The DAR through the Solicitor General will file a Motion for Reconsideration of the decision of the Supreme Court in the Hacienda Luisita. It will anchor its arguments that the law is clear. Sec. 31 of RA 6657 states that when the Stock Distribution Option is invalidated then the only option is to distribute the land. Thus, the Supreme Court's formula of asking the farmers if they still want to have stocks has no legal basis. The Doctrine of Operative Facts does not apply because the law is clear. 

It is only now that DAR has announced its decision because it received the official copy of the 277 pages decision last thursday. 

“PUNCTURING ARGUMENT balloons full of hot air with cold hard needles of impeccable logic.” That is the description that comes to mind when reading Supreme Court Asociate Justice Ma. Lourdes P.A. Sereno’s dissenting opinion in the Hacienda Luisita (HLI) case. There are six balloons she pricks in quick succession (in the first three pages of her dissent)—or in her words, “legal and operational aberrations” in the majority decision.

First, she points out that the majority categorically affirmed the questioned PARC (Presidential Agrarian Reform Committee) resolutions revoking its approval of the HLI Stock Distribution Plan (SDP), and ruled as “nullified and voided” the PARC’s 1989 approval of the HLI SDP.  But having thus left legally baseless the  SDP and its operating agreement, the Stock Distribution Option Agreement (SDOA),  it then proceeds to allow (actually, require) the farmworker-beneficiaries (FWBs) to decide through a referendum whether they want to continue with it. As she puts it so scathingly, “There is not a single legal twig on which the order to proceed with the voting option can hang, except the will of this Court’s majority.”

Second, she points out that the majority ruled that the SDOA that was signed between the HLI, the Tarlac Development Corporation (TADECO) and the FWBs was not only illegal but unjust to the FWBs.  Illegal for two violations: (a) the distribution of shares of stock based on the number of man-days worked, and (b) the prolonged 30-year timeframe for the distribution of shares. Yet, the decision “allows them to remain in such a prejudicial arrangement if they so decide.” Says she: “ To allow the FWBs, the disadvantaged sector sought to be uplifted through agrarian reform, to remain in an illegal arrangement simply because they choose to so remain is completely contrary to the mandatory character of social justice legislation.”

The third aberration Sereno cites is that while the majority state that an SDOA can only be valid if the FWBs have control (i.e., a majority of the shares), they still do not require, as a condition precedent to the holding of the referendum they order, that the HLI be restructured so that the FWB share rises from 33 percent to more than 50 percent.

Fourth, Sereno states that the “doctrine of operative facts” which the majority use to justify the voting option, is misapplied in this case, because jurisprudence allows it to be applied “only in the extreme case in which equity demands it. “The doctrine of operative facts applies only to prevent a resulting injustice, if the courts were to deny legal effect to acts done in good faith, pursuant to an illegal legislation or perhaps even executive action, but prior to the judicial declaration of the nullity of the government action.”  There is no room for application of the doctrine, she says, because the Comprehensive Agrarian Reform Law categorically provides for direct land distribution in the event a stock distribution is not completed.

The fifth aberration that Sereno points out is that even if the doctrine above were not misapplied, it is applied wrongly, because “it should be applied in favor of the FWBs by ordering direct land distribution, because that is the inequity that continues to fester—that the FWBs who have been promised ownership of the lands they till are denied the same, twenty-three years after the passage of CARL.”

And the sixth aberration that Sereno points out is that even as the majority ruled that the issue of constitutionality of the stock distribution option should not be touched upon (for various listed reasons), it then proceeded anyway to “discuss, and even rule in favor of its constitutionality.”

Having torn the majority decision to pieces, what does Sereno want? Together with AJs Arturo Brion and Martin Villarama,  an absolute no to the voting option, but rather a straightforward distribution of the land to the tillers, who can then do with their land as they wish.  However, where the other justices want the land to be acquired at the values obtaining in 1989, Sereno wants the valuation at current prices (a difference as to when the “time of the taking” is reckoned).  On this issue, I side with the other justices.

Chief Justice Renato Corona’s dissent starts off with a bang. He begins  with a quote from the proceedings of the 1987 Constitution which he said, shows that “Hacienda Luisita has always been viewed as a litmus test of genuine agrarian reform” (emphasis his),  the essential thrust of which is land to the tiller, so that “Consequently, any law that goes against this constitutional mandate of the actual grant of land to farmers and regular farm workers must be nullified.”

He argues that the question of constitutionality is unavoidable (and thus trumps any lis mota argument), and that the four requisites for deciding moot and academic cases are present: a grave violation of the Constitution, paramount public interest involved, controlling principles are required, and the case is capable of repetition, yet evading review.

“History will be the unforgiving judge of this Court,” he warns, if it does not direct the implementation of the Constitution’s vision on agrarian reform.

Beautiful, yes?   Alas, he spoils it all at the end.  Having roared about the unconstitutionality of stock distribution, he then whimpers that the FWBs may choose to waive their rights to the land, and stay as stockholders” of HLI—“due to considerations of fairness and equity.”  To whom? Certainly not to the farmers.

A chance for greatness.  And he muffed it. Pity.

 PNoy must distribute Luisita! It is like winning the Lotto! This will fulfill Tita Cory’s promise to distribute it and make agrarian reform a centerpiece program of the government. At the time when the PNoy’s confidence level is dipping, distributing Luisita will make history affirming him as THE Leader, a true People’s President. His asset reform agenda will be clear and distributing Luisita will definitely banner it. If he will distribute Luisita, CARP will gain momentum towards its completion and even can possibly end the war against the NDF-CPP-NPA because they will now think that the government is serious with fighting the root causes of poverty. He will gain moral ascendancy, enough to sustain the rally for the RH Bill and any other challenge in the future. The timing is rare, it is a once in a lifetime, momentary opportunity which was not available during FVR, ERAP, GMA’s time—definitely if done with them will make any of them a great President. This is greater than “wang-wang” which catched the imagination of the nation, distribution of Luisita will reverberate in history.  Majority of the family already decided to give up ownership of Luisita and the Supreme Court will soon make a verdict. Either decision is a losing proposition for PNoy. If the decision favors distribution, he will be perceived as “napilitan ” to distribute (or a lame duck). However if the decision favors non-distribution, the government will move for reconsideration and will also make him appear just not sincere because in the first place you don’t want to distribute. Before any major decision, he can already make a bold one now. The Supreme Court cannot stop the voluntary distribution of Luisita and can in fact make a lasting closure to the case. This is his choice, his chance encounter with greatness! His Presidency is made and the lives lost in Mendiola and Luisita will rest in eternal peace.

SDO in Hacienda Luisita:

Circumventing the Agrarian Reform Law for Three Generations

Agrarian Reform as a social justice legislation should not be used to pacify unrest and popular sentiments but should be pursued to eliminate historical ills in society against the peasantry.  Today’s massive rural poverty is brought about by various factors and majority of them is historical injustice - unjust consolidation of land by the elites from the time of Spanish colonization to the American rule. And, this continuously perpetuated inequity had been further aggravated by the lording over of local elites in the present time.

President Noynoy Aquino, in his campaign tagline puts forward his hypothesis on the cause of poverty this way: Kung Walang Corrupt, Walang Mahirap!. He is, in effect, saying that poverty can be directly attributed to graft and corruption.  Though it may be partially true in some instances, this theory proves too simplistic and lacking in logic.    A careful analysis would show that poverty is primarily caused and perpetuated by unjust structures, one of them being the unjust distribution of resources like land.  Thus, combating poverty needs serious and sincere structural reform especially in asset redistribution.  This means actual transfer of ownership and control of the land to the tiller.  The Philippines has ample legislation on agrarian reform, most significant of which    is the Comprehensive Agrarian Reform Law or RA 6657 of 1988.  Despite its inherent limitations and loopholes, it is instrumental in changing the economic condition of the farmer beneficiaries. 

Generations of Broken Promises

The long overdue distribution of Hacienda Luisita is a three-generation transgression against the peasants in the estate.  The acquisition of the hacienda in 1957 (completed in 1958) was financed by the Government Service Insurance System (GSIS) on condition that Jose Cojuanco (PNoy’s grandfather) will distribute the whole hacienda to the tenants after 10 years, or in 1967.  1967 came and passed but the hacienda was never distributed to the farmers. 

In 1985, then presidential candidate Corazon “Cory” Aquino promised— during her campaign- to make land reform as the center-piece program of her administration.  After she took over the presidency, she also promised to subject Hacienda Luisita under agrarian reform.  These promises, though, were short lived. After the enactment of RA 6657 in 1988, a new mode was devised which helped corporate farm operators evade actual land distribution through the onerous Stock Distribution Option (SDO).  This arrangement designated the possession and control of agricultural lands to corporations while depriving the tenants therein ownership of the land.  This onerous arrangement was applied by the Cory administration to the Hacienda Luisita, breaking Cory’s own promises.

