Do you know that the Malaysian Government pays RM5300 per year as rental for Sabah to the Sulu Sultanate heirs? They don’t call it rental or lease but cession money and the Malaysian Government has been paying this RM5300 since the formation of Malaysian Federation in 1963.
Lets get a little inside to see how this lease/rental/cession came about.
Historically, the Sultanate of Sulu was recognized as a sovereign state in 1457 and it encompassed portions of Mindanao in the east to North Borneo to the west and south and Palawan in the north. Evidently, The Sultanate of Sulu was granted the territory of North Borneo by The Sultan of Brunei as a gift for helping the Sultan of Brunei against his enemies.
In 1878, Baron Von Overbeck, an Austrian and his British partner Alfred Dent representing British East India Co later known as The British North Borneo Co. leased the territory of North Borneo from the Sultanate of Sulu by way of an agreement. The agreement was executed on June 22, 1878 and signed between Sri Paduka Maulana Al Sultan Mohammad Jamalul Alam – representing the sultanate as owner and sovereign of Sabah on one hand, and that of Baron Von Overbeck and Alfred Dent, representing the British East India Co on the other as lessee of Sabah. In return the the British North Borneo Company will provide arms to the Sultan of Sulu to resist the Spaniards and pay 5,000 Malayan dollars annual rental based on the Mexican dollars value at that time or its equivalent in gold.
After 1930, the British North Borneo Co were not paying the RM5000 to the Sultanate of Sulu as they were not sure who the heirs of Sultanate of Sulu were. In 1939, a group of heirs of the Sultan filed a suit in the High Court of North Borneo against the Government of North Borneo and the British North Borneo Company for the recovery of the stipulated annual payments.
The High Court Chief Justice McKaskie, rendered judgment in favor of the heirs on December 18, 1939. Justice McKaskie had handed ownership of North Borneo to the heirs of the Sultanate and upheld the validity of the claim of the heirs.
This lease have been continued and up to this day Malaysia has been continuing the rental payment of RM 5,300 per year – a RM300 increased from original rent.
The lease agreement is definitely a proof otherwise there will be no basis for any agreement if such ownership was not established at all.
But, Foreign Minister Datuk Seri Dr Rais Yatim said the payment RM5300 is merely assumed as a civil judgement and has no effect whatsoever because Sabah and its people had made a collective decision and want to be part of the Malaysian Federation through the Cobbold Commission. The Minister said hence, the payment would not be a basis to claim Sabah. The Minister also said that any claims by the Sulu Sultan or any other quarters on Sabah would not be entertained. It must be stressed, he said, that Sabah is part of the Federation of Malaysia and that its sovereignty and independence is honoured by all.