By Majangkim Office, Special Investigation
The Legal Maxim That Condemns the Federal Takeover
SANDAKAN: At the heart of this constitutional crisis lies not just modern statutes but an ancient common law principle that underpins all property rights in Commonwealth jurisprudence:
NEMO DAT QUOD NON HABET
(“No one can give what they do not have”)
This principle, when applied to the Continental Shelf Act 1966 and the Petroleum Development Act 1974, exposes the fatal legal flaw in Malaysia’s petroleum regime—a flaw that renders the PDA 1974 constitutionally void for Sabah and Sarawak.
1. Applying Nemo Dat to the Continental Shelf
2.
The Logical Chain:
The 1954 Alteration of Boundaries Order already vested the continental shelf in Sabah and Sarawak as state territory.
Therefore, the Continental Shelf Act 1966 (CSA 1966) could not create new federal ownership over something already owned by the states.
Nemo dat principle: The Federation could not “give” itself (or PETRONAS) rights over the continental shelf because it never had those rights to begin with.
The CSA 1966’s declaration that the continental shelf is a federal maritime zone is thus ultra vires as applied to Sabah and Sarawak, because:
It attempts to reassign property already vested elsewhere.
It contradicts the pre-existing territorial definition protected under MA63.
2. The PDA 1974’s Double Violation
The PDA 1974 compounds this illegality:
First Illegal Transfer:
CSA 1966 (invalidly) claims federal authority over the shelf.
Second Illegal Transfer:
PDA 1974 (invalidly) vests petroleum resources from that shelf in PETRONAS.
This creates a chain of invalid transfers:
State ownership (1954) → Federal claim (1966) → PETRONAS ownership (1974)
Each transfer fails under nemo dat because the transferor lacked valid title.
3. Constitutional Property Rights Amplify the Principle
4.
The nemo dat principle is constitutionalized in Malaysia through:
Article 13: Protects against deprivation of property without compensation.
Article 8: Guarantees equality before the law – but here, Sabah/Sarawak’s pre-existing property rights were unequally taken.
State List, Item 2(c): Recognizes state authority over minerals in their territory.
If the states already owned the continental shelf and its resources (via 1954 Order + State Constitutions), then Parliament cannot legally transfer that property to PETRONAS without:
State consent (via Article 76(4) – legislation with state consent).
Adequate compensation (which 5% royalty is not).
Constitutional amendment (which never happened).
4. The Bypassed Safeguard: Article 161E and the Silent Violation
Any meaningful constitutional examination of the PDA 1974 must also turn to a provision that stands as a solemn gatekeeper of Sabah and Sarawak’s legal identity within the Federation: Article 161E of the Federal Constitution.
Crafted not as an afterthought but as a core assurance of the Malaysia Agreement 1963, this Article mandates that no federal law which “affects the operation of any native law or custom in the Borneo States” — or which seeks to amend fundamental provisions of the State Constitutions of Sabah and Sarawak — may apply to East Malaysia without the concurrence of the Yang di-Pertuan Negeri of that State.
The PDA 1974 did not merely “affect” native customs and territorial law — it sought to sever them from the living legal order of Sabah and Sarawak. By transferring ownership of subsoil resources — resources that under native customary law, colonial land codes, and pre‑Malaysia constitutional instruments were inseparable from territorial sovereignty — to a federal entity, the Act engaged precisely the kind of legal‑cultural displacement that Article 161E was designed to prevent.
Yet there exists no credible evidence that the Governor’s concurrence — that essential constitutional key — was sought or granted before extending the PDA 1974’s reach across the South China Sea to the shores of Borneo. In its haste to centralize petroleum wealth, the federal legislature treated Article 161E not as a constitutional lock, but as a historical footnote.
This omission finds its judicial mirror in the enduring wisdom of Tun Suffian’s judgment in Ah Thian. While rightly affirming the supremacy of federal law in cases of inconsistency, the learned Chief Justice anchored that supremacy within a broader constitutional architecture of balanced federalism. He reminded the nation that federal power, however expansive, “must be exercised in accordance with the Constitution” — a document that includes, unequivocally, the special procedural safeguards of Article 161E.
Thus, the PDA 1974 stands accused not only of violating territorial, proprietary, and common‑law principles, but of committing a procedural constitutional breach of the highest order. It attempted to govern Borneo’s resources through a law that, by sidestepping Article 161E, never properly entered the constitutional gate.
Here, Tun Suffian’s vision and Article 161E converge:
Federal power does not flow like an unchecked tide; it moves within channels dug deep by the Constitution itself.
Where those channels were carved specially for Sabah and Sarawak — as they were under MA63 — to bypass them is to violate not just a clause, but the covenant of federation.
5. The MA63 Dimension: A Special Compact & The Sacred Principle of Pacta Sunt Servanda
MA63 is not just an agreement; it is a property succession compact elevated to constitutional status. When Sabah and Sarawak formed Malaysia, they brought their entire territory (including continental shelf) into the federation, under terms solemnly guaranteed by the Federal Government, the United Kingdom, and the predecessor governments of North Borneo and Sarawak.
