BUSINESS LAW

(LAW 416)
Chapter 1
Malaysian Legal System
 Malaysian Legal System
(The slides explain to you what is law, the relation between law and moral, the function of law (why do we
need law) and also some of basic rights (provided in Federal Constitution and other statutes).

Definition of law
What is law??
• any set of uniform principles
• layman- general rule of conduct
• Oxford English Dictionary- a body enacted/customary rules recognized by the community as binding
• Karl Max- law is an instrument used by the wealthy class (capitalist) to dominate and exploit the weaker
and labouring class (proletariat)

schools of law:
(a) Natural Law view- Determine the working of nature
- prescribes what proper behaviour for human being is
- maintains that any manmade law which is in conflict with natural law is not true law
- “Good is to be done and promoted and evil is to be avoided”.
(b) Positivist view
- John Austin- (The Province Of Jurisprudence Determined 1832) law is a command set by a superior
being to an inferior being and enforced by sanction
- John Salmond- the body of principles recognized and applied by the state in the administration of justice.
The purpose and end of law is to secure justice.

H.L.A Hart:
• Laws are rules that may forbid individuals to perform various kinds of actions or that may impose various
obligations on individuals. Laws may require individuals to undergo punishment for injuring other
individuals. They may also specify how contracts are to be arranged and how official documents are to be
created. They may also specify how legislatures are to be assembled and how courts are to function.
• They may specify how new laws are to be enacted and how old laws are to be changed. They may exert
coercive power over individuals by imposing penalties on those individuals who do not comply with
various kinds of duties or obligations. However, not all laws may be regarded as coercive orders, because
some laws may confer powers or privileges on individuals without imposing duties or obligations on them.

law consists of 2 types of rules:

• primary-rule impose duties. Human beings are required to do or abstain from certain action
• secondary- explain what the society’s duty imposing rules are, by what procedures news rules may be
ascertained or old rules changed abrogated, how dispute can be resolved.

(c) realist view

 - the law is referred as a rule of conduct laid down by the person acting as judicial organs of the state such
as judges
- law is what the judges say/declare
- law is what judges do about dispute
- it is carried out and enforced rather than law as series of rules contained in statutes

d) sociological view
-the law can only be understood when it is viewed in terms of its relationship to the society
 
e) syariah
-Dr. Hashim Kamali-it refers to the command, prohibition, guidance and principles that God has
addressed to mankind pertaining to their conduct in this world and in the next.
Statutes
• the term ‘law’ is defined both by Article 160(2) of the Federal Constitution 1957 and section 3 of the
Interpretation Acts 1948 And 1967 (Consolidated And Revised 1989) to include:

(a) the written law

(b) common law in so far as it is in operation in the Federation or any part thereof

(c) any custom or usage having the force of law in the Federation or in any part

The relation between law and moral

• Moral- collection of rules/social system of norms and values by which society sits to regulate its
conduct – (based on the supreme of high morality principle)

• Law-based on the notes given

• Moral- not be enforced by the court depends to the society

• Where the rules of morality that have been enforced by the court  it becomes law

Functions of law
applies to all citizens, public authorities, governmental departments, private bodies, profit making
organisations as well as non-governmental organisations.

-to provide justice

-to ensure public order

-as guideline to citizens

-to protect individual liberty

-to act as agent for social changes

Basic rights
• -right to be assumed innocent until proven guilty

• -right against unreasonable searches and seizure

• -right against arrest without probable cause

• -right against self incrimination (see

http://www.malaysianbar.org.my/human_rights/rights_of_accused_persons_are_safeguards_being_redu
ced_.html)

• -right to fair questioning by the police

• -right to protection from physical harm throughout the process

• -right to an attorney

• -right to know the charges

• -right to cross examine the witnesses

• -right to speak and present witnesses

• -right not to be tried twice for same offense

• -right against cruel and unusual punishment

• -right to due process

• -right against excessive bail and fines

• -right to be treated the same as others

• -right to speak

• etc
This slide explains about various sources of law in Malaysia (where can we find the law) , the
process of making law and also the Malaysian Court System... any further explanation will be
given on the future post..

Introduction
- The Malaysian Legal System is a common law system where the legal principles are developed by judges
through case-law. This system was inherited from British Colonies such as Australia, Singapore, India etc.

- Under the common law system, as practiced in Malaysia, law has been classified into several divisions such
as national law, international law etc.