Noynoy Aquino’s campaign promises also touched, though in a calibrated manner, the issue of Hacienda Luisita and Agrarian Reform in general.  He promised to complete Agrarian Reform within five years and to resolve the issue with respect to and distribute Hacienda Luisita within the remaining period for the CARP.  Barely a month after Noynoy’s ascension to presidency, the “Compromise Deal” involving the Hacienda Luisita case broke the news. A careful review of the “Deal” will reveal that the share of the farmers was reduced to 1,400 hectares from 4,900 in 1989 and the HLI management had successfully trapped the farmers who are now practically left with only two choices: a parcel of land or SDO.  More alarming is the consistent hands-off policy of Noynoy amidst the snaffu.  Does this stance mean that PNoy is already abandoning his campaign promises this early, barely two months from taking office and the oath to implement the laws of the land?  Could this be the third broken promise after three generations of control by Noynoy’s family over Hacienda Luisita?

 SDO

The use of the SDO as the mode of “distribution” in Hacienda Luisita has clearly become onerous upon the farmer beneficiaries and was apparently a means to perpetuate the control of the Cojuancos over the vast agricultural land.  Ironically, this mode which was identified by the Cory administration to supposedly bolster Agrarian Reform implementation has denigrated the very essence of the program. After twenty one years of SDO implementation in Hacienda Luisita, the lives of the tenants had worsened.  The promise of a better life never materialized. The SDO had failed in raising the livelihood of the farmers and their families.

Not only is the SDO mode self-serving and onerous, it also runs – blatantly - against the Constitutional mandate of direct or collective ownership of farmers and farmworkers of the land they till and of the agrarian reform law under Section 4, Article XIII of the 1987 Constitution.[1]  With the passage of Comprehensive Agrarian Reform Program Extension with Reforms law (RA 9700), HLI and other corporations engaged with SDO should be covered under agrarian reform program.  RA 9700 did not provide for the SDO or any other mode that would hinder land distribution.  Instead, Section 7 paragraph 1 of RA 9700 states that, “The DAR, in coordination with the Presidential Agrarian Reform Council (PARC), shall plan and program the final acquisition and distribution of all remaining unacquired and undistributed agricultural lands from the effectivity of this Act until June 30, 2014”.  Section 7 further states that, “after June 30, 2009, the modes of acquisition shall be limited to voluntary offer to sell and compulsory acquisition.” Thus SDO and other similar schemes are clearly a circumvention of the agrarian reform law. The SDO, as a matter of policy, should be abandoned forever.  SDO is plainly not agrarian reform. 

The ball is now in the hands of Noynoy and he has to choose among available courses of actions carefully, as the nation’s president and lead implementer of the law should.  He can either choose to repeat history of broken promises, or opt to rectify the transgressions committed by his family against the families of poor peasants for over three generations.  He cannot afford to continue with his hands-off policy and should, instead, be involved with the just resolution of the case at hand, not only because he is a part owner of the Hacienda but because he made a promise during his campaign and many rural folk believed in his promises. That promise, together with the hope of reform in governance in general, is the reason why he is not the Philippine president. And, as such President, he is obliged to fulfill such Constitutional mandate on agrarian reform.  

The HLI issue will be the acid test for the political will, if not the sincerity, of Noynoy.  If this issue will not be justly resolved, it will haunt Noynoy throughout his term and the rest of the Aquino-Cojuanco family for several generations henceforth.

The Convictions of Farmers Groups and Other Agrarian Reform Advocates

            We, supporters of the Hacienda Luisita farmers believe that:

1.    Any mode or arrangement without actual transfer of ownership and Control to the farmer-tiller is not agrarian reform but landlordism in another form.  The SDO applied in Hacienda Luisita should be revoked and the landholding should be immediately distributed the to the rightful beneficiaries.

2.    Political democratization is futile without democratizing resources.  If Noynoy is serious about transparency, greater participation and political empowerment he should give equal focus to asset redistribution.  CARPER should be strictly and seriously implemented within 5 years.

3.    The primacy of the rights and the dignity of the poor peasants should be recognized over the corporation’s economic concerns.

BALAOD Mindanaw, Inc.

--
BALAOD Mindanaw, Inc.
2/F BELSAR Building,
Capistrano-Del Pilar Sts., Barangay 19,
9000 Cagayan de Oro City, Philippines
+63 8822 727432 (telefax)
balaodmindanaw@gmail.com
balaod_mindanaw@yahoo.com

Pig in a poke

By Solita Collas-Monsod
Philippine Daily Inquirer 09/03/2010

WHY DID the Hacienda Luisita farmers vote for the stock distribution option (SDO) in 1989 over owning the land? Simple. They were told that the SDO would bring P33,967 a year for each of them, while tilling their own land would yield P17,702 a year—an estimate attributed to the Opus Dei’s Center for Research and Communications (CRC)—and carry attendant risks such as crop failure and fragmentation of land problems, not to mention the lack of entrepreneurial skills. A no-brainer, right?

These are the figures cited by then Solicitor General Frank Chavez in an article (August 1989) defending that choice. But a closer examination of those figures leads to an inescapable conclusion: the farmers were deliberately misled, cruelly misinformed. The P33,967 benefit package attributed to the SDO resulted from figures plucked out of thin air, spurious benefits and unacceptable accounting practices. Stripped of these, the SDO would yield each farmer closer to P14,583—or P3,119 less than the CRC estimate of what a farmer would get if he tilled the land himself.

To use an idiomatic expression, the farmers bought a pig in a poke. They were misled into believing that the inferior option was the superior one. No wonder that in 2003, after waiting for 14 years for a better future and realizing that in fact the future was getting worse, the farmers asked the government to cancel the SDO, and just give them their land.

But let’s not take the conclusion on faith. The arithmetic is fairly simple.

The Chavez article lists the following as the benefits from the SDO:

Gross annual salaries and benefits P85.353M

Stock Plan Benefits P115.869M

Total Benefits P201.222M

If you divide the Total Benefits above by the number of 6,296 farmer beneficiaries, the quotient is P31,960 per farmer. How did that become P33,967? Nothing is indicated in the article, and “Total Benefits” is about as clear as one can get. The difference between the latter figure and the former figure—P2,007—is plucked out of thin air.

Now let’s zoom in on the Stock Plan Benefits of P115.869 million, which comprises the larger portion (58 percent) of the farmer’s purported annual total benefits from SDO. The Chavez article breaks them down as follows:

3% of Gross Sales P 6.343M 5.47%

3% of Cash Dividends 0.118M 0.10%

Free Distribution of Shares 3.946M 3.41%

Free Residential/Homelot 105.462M 91.02%

Total Stock Plan Benefits P115.869M 100,00%

The item “Free Residential/Homelot” accounts for 91 percent of the total. This is not only a spurious benefit, but also the result of shady accounting.

To understand why it is spurious, remember that the original size of the Hacienda Luisita was 6,443 hectares eligible for compulsory acquisition under agrarian reform. But somehow, 1,527 hectares were excluded from the CARP—about 24 percent of the total. Among that excluded hectarage was the land set aside for “homelots” for the farmers.

By rights, that land should not have been excluded but awarded to the farmers outright. That it wasn’t, made possible for the landowners to have a larger share in the corporation that was formed, and to claim that it was “free” to the farmers. Truly chutzpah.

Then insult was added to injury: this homelot (including improvements) given “free” to the farmers was valued at P105.452 million. Again dividing that by the 6,296 beneficiaries, the quotient is P16,751 each, for 240 square meters of homelot, or roughly P70 per sq m—or P700,000 per hectare.

To see how grossly inflated this is, remember that the homelots were carved out of the agricultural land, which was valued, for purposes of determining the farmers’ share in the corporation, at P4 per sq m or P40,000 per hectare. Not P70 per sq m. Or one can refer to the landowners’ valuation of that property just the year before (reportedly in its financial statements): for the same land and improvements, a total of P12.3 million. That’s a far cry from P105.452 million.

Now comes more injury heaped on insult added to injury: the entire bloated amount was front-loaded to the first year—all P16,751 of it, which made the benefits to the farmer look huge—cosmetic accounting at its shadiest.

If, as provided by law, payments were spread over 30 years at 6-percent interest, the imputed benefit of giving it to him “free” would be something like P1,155 per year—not P16,751. And if the homelots were valued as the rest of the land (i.e., P4 per sq m), the imputed benefit would be all of P134.80 a year, instead of P16,751. The front-loaded benefit was bloated 124 times.

Compared to that magnitude, the value of the other spurious benefit—“free” shares distributed to the farmers amounting to P3.9 million or P627 per farmer—seems picayune. But it’s as spurious as the “free” homelot. And it actually represents a loss to the farmers.

