this note is reference for student of Equity and Trust (LAW 3710) in International Islamic University, Malaysia. It's prepared by Dr. Zuraidah Ali

1. 25/02/15 Dr. Zuraidah Haji Ali 1
RECEPTION OF EQUITY IN
MALAYSIA

2. 25/02/15 Dr. Zuraidah Haji Ali 2
Learning Objectives
 To revise the reception of English Law in
Malaysia.
 To understand how Equity is applied in
Malaysia
 What is the status of Equity, is it binding or
merely persuasive authority?

3. 25/02/15 Dr. Zuraidah Haji Ali 3
Legal History
 Malaysia was formed in 1963 after its
independence in 1957.
 Under a few Western dominations
1) Portuguese = 1511
2) Dutch = 1641
3) British = 1795

4. 25/02/15 Dr. Zuraidah Haji Ali 4
REIGN OF BRITISH
EMPIRE
STRAITS
SETTLEMENTS
FEDERATED
MALAY
STATES
UNFEDERATED
MALAY STATES

5. 25/02/15 Dr. Zuraidah Haji Ali 5
Straits Settlements
 Comprised of Penang, Malacca and Singapore.
 First Charter of Justice (COJ) 1807
- applied only in Penang.
- made provisions for the government of the island
and the administration of justice
- Established Ecclesiastical Court – jurisdiction was
subject to ‘so far as several religions, manners and
customs of the inhabitants will admit.

6. 25/02/15 Dr. Zuraidah Haji Ali 6
 Second Charter of Justice 1826
- Island of Singapore and town and fort of
Malacca were annexed to Prince of Wales
Island (Penang)
- It conferred the same jurisdiction on the
Court of Judicature as the former Charter
had done.
 Third Charter of Justice 1855
- Nothing was altered as far as the
fundamental condition was concerned.

7. 25/02/15 Dr. Zuraidah Haji Ali 7
Federated Malay States
 These state were not under British territory.
 British’s influence came through treaties with
the Rules of these State.
 The Ruler merely acted on the advise of the
British administration = RESIDENTIAL
SYSTEM.
 Two ways ;
i) advice of British administrator = enacted several
laws such as Penal Code, Evidence Ord and
Contract Ord.

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 ii) Decision of the judges in the court – principles
of law of tort and equity were introduced into the
Malay states.
 Later THE CIVIL LAW ENACTMENT 1937
were enacted.
 CLE was extended to Unfederated Malays States
in 1951 under the CIVIL LAW ORD 1951.
 Replaced by the CIVIL LAW ORD (1956) –
applicable to Penang and Malacca.
 With formation of M’sia in 1963 the ordinance
was changed to CIVIL LAW ACT (1956) which
include both Sabah and Sarawak.

9. 25/02/15 Dr. Zuraidah Haji Ali 9
Court of Judicature
 COJ introduced ECL & equity in the SS. The Charters
however did not apply to MS
In the FMS-Residency sys introduced. On the advice of the
British Residents, English-styled cts were established and
English judges were appointed. The judges relied/applied
CL & equity.
This was confirmed by the Civil Law Enactment 1937-Sec
2(i)
The application was extended to UFMS in 1951 and to
Penang & M’ca in 1956
1972-the 1956 Act was revised to extend its application to
Sabah & Sarawak

10. 25/02/15 Dr. Zuraidah Haji Ali 10
Section 3 of the Civil Law Act
 Save so far as other provision has been
made or may hereafter be made by any
written law in force in Malaysia, the Court
shall-
(a) In West Malaysia or any part thereof,
apply the common law of England and rules
of equity as administered in England on 7th
day of April 1956.

11. 25/02/15 Dr. Zuraidah Haji Ali 11
b) In Sabah, apply the common law of
England and the rules of equity, together
with statutes of general application, as
administered or in force in England on the
1st
day of December 1951;
c) In Sarawak, apply the common law of
England and the rules of equity, together
with statutes of general application, as
administered and enforced in England on
12th
day of December 1949.

12. 25/02/15 Dr. Zuraidah Haji Ali 12
Consequences
 April 7th 1956 is significant because only
English Common law and equity as
administered in England on that date is
applicable in Peninsular Malaysia.
 After that stated date-Common law and the
rules of equity do not become law in
Malaysia.

13. 25/02/15 Dr. Zuraidah Haji Ali 13
Civil Law Act 1956 (Revised
1972)
 Came into force on April 1st
1972
 Repealed – Civil Law Ordinance 1956
 - Sabah Application of Laws
Ordinance 1951
 - Sarawak Application of Laws
 Ordinance 1949


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WHAT IS THE DIFFERENCE AS
REGARDS TO THE APPLICATION OF
EL IN PM &SABAH &S’WAK?
PM- common law and rules of
equity
Sabah & Sarawak- common law,
rules of equity & SOGA

15. 25/02/15 Dr. Zuraidah Haji Ali 15
Application of statutes both in PM
and Sabah and S’wak
a) In favour of importation
- Rules of ECL and equity includes
legislatiom that need to be enforced by
Courts
- Administration of CL and equity would be
inconvenient without AOP
- The words statutes was found under s2(1)
of the old CLE 1937.

