STATE lawyers defended the authority of the government in revoking the stock distribution option (SDO) offered by the Cojuangco family’s Hacienda Luisita Inc. to farmer-beneficiaries.

Chief Justice Renato Corona, at the end of the oral arguments at 8 p.m. Tuesday, ordered the creation of a special committee that will try to mediate in the case pending the submission of the parties’ respective memoranda within 30 days.

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During interpellation by Supreme Court justices, Solicitor General Jose Anselmo Cadiz argued that the Presidential Agrarian Reform Council's revocation of the SDO is valid and founded in the constitution.

However, he expressed no objection to the compromise agreement signed on August 6 by HLI and several groups of farmers.

Cadiz also made much ado about his independence in agreeing to the compromise deal despite that he is an appointee of President Aquino, who is one of the scions of the HLI through his mother, the late former President Corazon Cojuangco-Aquino.

He said that Aquino did not talk to him about the issue and that his position is based solely on his review of the records of the case and that he is speaking on behalf of the “Republic.”

“The President has not swayed me either way to speak in behalf of his family, and I would think the late President Corazon Aquino was also that way. I think it is fair to assume that the late Cory Aquino did not give instructions to her Cabinet members, nor did she sway her cabinet members to rule otherwise,” he said.

While he admitted that he has yet to examine the details of the compromise agreement, Cadiz said he is amenable to such settlement, provided that it is not contrary to law and public policy and that all parties are amenable to it.

He said entering into a compromise agreement is in line with the alternative dispute resolution (ADR) program being pushed by the Court.

“If the provisions will be not violation of the law and public policy and if we could hammer out with the help of the Court a compromise agreement acceptable to all parties and acceptable to the law then I think the parties should be given a chance to be able to come up with something which is agreeable to both parties in this case,” he said.

Cadiz said a compromise agreement is feasible considering that a great number of farm workers in the 6,000-hectare sugar plantation favor the deal.

“It is our submission that the farmers will not agree to an illegal or unlawful provision. The parties must come up with an agreement which is not contrary to law, not contrary to public policy, not contrary to morals, and should be freely agreed upon by both parties. I think that is something that can be explored,” he said.

The OSG further cited several reasons why the revocation of the SDO scheme in 2005 by PARC was valid, including the fact that the farmers remain to be poor 21 years after the memorandum of agreement for SDO program was signed by the HLI and the farmers.

However, he noted that the biggest violation of the agreement was the implementation of the Mondays formula, which is contrary to the provisions of the Comprehensive Agrarian Reform Law (CARL), in which the farmers would be given shares to the company based on the number of hours that they worked in the farm.

Under CARL those who will be given the land are farmworkers at the time of the enactment of CARL in 1988, while under the SDO agreement, the beneficiaries are workers not in 1988 but in the future.

“The SDO is unique and deviates from the law as it allows the distribution of the shares of stocks of the farmer-worker beneficiaries based on Mondays work over a period of 30 years. It can be described as a looking forward arrangement since the farm worker beneficiaries shares of stock will only be given after 30 years,” said the OSG.

Cadiz said this set-up, according to Cadiz, has placed the farmers at a disadvantage because of the recognition of additional shareholders through the years effectively results in the dilution of their respective aggregate shareholdings.

Being the implementor of the agrarian reform program of the government, PARC and DAR should also be allowed to join in any discussion that would lead to a compromise agreement

Cadiz also said the government is amenable to the creation of panel of mediators to be organized by the court in order to come up with an agreement that is acceptable to both parties.(JCV/Sunnex)