Classification of Law
1. INTERNATIONAL LAW
It is a body of law which is composed to lay down principles and rules of conduct which the States feel
themselves need to observe in regulating the relationship with each other.

a. International private law- Rules that guide a judge when the laws of more than one country affect a case.

• Dispute between individual citizen or states

• also known as conflict of laws.

• Which law to be used?

Examples:
- contract dispute (e.g. involving a purchase agreement) reside in two different countries.

- transborder environmental damage , such as, in cases of an oil spill from a ship that causes damage to
fishing or land owners in several countries.

- family law ie: a person immigrates to live in another country. In such a case, questions may arise in the
new country concerning the law to be applied to divorce, division of marital property and inheritance.

b. International public law – consist of rules and principles of general application dealing with the conduct of
states and of intergovernmental organizations and with their relations inter se

- deal with the conduct of nation states and international organisations among themselves as well as the
relationships between nation states and international organisations with person

- it determines the rights and obligation in relation to each other

i.e. agreement, treaty, convention, pact, protocol etc

- law of nations.
2. NATIONAL/MUNICIPAL LAW
a) Substantive:

Public law:

i. law which governs the relationship between individuals and the state

ii. It covers-taxation, environmental, constitutional, criminal, administrative

Private law:

i. Matters that affect the rights and duties of individuals amongst themselves

ii. Intended to give compensation to persons injured, to enable property to be recovered from wrongdoers,
and to enforce obligations (contracts and trusts)

iii. It covers-trust, commercial, succession, family, property, tort, contract

Contract: agreement btw two parties or more which is legally binding btw them.

Tort: based on obligation imposed by law (not agreed btw the parties). It is civil wrong. It is the breach of
general duty which is imposed by law and it is remediable by civil action. The essential element of tort:

→ there must be an act/ommission done intentionally or negligently

→ there must be damage caused by such act/ommission

Trust: it is an equitable obligation binding a person (trustee) to deal with property over which he has control
(trust property) for the benefit of persons (beneficiaries).

b) Adjectival / procedural :

i.e. evidence, civil procedure, criminal procedure, interpretation of statute etc

Sources of Malaysian Law
3 main sources:
• Historical sources-factors that have influence the development-based on-religious belief, local custom and
opinion of jurists

• Malaysian Legal Sources-(all the rules and regulations that make up the law)

- written- the law enacted/passed by parliament, state legislative, local council ie act, ordinance,
enactment, circular etc)
- unwritten law- can be found in common law and equity, judicial decision, customary law,
- Islamic law- Quran, Sunnah, Qiyas, etc

• Place-Place where the law can be found ie: reported cases (MLJ, CLJ, ALLER, QB, KB etc), text book, statutes
WRITTEN LAW
A. FEDERAL CONSTITUTION (FC)
• A written constitution – FEDERAL CONSTITUTION

• It declares itself as the supreme law of the Federation. Article 4(1) FC

• any other law must not conravene with any provision under the FC.

• Article 4(1): FC This Constitution is the supreme law of the Federation and any law passed after Merdeka Day
which is inconsistent with this Constitution shall, to the extent of the inconsistency, be void.

REPCO HOLDINGS BHD v. PP [1997] 3 MLJ 681

• Held: certain provisions of two Acts of Parliament were declared to be unconstitutional, null & void as it was
law which was inconsistent with the FC.

1) Sec. 126(2) Securities Industry Act (SIA) 1983

2) Sec. 39(2) SCA 1993

• Both laws were ultra vires Article 145(3) FC

R. Rethana v. The Gov. of Malaysia & Anor (1988)

• The plaintiff claimed that s.31 and 42 of the Employees’ Social Security Act 1969 (Socso)were ultra vires.
• The Federal Constitution for not provided equal protection of the law to all persons.
• Held – Case dismissed on the grounds that it was fair and reasonable.

