Closing the Gaps between Law and Justice

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Closing the Gaps between Law and Justice
Speech of Supreme Court Justice Antonio Carpio delivered during the regional
convention of Mindanao lawyers on November 20, 2007 in Davao City

For the last 20 years, the state has not received a single centavo from the profits of
mining companies.
I can sense, from the theme of your Convention, that you – the lawyers from resourcerich Mindanao – have come together to address a common issue that has agitated your
souls, disturbed your minds, and pained your hearts.
The theme of your Convention , Katarungan sa Kinaiyahan, Kalinaw sa Mindanaw,
connects environmental protection to peace and development in Mindanao. The theme
expresses the concept of fair treatment to the environment as essential for peace and
development in Mindanao.
Fair treatment to the environment is fair treatment to the people whose lives – past,
present and future – are intertwined by history, custom, livelihood and fate with the
environment. Fair treatment to the people means two things.
First, giving the people their fair share in the income from the exploitation of the natural
resources of the environment. Second, protecting the environment to insure that even
after the exploitation of the natural resources, the environment continues to sustain the
lives and livelihood of the people. This is the policy that will guarantee peace and
development, in Mindanao and elsewhere in the country.
I understand that you have invited me as your keynote speaker because of my dissenting
opinion in La Bugal-B’laan v. Ramos. I cannot discuss with you the merits of La Bugal,
because I cannot expand on what I have written in my dissent. I am a firm believer that
a Justice who dissents in a case cannot continue his fight outside the Court. He must
write everything—all his arguments, fears and angst and pour out his soul—in his
dissent.
His dissenting opinion is the only vehicle for expressing his thoughts. He cannot wage a
debate outside of the En Banc deliberations because he must accept the finality of the
vote of the majority as establishing what is legal. If he does not personally believe in the
correctness or fairness of the majority’s decision, he must patiently wait for the same
issue to be raised again in the Court, when the wisdom of hindsight might sway the
majority of his colleagues to his point of view.

However, without touching on the merits of the legal issues in La Bugal, I can discuss
with you the official acts of the Executive Department after the promulgation of La Bugal
on February 1, 2005. Did the Executive Department follow the majority opinion? Why?
And what lessons can lawyers from Mindanao learn from this?
In July this year, then DENR Secretary Angelo Reyes issued Department Administrative
Order (DAO) 2007-12 on the Revised Fiscal Regime of FTAAs or foreign technical
assistance agreements. In a news report dated July 2, 2007, ABS-CBN Interactive
stated:
Reyes, however, clarified that the scheme (revised fiscal regime) is included
in the three options given to foreign investors before they are allowed to
start mining operations. The three options are cumulative face value of cash
flows, profit based sharing and cumulative net mining revenue.
“Companies coming over would naturally choose the option that will be most
beneficial to them; and they will end up choosing one, that is the second
option,” he said.
He added: “(The) second option will be disadvantageous to the government
because it says that the additional government share … will only kick in if
the profitability ratio net income over gross income is higher than 40
percent.”
He said no mining company in the history of the industry achieves that 40
percent income. He said the probability of the government getting an
additional and fair share of its minerals from the mining companies is
“somewhere from zero to nil.”
Let me repeat that: the DENR Secretary, doing his own arithmetic, publicly admitted
that, under the profit sharing formula in DAO 99-56 approved in La Bugal, the
government will receive “somewhere from zero to nil” in the mining revenues of foreign
contractors. “Zero to nil” means not even a pittance. The Filipino people will receive
nothing, zero, nil, in the profits from the estimated P47 trillion mineral wealth of the
country. This is the conclusion of the DENR Secretary.
The DENR Secretary therefore revised the profit sharing formula in the net mining
revenues into a 50-50 split between the State and the FTAA contractor. This is ordained
in the recently issued DAO 2007-12.
Should you now be jumping with joy? I believe that lawyers should always have a healthy
skepticism. The devil often lurks in the details.
I have not thoroughly studied DAO 2007-12. You, the lawyers from Mindanao, where a
substantial portion of the P47 trillion mineral wealth of the nation is found, should be the
first to study thoroughly DAO 2007-12.
The P47 trillion mineral wealth belongs to the State. You, your children, grandchildren

