The Indigenous owners of the world's largest sand island are frustrated by delays in their court case with the Queensland Government for compensation.

Key points: A compensation claim for land where native title was extinguished was lodged two years after the Butchulla people received their claim over the island

A compensation claim for land where native title was extinguished was lodged two years after the Butchulla people received their claim over the island The corporation's solicitor says technicalities have pushed the process back as the application was brought by a PBC rather than individual traditional owners

The corporation's solicitor says technicalities have pushed the process back as the application was brought by a PBC rather than individual traditional owners A native title expert says the State Government has a responsibility to ensure the claim is made correctly

They fear the delay could mean the Indigenous Land Use Agreement (ILUA) signed in 2014 could expire before an outcome is reached, potentially the first time in Australia an ILUA has been allowed to expire.

In 2016, the Butchulla Aboriginal Corporation lodged a claim in the Federal Court to be compensated for their loss of native title over parts of Fraser Island, or K'gari.

Secretary Christine Royan said they are seeking compensation over 436 parcels of land where native title has been fully or partially extinguished.

"We had to wait 20 years to get native title, do we have to wait another 20 years to get compensation?" she said.

"The Government should be ashamed of themselves. They took our people away from our island.

"Today our ancestors are looking down on us to actually fight for what we should have got a long period of time ago."

The claim was lodged two years after the Butchulla people received native title claim over the island.

Christine Royan of the Butchulla Aboriginal Corporation says the State Government is holding up their claim. ( ABC Wide Bay: Brad Marsellos )

The corporation's solicitor Colin Hardie said when the case was brought before the Federal Court earlier this month, technical legalities pushed the process back.

He said it was on the basis the application was brought by a prescribed bodies corporate (PBC) rather than individual traditional owners.

"Whether it is made on behalf of the Butchulla Aboriginal Corporation, individuals, or if it is done outside the court via negotiations … we want to get down to the nitty gritty," Mr Hardie said.

"Which is basically identifying what are the areas in which compensation is payable and what is the value of that compensation."

In a statement, a spokesperson for the Deputy Premier said the Government recognised that under the Native Title Act it had a compensation liability to the native title holders of K'gari.

"While court proceedings are underway, the state and the Butchulla people must respond to the requirements of the Federal Court," the statement said. "The state would welcome open discussions with the Butchulla people to agree on a way to progress their compensation claim. "This offer has already been made to the Butchulla people via their legal representatives."

Ms Royan said she felt the State Government was holding up their claim.

"What the Government is doing now is just trying to use the system … against us," she said.

Native title law expert and lawyer Jonathan Fulcher said while the process of making a compensation claim can be onerous for traditional owners, the State has a responsibility to ensure the claim is made correctly.

"[The traditional owners] are probably extremely frustrated having gone through a long determination process to now find there are hurdles to get over in dealing with the compensation process as well," he said.

"[They] would like those applications to be dealt with as expeditiously as possible.

"[However] the State has a responsibility to taxpayers to ensure that if it pays compensation that it is done so correctly.

"There is no reason for the State to be avoiding any responsibility, it just has to be seen to be doing that properly."

Rights 'expiring'

Mr Hardie said the Butchulla Aboriginal Corporation was not seeking a large sum of money, rather a future revenue stream and co-management rights.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Watch Duration: 1 minute 28 seconds 1 m 28 s Federal Court grants native title over Fraser Island ( Kallee Buchanan )

"Rather than have the sterile technical arguments before a court, we wrote to the State Government saying we'll discontinue our client's compensation claim if you are able to provide an assurance that you'll enter negotiations with the relevant Aboriginal people to reach a settlement via an Indigenous Land Use Agreement," he said.

Mr Hardie said they are yet to receive a response.

Come November, Ms Royan said the ILUA that was signed in 2014, with the consent determination, would expire.

She believes this would be the first time in Australia an ILUA had expired.

"All the ILUA allowed us to do was to sit at the table and pick some camping grounds that we could go to [and] hunt, to have rights to negotiate with Queensland Parks and Wildlife," she said.

"But it didn't give us any rights to stop anything that's happening — for example, tourism.

"It doesn't give us rights to say to everybody that 'you're bringing over 500,000 people to our island and that's destroying our island'."

Butchulla Aboriginal Corporation rangers work with Queensland Parks and Wildlife to manage the care of Fraser Island ( Source: Butchulla Aboriginal Corporation )

Ms Royan said more effort should be focused on what can be offered to the Aboriginal people who were taken off their land.

"Compensation is about employment for our people, businesses, we want our people to have the opportunity to actually live on country," she said.

"I'm disgusted that they can still keep treating our people as second class citizens, and as far as we're concerned we should already be recognised.

"What a disgrace we are as Australians that we, again, are being put into a corner and pretending that Aboriginal people weren't here."

The Timber Creek precedent

In March this year, the High Court ruled native title holders from Timber Creek in the Northern Territory would receive $2.5 million in compensation for loss of their rights.

The Butchulla Aboriginal Corporation's legal representative Mr Hardie said this set a precedent for the standard of compensation.

"Before that occurred there wasn't much point in actively litigating these claims," he said.

"[Timber Creek] dealt with principles of compensation, how much could be claimed, what factors needed to be taken into account in consideration of compensation."

Native title holders of Timber Creek received $2.5 million in compensation for loss of their rights, including spiritual connection to the land. ( ABC News: Mitch Woolnough )

Three native title compensation claims are currently underway in Queensland.

Mr Hardie is also representing the Iman people from central and south-western Queensland and the Wulli Wulli people from the Cracow and Theodore areas.

"There are other cases in the system that are waiting to see what happens in relation to these three cases," he said.

"Aboriginal people are saying 'well we know about our entitlement to compensation … but we want to see what happens with these three claims first'."

The Butchulla Aboriginal Corporation's case will return to court on September 5.