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The London School of Economics and Political Science ILL FARES the LAND: the LEGAL CONSEQUENCES of LAND CONFISCATIONS by THE The London School of Economics and Political Science ILL FARES THE LAND: THE LEGAL CONSEQUENCES OF LAND CONFISCATIONS BY THE SANDINISTA GOVERNMENT OF NICARAGUA 1979-1990 Benjamin B. Dille A thesis submitted to the Department of Law of the London School of Economics for the degree of Doctor of Philosophy, London, September 2012 Declaration I certify that the thesis I have presented for examination for the MPhil/PhD degree of the London School of Economics and Political Science is solely my own work other than where I have clearly indicated that it is the work of others (in which case the extent of any work carried out jointly by me and any other person is clearly identified in it). The copyright of this thesis rests with the author. Quotation from it is permitted, provided that full acknowledgment is made. This thesis may not be reproduced without the prior written consent of the author. I warrant that this authorization does not, to the best of my belief, infringe the rights of any third party. The views expressed herein are my own alone and not those of the United States Department of State or the United States Government. 2 Abstract This thesis analyzes the consequences of property confiscations and redistribution under the Sandinista (FSLN) government in Nicaragua of the 1980s. It covers the period from the overthrow of Anastasio Somoza Debayle in 1979 to the February 1990 FSLN electoral defeat and the following two months of the Piñata, when the outgoing Sandinista government quickly formalized possession of property by new owners, both formerly landless peasants and the elite. It also examines subsequent efforts to resolve outstanding property claims, with the focus on the Chamorro and later presidential administrations to 2007, when Sandinista leader Daniel Ortega and the FSLN returned to power. The main argument is that Sandinista leaders, largely from the same families that have dominated Nicaragua since the Colonial period, followed Nicaraguan traditions of using influence to distort the legal and political system to gain title to valuable properties. In contrast to partisan arguments in favor of one regime or another, here the methods of property transfer are analyzed by investigating in detail documentary evidence of illustrative cases that show the steps and individuals involved in these transactions, as well as more generally surveying other cases and the overall situation with property. The argument is tested by examining how the selected claimants’ properties were taken and who obtained them. The results indicate that Sandinista elites did obtain properties for their personal benefit, often in violation of their own legislation, but that this was largely consistent with the practice of other, non- Sandinista governments. After their electoral defeat, ongoing Sandinista influence in the organs of government influenced the restitution process, with claimants typically settling for compensation at a fraction of the market value, with the Nicaraguan state and people bearing the cost of paying for compensation bonds over the coming decades. Political influence undermined the restitution mechanism. 3 Acknowledgements I am grateful for the support of my wife, Anna, and boys, Nicolas, Sasha, and Daniel. During the time I wrote this, I balanced full-time work as a U.S. diplomat and part-time work as an associate professor. This work spanned a period in my life that included welcoming new family members, many moves, and service in a war zone. I am also indebted to my parents and, especially, to my sister Sarah, who proofread some chapters and offered advice on structuring my approach. I am grateful for the flexibility and support shown by my supervisors, Simon Roberts and Tatiana Flessas, by my first supervisor, James Penner, and by the staff at LSE’s Faculty of Law, especially Rachel Yarham, who all recognized the challenges of my full-time professional commitments in far-away locations. In particular, I appreciate the guidance and direction by my supervisors in steering me to the successful conclusion of this project. I am grateful to my former colleagues at the U.S. Embassy in Managua, Leonidas Henríquez and Claudia Vivas, who helped keep me updated on the overall situation in Nicaragua and to Ambassador Oliver Garza for supporting my application to the LSE and my project. I am also grateful to Ambassador Norman Eisen and Deputy Chief of Mission Joe Pennington at the U.S. Embassy in Prague, who both encouraged me in the hectic last year of my writing. Finally, I am grateful to those property claimants, the Barreto family (especially Samuel), Katherine Willey families, Miguel Vanegas, Leyla Rener de Marín, and Ulises Carrillo, who gave me permission to cite their property claims in detail. 4 TABLE OF CONTENTS DECLARATION ..............................................................................................................2 ABSTRACT .....................................................................................................................3 ACKNOWLEDGEMENTS..............................................................................................4 TABLE OF CONTENTS..................................................................................................5 LIST OF TABLES AND FIGURES.................................................................................8 1: INTRODUCTION AND OVERVIEW OF THE PROBLEM...................................10 1.1. Context.............................................................................................................11 1.2. Approach..........................................................................................................16 1.3. Methodology and Sources ...............................................................................18 1.4. Objectives ........................................................................................................25 2: A BRIEF HISTORY OF NICARAGUA ...................................................................27 2.1. Pre-Colombian Period .....................................................................................27 2.2. Colonial History...............................................................................................27 2.3. Independence and History to Early 20th Century............................................30 2.4. The Somoza Era and Resistance to the Dictatorship.......................................38 2.5. The Victorious Revolution...............................................................................42 2.6. Challenges of the Sandinista Era .....................................................................45 2.7. The 1984 Elections, the Contras, and the Deal for the 1990 Elections ...........47 2.8. Sandinista Electoral Loss, the Piñata, and “Rule from Below” ......................48 2.9. The Chamorro Administration.........................................................................50 2.10. The Alemán Administration.............................................................................53 2.11. The Bolaños Administration ............................................................................54 2.12. The Pact and Ortega’s Return ..........................................................................56 3: THE EVOLUTION OF THE LEGAL ENVIRONMENT IN NICARAGUA ...........58 3.1. Overview of the Legal System ........................................................................58 3.2. A Brief History of Land, Law, and Corruption in Nicaragua ..........................60 3.3. Legal and De Facto Situation under the Somozas ...........................................65 5 3.4. The Sandinista Revolutionary Legal Regime and Its Aftermath.....................72 3.5. Sandinista Corruption and Human Rights Violations......................................86 3.6. The Protocols of Transition .............................................................................88 3.7. The Post-Sandinista Legal Regime: Reconciling Two Systems......................89 3.8. The Dust Settles, A System is Established, and Corruption Endures ..............94 3.9. The Revolutionary Nature of the Sandinista Regime ......................................97 3.10. Conclusion: Little Fundamental Change but Many Inconsistencies .............102 4: SPECIFIC PROBLEMS OF NICARAGUAN PROPERTY....................................105 4.1. Two Dimensions, Confiscation and Benefit, Both Uncertain........................105 4.2. Problems of Sandinista Confiscations ...........................................................107 4.3. Legalization of Occupied Lands: The Piñata, February to April 1990 ........115 4.4. First Tries at Resolving Claims and Awards of Property...............................118 4.5. Law 278 Codifies the Middle Ground but Problems Persist .........................133 4.6. Bonds and the Problem of Adequacy of Compensation ................................147 4.7. Hard Feelings, Social Reality, Slow Progress, and Grudging Acceptance....162 5: TAKINGS FOR BROADER BENEFIT: LAND INVASIONS AND PUBLIC NATIONALIZATIONS .......................................................................................163 5.1. Land Invasions...............................................................................................163 5.2. Case Study of Invasion and Looting of Farms: the Willey Family ...............163 5.3. Examples of Nationalizations for Public Benefit ..........................................176 5.4. Discussion of Non-Elite Seizures ..................................................................187
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