FUNCTION OF FC
•The Federal Constitution (FC) has laid down the mechanism of a federal government and a constitutional
monarchy
•-(to run/manage the country)
•This mechanism is called Separation of Powers.
Separation of powers:
Legislative:-
- Parliament
- responsible for making a law (article 44-46 Federal Constitution)
- it consists of YDPA, Senate, House of Representative

Executive-control, govern and police the law (article 39-43)

• To implement the laws as enacted by the parliament and to act in the interest of the people.
• consists of YDPA and the apparatus of Government, principally:
i) the Cabinet;
ii) the public service;
iii) the police force; and
iv) the armed forces.
• ie: Food Act 1983 –under responsibility of Ministry of Health

Judiciary-
• To enforce the law made by legislative
• To interpret the law (art 121-131)
• High Courts, Federal Courts, Court of Appeal
• In some situations- ‘to make’ law when the judge could not find an existing principle.
• ‘judge-made law’
• Case law
• Rational: to prevent any abused and corruption in the government system
• Each body need to check the other and ensure that they are not exceed or abused their power
• Must have – check and balance
• If all three powers are held by the same person, then there would be a dictatorship and arbitrary rule would
prevail

• Issue: No absolute of SOP

• Example: the judiciary may declare as void of an executive act or an Act of Parliament if either violates the
Constitution but judicial appointments to the superior courts are made by the executive body and Parliament
may change the law- shows- the indirect system on judicial power.
• Cases: Umno’s case

FC confers the legislative power to the Federal Parliament and the State Legislature

Art 73. In exercising the legislative powers conferred on it by this Constitution –

(a) Parliament may make laws for the whole or any part of the Federation and laws having effect outside as
well as within the Federation.

(b) the Legislature of a State may make laws for the whole or any part of that State.

NINTH SCHEDULE
FC provides that the federal head of the state is YDPA

• FEDERAL HEAD OF STATE : YDPA

• ELECTED FROM CONFERENCE OF RULERS
• ROTATES EVERY 5 YEARS
• CONSTITUTIONAL HEAD
• NO POWER TO REFUSE ASSENT TO BILLS PASSED BY PARLIAMENT

under Article 3 of the FC provides that Islam is the religion of the federation but guarantees the freedom of
religion

FC also provides fundamental rights of the individual in our country

FC can be amended by a 2/3 majority of the total number of each house of parliament on its 2nd and 3 rd
reading. (Refer article 159 and 161E)

B. STATE CONSTITUTION2

• Each State has its own constitution

• Lays down matters concerning (refer 8th schedule of FC):
➢ Ruler (Sultan , Yang di-Pertua Negeri)
➢ Executive council
➢ Legislative Assembly
➢ Financial provisions
➢ State employees
➢ Amendment of State constitution

• If such essential provisions are missing, or if any provision is inconsistent with them, Parliament
may make provision to give effect to them or to remove any inconsistencies, as the case may be –
Article 71, Federal Constitution

C. LEGISLATION
• It is the law enacted by a body constituted for this purpose i.e Parliament at federal level and by various
State Legislative Assemblies at state level.

• Proclamations : laws made by British Military Administration during 1945-46

• Ordinances : laws enacted by Parliament after 1946 but before 1957
• Enactments : laws enacted by State Legislative Assembly (except in Sarawak, they are known as ‘Ordinances’)
• Acts : laws enacted by Parliament after 1957
• Parliament and State legislature have to enact law according to the provisions stated under the Federal and
State Constitutions. Parliament can make laws on matters listed in List I of Ninth Schedule of the Federal
Constitution whereas each state in Malaysia may make laws on matters listed in List II.

• List III provides the maters that can be touched by both Parliament and states.

D. SUBSIDIARY LEGISLATION
• Also known as delegated legislation/ subordinate legislation.
• It is the rules and regulation appointed by authority under powers conferred on it by statue.
• Proclamation / rule / regulation / order / notification / by-law made under any Act, Enactment, Ordinance or
authority having legislative effect
• Section 3 of Interpretation Act 1967-these subsidiary legislation have legislative effect.
• It is law make through powers delegated by legislature to a body or a person via an enabling or parent statue
• Example: Insurance Act 1963 (Repealed)-section 45
• Cases:
- Daihatsu (Malaysia) Sdn Bhd v. Pendakwa Raya (1987) 1 MLJ 88
- Watson v. Winch (1916) 1 KB 688

• Advantages/Reasons for Subsidiary Legislation:

- The legislature has insufficient time to enact all the legislation, detailed in every aspect, required in a
modern society
- Modern legislation is highly technical (more complex) -need to be referred to the experts
- The legislature is not continuously in session and its legislative procedure are cumbersome (difficult to
handle). so→ delegation is necessary-easy to be amended or repealed quickly. (can easily be rescinded
and more flexible)
- However, the subsidiary legislation made in contravention of either a parent Act or Constitution is void.
- Exception: if there happen to be proclamation of Emergency which is stated under Article 150 of FC, the
parliament has the power to legislate on any subject if it is inconsistent with the FC.

