Malaysian Legal History Essay

Malaysian Legal History Essay.

The Straits Settlements were a group of British territories located in Southeast Asia. Originally established in 1826 as part of the territories controlled by the British East India Company, the Straits Settlements came under direct British control as a crown colony on 1 April 1867. The colony was dissolved in 1946 as part of the British reorganisation of its south-east Asian dependencies following the end of the Second World War. The Straits Settlements consisted of the four individual settlements of Malacca,Penang (also known as Prince of Wales Island), Singapore (with Christmas Island and the Cocos Islands).

The island of Labuan, off the coast of Borneo, was also incorporated into the colony with effect from 1 January 1907, becoming a separate settlement within it in 1912. With the exception of Singapore, Christmas Island, and the Cocos Islands, these territories now form part of Malaysia. The Island of Penang in highligh was under the governance of Sultan of kedah however its noted that after the esthablishment of English East India company an agreement was penned by the Ruler of Kedah and the company for penang.

Now in judging what is the “’lex loci” of the island will require answers to two questions as below: i) Was the Island a “settled” or “ceded” colony?. ii)Was the law of Kedah to be applied to island of Penang on ground that the island was “ceded”?

For the first 20 years after esthablishment , it was noted that the only law in place was “Regulations of 1794” or “nature of law”. On March 1807, the English Crown granted the first charter of justice, which resulted in the esthablishment of Court of Judicature in Penang. The effect of this charter could be seen in Kamoo v Basset, In re Goods of Abdullah and Reg v Willans.

The Kamoo v basset (1808) case, notes that the plaintiff a native of Bengal, had agreed to be an employed by the defendent who was an army officer in the Bengal Native Infantary. However upon severe mistreatment by the employer an Police Majistrate complaint was made by the plaintiff. The plaintiff filed and action for assault,battery and false imprisonment against the defendent,claiming damages for $600. The verdict in short noted payment to plaintiff in $150 with cost.

In the Goods of Abdullah (1835) is noted the principle issue is whether a Muslim,who died in Penang,device his entire property by means of will? However it was decided that the will of Abdullah being esthablished as a valid instrument.

In the case of Fatimah Ors v Logan Ors it was noted that since 1786 , Penang being then a desert and uncultivated island,inhabited except by few intinerant fisherman and without any fixed institution was ceded by the Rajah of Kedah to Captain light,an office of EIC,for and on behalf of the company. This fact was important in this case in view of the platiff’s petition to obtain a decree of the court declaring that the deceased died intestate. Three preliminary question arised in this case which were, i) Wheter the capacity of the deceased to make a will is to be decided by Mohamedan or by English law. The verdict was given as the deceased’s capacity to write a will will be decided by “lex loci” and not by Mohamedans law.

Other Important cases in aspect of the “lex loci” includes Choa Choon Neoh v Spottiswodde, Isaac Penhas v Tan Soo Eng, Shaik Sahied v Sockalingam Chettiar.

Reception of English Law in Malay States.

As noted earlier common law and equity was applied in the straits settlements by virtue of the three charter of justice. The charters however did not apply to the Malay states. The introduction of the Resident system in Perak according to the Pangkor Treaty 1874, allowed the introduction of english styled courts by the Sultan and english judges were appointed.

It should be noted that beggining with the civil Law Enactment No 3 of 1937,such judicial practise received the official stamp of approvalby legislature. Section 2 (i) of the enactment provides that “save in so far as other provision has been or may hereafter be mada any written law in force in the federated Malay states,the common law of england,and the rules of equity,as administrated in england at the commencement of this Enactment shall be in force in the Federated Malay states.

On case which can be disscussed in terms of “common law” are the Goverment of Perak v A.R Adams (1914) , which concerns damage to the plantiff’s land by the defendent. The question which was arised was wheter the defendant is exempt from liability on the ground that he was without wilfulness or negligence using his land on the principle that a man must use his own land and not to damnify another. The court found the defendent guilty under all circumstances he is liable for the damage caused.

In re the will of Yap Kwan Seng, which the deceased gave direction in his will that his hose and land be held in trust for ever for a family house for ancestral worship and as family burial ground in accordance with chinese customs. The Issue before the court was whether such a custom was valid a not. The arguments made were (1) That the rule against perpetuities does not excist in and should not be adopted in the federated malay states, (2) That even if the rule be applied,the trust are saved from offence agaist it, (3) That having regard to chinese customs the trust should be regarded as religious and charitable and therefore without offence to the rule. During the proceeding of this case it was noted that the rule agaisnt perpetuities has never been applied in the states. However it was concluded that to regard these trust either as trust for religious purposes or as trust concerning or benefitting the community at large or any portion of it,it follow that there is no way to be saved or excepted from repugnancy to the rule of perpetuities and are therefore void.

In the case of permodalan plantations sdn.bhd v Rachuta sdn.bhd (1985) can be discussed as legal set off which is based on english statute is not included in the expression “the common law of england”. Only equitable set –off is part of the local law and consequently the court can only deal with and equitable set-off.

Malaysian Legal History Essay

National Bank of Borneo Essay

National Bank of Borneo Essay.



National Bank of Borneo is one of local banks in Brunei. Its establishment was indebted to Mr. Khoo Teck Puat the father of the detained Khoo Ban Hock. Mr. Khoo Teck Puat is a son of a rich trader, who in 1933 merged several banks together to form Singapore’s biggest, OCBC or Overseas- Chinese Banking Corporation. After his impeded rise in the position, he left and went to Malaysia.

In Malaysia he founded Malayan Banking and very rapidly he was able to open 100 branches in just one year.

In six years time, the bank that he founded equal that of OCBC in Singapore, with this he was able to own 60% of Malayan Banking. Seven years later the Malayan Central Bank or BN Bank of Negara forced Khoo out, alleging excessive lending to his own companies.

After leaving Malayan Banking he retained his interest in the bank’s branch in Brunei. This branch was about to be closed in 1962 but with the help of share investment by the royal company, the bank now called National Bank of Borneo prospered.

National Bank of Borneo is a bank which is the larger of the two local banks in Borneo. It has advances of $ 1.128 billion, deposits of $ 1.147 billion, total capital and reserves of $ 199.4 million, and a post tax profit of $ 31.1 million.



One case from Brunei concerns Khoo Teck Phuat and his son Khoo Ban Hock. The latter was managing director of NBB w. Under his charge, the bank loaned more than Brunei $1 billion (which is equivalent to Singapore $1 billion) to companies controlled by his father. These loans were undocumented and unsecured. It was claimed that these offences under Brunei banking laws by Khoo Ban Hock were committed under the control and his direction of his father.

When this dishonesty was discovered, the younger Khoo was sentenced to 3 years jail but later only served two. The elder Mr Khoo was not charged, but it was understood that he made restitution of about S$600 million to cover the losses suffered by various party. Mr Khoo Teck Puat later went on to become a billionaire, and was of the largest shareholders in megabank Standard Chartered when he died in 2004. However, after the NBB scandal, he kept a low profile.

National Bank of Borneo Essay