Look at it this way: if the farmer gets P627 a year in “free shares,” then by the same token, the corporation benefits from P4,000 to P5,000 worth of “free” rent per hectare, courtesy of the farmers—the value of the lease on sugar land at the time. That was the deal between Del Monte and Dole workers: sale and lease-back, coupled with assured work for the workers and their qualified children. By choosing the SDO, the farmer lost that option.

Cruelly misinformed. Deliberately misled. Like lambs to slaughter.

By: Prof. Winnie Monsod

I recall, during one of the Presidential Agrarian Reform Council (PARC) meetings -- as NEDA director general, I was a member -- I asked the DAR if they were the ones conducting the meetings with the Luisita farmworkers to apprise them of the alternatives. The answer was no, that in fact they were not present in all meetings.

I also asked if there was any attempt by them to inform the farmers that aside from the Stock Distribution Option (SDO), there were other modalities (e.g., lease-back, cooperatives) that were available to them. The answer was also no -- in fact, they were merely observers. President Cory was presiding, and she agreed with me that to ensure the credibility of the process, the DAR, as objective outsiders, should conduct the meetings and present the choices that instruction modules should be created that would contain the information needed by the farmers to make an informed choice.

I left the government shortly after that, and do not know whether my recommendations were indeed followed. To verify that, DAR records have to be accessed. But the spirited defense by then Solicitor General Frank Chavez (in a series of articles published in the Manila Bulletin in 1989) leads me to believe that if the choice between the SDO and direct land distribution was discussed, the deck was certainly stacked against land distribution.

Here are relevant excerpts from the Chavez article: "It is obvious that this size of land (0.78 ha -- scm) will not be able to support a farmworker’s family if he is to depend on the income potential....The net profit of P7,400 p.a. is clearly inferior to the status quo.... A farmworker at Hacienda Luisita who works 214 days a year receives P33,967.00 in the form of basic pay and fringe benefits like service bonus, amelioration bonus, 13^th monthly pay, sick leave commutation, hospital and medical allowances for workers, their dependents and parents, school bus allowance financial assistance for old age, sugar vale discount, interest-free loans to employees, and others. In addition, the farmworkers will also receive under the stock plan a free homelot of not more than 240 sq. m.... On the other hand, a study made by the Center for Research and Communications (CRC) showed that a farmowner who cultivates a one-hectare area and produces 40 tons of cane, makes a net profit of P17,702 yearly...."

The first estimate of P7,400 per annum is based on a table entitled: "IA. Estimated Income of a One (1) Hectare Sugar Farm, Under Conventional System, for Marginal Planters with an area of one to three hectares at Tarlac Mill District." The table gives the total "cost and expenses" per hectare and then it gives the proceeds from the sugar and molasses, assuming 35 tons of cane per hectare, and assuming a recovery of 1.5 piculs of sugar per ton, and a price of P520 per picul for sugar.

"Marginal Planter" is nowhere defined (why not Average Planter?, but if it is used to describe something similar to "marginal land" then obviously the cost of production would be higher and yield per hectare would be lower (the CRC estimate, cited in the article, uses a yield of 40 tons of cane per hectare).

In any case, let’s take a closer look at the costs cited. It turns out that about 15% of the total cost of P9,491.20 per hectare is attributed to plowing and harrowing with a tractor, no less (although there is another harrowing item elsewhere where a carabao is used -- for P150). How’s that for cost inflation?

Now, let’s turn to the income per hectare. The data needed are the yield per hectare in tons of cane, the recovery rate (piculs of sugar recovered per ton) net of miller’s share, and the price per picul of sugar. Molasses is a byproduct in the processing of the cane, and so data needed would be the gallons of molasses per ton of cane (net of miller’s share) and the price per gallon of molasses. Just on the yield per hectare alone, there already seems to be an attempt to reduce the benefits. The estimate was based on 35 tons of cane per hectare, whereas the CRC study assumes a 40-ton-per-hectare average yield. Using 35 tons instead of 40 tons results in reducing income per hectare by 12.5%.

In sum, Table 1A , used by Chavez, overestimates costs and underestimates revenues. No wonder the first estimate is so small. But as mentioned, he also cites the CRC study, where the estimated income per hectare for the farmer choosing to till his own land, is P17,702 yearly. The question is: which estimate was presented to the Luisita farmworker in the course of explaining the effect of tilling his own land (vs choosing SDO)? But wait. Now let’s look at the P33,967 per year mentioned by Chavez as the income of the farmer, in the form basic pay and fringe benefits, for only 214 days of work. Here is where income inflation reaches the world-class proportions.

How is that amount derived? Well, first there is "the company’s gross annual salaries and benefits of P85.353 million." Which, given 6296 beneficiaries, means P13,556 a year. And now comes the "stock plan’s financial benefits," which "for the first year alone amount to P115.869 million." Divided by the number of farm workers, that comes to P18,403 yearly. Still, the sum of the two amounts to P31,959, so where Chavez gets his P33,967 yearly income in basic pay and fringe benefits, is a mystery. Inflation upon inflation, because the breakdown of the fringe benefits is as follows (total, in million pesos):

• 3% of gross sales 6.343
• 3% of cash dividends 0.118
• Free Distribution of Shares 3.946
• Free Residential/Homelot 105.462
• Total Stock Plan Benefits 115.869

Good grief. I will save the discussion of "free" distribution of shares for another time (of course it’s not free!). But focusing on that free residential homelot valued at P105.5 million, which constitutes 91% of the farmworkers "benefits," shows how breathtakingly brazen was the overvaluation of these so-called benefits. Consider: the farmer earns P13,556 a year in wages, but the use of his homelot (which as was noted in the previous column, would have been his in the first place if the land had been distributed directly to him) is valued at P16,750 a year -- sans a house, if you please. So either he is underearning, or he is in essence overpaying for his homelot -- where have you heard of or seen a person who would pay for rent (on the land where he has his house) almost 25% more than his total wage? What would you choose, reader, if you were given the choice between Alternative A that would bring you P7,400 a year (or P17,702, depending on what was presented to the farmers), and which had many attendant risks to boot (as listed by Chavez in his article), and Alternative B, which, all in, would bring you P33,967 a year, with no seeming risks? I bet you would think that there’s a hitch somewhere, and I bet you would ask to look more closely at those choices, and perhaps ask whether there was alternative C, or D.

Now then, dear reader. Put yourself in the place of the hacienda worker, and your "amo" offers you the choice. What would you choose?

Yes, that’s what the farm worker did choose. Only to experience the brutal reality that all he could bank on was his P13, 556 yearly wage -- if he worked. And since the mid-nineties, I am told, he did not even have regular work. And since 2004, he has had no work at all. The heaven turned into hell.

Short end of the stick? Short-changed? Stacked deck? Nails in his coffin? All of the above.

By Solita Collas-Monsod

Let’s face it: The Luisita farm workers -- the 6,296 men and women who should have been the beneficiaries of the CARP that was passed during President Cory Aquino’s term -- have been getting the short end of the stick since 1989. The so-called "Compromise Agreement" the last nail in that coffin of exploitation (pardon the mixed metaphors).

The first nail in that coffin of exploitation was when, in 1989, they were either encouraged or enticed or intimidated or manipulated -- remember, most of them had worked there for all of their lives in a patriarchal setting -- to opt to own shares of stock in the Hacienda Luisita corporation -- the so-called Stock Distribution Option (SDO), rather than to get a share of the land. The argument that they bought, or was shoved down their throat at the time, was that if the land were divided, each farm worker would be getting at most 0.78 hectares (of the 6,443 hectares of Luisita at that time, only 4,916 hectares were classified as CARP-able); while if they were own shares in the corporation, the workers would not only be getting wages, but also a share of the profits. It sounds like a good deal, doesn’t it? Unfortunately, since then, the corporation never showed any profits, and claims it has become burdened with enormous debt (which then required selling land to help pay off some of it).

The second nail in the farmers’ coffin of exploitation was pounded in almost simultaneously: The farmers got only 33% of the corporation, while the Cojuangcos, through the Tarlac Development Corporation or TDC got 67%. Why only 33% for the farmers, when their contribution to this agricultural corporation was its principal resource, mainly the land? Three reasons: the amount of land included in the CARP was only 76% of Hacienda Luisita; that "CARPable" land was undervalued; and third, the TDC contribution was overvalued.

The following shows that 1,527 hectares of Luisita’s total land area of 6,443 hectares were excluded from CARP:

Of these, it is arguable that only the 66 hectares of sugar mill land, the 266 hectares of roads and creeks -- totaling 332 hectares, should have been excluded. Certainly the 121 hectares of homelots for farmer beneficiaries is part of their land. In any case, allotting 652 hectares for reserve home lots is ridiculous -- at an average 192 sq. meters (gross) for the original homelots, it implies that either 34,000 additional workers could be accommodated. Or that each beneficiary would be given over time, an additional 1,035 square meters).

