Why can God declare us justified even though we still sin?
God declares us justified because, in His eyes, the old Adamic sin nature was crucified when we believed the Gospel. He reckons old Adam dead and gone, so the believer is seen as never having sinned. Though we still sin experientially through the old nature, God's declaration rests on the old Adam being dead.
Les teaches that the believer has two natures. When we believe the Gospel, the old sin nature—the old Adam we are born with—had to be crucified and put to death in the realm of the Spirit. Christ reckons it as crucified, and immediately God places opposite that old Adamic nature a new divine nature, which cannot sin because it is divine. When believers sin, old Adam has taken control for a moment, and it is through the old nature that we continue to sin. Yet in God's eyes old Adam is dead. That is why He can declare us justified: we are just as if we had never sinned, because old Adam is dead and gone so far as God is concerned. But experientially, in our everyday life, old Adam still affects us.
For the flesh lusteth against the Spirit, and the Spirit against the flesh: and these are contrary the one to the other: so that ye cannot do the things that ye would.