UNWRITTEN LAW
(the laws that are not enacted and not found in any constitution.)

A. ENGLISH LAW

• The Civil Law Act 1956 (Revised 1972)- Section 3, 5 and 6

• Before- Civil Law Ordinance

A. Section 3 : Application of U.K. common law, rules of equity and certain statutes

(I) 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

(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.

• Issue: old law and not develop?

• Commonwealth of Australia v. Midford:
• Held: the requirement to apply the common law and the rules of equity as administered in England does not
mean that the common law and equity as applied in Malaysia must remain static and not develop. Here, the
developments of common law after 1956 may well be applicable in Malaysia. (but must be suitable to the local
circumstances)
• Important factors to apply English Law in Malaysia is subject to 2 limitations:
a. only applied when there is an absence of local statue on a particular subject. (Only to fill the lacuna→ the
local law later still can prevail over the particular law)
b. only applied to the part of English Law that is suited to local circumstances.

• Section 3(2)- conflict between common law and equity→ equity prevail

Cases:
• Jamil Harun v. Yang Kamsiah & Anor (1984) 1 MLJ 217
• Lee Kee Chong v. Empat Nombor Ekor (NS) Sdn. Bhd. (1976) 2 MLJ 93
• Ong Cheng Neoh v. Yeap Cheah Neoh & Ors (1872) 1 KY 326
• Kamoo v. Thomas Turner Basett (1808)1KY 1
• Permodalan Plantations Sdn. Bhd v. Rachuta Sdn. Bhd (1985) 1 MLJ 157
• Pushpah a/p Mss Rajoo v. Malaysian Co-operative Insurance Society Ltd & Anor (1995) 2 MLJ 657
• Six Widows case- Chou Ang Chee v. Nan Chan Neo & Ors (1908) 12 SSLR 120
• United Malayan Banking Corp Bhd & Anor v. Pemungut Hasil Tanah Kota Tinggi (1984) 2 MLJ 87

• Common law is law developed by judges through the precedent of court decisions. Equity law supplements
common law and allows courts to apply justice according to natural law. (to prevent the harshness in Common
Law)

B. Section 5 - Application of English law in commercial matters

1) In all questions or issues which arise or which have to be decided in the States of Peninsular Malaysia other
than Malacca and Penang with respect to the law of partnerships, corporations, banks and banking, principals
and agents, carriers by air, land and sea, marine insurance, average, life and fire insurance, and with respect to
mercantile law generally, the law to be administered shall be the same as would be administered in England in
the like case at the date of the coming into force of this Act, if such question or issue had arisen or had to be
decided in England, unless in any case other provision is or shall be made by any written law.

2) In all questions or issues which arise or which have to be decided in the States of Malacca, Penang, Sabah
and Sarawak with respect to the law concerning any of the matters referred to in subsection (1), the law to be
administered shall be the same as would be administered in England in the like case at the corresponding
period, if such question or issue had arisen or had to be decided in England, unless in any case other provision
is or shall be made by any written law.

Meaning:
• Section 5(1) of CLA -the application of English Commercial law into Peninsular Malaysia (except Penang and
Malacca) as administered on 7th April 1956 in the absence of local legislation
• Section 5(2) Penang, Malacca , Sabah and Sarawak shall apply English Commercial Law as administered in
England. (continuing reception)
• However nowadays we have so many local laws at present with regard to the commercial matters. Therefore
not total reliance to the English Commercial Law.

Cases:
• Seng Djit Hin v. Nagurdas Purshotumodas Co. (1923) AC 444
• Shaik Sahied Abdullah Bajerai v. Sockalingam Chettiar (1933) 12 MLJ 81
• Kon Thean Soong v. Tan Eng Nam [1982] 1 MLJ 323

Cont

C. Section 6- No application of English land law

• Nothing in this Part shall be taken to introduce into Malaysia or any of the States comprised therein any part
of the law of England relating to the tenure or conveyance or assurance of or succession to any immovable
property or any estate, right or interest therein.
• Cannot apply English Law unless the NLC applies it for judicial comity.
• (judicial comity- a term where the courtesy of the court that respects a judicial decisions of another state)
• United Malayan Banking Corporation Bhd & Anor v Pemungut Hasil Tanah, Kota Tinggi [1984] 2 MLJ 87

B. JUDICIAL DECISIONS
• Court decision which make up the Common Law of country
• Doctrine of Stare Decisis apply (Doctrine of Binding Judicial Precedent)
• Precedent- legal decision serving as an authoritative rule embodied in its decision
• Binding precedent- The decisions of higher courts (previous court) that set the legal standards for similar
cases in lower courts (present court) within the same jurisdiction.