How can we tell that the farmers’ land was undervalued and some TDC assets overvalued? The table below, adapted from Putzel, shows the basis of the sharing:

First, the farmers’ land was valued at P4 per square meter, or P40,000 per hectare and therefore P196.6 million for the 4,916 hectares.

Yet, look at the item Other Assets, Residential, under TDC: that looks to be the 121 hectares of land set aside for the farmers’ home lots, which was excluded from the CARPable land and then considered a TDC asset and part of its contribution to the corporation (adding insult to injury). P60.5 million divided by 121 hectares means P500,000 per hectare, or P50 per sq. m. Or more than 12 times the value of the farmer’s land.

But, according to Putzel, the same piece of land, in the TDC balance sheet the previous year, was valued at only P55,000 per hectare, or only one ninth the value given to it for purposes of determining its shares in the corporation. Overvaluation with a capital O.

Then look at the other item under Other Assets: the land improvements, which were valued at P58.1 million. Again according to Putzel, this same item, the year before, was valued at P5.6 million in the TDC books.

One can only ask: How could these shenanigans have been approved by the Department of Agrarian Reform? (Then under Popy Juico, alas).

Some counterfactuals: If we were to correct just for the undervaluation and overvaluation, what would happen is that the farmers’ contribution would now rise to 48.5%, and the Cojuangco contribution would be 51.5%. What we merely did in the following table is value TDC’s "Other Assets" at the value given them by TDC just the year before; and we also valued the farmers’ land at the same value is as the homelot value (of P55 per sq.m):

If we now correct for the exclusion of land covered by CARP, in other words, add even just another 1,000 hectares, then the farmers would have owned 53.1% of the corporation and TDC would have owned own only 46.9%, because their contributions would be respectively valued at P325.4 million (farmers) and P287 million (TDC).

But because of these wrong valuations, which were obviously, as I said, overlooked or ignored by the DAR at the time, the farmers got only 33% of the corporation.

How about that for "short end of the stick?"

By Solita Collas-Monsod
Philippine Daily Inquirer

THE SO-CALLED “Compromise Agreement” that was signed by farm workers of Hacienda Luisita gave them the choice between remaining as shareholders of the corporation (Hacienda Luisita Inc. or HLI) or getting their land. Quite apart from the legal issue that the stock distribution option (SDO) may no longer be valid because the new CARP law disallows it, one would have thought that the farm workers would have chosen to get the land anyway.

DITO SA AMIN AY SAGANA SA TUBIG NA DUMADALOY SA PATUBIGAN TUNGO SA AMING BUKIRIN.  MAGANDA AT MALUSOG ANG PANANANIM NAMING PALAY DAHIL SAGANA SA TUBIG, KAYA’T NAGBABADYA NG MASAGANANG ANI. 

SUBALIT BALE WALA PO SA KASALUKUYANG ADMINISTRATION NG CITY GOVERNMENT OF MALOLOS, BULACAN, NA NAHAHARAP TAYO SA MALAKING KAKULANGAN NG PAGKAIN.  TINATAMBAKAN NILA ANG AMING PANANIM NA PALAY UPANG MAISAGAWA NILA ANG KANILANG PROYEKTO NA MALOLOS SPORTS AND CONVENTION CENTER, NA SA AMING PANANAW AY HINDI MASYADONG KAILANGAN LALO NA NG MGA NAGHIHIRAP NA MAMAYAN, MAS MAHALAGA ANG PAGKAIN KESA ANO PA MANG BAGAY.

NAKAKAHINAYANG NA MAKITA NA ANG PALAYAN NA PINAGPAGURAN AT GINASTUSAN AY KANILANG BINO-BOULDOZER AT TINATAMBAKAN NG LUPA.  HINDI NILA ALINTANA ANG KINAKAHARAP NATING MALAKING KAKULANGAN SA PAGKAIN SA MALAPIT NA HINAHARAP.  NAPAKALAKING TULONG PARA SA ATING MGA KABABAYAN ANG AMING AANIHING PALAY.  MARAMING KALAMIDAD NA ANG NAGDAAN SUBALIT LAGING INILILIGTAS NG DIYOS ANG AMING PALAYAN AT KAMI AY NAG AANI PA DIN.  SUBALIT SA PAGKAKATAONG ITO SA KAMAY NG TAO AY HINDI NAKALIGTAS ANG AMING PANANIM DAHIL SA PATULOY NA PAGTAMBAK.

KUNG MAGPAPATULOY KAMI SA PAGSASAKA, DALAWANG BESES BAWAT TAON NAG-AANI, PATULOY DIN KAMING NAG-AAMBAG SA PAGGAWA NG PAGKAIN PARA SA LAHAT.  MAHABANG PANAHON NA PO KAMING NAKAKATULONG AT NAIS PO NAMING MAGPATULOY SA MAHABA PANG PANAHON.

KAILANGAN PO NAMIN ANG TULONG NINYO UPANG MAPROTEKTAHAN ANG AMING PALAYAN, LALO NA SA PATULOY NA PAGSIRA NG GOBYERNO NG MALOLOS. INAASAHAN DIN NAMAN NA IPATUPAD NG GOBYERNO ANG MGA BATAS PANG-AGRARAYO, YUNG BAGONG PASA NA CARPER NA NAGBABAWAL NG CONVERSION NG MGA LUPAING MAY IRIGASYON. SANA MAPIGIL NATIN ANG NAIS NG SIYUDAN NG MALOLOS NA SIRAIN ANG PALAYAN AT ALISAN KAMI NG LUPANG SAKAHIN AT KABUHAYAN.  HINDI LAMANG PO KAMI ANG APEKTADO KUNDI ANG IBA PA NATING KABABAYAN NA UMAASA SA AMING PRODUKTONG PALAY. 

SALAMAT PO.

 ATE FLOR C. GALMAN

MCARTHUR HIGHWAY, MALOLOS, BULACAN

On December 1, 2009 Judge Hector Almeyda of RTC Branch 62 Gumaca, Quezon ordered the referal of a qualified theft of coconut case  pending before him against a tenant to the DAR for determination if it arose from agrarian dispute and thereby dismissing it. Such is the clear mandate of Section 19 of RA 9700 which states:“Section 50 Republic Act No. 6657, as amended, is hereby further amended by adding Section 50-A to read as follows:

“Sec. 50-A. EXCLUSIVE JURISDICTION ON AGRARIAN DISPUTE. – NO COURT OR PROSECUTOR’S OFFICE SHALL TAKE COGNIZANCE OF CASES PERTAINING TO THE IMPLEMENTATION OF THE CARP EXCEPT THOSE PROVIDED UNDER SECTION 57 OF REPUBLIC ACT NO. 6657, AS AMENDED. IF THERE IS AN ALLEGATION FROM ANY OF THE PARTIES THAT THE CASE IS AGRARIAN IN NATURE AND ONE OF THE PARTIES IS A FARMER, FARMWORKER, OR TENANT, THE CASE SHALL BE AUTOMATICALLY REFERRED BY THE JUDGE OR THE PROSECUTOR TO THE DAR WHICH SHALL DETERMINE AND CERTIFY WITHIN FIFTEEN (15) DAYS FROM REFERRAL WHETHER AN AGRARIAN DISPUTE EXISTS: PROVIDED, THAT FROM THE DETERMINATION OF THE DAR, AN AGGRIEVED PARTY SHALL HAVE JUDICIAL RECOURSE. IN CASES REFERRED BY THE MUNICIPAL TRIAL COURT AND BY THE PROSECUTOR'S OFFICE, THE APPEAL SHALL BE WITH THE PROPER REGIONAL TRIAL COURT, AND IN CASES REFERRED BY THE REGIONAL TRIAL COURT, THE APPEAL SHALL BE TO THE COURT OF APPEALS.

“IN CASES WHERE REGULAR COURTS OR QUASI-JUDICIAL BODIES HAVE COMPETENT JURISDICTION, AGRARIAN REFORM BENEFICIARIES OR IDENTIFIED BENEFICIARIES AND/OR THEIR ASSOCIATIONS SHALL HAVE LEGAL STANDING AND INTEREST TO INTERVENE CONCERNING THEIR INDIVIDUAL OR COLLECTIVE RIGHTS AND/OR INTERESTS UNDER THE CARP”.

Many farmers, tenants and farmworkers are charged with criminal cases like qualified theft of coconuts and estafa by landowners in order to harass and eject them from the land they till. RA 9700 or CARPER remedies this phenomenon by mandating the Courts or prosecutors to automatically refer a case if there is an allegation that the controversy arose from an agrarian dispute. The DAR being the specialized administrative agency on agrarian reform implementation has the expertise to resolve the controversy applying agrarian laws and not the penal code. The farmer will have equal opportunity to assert his/her rights before the DAR hearing officer. Hopefully the other Courts and Prosecutors pending criminal cases against farmers will likewise follow the actions of RTC Gumaca. 

