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2014 11 14 Current Application of English Law Sections 346 Cla 1956
2014 11 14 Current Application of English Law Sections 346 Cla 1956
9.1 INTRODUCTION
Malaysia is a common law country with a distinct common
law-based legal system. The Malaysian legal system comprises various
sources such as: Federal and State Constitutions, Legislations, Judicial
decisions, English law, Islamic law, and Customary law. English law
includes English common law, rules of equity and certain legislations.
Although the English law, which is entrenched in Malaysian
legislations and judicial decisions, is a predominant source of
Malaysian law, other sources of law, such as, Islamic law and
Customary laws, have also played a significant role in shaping the
Malaysian legal system to be what it is today. There was a time when
English and Islamic laws conflicted especially during the British
occupation.2 The conflict of laws is less evident today due to active
legislative interventions and strict judicial observance of jurisdictional
boundaries.3 However, the conflict between the laws has not been
eliminated and it occasionally occurs before the Civil and Syariah
courts of the country.4
1 This chapter is contributed by Tun Abdul Hamid Mohamad and Dr. Adnan Trakic.
2 See for example, the case of In the Goods of Abdullah [1835] 2 Ky Ec 8; R v. Willans [1858]
3 Ky 16; and Fatimah v. Logan [1871] 1 Ky 255.
3 Article 121(1A) of the Federal Constitution provides: ‘The courts referred to in Clause (1)
shall have no jurisdiction in respect of any matter within the jurisdiction of the Syariah
courts.’ This constitutional amendment was made in order to stop the Civil courts from
interfering in the matters which are under the jurisdiction of Syariah courts.
4 The latest example is the case of S. Deepa in which the husband who converted to Islam
obtained custodial rights over two children in the Syariah court while the non-Muslim
wife obtained a custodial right in the civil High Court. This case immobilised the police
to act on the ‘abduction’ indictment alleged by the wife as the husband took the son into
custody by force. The police called for Parliament to act as they could not do much when
two conflicting orders given by both courts were valid and enforceable. See newspaper
comment by Balan Moses, ‘Dewan Rakyat Should address custody issue fast’, the Sundaily,
Monday, 13 April 2014. http://www.thesundaily.my/news/1015486 viewed 14 April 2013.
Current Application of English Law:
156 Sections 3, 5 and 6 of the Civil Law Act 1956
3. (1) 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 Peninsular Malaysia or any part thereof, apply the common law of
England and the rules of equity as administered in England on the 7
April 1956;
(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 1 December 1951;
(c) in Sarawak, 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 12 December 1949, subject however to
subparagraph (3)(ii):
Provided always that the said common law, rules of equity and statutes of
general application shall be applied so far only as the circumstances of the
States of Malaysia and their respective inhabitants permit and subject to
such qualifications as local circumstances render necessary.
(2) Subject to the express provisions of this Act or any other written law in
force in Malaysia or any part thereof, in the event of conflict or variance
between the common law and the rules of equity with reference to the
same matter, the rules of equity shall prevail.
8 Amongst the academics, see for example, Ahmad Ibrahim, ‘The Civil Law Ordinance in
Malaysia’, [1971] 2 MLJ lviii; Syed Ahmad Alsagoff, Principles of the Law of Contract in
Malaysia (3rd Edn) (LexisNexis, Kuala Lumpur, 2010), pp. 22–27. This view has been
shared by some judges such as, Tun Abdul Hamid Omar, ‘Common Law: Mitos atau
Realiti?’ [1990] 2:2 KANUN 1; and Tun Ahmad Fairuz Sheikh Abdul Halim’s opening
speech at IKIM’s s eminar titled ‘Ahmad Ibrahim: His Intellectual Thought and
Contributions’ (see an article written by Dr Wan Azhar Wan Ahmad at http://
ww w.ikim.gov.my/index.php/ms/the-star/7587-malaysian-common-law (viewed
20 May 2014).
9 Ahmad Ibrahim, ‘The Civil Law Ordinance in Malaysia’, [1971] 2 MLJ lviii.
Current Application of English Law:
162 Sections 3, 5 and 6 of the Civil Law Act 1956
proviso to s. 3(1) which states: ‘Provided always that the said common
law, rules of equity and statutes of general application shall be applied so
far only as the circumstances of the States of Malaysia and their
respective inhabitants permit and subject to such qualifications as local
circumstances render necessary’, it can be concluded that even the
drafters of the Act expected the Malaysian courts to develop a
Malaysian common law. They have intentionally subdued the
application of English law to the local circumstances of Malaysia and
its people. In other words, in case of a lacuna in law, the Malaysian
courts are free to develop the Malaysian common law that will suit
local circumstances and people.