Rational:
• Provide certainty
• Final say (decision)
• (see future notes on Malaysian Court System

3. Customs
• Refers to Adat-proper behavior, courtesy where it has legal consequences
• Article 160 FC
• Principal requirements for a valid custom

Cases:-
A) SARIP v MITCHELL
B) RAMAH v LATON
C) ROBERTS v UMI KALTHOM

Types

Types of Adat:

1) Adat Temenggong
2) Adat Pepatih
3) Chinese Custom
4) Hindu/Indian Custom
5) Native Customary Laws (Sabah and Sarawak)

Adat Temenggong
• From Minangkabau-practiced in all part of West Malaysia (except Negeri Sembilan and Naning in Melaka)
• It is a mixture of Islamic and Hindu Law
• The government is in Ruler’s hand
• Assisted by bendahara, Temenggung and several ministers

Adat Pepatih
• From Minangkabau –only practiced in Negeri Sembilan and Naning
• The leaders are known as Yang diPertuan Besar, followed by Lembaga, Buapakk and Undang.
• Dato Menteri Othman Baginda v. Dato Ombi Syed Alwi (1981) 1 MLJ 29
• Every family has a leader.
• Any offences committed under this adat have to be remedied by paying compensation.

Chinese and Hindu Customary Law:

• family matter
• when English Law came- Introduce new laws ie: Law Reform Act (Marriage and Divorce) 1976
• cases: Choo Ang Chee v. neo Chan Neo (1908) 12 SSLR 120 (Six Widow case)
• Before LRA was introduced
• Recognized the Chinese law
• Tan Kui Lim v. Lai Sin Fah (1980) 1 MLJ 222
• Patoo v. Valee Uta Taven (1883) 1 KY 622

Customary law in Sabah and Sarawak

• 3 types of customary law:
• i. Malay customary law
• ii.Native customary law
• iii.Sarawak-Chinese customary law
• Article 161A of Federal Constitution
• Mandi a/k Kerbau v. Timah a/k Landa (1950) SCR
• Haji Laugan Tarki v. Mahkamah Anak Negeri Penampang (1988) 2 MLJ 85

Islamic Law
• In Malaysia →Shafie School of jurisprudence + modification of customary law

• Sources of Islamic Law:

1) Primary- Quran, Sunnah (Hadith)
2) Secondary-Ijamak, Qiyas and so on

• Quran:
– contain of direct revelations for God
– Code of Devine Exhortation and moral principles
– Deals with the law-family, civil, criminal, international relations and many aspects of life

Sunnah:
- the practice followed or enjoined by the Prophet Nabi Muhammad S.A.W
Includes:
1) what the prophet said
2) conduct of prophet
3) agreed to

Ijmak:
• the consensus of the jurists/scholar on a particular hokum after the death of prophet.
• Ijmak guarantees the authenticity and correct interpretation of the Quran, the faithful transmission of the
Sunnah of the prophet, the legitimate use of Qiyas and its result , in short in covers every detail of law

Qiyas:
• the accord of a known thing with a known thing by a reason of the equality of the one with the other in
respect of the effective cause of its law
• Analogical reasoning- deducing a law by using the process of analogy –an application or extension of the law
established by a binding authority to a particular case.

The acceptance of Islamic Law under statute:

• Article 3 of Federal Constitution-Islam is the religion of the Federation but other religion may be practiced in
harmony and peace
• Article 11(1) everyone has right to profess and practice his religion
• Article 11(4) no propagation of any religion among Islam
• Article 121(1A) the High Court shall have no jurisdiction in any matter which in the jurisdiction of Syariah
Court
• Article 74(2)
• Cases: Muhammad Habibullah v. Faridah Dato Talib (1992) 2 MLJ 793
• Sukma Dermawan Sasmitaat Madjav. Ketua Pengarah Penjara Malaysia & Anor (1998) 4 MLJ 742

Process of Making Law

• Relevant articles:
• Article 73- 79
• Case: Mamat Bin Daud & Ors v. Govt. of Malaysia
• In Malaysia, law enacted by Parliament (Federal Level) and State legislative Assemblies (State Level).
• Parliament: law for the whole federation
• State Govt: law for the whole federation state)
• The parliament will exercise its power to make laws for the whole Malaysia by the passing of Bills
in both houses. A Bill may originate in either of the House.

