5.1.1  Risk allocation

(a)  Government will be responsible for dealing with any application or claim made under any Law relating to native title and for payment of compensation to native title holders (and in respect of which, it will compensate the private party).

(b)  It is generally both more effective and less costly for government to assume the greater part of native title risk.  This is because native title potentially subsists only over Crown Land, and the government is ordinarily better able than the private party to nominate and communicate with indigenous representatives for the purpose of meeting notification and consultation requirements under the Commonwealth Native Title Act 1993 and relevant State and Territory Aboriginal Land Rightslegislation.15

(c)  If there is a native title application, the private party must continue to perform its obligations under the project agreement, except to the extent prevented by the native title application (such as a government direction, legal requirement or court or tribunal order to suspend execution of the works or Contracted Services) and subject to any Relief and Compensation referred to in paragraph (d), and provide all reasonable assistance in connection with dealing with such an application.

(d)  The private party will not have any claim against government for loss or damage suffered as a result of any native title application.  However, the private party will be entitled to Relief and Compensation where delays arise or additional costs are incurred (by the private party) as a result of any government, court or tribunal direction to suspend or cease all or any part of the works or services because of a native title claim or application.

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15  It should be noted that where land title rights exist under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cwlth), the Northern Territory government has no right of compulsory acquisition (unlike Commonwealth authorities) and is therefore in no more an advantageous position than the private sector. On this basis, the Northern Territory government could expect the private sector to accept this risk.  A further issue is Aboriginal sacred sites, in respect of which the Northern Territory government has historically expected the private sector to accept land title risk, again on the basis that that the Northern Territory government is in no more advantageous a position than the private sector and the private sector is better placed to manage such issues as part of the project/site development.