There are many contemporary Malaysian scholars who, concurring
with the views expressed by Professor Ahmad Ibrahim, argue that
what is needed is neither the complete abolishment of the Civil Law
Act 1956 nor the complete revamp of the existing system but rather a
change in the attitude of judges, counsel as well as academics. For
example, Farid Sufian Shuaib, argues that the judges in particular,
should be more proactive in ‘indigenising’ the English law. In order to
do that, the Civil Law Act 1956 may have to be amended to allow the
courts to, in addition to English sources, refer to other sources such
as religions and customs of Malaysians.10 He said the following: “After
50 years of independence and numerous achievements proclaimed,
Malaysia should feel strong enough to develop its own law by looking
within herself first. Physical judicial autonomy obtained by severance
of appeal to the Judicial Committee of the Privy Council should be
followed by substantive autonomy by severing the umbilical cord to
English law.”11
However, there are some prominent contemporary Malaysian
scholars who have been even more critical of Malaysia’s reliance on
English law and have called on the complete abolition of the Civil Law
10 See Farid Sufian Shuaib, ‘Towards Malaysian Common Law: Convergence between
Indigenous Norms and Common Law Methods’, Jurnal Undang-Undang dan Masyarakat,
13, p. 167.
11 Ibid, p. 162.
Civil Law Act 1956 (Act 67) 163
Act 1956. For instance, Syed Ahmad Alsagoff contends the following:
“It is about time the Civil Law Act 1956 be abolished, releasing Malaysia
from the last remaining vestige of colonial rule. The Civil Law Act
1956 may have served its purpose in providing Malaysia with a
supplementary English common law or equity in its fledging years
after independence. But times have changed. It is diabolical and
indignified that whenever there is a novel case before the Malaysian
courts, unprovided for by written law, they have first to determine
what was the law in England 50 years ago!”12
The call for a departure from the Common law either through the
repeal or abolition of s. 3 or the Act as a whole was strongly opposed
by the Malaysian Bar Council.13 The Bar Council pointed out that
Malaysia should be proud of its Common law system which is without
doubt one of the most respected legal systems in the world. It even
forms the basis of public international law. The Bar Council argued
that the application of English common law in Malaysia should not
be viewed as a weakness but rather a strength. It projects security and
certainty to investors and businesses operating in Malaysia. Malaysia’s
steady economic development for the past few decades has been by
and large enabled and fostered by, among other things, its Common
law-based legal system. In addition, the Bar Council argued that
Malaysia’s link to the Common law via s. 3 does not prevent Malaysian
courts from developing the Malaysian common law. English cases
that have been accepted by the Malaysian courts automatically become
part of the Malaysian common law. As a matter of fact, this is what
has been done for the past few decades where Malaysian court decisions
12 See Syed Ahmad Alsagoff, Principles of the Law of Contract in Malaysia (3rd Edn)
(LexisNexis, Kuala Lumpur, 2010), p. 22.
13 See, for example, Ambiga Sreenevasan, ‘Common Law’, The Malaysian Bar, 23 August
2007. http://www.malaysianbar.org.my/press_statements/press_release_common_
law.html (viewed 20 May 2014); Ambiga Sreenevasan, ‘Leave the Common Law Alone’,
The Malaysian Bar, 24 August 2007 http://www.malaysianbar.org.my/press_statements/
press_release_leave_the_common_law_alone.html (viewed 20 May 2014); Param
Cumaraswamy, ‘Dropping English Law may Leave Nation Isolated’, The Malaysian Bar,
27 August 2007. http://www.malaysianbar.org.my/members_opinions_and
_comments/dropping_english_common_law_may_leave_nation_isolated.html
(viewed 20 May 2014).