• However, exception for the “Money Bill” (such as budget and taxation) must originate in House of
Representatives and can only be introduces by a Minister.

Public Bill:
• Public bill include bills on matter of general public interest such as national defense, public order and
taxation.

Private Bill:
• It is a proposal for the law that would apply to a particular individual or group of individuals, corporate
entity.
• Eg: Universitiies and Universities Colleges (amendment) Act 1996.

Private member’s bill:

• A private member’s bill is a proposed law introduced by any member of the legislature other than a minister
or assistant minister.

Hybrid or Government bills

• Bills that seem to be both public and private in nature are referred to as hybrid bills.
• Hybrid or government bills are introduced by a minister or private member for general application but
belong to the class of bills which appear to affect individual rights or interests.
• It is a public matters that also affect the private bodies

Eg: a hybrid bill is used by the government on behalf of railway companies and transport agency to obtain
authorisation for major project deemed to be in the national interest, but which would affect a large number
of private interests as well.

• In the parliamentary system, most bills are proposed by the government, not by individual members of the
legislature.
• Refer article 62,66,67,68
• Art 66(3) the Bill is sent to YDPA to get his assent.
• Art 66(4) YDPA must assent within 30 days
• Art 40(1) YDPA act as according to advise of cabinet
• The bill then will be gazetted and then it can be officially enforced (into publication).

Voting process-normally→ simple majority but in some cases it needs 2/3 majority
Refer Part III of 2nd Schedule, article 161E, 159(2), 74 and 76

Malaysian Court System and Administration of Justice

• Doctrine of Binding Precedent (Stare Decisis)

• Hierarchy of Courts
• Jurisdiction of Courts

Binding Precedent

• Refer to previous notes on Judicial Decisions.

• The functioning of the system of precedent is based on the hierarchy of decisions and hierarchy of courts.
• Judicial precedent are when a process of adjudicating is made, whereby after argument before a judge, a
decision in a dispute is given.
• In reaching to his conclusion, the judge will formulate a dn apply legal principles.
• Here, the principles may for a guide for the future.

How it (doctrine of Stare Decisis) can be applied?

• Court-Introduce new principle

• Court-interpreting statutes
• ??? How it works?
• 2 Ways:
• Vertically
• Horizontally

Rules

• Rules of Application of the Doctrine:

• The Superior Courts binds the Inferior Courts
• The Federal Court does not bind by its own decision (previous decision).
• Cases: Dalip Baghwan Singh v. PP 91998) 1 MLJ 1
• Arulpragasan a/l Sandaraju v. PP (1997) 1 MLJ 1
• Kwong Yik Bank v. Ansonia Management Associates (1999)1 AMR 377
TYPES

1. Original Precedent

• If a point of law has never been decided before, then whatever the judge decides will form a new precedent
for later cases to follow. Donoghue v Stevenson (1932) snail in a bottle case – negligence. As there are no past
cases for the judge to base his decision on, he is likely to look at cases that are closest in principal and he may
decide to use similar reasoning. This way of arriving at a judgement is known as ‘reasoning by analogy’.

2. Binding Precedent.

• This is a precedent from an earlier case, which must be followed even if the judge in the later case does not
agree with the legal reasoning. A binding precedent is only created when the facts of the second case are
sufficiently similar to the original case.
• Here, the decision of superior court are binding on lower courts or the superior courts are bound by their
own decisions previously (same level with later case).

3. Persuasive Precedent.

• These are not binding on the court, however a judge may consider such a precedent and decide that it is the
correct principal to follow. On other words, he is persuaded that he should follow it. (eg: Decisions of lower
courts and foreign courts can be persuasive precedents)

Ignorance of the principle (Exceptions)

• The case is on appeal

• The precedent is per incuriam (wrongly decided)
• Difference in material fact

Advantages v. Disadvantages

Advantages
• It leads to an element of certainty in the law
• More practical as the law grows together with social changes in the society
• The law is flexible in that new rules arise out of concrete facts or situation
• Uniform and consistent decision
• Saves time – avoids unnecessary litigation

• Follow the interpretation set out by the higher courts.

• Easier for reference
• Guide for the future court and judges.
• Lawyer will able to brief us the possible outcome of the cases that we are having based on previous cases.

