PUBLIC INTERNATIONAL LAW

(LAC3603)

SEMESTER 1 2020/2021

INDIVIDUAL TASKS

CASE BRIEF / CASE SUMMARY:

VILLAGE HOLDINGS SDN BHD v HER MAJESTY THE QUEEN IN RIGHT

OF CANADA [1988] 2 MLJ 656

NAME: NUR MUDRIKAH BINTI MOHAMAD NIZAM

MATRIC NUMBER: 1181912

KLB2/TLB6

PREPARED FOR: DR CHE ZUHAIDA SAARI

 1. Case citation:

Village Holdings Sdn Bhd v Her Majesty The Queen In Right of Canada [1998] 2 MLJ 656

2. Topic:

Ownership of Land in Malaysia.

3. Facts:

Village Holdings Sdn. Bhd. ( the plaintiff) wrote a letter on 17/8/1983 to Messrs. Jones Lang

Wootton, a firm of property consultants and offered to buy a land which the land was used as

residential accommodation for the diplomatic members of the Canadian High Commission in Kuala

Lumpur. Later the offer was conveyed to the Canadian High Commission who in charge for the said

matter. On 8/11/1983, Jones Lang Wootton met with the plaintiff's solicitors with the final draft sale

and purchase agreement was to be subject to perusal and approval by the treasury board and the

Privy Council of the Canadian Government.

On 11/5/1984, a formal written sale and purchase agreement was executed. The plaintiff

company was the named purchaser and Her Majesty the Queen in Right of Canada (the defendant)

as a registered proprietor of the said land was named as the vendor. In the agreement stated that

10% of the purchase price had been received on execution and the completed payment need to be

done within four months of the agreement or within two weeks of the receipt of the approval of the

foreign investment committee, whichever was the earlier. If the plaintiff fail to complete the

payment within the said period, the defendant was entitled to forfeit the deposit.

The plaintiff did not complete the payment and request for extension of time but it come

with a price. The time for completion was extended from 16/9/1984 to 30/9/1985. However, the

plaintiff failed once again and request to extend the time but was declined by the defendant. Later

the agreement was terminated because the plaintiff's failure to complete the payment. Thus, all the

 amount paid by the plaintiff during execution was forfeited by the defendant. The plaintiff took out

a writ against the defendant and claimed for a refund of the total amount paid with interest and

damages.

4. Issue / Legal Questions:

Issue in this case is whether the defendants as the foreign sovereign is subject to the

jurisdiction of the court.

5. Decisions / Ruling of the court:

The court held that the defendant is not subject to the jurisdiction and the writ must be set

aside.

6. Legal reasoning / Court rational:

The court has no jurisdiction over a foreign sovereign. In this case the court referring to

Mighell v Sultan of Johore [1894] 1 QB 149. Another case of Sloman v Government of New

Zealand (1875) 1 CPD 567, in matter of sovereign immunity, it will take affect if the service of the

writ is submitted to the jurisdiction of the court by the sovereign ruler or government. But, in this

case there was no submission made by the ruler or government of Her Majesty the Queen in Right

of Canada.

The court took into consideration the counsel of defendants contention. The counsel

affirmed by virtue of Section 3 of the Civil Law Act 1956, the common law of England as

administered on 7 April 1956 applicable. The counsel referred to the case of Mighell v Sultan of

Johore [1894] 1 QB 149 and Duff Development Company Limited v Kelantan Government &

Another [1924] AC 797 as embodied in the common law of England as administered on 7 April

1956 whereby the immunity from legal process accorded to a foreign sovereign was absolute. In

 both cases mentioned, the court held that when the court need to exercise authority over sovereign,

he need to decide whether to submit or not and the sovereign can refuse to be impleaded.

Furthermore the court referred to the judgment in the case of Trendtex Trading Corporation Ltd v

Central Bank of Nigeria [1977] 1 All ER 881 that the foundation of the doctrine of sovereign

immunity in international law is reciprocity and mutual recognition. Therefore, for the foreign

sovereign case, the court by virtue of the section 3 of Civil Law Act 1956, there is no space for

doubt that in Malaysia, the law will continue to adhere the doctrine of state immunity in regards of

impleading a foreign sovereign who declines to submit to the court.

7. Significance of the case:

This case reaffirm that the judge in this case relied on English Common Law position in

respect of section 3 of the Civil Law Act 1956 where the English Common Law is applicable by

Malaysian Court if there is lacuna or absence of any written law and in circumstances of the

Federation rendered necessary.

8. Evaluation of the case:

In my opinion, this case provide the situation of Malaysian courts where it impliedly

applying customary international law through English common law in regards of the Civil Law Act

1956. Nonetheless, referring to this case, even the court of Malaysia did not rule that it applied the

restrictive theory of State immunity due to the rule of customary international law that is accepted

by most States thus it become a part of the law in Malaysia. For me, it is illustrated in this case that

the judge can reached to their decision only by resorting to English common law and by referring to

English leading case because of the lacuna in Malaysian Law.

Other than that, I think the court decision is fair for both parties because first, the defendant

was a foreign sovereign subsequently bound with the law of sovereign immunity. We cannot said it

 is not fair for the sovereignty to be granted with immunity as it was the rule of law. Second, the

plaintiff also need to be aware of his financial capability before offering to purchase the said land.

The defendant was lenient by giving a chance to extend the times for completion of payment after

the plaintiff failed to complete at the first place. So when the plaintiff failed to complete the

payment for the second time and resulting to the deposit being forfeited by the defendant it unfair

for the plaintiff to ask for refund because in the agreement stated that condition and had been signed

by the plaintiff therefore the contract is binding between both party. Any breach of the contract lead

to damages and in this case the plaintiff breach the contract so he need to pay as stated in the

agreement.