Current Application of English Law:
164 Sections 3, 5 and 6 of the Civil Law Act 1956
Everyone agrees that there is a dire need for Malaysian common law
but the disagreement is on the question as to how to develop it. We
argue, and many would share our views, that the existing legal
framework already allows for the development of the Malaysian
common law. In fact, the Malaysian courts have been developing
Malaysian common law in the past and are continuing to do so. Any
English law that has been accepted by the Malaysian court in toto or
in part crystalises into Malaysian common law. There is nothing wrong
in accepting the English law in toto but that has to be done in
compliance with s. 3(1) of the Civil Law Act 1956. If there is lacuna in
the Malaysian law, then the court may apply English law in toto
provided the hurdles in s. 3(1) are all satisfied. In this way, the English
17 Ibid, p. 309.
Current Application of English Law:
166 Sections 3, 5 and 6 of the Civil Law Act 1956
Be that as it may, it can be surely said that the Malaysian courts are
empowered by s. 3(1) to develop the Malaysian common law. In fact, it
has been argued that the Federal Court as the highest court in the
country has the responsibility to develop the Malaysian common law
by taking into consideration local circumstances and inhabitants.23
Hence, the development of the Malaysian common law must be done
in the manner prescribed by s. 3. Section 3 is a complex section which
provides the concrete methodology that ought to be followed by the
courts when faced with a lacuna in the law. The correct methodology
has been explained by Dato’ Abdul Hamid Mohamed J in the High
Court case of Nepline Sdn Bhd v. Jones Lang Wootton,24 where his
Honour said:
In my view the approach that the Court should take is first to determine
whether there is any written law in force in Malaysia. 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, and the rules of equity as
administered in England on 7 April 1956. Having done that the Court
should consider whether ‘local circumstances’ and ‘local inhabitants’
permit its application, as such. If it is ‘permissible’ the Court should
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.
Where the Court 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 so doing, the Court is at liberty to look at any source of
22 Ibid, p. 319.
23 See Syed Ahmad Alsagoff, Principles of the Law of Contract in Malaysia (3rd Edn)
(LexisNexis, Kuala Lumpur, 2010), p. 26.
24 [1995] 1 CLJ 865.
Current Application of English Law:
168 Sections 3, 5 and 6 of the Civil Law Act 1956
25 Ibid, p. 871.
26 Ibid.
Civil Law Act 1956 (Act 67) 169
27 Danaharta Urus Sdn Bhd v. Kekatong Sdn Bhd (Bar Council Malaysia, intervener) [2004]
1 CLJ 701, FC. See also Farid Sufian Shuaib, ‘Towards Malaysian Common Law:
Convergence between Indigenous Norms and Common Law Methods’, Jurnal Undang-
Undang dan Masyarakat, 13, p. 164.
28 See art. 121(1) of the Federal Constitution of Malaysia.
29 See art. 160 of the Federal Constitution.
Current Application of English Law:
170 Sections 3, 5 and 6 of the Civil Law Act 1956
3. There should be no cut-off dates. Common law and the rules of equity
grow through judgments of courts to cope with time. There is no basis
whatsoever to impose the cut-off date around 1950’s (or any other date
for that matter) unless we want to live by an archaic law which may no
4. The provision that such common law and the rules of equity should
only be applicable in so far as provisions have not been made (at that
point of time) by any written law in force in Malaysia should remain,
subject to improved drafting, if any. This is obvious. Once the Malaysian
Parliament enacts a law on the subject, it is that law that should be
applied. No lawyer should be heard to argue and no judge should be
heard to say that common law rights or equitable remedy continue to
run parallel with the written law enacted by Parliament. The introduction
of the principle of equitable estoppel to contracts made under the
Control of Rent Act 1966 (which has now been repealed) had caused
great injustice to affected house owners and had caused the houses to
deteriorate.