Disadvantages
• Due to the hierarchy of binding precedent being established, the law becomes rigid
• The bad decisions are perpetuated since lower courts must follow higher courts
• The development of the law through new precedents may be said to be slow and irregular

• Takes a lot of time in interpreting the cases. (need to find the relevant cases that need to be followed)
• Problem of finding the ratio in particular case. (need to identify the relevant ratio in previous cases that can
be applied to later case)
• Problem of bulk and complexity.

Cases:
• Khalid Panjang & Ors v. PP
• Henry v. De Cruz
• The jurisdiction of Malaysian courts is determined by the Courts of Judicature Act and the Subordinate
Courts Act 1948.
• Article 121 of FC: Two High Courts of coordinate jurisdiction, the High Court in Malaya, and High Court in
Sabah and Sarawak.
Additional points:
• See section 65(1)(b) SubCA : hear civil cases x>RM1,000,000. (exception in sec 65(1)(a)-unlimited jurisdiction
in certain cases)
• However there are some cases that cannot be heard in Session Ct even if the claims does not exceed the RM
1,000,000.
• Ie: cannot hear:
• Cases pertaining probate
• Administration of estates, divorce, guardianship or custody of infant and bankruptcy
• Must be heard in High Court.

• 1st March 2013: Session Ct can try all actions for specific performance
• Rescission of contracts
• Cancellation or ratification of instrument
• -must still within the monetary limit of RM1,000,000.
Court Of Appeal

JURISDICTION:

Criminal
• The Court of Appeal has the jurisdiction to hear and determine any criminal appeal against any decision by
the High Court—
a) made in the exercise of its original jurisdiction; and
b) in the exercise of its appellate or revisionary jurisdiction on any criminal matter decided by the Sessions
Court.

• However, if it is an appeal from a decision of the High Court exercising its appellate or revisionary jurisdiction
on any criminal matter that originated from a Magistrates’ Court then no further appeal to the Court of Appeal
is permissible without leave of the Court of Appeal and such appeal must be confined only to questions of law
which may have arisen in the course of the appeal or revision and the determination of which by the High
Court has affected the event of the appeal or revision (section 50(1) & (2) Courts of Judicature Act 1964).

Cont

Civil:
• The Court of Appeal has the jurisdiction to hear and determine appeals from any judgment or order of any
High Court in any civil cause or matter, whether made in the exercise of its original or of its appellate
jurisdiction, subject to any written law regulating the terms and conditions upon which such appeals are
brought (section 67 of the Courts of the Judicature Act 1964).
• (section 68)-However, no appeal shall be brought to the Court of Appeal in the following cases—
a) if the amount or value of the subject matter of the claim is less than RM250,000/- except with the leave of
the Court;
b) the judgment or order is made by consent of parties;
c) the judgment or order relates to costs only; and
d) where by virtue of any written law the judgment or order of the High Court is final.

Federal Court

Criminal Appeals:
• The Federal Court may subject to section 87 of the Courts of Judicature Act 1964 hears and determines
appeals against decisions of the Court of Appeal relating to any criminal matter decided by the High Court in
the exercise of its original jurisdiction.

Civil Appeals:
• Section 96 of the Courts of Judicature Act 1964 provides that an appeal against the decision of the Court of
Appeal may be made to the Federal Court with the leave of the Federal Court. Leave is only granted if–
a) the decision of the Court of Appeal is in respect of any civil cause or matter decided by the High Court
- in exercise of its original jurisdiction where it involves a question of general principle of law decided for the
first time or a question of importance upon which further argument and a decision of the Federal Court
would be to public advantage; or
b) the decision of the Court of Appeal is as to the effect of any provision of the Federal Constitution including
the validity of any written law relating to any such provision. (section 96(a) and (b) Courts of Judicature Act
1964).
Original Jurisdiction:
 The Federal Court has the exclusive jurisdiction to determine–
a) any question whether a law made by Parliament or by the Legislature of a State is invalid on the ground

 that it makes provision with respect to a matter with respect to which Parliament or, the Legislature of the

 State has no power to make laws; and

b) disputes on any other question between States or between the Federation and any State.

• (Article 128(1) of the Federal Constitution).

Referral:

• The referral jurisdiction of the Federal Court is provided for in Article 128(2) of the Federal Constitution
which reads—
• “Without prejudice to any appellate jurisdiction of the Federal Court, where in any proceedings before
another court a question arises as to the effect of any provision of this Constitution, the Federal Court shall
have jurisdiction (subject to any rules of court regulating the exercise of that jurisdiction) to determine the
question and remit the case to the other court to be disposed of in accordance with the determination.”
• Means: other courts may refer to the Federal Court for a decision which concern about constitutional
matters.