The DAR has already published the implementing rules and regulations on referral of criminal cases to them on October 15, 2009 as DAR Administrative Order No. 4 series of 2009 which can be access at http://www.dar.gov.ph/pdf_files/ao%204_09.pdf.

Secretary Nasser C. Pangandaman signed on October 15, 2009 three (3) important Administrative Orders that will guide the Department in the implementation of the recently approved Republic Act 9700 also known as the CARPER Law.

DAR is mandated by Congress to formulate the Implementing rules and Regulations 30 days upon the effectivity of the CARPER Law. While the law was signed by President Arroyo on Aug. 7, 2009, it was deemed effective retroactively on July 1, 2009.

The Secretary proudly announced the conclusion of the IRR during the World Food Day InterFaith Prayer Service at the House of Representatives where CBCP Officials  and NGOs gathered to celebrate the passage of the CARPER Law. He acknowledged the Operations and Legal Group specially FOO Undersecretary Renato Herrera and Director Martha Carmel Chanco of PSRS for their untiring efforts to complete the preparation of the voluminous rules and procedures governing Land Acquisition and Distribution.

The IRR went through a series of deliberations and consultation with various civil society organizations and NGO's. It was also the subject of thorough discussion in the ExCom meetings of the Department.

The following are the AOs signed by the Secretary:

Administrative Order No. 2, series of 2009 entitled "Rules and Procedures governing the Acquisition and Distribution of agricultural lands under RA 6657 as amended by RA 9700."

AO 3, Series of 2009 - Rules and Procedures governing the Cancellation of Registered Certificate of Land Ownership Awards (CLOAs), Emancipation Patents (EPs), and other titles issued under any Agrarian Reform Program.

AO 4, Series of 2009 - Rules and Regulations implementing Section 19 of RA 9700 (Jurisdiction on Referral of Agrarian Dispute).

The Rules and Procedures governing the Program Beneficiaries Development is expected to be approved soon.

Some say that CARPER is a worse CARP, other say it is just the same while those who fought for say it is better. You be the judge. Considering the context where Congress castrated CARP last December 2008, CARPER has restored Compulsory Acquisition with 150 Billion budget and 26 reform provisions.

Congress approved the Comprehensive Agrarian Reform Program extension with reform (CARPER) bill separately. The House of Representative’s version is HB 4077 and the Senate’s version is SB 2666. The Senate passed its version earlier which gave some pressure to the House to pass a better version. Although each version has its strengths and weaknesses, the Bicameral Committee Conference (BICAM) came out to be the best of both versions. Generally, the BICAM version of CARPER is better than the Senate or the House version and closely approximates the Civil Society CARPER proposal. Definitely, the BICAM version comes as a strengthened CARP to face to the challenge of fierce landlord resistance and bureaucratic inefficiencies. The passage of the CARPER law was fought by able Champions in the House through Rep. Risa and Rep. Lagman and in the Senate by Sen. Pimentel and Sen. Honasan and the countless farmers’ march, hunger strikes, fora and dialogues with the Church, Academe and Agrarian Reform Advocates.

The RA 9700 or the CARPER law which was signed by GMA on August 7, 2009 contains an extension of the budget for CARP especially the Land Acquisition and Distribution (LAD) program for five years starting July 1, 2009 and the necessary reforms to complete the acquisition and distribution of the remaining One Million Hectares of private agricultural lands to landless farmers[1].  Moreover, CARPER law provides for clarification of policies and its interpretation by CARP implementation agencies including the decision of judicial courts.

 RA 6657, the original CARP law (CARL) has not been superseded by the CARPER law but strengthens or improves the CARL. Some provisions of the CARL were amended like the provision on the award to beneficiaries and the schedule of acquisition and distribution, new provisions were introduced like the Gender provisions and the Congressional Oversight Committee and a number of Supreme Court decisions legislated like the indefeasibility of titles given under agrarian reform and exclusive jurisdiction of DAR in agrarian dispute criminal cases.

The most challenging part in the crafting of the CARPER law was how to balance the landowners’ interest, the farmer’s interest and the Department of Agrarian Reform’s (DAR) interest. One can see the tension in the provisions of the CARPER law. For instance, the landowners’ interest is dominant  in the provision on Just compensation, the 90% trigger completion for acquisition of small land (below 10 hectares), the consideration of 70% of zonal valuation, attestation requirement to ensure that  loyal farmers will get the land, priority of tenants and regular farmworkers in distribution to ensure easy consolidation and the support services for land owners; while the farmer’s interest is evident in the provisions on the rights and obligation will begin from the receipt of CLOAs and EPs, distribution of CLOAs and EPs and actual possession,  installation of ARBs within 180 days from date of registration in the title of Republic of Philippines, usufructuary rights of identified ARBs pending award and subsidies for initial capital of new ARBs; and the DAR’s interest is apparent in the budget provision and phasing of land acquisition.  Although the majority of the provisions in the CARPER law are pro-farmers, many reforms are still pending and continuously advocated at the executive, legislative and judiciary. The succeeding parts will discuss the salient provisions of the CARPER law.        

I. New and Bold Provisions

CARP is a Continuing Program

With the CARPER law the debate whether CARP will end and DAR will close shop after five years from the extension has been clarified. Under the Constitution, the State is mandated to undertake an agrarian reform which supports the opinion that CARP is a continuing program. It will only end when ALL agricultural lands have been distributed to landless farmers and that tenancy system has been converted to ownership.  What ends in RA 6657 and RA 8532 is the funding for CARP and this is clarified in section 21[2] of the CARPER law. The fund allocated for CARPER is “to further implement the CARP” which means that the CARPER law provides funding needed to implement CARP. The same section emphasizes that the CARP will not end after five (5) years and even after 5 years when the LAD is completed, DAR will continue with the delivery of support services and agrarian justice[3]. Section 30 of the CARPER law provides a way to legally continue the implementation of pending CARP cases after the 5-year extension[4] by filing the initiatory process of CARP.

Creation of a Joint Congressional Oversight Committee

The Oversight Committee[5] is composed of members of Congress equally distributed between the House of Representatives and the Senate who will closely monitor the implementation of the CARP. Many cases involving implementation of CARP have reached Congress and Congress calls for a legislative investigation. The problems are mostly rooted in the implementing agencies, budget and gaps in the CARL. It has been anticipated that for the next 5 year extension, Congress wants to closely monitor the implementation of CARP in order to achieve its target and complete the distribution of more than 1 Million hectares of agricultural lands. The oversight committee will report periodically to Congress for possible adjustments of the law and executive polices in order to strengthen the implementation of the CARP[6].

Clear Policy against Conversion of Agricultural Lands

One of the sharpened policies in the CARPER law is the relationship of conversion of agricultural land to non-agricultural uses and food security. At present, only the DAR has the mechanism to regulate the conversion of agricultural lands to non-agricultural uses because all agricultural lands are covered under CARP.  Many landowners convert their land to non-agricultural uses to evade CARP coverage.  When the country experienced rice crisis last year, government realized that many of the food producing lands have been converted to non-agricultural uses. Studies show that small farms are food producing farms compared to big plantation. This can be seen in the distributed lands in Negros where the ARBs awarded with less than a hectare of land plant vegetables, raise chicken and other food products which contributed to their food needs as well as the community.

The CARPER law strengthens the ban on any conversion of irrigated and irrigable lands and mandates the National Irrigation Administration to identify these[7]. Moreover, it also legislates the resolution of the “Sumilao farmers case” that the non-implementation or violation of the conversion plan will result to automatic coverage of the subject by CARP.

Under the CARPER law, any conversion to avoid CARP coverage is a prohibited act. The word “any” makes the defense of good faith or ignorance of the law untenable[8]. Moreover the penalty for conversion is heavier. It will merit imprisonment of 6 to 12 years and/ or a penalty of 200,000 pesos to 1 million pesos[9].

Gender-Sensitive Agrarian Reform

The CARPER law institutionalizes reforms recognizing the rights of rural women to be beneficiaries of the CARP and to have meaningful participation in its planning[10] and implementation. Aside from making the language of all the provisions of the law gender-neutral, the policy statement declares the right of rural women-- 

“the State shall recognize and enforce, consistent with existing laws, the rights of rural women to own and control land, taking into consideration the substantive equality between men and women as qualified beneficiaries, to receive a just share of the fruits thereof, and to be represented in advisory or appropriate decision-making bodies. These rights shall be independent of their male relatives and of their civil status”[11].

Such policy pronouncement on rural women is a great improvement of the CARL. The CARPER law defines the identity to the countless of rural in agrarian reform communities and recognizes their productive and reproductive labor[12]. The design of the support services[13] of the ARBs takes into account the specific needs of rural women through the creation of a women’s desk. Moreover, rural women will have a representative in the highest policy make body of DAR which is the Presidential Agrarian Reform Council (PARC) ensuring also that the composition of the PARC will have 20% women members[14].

