The Commonwealth has lodged a special leave application in the High Court to challenge a landmark Federal Court ruling about millions of dollars in compensation over a mining lease on the Gove Peninsula. 

Note to Aboriginal and Torres Strait Islander readers: Yunupingu's last name and image are used here in accordance with the wishes of his family.

In May, the late Gumatj clan leader Yunupingu won a historic legal battle when the full Federal Court found the Commonwealth had acquired land for a mine without the consent of landowners.

The decision was handed down less than a week after the Aboriginal land rights champion was farewelled at a public memorial attended by Prime Minister Anthony Albanese.

Yunupingu was seeking up to $700 million in compensation from the Commonwealth on behalf of his people, the Gumatj clan, over the acquisition of land on the Gove Peninsula in north-east Arnhem Land in 1969.

He argued the Commonwealth failed to act "on just terms", as required by the constitution, when it acquired land and leased it to Swiss mining company Nabalco in the early 1960s.

The lease was taken over by Rio Tinto in 2007.

While the Federal Court found that the Commonwealth was liable for compensation, it is yet to determine whether the Gumatj clan, or another group, was entitled to native title.

'Failed to address central plank of case'

The Federal Court battle was the first time the court had been asked to determine whether the Commonwealth's actions in acquiring land without recognising native title were invalid.

It was hailed as a case that could "break new legal ground" when it was first brought forward in 2019.

The Commonwealth argued it had the right to take property from Territorians without having to pay fair compensation, and that it did not have to provide just terms for an acquisition of land in the Northern Territory.

Lawyers also said that if the court rejected the Commonwealth's argument, it could "potentially invalidate every grant of freehold or leasehold title in the Northern Territory since 1911", exposing the Commonwealth to a slew of new native title compensation claims.

"On the full court's reasoning, that situation has largely come to pass," lawyers acting on behalf of the Commonwealth stated in their application for special leave to appeal, lodged on Monday.

In its appeal submission, the Commonwealth states it was not bound by the just terms requirement under the constitution between 1911 and 1978 — the year the NT was granted self-government.

It argues that if the Federal Court found that any granting of land by the Commonwealth in this period of time was invalid, it must also be the case for public infrastructure.

Case raises 'very significant issues'

Federal Attorney-General Mark Dreyfus said it was appropriate the case's issues be settled by the High Court so "parties to this and future matters have clarity and certainty about the law in this area".

"I recognise the significant contribution that Yunupingu has made to First Nations land rights in Australia. Initiating this landmark case was one of many actions he took to build a better future for his people," he said.

"This case raises important legal issues including very significant constitutional issues that go beyond the native title context.

"The application of these constitutional issues in the context of native title compensation is new and the Federal Court decision represents the first time these issues have been judicially determined in that context."

Yunupingu first announced his intention to lodge a native title compensation claim at the 2019 Garma Festival, condemning mining companies for "destroying" dreaming sites.

"They have damaged our country, without seeking advice from us, and they have damaged a whole lot of dreamings, and dreamings that were important to Aboriginal people in land claims and land rights," he said.

The High Court will now decide if it will consider the Commonwealth's appeal.