Here, the international legal principle of Pacta Sunt Servanda (“agreements must be kept”) becomes domestically constitutionalized. This is no mere diplomatic courtesy—it is a peremptory norm that binds the Federation to honour the terms upon which Sabah and Sarawak consented to unite.
The PDA 1974 constitutes a fundamental breach of this principle. By unilaterally seizing resources that were part of the territory and patrimony that Sabah and Sarawak brought into the Federation—resources explicitly or implicitly protected under the MA63 bargain—the Federal Government violated the very good faith upon which the Malaysian federation was founded.
The federal government became a trustee, not an owner.
The PDA 1974 breached that trust by attempting to sell what it held in trust.
Nemo dat applies with particular force here, reinforced by Pacta Sunt Servanda:
You cannot sell what you hold in trust without the beneficiary’s consent, and you cannot unilaterally alter the terms of a foundational compact upon which a nation is built.
6. The Sovereign Reminder: When the King Speaks of Constitutional Supremacy
In his recent address, His Majesty Sultan Ibrahim, the Yang di-Pertuan Agong, delivered a message of profound constitutional significance—one that resonates directly with this legal crisis:
“The supremacy of the Constitution and the rule of law must always be preserved and defended.”
These are not mere ceremonial words. They are a royal and constitutional command—a call to return to first principles, to honour the social contract, and to correct decades of legal overreach that have undermined the very foundation of Malaysian federalism.
The “rule of law” means that government power must be exercised according to law, not discretion. Yet the PDA 1974 represents rule by lawlessness—using federal legislative power to rewrite history, redraw boundaries, and reassign property in defiance of prior legal instruments and the sacred principle that agreements must be honoured.
His Majesty’s statement should be heard as a mandate for constitutional restoration, particularly for Sabah and Sarawak. The King, as guardian of the Constitution, reminds all branches of government:
The executive cannot enforce an unconstitutional law.
Parliament should not uphold an unconstitutional statute.
The judiciary must not shy away from voiding an unconstitutional act.
7. Legal Precedent Support
While no Malaysian case has directly applied nemo dat to petroleum rights, Commonwealth courts consistently apply it to state property disputes:
Australian Commonwealth v State of Tasmania (1983) – Federal laws cannot extinguish state property rights without clear constitutional authority.
Canadian Provincial Fisheries References – Federal power over fisheries does not allow taking of provincial seabed property without compensation.
In Malaysia, Tun Suffian’s federalism principles in Ah Thian align with this: federal and state governments are sovereign in their own spheres. The continental shelf, as state territory, is within the state’s sphere.
The Complete Constitutional Argument
Now we have a multi-layered legal condemnation of PDA 1974:
Historical Territorial Right – 1954 Boundaries Order made the continental shelf state territory.
Constitutional Property Right – State Constitutions (Article 47 etc.) vested Crown property in the state.
Fundamental Property Law Principle – Nemo dat quod non habet makes the federal-to-PETRONAS transfer legally void.
Procedural Constitutional Breach – Violation of Article 161E’s special safeguards for Borneo States.
Foundational Compact Breach – Violation of Pacta Sunt Servanda inherent in MA63.
Federal Recognition – State List Item 2(c) recognizes state mineral rights; MA63 safeguards them.
Royal Constitutional Mandate – YDPA’s call to uphold constitutional supremacy and rule of law.
The federal government had no title to give. PETRONAS therefore has no valid title to hold.
Conclusion: Answering the Royal Call – Restoring the Chain of Title
When the Yang di-Pertuan Agong speaks of defending constitutional supremacy, he is calling all Malaysians—especially lawyers, legislators, and leaders—to the highest duty of citizenship: to uphold the supreme law of the land.
The PDA 1974 stands as a 50-year test of that duty. It has failed.
Now, guided by royal principle and armed with irrefutable legal arguments spanning from ancient maxims to constitutional guarantees, we must act.
The solution is not renegotiation—it is title restoration:
Declare PDA 1974 unconstitutional as applied to Sabah and Sarawak’s continental shelves.
Recognize state ownership of petroleum resources within their territorial boundaries (including the shelf).
Establish new joint management agreements where the states are true equity partners, not passive royalty recipients.
The principles nemo dat quod non habet and pacta sunt servanda converge in this judgment:
No government can give what it does not own, and no nation can thrive by breaking the compact upon which it was built.
The PDA 1974 attempted both. Fifty years later, the Constitution—and the timeless principles of justice—demand its correction.
Let His Majesty’s words be the catalyst:
Strike down the unconstitutional.
Restore the rightful.
Honour the agreement.
Preserve the Federation by upholding its supreme law.
(Majangkim Office is a legal researcher specializing in constitutional law, federalism, and the Malaysia Agreement 1963. This opinion is written in response to the call of His Majesty Sultan Ibrahim Ibni Almarhum Sultan Iskandar, Yang di-Pertuan Agong, on 09 January 2026.)