II.LAND ACQUISITION AND DISTRIBUTION

150-B Budget For CARPER Implementation

The budget allocated for the 5-year extension is 150 Billion pesos[15] which will be sourced from three funds namely: 1.) Agrarian Reform Fund, 2.) other sources of funding like privatization of government asset, foreign donors, etc. and 3.) General Appropriations Acts (GAA). So far, this budget is the largest per year in the history of CARP.

In the 2009 GAA, only 13 Billion pesos was allocated for the DAR because of the absence of the law that extends the funding of CARP. Sen. Arroyo specifically inserted a provision in the GAA that disallows any use of this budget for LAD. This has been foreseen in the deliberation of CARPER and the intention of the lawmakers was to allocate the budget to be used for CARPER immediately available when the law takes effect on July 1, 2009.

Another improvement in the CARP budget is the continuing appropriation during the 5-year period and the clarification that interest payments of the bonds and just compensation used to acquire private lands will be part of the debt servicing in the GAA or any unprogrammed items in the GAA. This will ensure that the landowners will be paid. The usual complaint of landowners in the implementation of the program is that they are not paid for their land taken under CARP.   

Phasing Schedule of LAD To Ensure Completion by June 14, 2014

Under the CARPER law, Congress updated the phasing of the LAD implementation[16] in the CARP for the next five (5) years. The intention was to provide a time table for DAR to manage the acquisition and distribution of the remaining backlog. The target period for each phase mandates DAR to work hard in order to be on schedule. The BICAM clarified that the target period does not stop the coverage of agricultural land after the deadline.

At first glance, the phasing schedule seems complicated but a careful reading of provision will show straight forward schedule. The first phase will cover the landholdings 24 hectares and above which have been issued notice of coverage by December  10, 2008, government lands and those offered under Voluntary Land Transfer (VLT) and Voluntary Offer to Sell (VOS). This phase will start on July 1, 2009 and should be completed on June 30, 2012. The second phase will cover the landholdings 24 hectares and above which have not been issued notice of coverage by December 10, 2008 and all landholdings below 24 but above 10 hectares which have been issued notice of coverage by December 10, 2008. This phase will start on July 1, 2012 to June 30, 2013. The last phase covers below 10 hectares. However, this last phase will only begin if all the previous phase has been 90% completed in a particular province. The last phase will start on July 1, 2013 and end on June 30, 2014. Public Agricultural lands will not be covered by the phasing and can be covered anytime.  

Another important improvement for this provision is the deletion of the phrase “insofar as the excess hectarage” in the CARL. The phrase was interpreted to limit the coverage to the excess area of a piece of landholding for that phase. Then cover the next excess for the next phase and so on. To illustrate the interpretation before, given 51 hectares; for the first phase, 1 hectare will be covered being the excess of 50 hectares, the next phase will cover the 26 hectares the excess from 24 hectare and the next phase the entire 24 hectares. Such interpretation was absurd, expensive and would definitely prolong the LAD. In the CARPER law, a particular landholding above 10 hectares can be acquired and distributed only once. 

There is a mandate in the CARPER law to resolve by June 30, 2012 all the valuation cases pending in the DAR.

No More Voluntary Land Transfer (VLT) After June 30, 2009

Compulsory Acquisition and Voluntary Offer To Sell will be the main mode of land acquisition when the law takes effect. Many studies have shown that VLT has been abused by the landowners to put people who are not qualified or people who are loyal to them as beneficiaries. A cut-off date for VLT applications has been set on June 30, 2009. No VLT applications will be allowed after July 1, 2009.

Retention Limit Exemption Of Local Government Units (LGUs)

LGUs except the Barangays can own agricultural lands beyond the five (5)-hectare limit set by CARL. This privilege is only applicable to lands that will be used for public purposes such as roads, bridges, public markets, school, resettlement, LGU facilities, public parks and barangay plazas. There are two limitations to this exemption: 1.) the use of the land must be actual, direct and exclusive; and 2.) the use must be consistent with the approved comprehensive land use plan[17]. Moreover, if the land is covered under CARP and the LGU wants to use it for one of the public purpose mentioned earlier then it must be expropriated first and the farmers therein must be justly compensated.

The law on conversion will still apply to the LGUs because the public purpose projects will entail conversion of agricultural lands to non-agricultural uses. The LGUs are not exempted from the application of the Conversion Order from DAR.

Review of Land Size Limits For Each Type of Crop

For the next six (6) months, DAR will submit a study to Congress for the appropriate land size of each crop[18]. The purpose is for a possible review on the limit of land sizes. For instance, for coconut what is the most productive land size to maximize yield and minimize cost. However, before the 3 hectare award be adopted, a new law is needed.  

Tenants and Regular Farmworkers Are First Priority Beneficiaries

This provision[19] was formulated and strongly advocated by Rep. Pablo Garcia (hence this was known as the Garcia Amendment). The provision provides that in a certain landholding the qualified beneficiaries who are tenants and regular farmworkers will receive 3 hectares each before distributing the remaining land to the other qualified beneficiaries like seasonal farmworkers and other farmworkers under Section 22 of CARL. The practice now is that any qualified beneficiary in the area will receive a piece of land however small through collective ownership. Such is beneficial to farmers because no matter how small the land, they can always make it productive. If this provision will be implemented strictly, a number of seasonal farmworkers in Negros and many other places that will not receive land because they can only benefit if there is extra land or if there are no tenants or regular farmworkers. Most of the time, the Tenants and Regular Farmworkers are the most loyal workers to the landowners and it will be easier for the landowner to get back, lease back or consolidate the lands distributed under CARP.

Attestation Requirement of Farmer Beneficiary

Another Garcia Amendment[20], under the CARPER law a new procedure for the identification of agrarian reform beneficiaries requires the Barangay Agrarian Reform Council (BARC) to first certify that the potential beneficiaries are Farmers or Regular Farmworkers actually tilling the lands and the list should by attested under oath by the Landowner and lastly will state under oath before a judge that he/she is willing to work on the land and make it productive and assume the obligation of paying the amortization. The problem will arise because landowners are not the most available persons to make an attestation. The attestation requirement can be used as leverage against the farmers. Secondly, with this requirement the Landowner can choose the beneficiaries and only those favorable to him/her will be on the list. Another problem is the proximity of the Judge from the place of the farmer beneficiaries which are far from the farms. This requirement will actually pose a serious problem to the farmer beneficiaries and hamper the selection process of beneficiaries.  

A provision to check the correctness of the attestation and the undue delay in giving out the attestation might cause in the implementation is in place. Section 25 provides penalties to the landowner who will cause undue delay in complying with the obligation of attestation and/or falsification of the certification or attestation required is prohibited and is punishable with 6 to 12 years imprisonment or up to 1 million pesos penalty.

 Encourage Empowerment and Organizing of Farmer Beneficiaries

The CARPER law has a bias for organized farmers to be beneficiaries. Congress believes that the success rate of organized farmers is high and can make their awarded lands productive. The DAR is mandated to conduct seminars and trainings for the farmers to organize. The DAR shall also assist the farmers form or join cooperatives.   

Individual Titles of Award

The CARPER law adopted the recommendation from the economists that individualized Certificate of Land Ownership Award (CLOA) and Emancipation Patent (EP) is beneficial for the farmer beneficiaries. This will encourage farmers to invest in the awarded land and will have a sense of ownership. As a matter of policy in the CARPER law, land awarded should be in the form of individual title. The DAR will do the parcelization of the existing collective CLOAs and must be completed within three (3) years from the effectivity of the law. However, this is without prejudiced to collective CLOAs that are effective and need not be parcelized. A group of farmer beneficiaries can also decide to have a collective CLOA subject to the conditions[21] in section 10 of CARPER. Their collective CLOA must indicate the names of the beneficiaries.

Shortened Period For Installation of Farmer Beneficiaries

The CARPER law mandates that the award of the land must be completed within 180 days from the date of registration of title in the name of the Republic of the Philippines. Such period is shorter than that of CARL. Another reform that can help shorten the period for installation is the inclusion of the standing crop in the computation of the just compensation for the land[22]. This is the learning from the Hacienda Malaga Case were the only reason for the delay in installation is the standing crop. From experience, delay in installation causes violence and insecurity to the farmers.

The CARPER law emphasize that farmer beneficiaries will only start payment of amortization if they have been physically installed on the awarded land for one (1) year.