and great grandchildren are the primary beneficiaries of this vast, God-given wealth. You
have a tremendous stake in how the mineral wealth of the nation is going to be carved
out.
Let me just cite two points about DAO 2007-12, and these should serve as caveats. First,
DAO 2007-12 by its express terms applies prospectively. There are only two existing
FTAAs, and both were signed before the effectivity of DAO 2007-12. That means DAO
2007-12 does not at present apply to any existing FTAA. That also means the two
existing FTAAs will still be governed by the formula approved by the majority of the Court
in La Bugal, the formula in the old DAO 99-56.
That old formula, in the words of then DENR Secretary Reyes, gives the Filipino people
“somewhere from zero to nil” in mining revenues. Ironically, this is the fate the DENR
wants the Filipino people to accept for the 49,373 hectares of mineral lands covered by
the two existing FTAAs.
Second, DAO 2007-12 applies only to FTAAs and not to MPSAs or mineral production
sharing agreements. There is no law or DAO that gives the Filipino people any share, not
even a single centavo, in the profits from MPSAs. And yet all the existing mining permits
issued by the government are MPSAs except for the two FTAAs.
In short, the two FTAAs reveal only the tip of the iceberg, and what lies below the surface
of the waters are the more than 262 MPSAs approved as of July 31, 2007 comprising a
total of 422,804 hectares of mineral lands. You can just imagine where the bulk, even all,
of the profits from the P47 trillion mineral wealth of the nation is now going – certainly
not to the coffers of the State, certainly not to the Filipino people, certainly not for your
benefit.
The 1987 Constitution has been in effect for 20 years now. The 1987 Constitution
discarded the “concession and lease” system under the 1935 and 1973 Constitutions.
Instead, the 1987 Constitution mandates the State to exploit our mineral resources
through direct undertaking, joint venture, or co-production arrangements. The purpose is
for the State, as owner of the mineral resources, to receive its fair share in the profits
from the exploitation of our mineral resources. Sadly, for the last 20 years the State has
not received a single centavo from the profits of mining companies.
What lessons can you as lawyers learn from this?
Obviously, gaps exist between what is legal and what is just and fair in the exploitation of
our mineral resources. There have always been, and will always be, gaps between law
and justice.
In 1857, the U.S. Supreme Court ruled, in the infamous Dred Scott case, that blacks are
inferior to whites, that they deserve to be slaves, and that they could never be citizens of
America. This decision of the U.S. Supreme Court was the law then, legal yes but
obviously terribly unjust and unfair. This blatant racist decision dragged the U.S.

Supreme Court to its lowest point in history. It took a civil war to undo this greatest
blunder of the U.S. Supreme Court. It took a bloody civil war, not another court decision,
to close the gap between law and justice.
In 1954, the U.S. Supreme Court promulgated Brown v. Board of Education, allowing
blacks to sit in the same classrooms as whites, overturning the 1896 “separate but equal
doctrine” in Plessy v. Ferguson. The “separate but equal doctrine” legitimized segregated
schools for blacks and whites. In its over half a century as the prevailing jurisprudence,
Plessy v. Ferguson was the law – legal just like Dred Scott, but never just and fair. Brown
v. Board of Education closed the gap between law and justice. Fortunately, this time
around there was no need for another civil war in America to close the gap between law
and justice.
The reversal of Plessy v. Ferguson was a bitter, long drawn battle. The reversal was
carefully planned and waged for several years, starting from the choice of the test case,
by Thurgood Marshall, general counsel of the NAACP or the National Association for the
Advancement of Colored People. Marshall and his band of civil rights lawyers prevailed
because they had a clear vision of social equality, they had a passion for justice for their
fellow blacks, and they had the determination to fight against great odds the historic
battle of their lifetime. Marshall, who argued brilliantly for NAACP before the U.S.
Supreme Court in Brown v. Board of Education, later became the first black Justice to sit
in the U.S. Supreme Court.
The development of the law through the ages is all about closing the gaps between law
and justice. What is legal may not necessarily be just and fair.
Historically, the gaps between law and justice have been closed either through force of
arms or through force of reason. As lawyers dedicated to the rule of law, you have only
one choice – to close the gaps, no matter how wide, through force of reason. All the
formal and informal institutions of society must constantly strive to close the gaps
between law and justice through reason and the legal processes.
This constant struggle to close the gaps through reason and the legal processes may be
tedious but this is the only way to avoid a bloody closure of the gaps between law and
justice. This is the only guarantee to maintain peace in our land.
Your advocacy as lawyers is to close peacefully the gaps between law and justice. The
gaps to address are naturally those that impact most your lives, your environment, and
your future. Do existing law and jurisprudence on the exploitation of mineral resources
do justice to the Filipino people? Your theme Katarungan sa Kinaiyahan, Kalinaw sa
Mindanao correctly addresses the gaps in the law that cry out for justice, and I commend
you for this.
Like you, I am from Mindanao. In fact I grew up here in Davao City until I went to college
in Manila. I remember in the 1950s and 1960s seeing almost daily huge trucks filled with
logs negotiating the then narrow highways of Davao. People did not mind the

indiscriminate logging because our forests then seemed inexhaustible.
Our nation’s population at that time was only 20 million. Now we regret bitterly how we
squandered our finite forest resources and how indiscriminate logging has destroyed our
environment. And with all that logging, did the people of Mindanao receive their fair
share in the profits from the exploitation of this precious natural resource? How much did
the State earn from all that logging? Only a pittance consisting of minimal forest fees and
charges.
We ought to know better now in the exploitation of our mineral resources. We must learn
from our past mistakes in the exploitation of our forest resources, otherwise we will be
forced to repeat the same mistakes in the exploitation today of our mineral resources.
Because of neglect, inaction or whatever, the generation of lawyers before you apparently
failed to take the cudgels for the Filipino people in protecting the nation’s interest in the
exploitation of our forests.
Now, you – the present generation of lawyers – have the benefit of hindsight. Aided by
the wisdom gained from the sad experience of the past, you can better examine present
government policies on the exploitation of mineral resources. History will soon record
whether the lawyers of today have learned from the mistakes or inaction of their
predecessors. I have great expectation that considering the theme of this Convention,
the present lawyers of Mindanao will fulfill their historic duty to the nation and to the
people of Mindanao. I salute you, the lawyers of Mindanao, for going boldly where no
lawyers have gone before.

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