By THE ASSOCIATED PRESS

          Filed at 12:32 a.m. ET

          MEXICO CITY (AP) -- A top Mexican official said he expected
          hundreds of American retirees to be able to remain in the homes they
          built along the Baja California coast on disputed land, despite a court
          order that the property be returned to its rightful owner.

          Agrarian Reform Secretary Eduardo Robledo said that government
          representatives would go to the Baja California port of Ensenada in the
          next two weeks, not to evict the Americans, but to mark out boundaries
          and formally hand over title of the land to its legal owner, a Mexican
          company.

          ``I sense they (the homeowners) will be able to reach new agreements
          with the real owners. I see no reason why not,'' Robledo told a news
          conference Wednesday.

          The Mexican Supreme Court on Monday threatened to oust Robledo if
          he did not execute a long-standing order to return the land to its rightful
          owners within 10 working days. On Tuesday, Robledo's department said
          it would comply.

          Robledo admitted that the Americans who built on plots leased from a
          farm group, which was later found by courts not to be the legitimate
          owner of the land, could be vulnerable to legal action by the original
          owners.

          Those owners could, after receiving title, go to a court to request eviction
          orders.

          But he stressed that in all five previous cases, where similar land
          restitution orders had been enforced at Punta Banda, the owners had
          negotiated new lease contracts which allowed the residents to stay.

          He said he was under no legal obligation to inform either the farm group
          or the American residents when he intended to act.

          ``I must return the land legally and materially. What happens after is a
          matter for the new owners and the residents,'' Robledo said.

          Any attempt at eviction is likely to draw protests from either the
          Americans or the Mexican farm group, which blockaded roads leading to
          Punta Banda on Wednesday to protest the handover.

          The farmers said they would avoid violence but would maintain the
          roadblock until authorities showed them documents that supported the
          land claim, the government news agency Notimex reported

          The dispute dates to 1973, when a presidential decree granted the farm
          group ownership of an area bordering Punta Banda; land on the spit was
          later wrongly drawn into their property grant on an official map in 1987.

          But Robledo insisted that contrary to first impressions, the return of the
          land to its original owners should increase the confidence of foreigners
          thinking of investing along Mexico's coast.

          ``The message we are sending is that we are consolidating legal security
          in land ownership. What foreign investors need is to feel the rule of law is
          upheld,'' he said.

          The court decision directly affects only 28 houses and a hotel, but is also
          relevant to 500 to 600 residents -- most of them U.S. retirees -- who
          built homes on Punta Banda, based on assurances from Mexican officials
          at the time that their land-leases were legal.

          Under Mexican law, foreigners are banned from owning property within
          65 miles of the border or 35 miles of the coast, but about 60,000
          Americans in Baja California have bought 50-year, renewable leases that
          are held in a bank trust.

          It appears that the leasing contracts between the Punta Banda American
          residents and the farm group were less formal, leaving the retirees without
          protection in the land dispute.