Ministerial Duty for the Registry of Deeds To Register Land in the Name Republic of the Philippines and CLOA

The unfortunate experience in Negros (especially the Arroyo Lands in Bacan, Negros) where Registry of Deeds refuse to register the title in the name of the Republic of the Philippines bring about the provision under the CARPER law which states--

“it is the ministerial duty of the registry of deeds to register the title of the land in the name of the republic of the Philippines, after the Landbank of the Philippines (LBP) has certified that the necessary deposit in the name of the landowner constituting full payment in cash or in bond with due notice to the landowner and the registration of the certificate of land ownership award issued to the beneficiaries, and to cancel previous titles pertaining thereto[23].

 Upon certifying the payment of Land Bank, the Registry of Deeds cannot refuse to cancel the title of the landowner, register the same title under RP title and to register the CLOA to be awarded to beneficiaries. This will lessen the stumbling blocks in the process of CLOA generation. 

Actual and Physical Distribution

The CARPER law specifies that award of land must be actual and physical possession[24] of the land which is in contrast to non-distributed schemes like Stock-Distribution Option and Leaseback arrangements. This can be the basis for the farmers to demand from the DAR for an actual and physical award of the land to them and they can legally reject any non-distributive schemes similar to the Hacienda Luisita experience.  

Indefeasibility of EP and CLOA

The CARPER law legislates the Supreme Court decision in Estribillo vs. DAR (G.R. No. 159674, June 30, 2006) declaring titles of land awarded under any agrarian reform program are indefeasible and imprescriptible. The titles (i.e. EP and CLOA) will be afforded the same protection as Torrens title under the Torrens system[25].  This provision provides protection to the CLOA’s or EP’s of farmers being cancelled after it has been registered already for a long time.

Usufructuary Rights Over Awarded Land Pending Award of EP or CLOA

Under the CARPER law, “identified and qualified agrarian reform beneficiaries, shall have usufructuary rights over the awarded land as soon as the DAR takes possession of such land, and such right shall not be diminished even pending the awarding of the emancipation patent or the certificate of land ownership award”. This is will be useful to secure the rights of farmers in cases when the title of the landholding is in the name of the Republic but there is a delay in installing them as farmer beneficiaries. Instead of waiting for the awarding of the CLOAs, the farmers can already occupy the land and cultivate it to prevent the land from being idle or abandoned.

Cancellation of CLOA or EP is under the Exclusive and Original Jurisdiction of the DAR Secretary

Congress intended to change the current rules on cancellation of CLOAs or EPs. The cancellation of registered CLOA goes to the DARAB while unregistered CLOAs to the DAR Secretary. The transfer of all cases on cancellation of CLOA to the DAR secretary will make it easier to the petitioner because of the simpler rules. The appeal to the Office of the President (OP) is available and is strategic for dialogue. Again this provision is double edge because the landowners can also go to the OP and will have chances of getting a favorable decision. This is the case of Banasi farmers in Camarines Sur where the favorable decision of the DAR secretary was reversed after seven (7) years at the OP.  Moreover, the decision of the DAR Secretary under the CARPER law is immediately executory even pending appeal to judicial courts.

Affordability Clause Made Mandatory

The CARPER law explicitly mandates that farmers will pay reduced amortizations established by PARC for the first 3 years. For the next years, the law put a ceiling on the annual amortization to not more than 5% to 10% of the value of the annual gross production[26]. The Land Bank of the Philippines (LBP) is mandated to reduce the interest or the principal to make repayment affordable. The amortization depends on the annual gross production determined by the DAR which will effectively make the amortization of farmer beneficiaries affordable. This is a great improvement from the CARL because the affordability clause here is made mandatory for LBP and DAR to implement.

The affordability principle arises from the nature of agrarian reform as a social justice measure and not really a market transaction or realty sale. The State comes as the equalizer trying to observe due process in correcting unjust ownership of agricultural land by paying the difference between just compensation and the affordable amortization of farmers.

More Participation of Farmers in the CARP Implementation

The CARPER law provides a mechanism for greater farmer participation in the policy formulation and program implementation of CARP through ARB membership in the PARC. Even potential agrarian reform beneficiaries may be nominated. The most important is the requirement of ARBs’ concurrence in all the stages of the program[27].

III. Agrarian Justice

Recognition of Farmer’s Legal Standing

The problem in many of the cases involving farmers is the non-recognition of their legal standing and interest under the CARP. The case of Fortich vs Corona (289 SCRA 624) is often used to exclude the farmers from cases before regular courts or quasi-judicial bodies even if the case or controversy involves their rights under CARP. The CARPER law tries to correct this doctrine by legislating that in cases where regular courts or quasi-judicial bodies have competent jurisdiction, agrarian reform beneficiaries or identified beneficiaries and/or their associations shall have legal standing and interest to intervene concerning their individual or collective rights and/or interests under the CARP[28].

The CARPER law went further by correcting the doctrine held in the case of Samahan 53 vs. Mosquera (GR 152430, March 22, 2007) where the legal standing of the farmers’ organization was denied because it was unregistered. Under the CARPER law the fact of non-registration of such associations with the Securities and Exchange Commission, or Cooperative Development Authority, or any concerned government agency shall not be used against them to deny the existence of their legal standing and interest in a case filed before such courts and quasi-judicial bodies[29].

Referral of Agrarian Related Cases to DAR

In many areas where the farmers or tenants assert their rights, landowners file criminal cases against them like qualified theft, estafa, arson or civil cases like ejectment. Such cases are meant to harass the farmers from asserting their rights under CARP. Tenants end up jailed because of a complaint by the landowner that he/she harvested coconuts. In order to correct this injustice, the CARPER law provides an automatic referral by the Judge or prosecutor to the DAR for cases that involves farmers. The DAR will certify whether the case is agrarian related or not. The objective is for the farmer falsely accused to avoid suffering unnecessarily court litigation which cost money and time[30].  

No TRO Issued Against DAR when Implementing CARP

The judicial courts cannot issue injunction or restraining order against DAR and other CARP implementing agencies. This is to legislate the Supreme Court’s ruling in DAR vs Cuenca (G.R. No. 154112, September 23, 2004) that Judicial Courts should not be used to hamper the sound implementation of CARP. The implementation of CARP needs political will and the judiciary must cooperate by affirming the revolutionary power of the State to implement agrarian reform. There are two provisions in the CARPER law that talks about this namely:

Section20.  “EXCEPT FOR THE SUPREME COURT, no court in the Philippines shall have jurisdiction to issue any restraining order or writ of preliminary injunction against the PARC, THE DAR, or any of its duly authorized or designated agencies in any case, dispute or controversy arising from, necessary to, or in connection with the application, implementation, enforcement, or interpretation of this Act and other pertinent laws on agrarian reform.” And,

Section 23 ”IN CASES FALLING WITHIN THEIR JURISDICTION, no injunction, restraining order, prohibition or mandamus shall be issued by the [lower courts] REGIONAL TRIAL COURTS, MUNICIPAL TRIAL COURTS, MUNICIPAL CIRCUIT TRIAL COURTS, AND METROPOLITAN TRIAL COURTS against the Department of Agrarian Reform (DAR), the Department of Agriculture (DA), the Department of Environment and Natural Resources (DENR) and the Department of Justice in their implementation of the Program.”

 A problem arises from trying to reconcile the above provisions because the Court of Appeals is not included in Section 23 while it is included in Section 20. The jurisdiction can be clarified through the implementing rules and regulations. 

DAR Decision is Immediately Executory

The DAR decision will be immediately executory notwithstanding any appeal to the Court of Appeals. The exception is the issue on just compensation which is really within the jurisdiction of the judiciary[31]. This will speed up the execution of favorable DAR decision pending appeal. However, this is another double edge provision which might also be harmful if the decision is against the farmer.

Additional Prohibited Acts on Circumvention of CARP Implementation

The significant addition of prohibited acts[32] focus on the inefficiencies of the DAR offices in the implementation of the CARP like the denial of notice and/or reply to landowners, deprivation of landowners of their retention rights, the delay in the preparation of the claim folders and the payment of just compensation. DAR and CARP Implementing Agencies are also enjoined to submit report, data or document involving the implementation of the CARP and refusal or undue delay is prohibited. A catch-all provision is included, “any culpable neglect or willful violations” of the CARPER law is punishable. Also any farmer violating this act will be disqualified from being a CARP beneficiary.

The penalties have been increased to promote efficiency and deterrent to circumvention of the law. The minimum period of imprisonment is three (3) years and the maximum is 12 years while the minimum fine is 50,000 pesos and the maximum is 1 Million pesos[33].

Hence, the CARPER policy is to implement CARP with full rigor, with State power and any obstruction by any person whether farmer, landowner or DAR will be dealt by the law. The enforcement of these provisions poses as a great challenge because in the previous years, not a single person was prosecuted successfully for violating the CARL.

IV. Support Services

Improved Budget for Support Services

The CARPER law allocates 40% of the 150 Billion pesos or 60 Billion pesos for support services[34], a very important component of CARP. This is a great improvement from the CARL which only provides 25%. Studies show that ARBs who succeed were provided adequate support services by the government.

