 2% discount. Discounts of 80% and 90% applied for exploration licences and prospecting licences outside the Solomon Hub Project, reflecting the shorter duration and lesser impact on native title rights and interests. This alone is material, as no judgment has before considered the question of discounts as they might apply to different types of mining tenure. 

The Court rejected three other heads of claim for economic loss:

• loss of opportunity to secure commercial benefits through the right to negotiate under the Native Title Act;
• loss of or damage to country and to ancient occupation, cultural and Dreaming sites and Dreaming tracks; and
• estimated cost of psychological and other services required to treat the social disruption/division and related psychological trauma within the Yindjibarndi community.

The Court did not originally stipulate the final economic loss figure due to the complexity of the lot-by-lot calculations and directed the parties to confer and supply short minutes of order giving effect to the reasoning. The Court’s final orders made on 1 July 2026 fixed economic loss at $136,757.

Compound interest awarded for the first time

For the first time, the Court found that compound (not simple) interest was payable on the economic loss component of the award from the date of the compensable acts, in the sum of $217,152.

The Court found that Timber Creek had not settled the law on this point, and that the evidence demonstrated the Claim Group would have used the funds to the most beneficial effect open to them and would not simply have applied them to an interest-bearing account. Justice Burley was accordingly satisfied that they were entitled to compound interest on the economic loss compensation amount, calculated from the date of each of the future acts.

Assessment of compensation for cultural loss

Justice Burley assessed cultural loss at $150 million. This was vastly less than the $1 billion claimed by YNAC but substantially more than the $5–10 million proposed by the State or the $8 million proposed by Fortescue.

The Court assessed cultural loss by reference to the principles in Timber Creek, which required a "social judgment" of "what, in the Australian community, at this time, is an appropriate award for what has been done". The assessment involved "a complex balance of different factors" going to the Yindjibarndi People's spiritual relationship with their country and the harm the compensable acts caused.

In calculating the dollar figure, the Court began by discussing the relevance of Timber Creek and McArthur River because it would be unwise to ignore what courts have decided in relation to similar cases when forming a view as to an appropriate amount. However, Justice Burley agreed with Justice Banks-Smith in McArthur River that, while applying a rate per hectare provides a form of check on parameters, one must approach it with considerable caution. At best, prior cases provide a point of comparison that may provide some normative standard when quantifying cultural loss, but they cannot go further.

The following factors were considered in assessing cultural loss:

• The compensation claim area is not the only area where the Yindjibarndi People may exercise their traditional customs and gain spiritual nourishment: However, for the Yindjibarndi People, "harm to one part of their country is not easily cauterised". It is like "a limb of a body coming off, leaving the whole weakened and damaged". Further, although Yindjibarndi People no longer live within the compensation claim area, this only disconnected them from the land in physical terms, not in spiritual or cultural terms.
• Scale of physical disturbance: The Solomon Hub Project occupies 135.48 km² of the compensation claim area, with the total claim area extending to 563 km². Over 135 km² has been fenced off and secured from entry, including by the Yindjibarndi People. Four open-pit mines operate within this area. 
• The Court made only a very slight allowance for the non-extinguishment principle within the Solomon Hub Project: Although native title rights and interests have not been extinguished and will revive when the future acts cease, Justice Burley could not perceive that much would remain of the original landscape within the mine’s footprint. Within the Solomon Hub Project, the Court held that native title has been wholly suppressed for an unknown duration. Even with physical access restored, the effects on other rights and interests will be felt permanently.
• The Court made a significant allowance for the non-extinguishment principle outside the Solomon Hub Project: Justice Burley noted that the level of infrastructure pales in comparison to that of an open-cut mine and the land is likely to be returned to the Yindjibarndi People much earlier than the land within the area of the Solomon Hub Project.
• The claim area was largely untouched before the Solomon Hub Project: The loss of connection to country was made all the greater because, prior to the 2012 commencement of mining, the determination area was largely untouched other than pastoral leases and various exploration licences which did not materially affect the Yindjibarndi People's activities.
• Spiritual hurt caused by the physical impact of the mine: Justice Burley identified specific aspects of harm suffered within the Solomon Hub Project. These are: severing of connection to aspects of songlines that run through the land; destruction of substantial parts of cultural sites at creeks and other areas; destruction of numerous rock caves and shelters where the spirits of Yindjibarndi ancestors dwell; "salvage" of numerous sites which has severed the connection of artefacts and ceremonial objects from the land; reduced ability to receive songlines through dreams; spiritual displacement leading to spirits becoming antagonistic; removal and remote storage of artefacts without the Yindjibarndi People's approval; and disturbance of the amenity of important ceremony places.
• Destruction of culturally significant sites: More than 100 heritage sites have been destroyed, and many more severely compromised. The evidence supports the conclusion that the Yindjibarndi People regard these places as sacred as the homes of the spirits of their ancestors or of other spiritual and religious significance. 
• Impact on groundwater and groundwater-dependent ecosystems: The Court considered the impact of dewatering at the mine site on groundwater and groundwater-dependent ecosystems both within and outside the Solomon Hub Project. It was irrelevant that the native title determination did not confer exclusive rights in relation to water. Compensation was payable for the Yindjibarndi People's spiritual group harm arising from damage to the flow of groundwater into two creeks outside the mine site and harm caused to country arising from the reduction in water for vegetation. However, the impact of dewatering outside the mine footprint was somewhat lesser than the impacts within the mine site and did not factor significantly into the cultural loss assessment.
• Loss of spiritual connection: A consequence of the damage done by the Solomon Hub Project is the loss of spiritual connection to country. The land is now a "hostile environment to them". To the Yindjibarndi People, the loss of the land is "like the death of a child".
• Loss of rights and duties of ownership: Within the Solomon Hub Project, the Yindjibarndi People are precluded from accessing the land, teaching younger generations about country, managing, and reviving their country through sacred ritual, and fulfilling their role as custodians of the land. They experience "shame, loss, frustration and extreme hurt as a result of being unable to protect their country". They have lost the right and duty to be asked when strangers come onto the land, and the right and duty to ensure their safety.

