FLS Closed Memo Problem 2014 Essay

Submitted By dahrouge1991
Words: 2194
Pages: 9

Nizar Dahrouge

Professor Kamphuis

Law 3060

Closed Memo AssignmentMEMORANDUM

To: Senior Partner, Charis Kamphuis

From: Nizar Dahrouge

Date: November 28, 2014

Re: Sanchez v Just Resources Inc. Our Client: 471204-14


I. Facts

Just Resources was incorporated in 2003 under British Columbia laws and trades its stock on the TSX. The company has made corporate social responsibility (CSR) a priority in its business endeavors and, shortly after its incorporation, signed onto the Voluntary Principles on Security and Human Rights. The VPSHR provides guidance to companies in the extractive and energy sectors “in maintaining the safety and security of their operations within an operating framework that ensures respect for human rights”.

In 2010, Just Resources purchased the Chiquita mining property located in Peru in an area known as “La Pata”. This property is the company’s only asset. Upon the announcement, Just Resources’ Executive Officer Sean Manley stated: “As a world class company, Just Resources intends to build a positive relationship with the inhabitants of La Pata, based on mutual respect, mutual benefit and open communication.

Just Resources purchased the Chiquita property through its 100% owned Peruvian subsidiary, Gold Inc. which had acquired the necessary titles and permits by law for the construction and operation of an open-pit gold Mine. Over a course of a few years, Gold Inc. completed construction phases and on April 1, 2013 the mine produce its first bar of gold. Just Resources anticipates the Mine to be one of the largest in South America.

The plaintiff Gomez Sanchez, an indigenous Quechua farmer who lives in La Pata, chose to join the Quechua People’s Defense, an organization formed to express opposition to the Mine.

For security purposes, Just Resources contracted the local services of Paz con Fuerza (PCF). (PCF) is owned and operated by Alberto Torres, a retired Capitan of the Peruvian Military and a former cop. The People’s Defense opposed this move and alleged in a letter that Torres was involved in human rights atrocities and drug trafficking. Just Resources checked two references for Torres among his military and police colleagues and both references described Torres in glowing terms.

Just Resources oversaw all operations at Chiquita Mina and was responsible for all the operational activities. Together Vander and Schwartz (Just Resources VPs) oversaw the hiring, training, equipping and monitoring of the security personnel that PCF had assigned to Chiquita Mine. John Richardson, Just Resources’ Country Manager, was responsible for supervising and directing the Chiquita Mine security personnel in consultation with the Security Manager Alberto Torres. Just Resources’ policy required its security personnel to receive a certain level of training and to follow certain protocols such as using only rubber bullets as a last resort in self-defense.

The Quechua People’s Defense voiced its dissatisfaction with government and company responses to its concerns and on February 14, 2013 they issued a press release stating that it had no choice but to perform a nonviolent protest and possibly civil disobedience in order to stop the project.

Just Resources responded with a press release on February 15, 2013 communicating their commitment to promote and respect human rights. To no avail, a few weeks later, the People’s Defense called on supports to blockage the main road leading to the Mine.

The blockade was causing Just Resources to lose $500,000 a day and on day 3 one of their biggest investor threatened to withdraw investments if construction did not resume soon. Tensions were rising and on day 4, Richardson instructed Torres to use PFC personnel to remove the protestors within 24 hours and turn them over to local authorities.

In the events that followed, the evidence is that PCF security personnel shot at the blockaders…