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b) Not in favour of importation.
- Difference in wording between para a, b
and c.
- CL is a body of principles built up from
decision of the Court and in fact in contra
distinction to statute of law.
- Section 5(1) of CLA vividly showed the
difference

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Mokhtar v Arumugam [1959] MLJ
232
 Smith J of COA;
 It is quite clear that in England the powers
of the court to award damages in the nature
of the interest for delay in returning goods
is a remedy conferred by statute and not one
available at common aw. This relief, being
a creature of English statute, in not
available here.”

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Limitation
 Proviso to s3 of CLA- divided to two
a) Applied in the absence of local statutes on
particular subject – a means to fill local
gap.
b) Application only covered the part of
English law that is suited to local
circumstances.

19. 25/02/15 Dr. Zuraidah Haji Ali 19
Chou Choon Neoh v Spottiswoode
(1869) 1 Ky 216 .Maxwell J
 On the application of English Superstitious
Uses Act 1547 and Mortmain Acts 1531
 “In this colony, so much of the law of
England as was in existence when it was
imported here and as is general (and not
merely local) policy and adapted to the
condition and wants of the inhabitants, is
the law of the land and further,

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 that the law is subject in its applications to
various alien races established here, to such
modifications as are necessary to prevent it
from operating unjustly and oppressively on
them. Thus, in questions of marriage and
divorce, it would be impossible to apply to
our Mohammedans, Hindoos and
Buddhists, without the most absurd and
intolerable consequences and it is therefore
held inapplicable to them.

21. 25/02/15 Dr. Zuraidah Haji Ali 21
What happens after that date?
lacuna in the Malaysian law/ absence of
local statutory provisions
- as long as it is not against the Malaysian
custom-
attempt can be made to apply the English
Common law and the rules of Equity
They are not binding and are merely
persuasive.

22. 25/02/15 Dr. Zuraidah Haji Ali 22
Lee Kee Chong v. Empat Nombor
Ekor Sdn. Bhd. [1976] 2 MLJ 93,
95 Lord Russell of Killowen
 …It appears that the Civil Law Ordinance
1956, section 3 adopted English laws as
administered at its effective date, so that
any subsequent march in English authority
is not embodied.

23. 25/02/15 Dr. Zuraidah Haji Ali 23
Jamil bin Harun v.Yang Kamsiah
[1984] 1 MLJ 217, 219
 Lord Scarman
 …Modern English authorities may be persuasive,
but are not binding. In determining whether to
accept their guidance, the courts will have regard
to the circumstances of the states of Malaysia and
will be careful to apply them only to the extent
that the written law permits and no further than in
their view it is just to do so.

24. 25/02/15 Dr. Zuraidah Haji Ali 24
Nepline Sdn Bhd v Jones Lang
Wootton [1995] 1 CLJ 865 at
869 Abd Hamid J;
 S3 of CLA 1956 is the law of Malaysia as it
stands today.
 Courts in Malaysia have no choice but to
keep on applying it.
 “In my view the approach that the Court
should take is first to determine whether
there is any written law in force in
Malaysia.

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 If there is, the Court need not look
anywhere else. If there is none, then the
Court should determine what is the common
law of the rules of equity as administered in
England on 7 April 1956. Having done that
the Court should consider whether “local
circumstances” and local inhabitant”
permits its application, as such. If it is
‘permissible”, the court shall apply it. If not,
I am of the view that, the Court is free to
reject it totally or adopt any part which is
“permissible”,with or without qualification.

26. 25/02/15 Dr. Zuraidah Haji Ali 26
 Where the Courts rejects it totally or in part, then
there being no written law in force in Malaysia,
the Court is free to formulate Malaysia’s own
common law. In doing so, the Court is at the
liberty to look at any sources of law, local or
otherwise, be it common law of or rules of equity
as administered after 7 April 1956, principles of
common law in other countries, Islamic law of
common application or common customs of the
people in Malaysia. Under the provision of s3 of
CLA 1956, I think, that is the way the Malaysian
common law should develop.

27. 25/02/15 Dr. Zuraidah Haji Ali 27
Almarhum Prof Ahmad Ibrahim
 There is no need to rely on English law to fill the
lacuna as the law is developed in M’sia through
legislations and judicial decisions.
 Need to consider other methods eg.
a) Muslim law of other land : eg Egyptian Civil
Code
b) Rules of customs
c) Principles Islamic law
d) Principe of natural law.

28. 25/02/15 Dr. Zuraidah Haji Ali 28
What are the impacts of the
application of sec 3 of CLA?
 In family law
 Commercial law
 Land law