The CARPER law provides for a clear guideline on where to use the support services like credit, infrastructure, farm inputs and trainings. One improvement is the allocation of budget for the training of farmers to empower and organize them into cooperatives. DAR is mandated to be active in the education and capacity building of farmers.

More Access to Socialized Credit, Subsidies to New ARBs

Thirty percent (30%) or 18 Billion pesos is allocated for credit to ARBs[35]. Six (6) Billion pesos will be subsidies to new ARBs for initial capitalization and 12 Billion pesos will be socialized credit to existing ARBs. Other government financial institutions are mandated to institute reforms to liberalize the access to credit by the ARBs.

Establishment of More Agrarian Reform Communities (ARCs)

The CARPER law mandates the DAR to create at least two ARCs in each legislative district. This is an improvement from the previous law which requires only one (1). The ARC strategy has been proven effective in developing successful ARBs. However not all ARBs are in ARCs because of lack of funds. Hence, the DAR is mandated to establish a complementary support service delivery to those ARBs who are not in ARCs.

Expected Harvest, Purchase Orders and Warehouse Receipts Can Be Used as Collateral

Access to credit of farmers is the ability to avail loans from finance institutions like banks which is a big problem with farmers because these financial institutions have a notion that farmers are not bankable. The CARPER law mandates financial institution to accept as collateral of a farmer who applies for a loan for production the following: purchase orders, marketing agreements or expected harvest. Some banks are accepting already the said instruments but others are hesitant. The traditional collateral accepted by banks is land, however banks shy away from CLOA or EP due to the first mortgage to LBP. Thus, the CARPER law denies the concept of farmland as collateral by providing alternative to land as collateral because the issue is how to increase access to credit of ARBs.

Conclusion

The CARPER law offers at least 26 reforms in order to address implementation gaps especially with the Land Acquisition and Distribution component of CARP, enough to spur a new vigor and interest in the implementation of a constitutionally mandated agrarian reform. The CARPER law brings government and civil society into closer cooperation for a better implementation of CARP. Five years is not enough to complete the LAD balance if the implementation sways without political will. From the track record of DAR, the best it accomplished was 150,000 hectares of public and private agricultural lands with voluntary land transfer. The challenge now is how to acquire and distribute private agricultural lands with strong resistance. DAR must go beyond its usual accomplishment in order to overcome the legal and extra legal challenges.

The CARPER law provides the resources, power and mechanism to do accomplish the CARP target. Civil society together with the Congressional Oversight committee will not only monitor DAR but will lend its hand to help the farmers get what is due them within the law. Serious enforcement is needed given the clear policy on conversion and gender sensitive agrarian reform. At least three provisions in the CARPER law that needs careful attention because they might delay or dilute the running of the CARP namely: the prioritization of beneficiaries to tenants and regular farmworkers, the attestation requirement and the LGU ownership beyond five (5) hectares.

The next five years will be the most exciting for CARP implementation, the 20-year rehearsal is over and DAR must strike head-on with full steam provided by CARPER. Let it be known that CARPER was won with sweat and blood of farmers, DAR must not put them to naught.   

Today, Aug 7, GMA signed into law RA 9700 or the CARPER law which will extend the funding for Land Acquisition and Distribution with Compulsory Acquisition. CARPER law has been crafted by the farmers with strong support from the Church, Civil Society and leaders in governement. The law was signed at Plaridel, Bulacan where Pres. Diosdado Macapagal signed the Land Reform Code. According to GMA, it was the only law passed by his father which made him very happy. He even brought his whole family to witness the signing of the Land Reform Code. Hence, according to GMA she is committed to CARP. However, during the interview on the salient points of CARPER, she was not able to explain the main features of the law but left it with the Congresspersons. GMA kept referring to her SONA where she wanted farmers to be entrepreneurs like Biofuels feedstock production. She was also asked about Conversion and she said that it is ok as long as the farmers agree. She added that there should be a balance on development and agriculture implying that conversion is ok. This  shows that she is not serious with implementing strict ban on conversion which is a new feature in RA 9700.

She also mentioned the condonation of the CLOA amortization which costs around 47 Billion pesos. This is not part of the CARPER law. This will allow farmers to use their CLOA as collateral which leads to consolidation of titles. The effect is that the first mortgage with Land Bank will be cancelled. Those who will benefit from the condonation are the landowners.

The next step after the signing of the CARPER law is the publication of the law in two newspapers. The law will have a retroactive effect on July 1, 2009.  

The House of Representatives with undue haste and manifest manipulation approved House Resolution 1109 (HR 1109) entitled-- A Resolution Calling Upon The Members Of Congress To Convene For The Purpose Of Considering Proposals To Amend Or Revise The Constitution, Upon A Vote Of Three-Fourths Of All The Members Of Congress. Amidst the unfinished interpellation by at least nine Congresspersons on the floor, the majority stopped the debate and approved the resolution turning a deaf ear to the vehement objections. The proponents are in a hurry despite the objections from the minority and in full view of the public. They approved HR 1109 because this is the first step for the House of Representative (House) to exercise its power as a Constituent Assembly (Con-Ass) under Article 17 Section 1 of the 1987 Constitution, to propose amendments or revisions to the Constitution.  This proposal has come up in previous Congress(s?) yet time and again the House ignores strong opposition from all sectors of society

Malicious Attempt By The House To Get the Supreme Court to Legitimize Con-Ass Now

The proponents want the Supreme Court to interpret the Constitutional provision if the House can proceed with the Con-Ass without the Senate. The proponents want to embark on a dangerous fishing expedition dragging with them the Supreme Court and the entire nation. The House wants to start a fight which the country does not need at this time. Prominent constitutional lawyers Fr. Joaquin Bernas and Justice Vicente Mendoza  have asserted that given the Bicameral nature of Congress, the House and Senate should vote separately. Recently, the Supreme Court correctly dismissed the case questioning the propriety of HR 1109 as premature for adjudication. The malice is manifest considering the haste in which HR 1109 was passed in the House and how the solons do not really represent their constituents who are against the idea of a Con-Ass.

Con-Ass Timing is Suspicious

This begs the question –Why convene the Con-Ass now? or Who will benefit from convening the Con-Ass? The proponents know  they don’t have the luxury of time to debate changes to the Constitution extensively. With less than a year before the 2010 elections, the nation is already preparing to elect a new President and other officials. Congress has many unfinished priority bills pending deliberation and these will be delayed even further because of the distraction brought about by the Con-Ass. The worsening global financial crisis coupled with rising oil prices, the disturbing weather patterns as a result of climate change and the spread of A(H1N1) virus pose very clear and present danger to the Filipino family.  These are issues more urgent and important than pushing for HR 1109.

Foreign Ownership Priority For Con-Ass Now, Antithesis of CARPER

The last Whereas clause of HR 1109 is enlightening on the agenda of the Con-ass. It states: “there is a specific proposal that for the Philippines to be internationally competitive in attracting foreign investments and technology transfers that the economic provisions of the Constitution is proposed to be amended… (emphasis supplied)” Earlier in March 2009, Speaker Nograles filed House Bill 737 proposing to amend the economic provisions of the Constitution to allow 100% ownership by foreigners and corporations to own land in the Philippines.

This has serious implications considering the poor performance of government in implementing agrarian reform with a balance of 1.3 million hectares of private agricultural lands still to be distributed to landless farmers. The CARP extension with reforms (CARPER) is a victory for the Filipino farmers who dream of owning a piece of  land to cultivate. Many studies show that CARP has been an effective tool in fighting rural poverty. Now is the perfect time for government to implement fully the new CARPER law to combat the global financial crisis.

Allowing 100% foreign ownership runs counter to agrarian reform.

The Filipino People Will Not Benefit From Con-Ass Now

Who will benefit from the Con-ass? One cannot ignore reports that the President is poised to run as representative  of Pampanga which according to legal experts is not prohibited.  She can be elected as prime minister when the Constitution is amended to allow a Parliamentary system. When that happens, she will have an extended term as Chief Executive and will overtake the Dictator’s term of office. Not to mention the many cases awaiting to be filed against her for violation of the laws and the Constitution. This also can erased by the Con-Ass.

With all the public uproar and expert opinion, convening a Constituent Assembly now is uncalled for because there are more pressing and urgent issues that the House of Representatives and the government must address. Top priority is to ensure peaceful and credible elections in 2010 and to tackle pending priority bills that will give social protection to poor Filipinos given the global financial crisis and climate change. Allowing 100% foreign ownership will destroy the gains from agrarian reform in rural areas. Regulation of ownership of land by the State is necessary because of its social implication.  Most importantly, any attempt to circumvent the Constitutional prohibition against term limits is illegal and immoral and will be opposed by the people in the exercise of their sovereign power provided for under the Constitution.