Advisory:

• The advisory jurisdiction of the Federal Court is provided for in Article 130 of the Federal Constitution which
reads—
• “The Yang di-Pertuan Agong may refer to the Federal Court for its opinion any question as to the effect of
any provision of this Constitution which has arisen or appears likely to arise, and the Federal Court shall
pronounce in open court its opinion on any question so referred to it.”
• Means: the Federal Court may give advice to the YDPA on regard of the Federal Constitution.

Other Courts:
• Syariah Courts
• Courts for Children
• Military Court
• Native Court
• Consumer claim Tribunal
• Industrial Ct
• etc

• Special Court for Ruler (art 182 and 183 FC)

• Mahkamah Jenayah Seksual Terhadap Kanakkanak??
• SEXUAL OFFENCES AGAINST CHILDREN ACT 2017
Cont

Consultation:
- In Malaysia, there is no general provision making prior consultation a formal requirement for making of
subsidiary legislation
- Consultation btw the authority (e.g. Minister) with interest groups and advisory bodies.
- Enable the affected people to get an opportunity to discuss the proposal.

Publicity:
- In Malaysia, it is the general practise that subsidiary to be published in the Gazette and will come into
force in the date of publication or if the dates is specified.
- If it is not gazetted as required, the law become invalid
- Therefore, no excuse to break the law
- Section 20 of Interpretation Acts 1948 and 1967:
- No person shall be made or shall become liable to any penalty in respect or any act done before on which
the subsidiary legislation was published

Parliamentary Control :
- The making of subsidiary legislation is authorised by the Act which was enacted by the legislative body
(Parliament)
- The legislature can always exercise control over the delegate by repealing the provision / the Act itself.
- Negative Resolution : the subsidiary legislation is effective unless the legislature passes a resolution
annulling it
- Affirmative Resolution : the subsidiary legislation cease to have effect unless with the prescribeb period,
the legislature passes a resolution affirming it
How to control subsidiary legislation?

• Consultation:
• In Malaysia, there is no general provision making prior consultation a formal requirement for making
of subsidiary legislation.
• Consultation btw the authority (eg. Minister) with interest groups and advisory bodies.
• Enable the affected people to get an opportunity to discuss the proposal.

• Publicity:
• In Malaysia, it is the general practice that subsidiary to be published in the Gazette and will come into
force in the date of publication or if the dates is specified.
• If it is not gazetted as required, the law become invalid
• Therefore, no excuse to break the law
• Section 20 of Interpretation Acts 1948 and 1967:
• No person shall be made or shall become liable to any penalty in respect of any act done before on
wich the sublisdiary legilslation was published.
 
• Parliamentary Control:
• The making of subsidiary legislation is authorised by the Act which was enacted by the legislative body
(Parliament)
• the legislature can always exercise control over the delegate by repealing the provision/ the Act itself
• Negative Resolution: the subsidiary legislation is effective unless the legislature passes a resolution
annulling it.
• Affirmative Resolution: the subsidiary legislation cease to have effect unless with the prescribed
period, the legislature passes a resolution affirming it
 Judicial Review:
• The court has a control over a subsidiary legislation.
• validity of the sub-legislation will be declared by the court.
• If the sub. Legislation conflicts with the Parent Act or Consititution, it will be declared as void (on the
ground of ultra vires).
• using the doctrine of ultra vires
• section 23(1) and section 87 (d) Interpretation Act 1967
• Types of ultra vires:
• 1) Substantive ultra vires
• 2) procedural ultra vires
• Cases: Major Phang Yat Foo v. Brigadier General Dato’ Yahya Bin Yusof (1990) 1 MLJ 252
• Datin Azizah bte Abdul Ghani v, DBKL (1992) 2 MLJ393
• Low Pheng Huat v. PP (1917) FMSLR 162
• Ghazalli v. PP (1964) MLJ 164

Low Pheng Huat v. PP (1917) FMSLR 162

• The appellant was convicted by the Magistrate of the charge of failing to comply with a notice
directing him to enlarge the open area of some of his houses.
• The notice was issued by the Sanitary Board in accordance with a by-law.
• The appellant challenged the by-law as being in excess of the powers of the Sanitary Board as
conferred by the Sanitary Board Enactment 1907.
• Held: the by-law was ultra vires and therefore void.