The Luisita conundrum

The recent decision of the Supreme Court on the Hacienda Luisita case presents a conundrum, a difficult and intricate problem involving the rights of landowners and farmers over this vast estate originally covering 6,443 hectares. During the deliberations of the Comprehensive Agrarian Reform Law, the stock distribution option granted to corporate landowners was already severely criticized. Why should landowners be given the option to distribute shares of stock to the landless farmers, when the 1987 Constitution mandates that agrarian reform is based on the right of farmers and regular farm workers to own the lands they till? This very same sentiment has been echoed quite strongly in the dissent of Chief Justice Renato Corona, and is the backbone of the case of the farmer beneficiaries. Simply put, the Chief Justice has opined that the stock distribution plan violates the Constitution.

This option has been looked upon with grave suspicion from the very beginning, being allowed only a period of two years from 1988 within which to have such a plan approved by the Department of Agrarian Reform, otherwise the land shall be distributed directly to the farmers. But here we are now, about 22 years later, and the same controversy that has hounded such an option is still with us.

The majority members of the Supreme Court have spoken through their votes, and affirmed the resolution of the Presidential Agrarian Reform Council (PARC) which revokes the stock distribution plan. In the process, the Court has affirmed the authority of the PARC to approve, review and revoke such plans. It also has noted certain provisions and practices which violate the spirit and intent of agrarian reform.

But why did the majority opinion require the DAR to conduct a referendum and see who among the beneficiaries would still want to remain as shareholders of the company? The Court said that even if the stock option plan will be invalidated, there are certain “operative facts” that would warrant such a referendum. For one, certain rights and privileges have been given to the farmers, and the Court would want to know if the farmers would still want to enjoy the same. The Court also cited the 2010 referendum where a majority of the farmers opted for the stock option scheme.

And herein lies the heart of the conundrum: Even if the farmers want to retain the stock distribution plan, what are the features of that plan? What are the details of the plan that the farmers will be assenting too? Will their entitlement be based on man-days worked, or by the mere fact of their having been workers, whether regular or seasonal? Surely, it cannot be those features of the plan that has been struck down by the Court. That plan has already been invalidated.

And surely, the company cannot be given another opportunity to draft a new plan, incorporating new features which will correct the inequities of the past, and then subject that to a referendum. The new CARPER Law (RA 9700) will have nothing of that approach, mandating very clearly that the only two modes of acquisition are voluntary offer of the land to the government, and compulsory acquisition or expropriation (see Sec. 7).

Even assuming that the company can still correct its “sins” of the past, some violations can no longer be corrected. For example, the Court ruled that the stock distribution plan should have been implemented and finished within three months from approval by the PARC in 1989, an event which did not take place. How can one correct this mistake, even if a new plan would be put into place? The mandate of Sec. 31 of RA 6657 is very clear: If within two years from June 15, 1988, the stock transfer envisioned in the law is not realized, then the land will be subject to compulsory coverage. It has been more than 20 years, and the Court has now decided that even if a plan has been put in place, the purpose for which it has been made has not been realized, and the PARC was correct in revoking it. Subjecting the process to a referendum is like asking the public if they want to be exempted from the number coding scheme of the MMDA or not. This is not a democratic choice. This is a prescription for chaos and confusion in the ranks of the Luisita farm workers.

The Court should be resolute, and guide with a gentle but firm hand the final conclusion of this saga of agrarian reform in Central Luzon.

Hector D. Soliman was undersecretary for legal affairs of the Department of Agrarian reform during the Ramos administration. He teaches agrarian reform law at the University of the Philippines College of Law.