About two (2) weeks ago, the Federal Supreme Court (“STF”) rejected, by nine (9) votes to two (2), the temporal milestone thesis for the demarcation of indigenous lands, which states that the demarcation of an indigenous land can only take place if it is proven that a specific indigenous community occupied the requested area on October 5, 1988 – the date of promulgation of the Federal Constitution (“CF/88”).
Thus, with the aforementioned rejection of the “Temporal Framework” thesis, it was decided by the STF that the expropriation and, consequently, the eventual demarcation of an area as indigenous does not depend on whether or not the indigenous communities were occupying or disputing the area on the date of promulgation of the CF/88, but on other requirements that the STF assessed as constitutionally valid, namely: the demonstration of the traditional nature of the occupation of a given indigenous community, in accordance with its uses, customs, traditions and environment, with the exercise of the indigenous people’s traditional activities being ensured.
It is important to note that the judgment of Extraordinary Appeal No. 1.017.365, which established the thesis in question as explained above, had general repercussion (Topic No. 1.031), that is, it will serve as a parameter for resolving other cases on the same subject, and began on September 21, 2023, being resumed and concluded only in the session held on September 27, 2023. On that occasion, in the middle of last week, the Justices of the Supreme Court recognized the right to compensation for private individuals who may have their land expropriated for the constitution and demarcation of indigenous reserves, provided that they have acquired their land in “good faith”, that is, within the legal premises and without any type of encroachment or defect in the acquisition of that property.
Also in this regard, the Supreme Court ruled in a general repercussion case that any compensation for improvements on the property and for the Value of the Bare Land – VTN, will apply to owners who received land titles from the federal and state governments that could later be considered as areas subject to expropriation for the creation of reserves and/or indigenous areas.
Thus, the requirements for setting compensation were defined by the STF as being:
- In the event of indigenous occupation or legitimate dispute over the land on October 5, 1988, what we call the “Inverted Temporal Framework” created by the STF at the time, it will be up to the owner to be compensated for the improvements made on the site, which the law already provides for today;
- If there is no indigenous occupation or legitimate dispute over the land on the date of the CF/88, and if the owner has occupied in good faith the place that will be demarcated as indigenous, he will be entitled to prior compensation for the improvements;
- If it is not feasible to resettle the owner in good faith, he will be entitled to compensation for the value of the land itself;
- Compensation for the land itself can be paid by the Union, which can demand the amounts from the states or municipalities that have allocated the area, and will be discussed in an administrative or judicial procedure separate from the demarcation process;
- The compensation must be paid immediately and the landowner may retain the land until the public authorities have paid the undisputed amount in full;
- In cases that have already been settled, such as indigenous lands that had been duly demarcated up to the date of the judgment in question, compensation will not be due, i.e. the judgment, despite the general repercussion, would not retroact its effects to affect situations already protected by formal res judicata;
- It will be possible to re-dimension the area of indigenous land up to five (5) years after demarcation, provided that serious or insurmountable errors in defining the boundaries of the territory are proven.
In this way, the approved thesis confirms the overthrow and, as we have tried to call it, the “inversion” of the temporal milestone and authorizes prior compensation to be paid in cash or in agrarian debt securities to landowners whose properties are involved in the process of demarcating indigenous lands.
It is also important to note that during the session on September 27, Justice Alexandre de Moraes voted to guarantee compensation for “bona fide” owners. Justice Dias Toffoli withdrew his proposed vote to set a 12-month deadline for Congress to pass a law allowing the economic exploitation of indigenous lands, which is currently being debated in Congress and has already been approved by a committee in the Senate, but with the aim of regulating the matter and creating legal certainty for landowners and traditional communities, as well as society as a whole due to food security and the environment.
Given the apparent contradiction between Congress and the STF’s decision, we believe that there could be a new judicialization of the issue. From this perspective, once the bill has been approved by Congress after the STF’s decision, it will be possible to challenge it on the grounds of unconstitutionality, and the matter will have to return to the STF itself for a new judgment, but this will depend on a new lawsuit and new arguments to be put forward in court.
The PSAA team is closely following developments on the subject, including before the Federal Supreme Court and the National Congress, and is available for any clarifications regarding the current stage, future prospects and their applications and implications, mainly related to legal certainty involving the owners and occupants of potentially demarcated areas.
Atenciosamente,
Passos e Sticca Advogados Associados – PSAA