The Court held that no compensation was payable for the social disruption between members of the Yindjibarndi community allegedly arising from the development of the Solomon Hub Project. This was because the Native Title Act does not allow the negotiation process to form part of the "future acts" in respect of which compensation may be claimed. Even if this was compensable, Justice Burley was not satisfied that Fortescue's conduct and the social division were sufficiently causally connected.

The Court also swiftly rejected the Yindjibarndi People's claim for a separate head of cultural loss founded on psychological harm caused by the social disruption from constructing and establishing mining infrastructure and conducting mining activities. The general consideration of cultural loss was sufficient to address this.

Key insights

After three major decisions there are common principles starting to emerge. Yindjibarndi is the first material precedent for major mining projects in Western Australia, and for iron ore projects in particular. It will start to significantly impact agreement-making in Western Australia and beyond. Despite the Court's caution about doing so, stakeholders will inevitably extrapolate from the amounts awarded in the two recent decisions to other projects, using the assessment criteria emerging from the 2026 cases. 

The Court in Yindjibarndi made very few references to the McArthur River decision but reasoned very similarly on both economic and cultural loss. Both judgments confirm that the Timber Creek freehold value methodology remains the applicable approach for assessing economic loss. Neither Court accepted royalty-based calculations. We now have a rough formula, of sorts, for calculating economic loss and determining the various discounts that apply in particular circumstances.

Although the award for cultural loss was far greater in Yindjibarndi than McArthur River, there was an important distinguishing feature. In Yindjibarndi, approximately 70% of the land within the Solomon Hub Project was subject to exclusive native title rights, whereas McArthur River involved only non-exclusive rights. Although the Solomon Hub Project footprint was comparable to the McArthur River principal mine and port area, the total Yindjibarndi compensation claim area was substantially larger.

Whether the Court in Yindjibarndi placed greater weight on the impact on archaeological and cultural sites than the Court in McArthur River gave to the disturbance of Dreaming sites and routes is unclear. What is clear from both decisions, however, is that the courts will consider how cultural heritage protection and management practices are conducted when assessing cultural loss, notwithstanding that parties have complied with relevant State and Territory legislation.

How the Solomon Hub Project affected groundwater both within and outside the mine site was a significant aspect of the case and the first time a court has considered this issue in the context of a native title compensation claim. Whether the findings can be extrapolated to allow a separate group of Native Title Holders to claim compensation for impacts outside a determination area, or indeed whether a "future act" can also have an impact in this manner, remains to be seen. 

The Court awarded compound interest on economic loss for the first time. Timber Creek had left this possibility open where the evidence supported it. That the Yindjibarndi People were able to demonstrate their corporate structure, investment strategy, and successful business activities satisfied this threshold was no surprise. Although the compound interest amount of $217,152 was not large in this case (because the compensable acts were relatively recent and the economic loss award was relatively low), compound interest could be significantly larger in other cases where there is a long time between the compensable acts and the compensation award and/or where the freehold values are much higher.

The Court's decision on the constitutional validity of the pass-through provision in section 125A of the WA Mining Act may not be the last word on this issue. In the meantime, WA and NSW remain the only States to legislatively pass on future act compensation to proponents.

Each of Yindjibarndi, the State and Fortescue has appealed aspects of the judgment to the Full Federal Court. 

Want to know more?

• $54M for cultural loss in McArthur River Mine native title compensation claim (30 October 2026)
• Glacial progress of developments in native title compensation (9 September 2025)
• Native Title Year in Review 2024-2025 (9 September 2025)

Authors: Andrew Gay, Partner; Leonie Flynn, Expertise Counsel and Cheyne Jansen, Counsel.