5. The proviso that ‘the said common law and rules of equity shall be applied
so far only as the circumstances of the States of Malaysia and their respective
inhabitants permit and subject to such qualifications as local circumstances
render necessary’ should remain, subject to improved drafting, if any.
law and the scope is very limited. Consider this example. There is no
equivalent of caveat emptore in Islamic law. Islamic law insists fairness
and honesty on both parties in their dealings. The common law on
disclosure of material information (eg. as in Hedley Byrne) does not go
so far as the Islamic law principle that ‘a seller must disclose the defects
of the good he is selling’.36
36 Please see discussion in Nepline’s case. Indeed in that case the court went further than the
common law of England and indeed drew an inspiration from the Islamic law position,
without saying so. (We know because Tun Abdul Hamid Mohamad, co-author of this
paper, decided the case.) The Court of Appeal confirmed the judgment, perhaps without
even knowing where the idea came from. Unfortunately, there is no written judgment of
the Court of Appeal. We have not come across any criticism of the judgment. We hope
there will not be any even after this ‘disclosure’! The point we are making is that there might
be some principles of Islamic law which could be applicable. Due to ignorance and
prejudice, many people do not realise the similarities between Islamic law and common
law.
Current Application of English Law:
174 Sections 3, 5 and 6 of the Civil Law Act 1956
37 See Partnership Act 1961 (Act 135); Companies Act 1965 (Act 125); Financial Services Act
2013 (Act 758); Islamic Financial Services Act 2013 (Act 759); Contracts Act 1950 (Act
136); Hire Purchase Act 1967 (Act 212); Bankruptcy Act 1967 (Act 360) etc.
Civil Law Act 1956 (Act 67) 175
This section has been passed to prevent the application of English law
to land matters. Hence, the English land laws relating to the tenure or
conveyance or assurance of or succession to any immovable property or
any estate, right or interest therein do not apply to Malaysia. Malaysia
follows the Torrens system which is modeled upon the Australian
system of land administration. The central theme of the Torrens system
is the registration of land titles which is perceived as more superior to
the English deeds system. The Torrens system has been applied in all
states of Malaysia, except Sabah, via the National Land Code.40
9.3 CONCLUSION
In conclusion, the debate on whether we need to sustain our
strong links with English law is likely to continue. Irrespective of which
side of the argument one may take, the truth is that, our links with
English law have contributed tremendously towards the development
of the plural Malaysian legal system which is highly regarded in the
region. We argue that the abolition of s. 3 of the Civil Law Act 1956, or
the Act as a whole, as some propose, is not necessary. The argument
that the Act stifles the development of the Malaysian common law is
flawed. The existing framework within the Act allows, if not promotes,
the development of the Malaysian common law. In doing so, the judges
are allowed to refer to other sources of law, including Islamic law,
provided that the prescribed procedure under s. 3 is followed. In fact,
we do suggest certain amendments to s. 3 which would enable
smoother reference to Islamic law principles in civil matters. The judges
are not only allowed but, in fact, they are encouraged to draw an
inspiration from the wide spectrum of Islamic civil laws to fill in the
lacunas in the law whenever the need arises. This was done by Tun
Abdul Hamid Mohamad in Nepline’s case as discussed earlier. In fact,
we are of the opinion that any law that is not unIslamic is Islamic.
Having said this, there are many common law rules which are very
similar to Islamic laws. One would be astonished to find how similar
these two systems are, in many ways. The prominent scholar, Professor
John, A. Makdisi, in his well-known article ‘The Islamic Origins of
Common Law’ suggests that the origins of Common law may be found
in Islamic law.41 This is an article that we would suggest be read by all
skeptics as to the link between the two systems of law which seem to
have much more in common than one may initially think.
40 Penang and Malacca – National Land Code (Penang and Malaka Titles) Act 1963 (Act
518), the rest of Peninsular Malaysia – National Land Code 1965 (Act 56), and Sarawak –
Sarawak Land Code (Cap 81). Sabah does not use the Torrens system and is instead governed
by the Land Ordinance (Cap 68).
41 See John, A. Makdidi, ‘The Islamic Origins of Common Law’, North Carolina Law Review,
June 1999, 77(5), pp. 1635–1739.