Philippine Guidelines on Matters Pertaining to Sabah Dominion

Philippine Policy Towards its Sabah Territory

Philippine Policy Towards its Sabah Territory

M. Malaysian Government paying of the Sultan of Sulu in his Sabah Territory in the year 2004, see below.

L. Malaysian Government paying of the Sultan of Sulu in his Sabah Territory in the year 2003, see below.

http://thephilippineclaimoversabah.blogspot.com/2007/12/introduction.html

K. Bibliography

Book

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__________________. Muslim Filipinos-Heritage and Horizon. Quezon City: New
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Ito, Kiyohiko. AN EMERGING REGIME: ASEAN AS THE MINI-MAX REGIME.
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Lacson, Arsenio H. "OUR SO-CALLED FOREIGN POLICY." Republic of the
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Magallona, Merlin M., Editorial Consultant, A. Suzette V., Editor Suarez, and
Celeste Ruth L., Assistant Editor Cembrano, . THE PHILIPPINE CLAIM TO A PORTION OF NORTH BORNEO: MATERIALS AND DOCUMENTS. Quezon City, Metro Manila: INSTITUTE OF INTERNATIONAL LEGAL STUDIES, 2003.

Majul, Cesar Adib. MUSLIM IN THE PHILIPPINES. Quezon City: University of the
Philippines Press, 1999 Edition.

Mohamad, Abdul Kadir. INTERNATIONAL COURT OF JUSTICE CASE BETWEEN
MALAYSIA AND INDONESIA CONCERNING SOVEREIGNTY OVER PULAU LIGITAN AND PULAU SIPADAN; APPLICATION FOR PERMISSION TO INTERVENE BY THE PHILIPPINES; OPENING STATEMENT BY THE AGENT FOR MALAYSIA TAN SRI ABDUL MOHAMAD. Hague: International Court of Justice, 2001.

Murphy, Ann Marie. From Conflict to Cooperation in Southeast Asia, 1961-1967:
The Disputes Arising Out of the Creation of Malasia and the Establishment of the Association of Southeast Asian (ASEAN). New York, N.Y.: Columbia University, 2002.

Nisperos, Nestor MArtinez. Philippine Foreign Policy On The North Borneo
Question. Pittsburg, PA: University of Pittsburg, 1969.

Noble, Lela Garner. PHILIPPINE POLICY TOWARDS SABAH: a Claim to
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Tucson, Arizona: The Association for Asian Studies by The University of Arizona
Press, 1977.

Oliveros, Renato. Islam in the Moro American WAr. Ann Arbor, MI: Temple
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Ortiz, Alan T. TOWARDS A THEORY OF ETHNIC SEPARATISM: A CASE STUDY OF
MUSLIM IN THE PHILIPPINES. Ann Arbor, Michigan: University of Michigan, 1986.

Tarling, Nicholas. SULU AND SABAH: A study of British policy towards the
Philippines and North Borneo from the late eighteenth century. Kuala Lumpur: Oxford University Press, 1978.

Journal Article

Abdul Samad, Paridah, and Darusalam Abu Bakar. "MALAYSIA-PHILIPPINES
RELATIONS: The Issue of Sabah." Asian Survey 32 (June 1992): 554-567.

"PRESIDENT GLORIA MACAPAGAL's TV/radio Message calling for Prudence,
Sobriety and Reason over the Sabah Repatriation Issue." Department
of Foreign Affairs. Malacanang, August 31, 2002.

Ramos, Godofredo P. "SPEECH DELIVERED ON THE FLOOR OF THE HOUSE OF
REPRESENTATIVES ON MARCH 29, 1963, BY CONGRESSMAN GODOFREDO P. RAMOS, CHAIRMAN OF THE COMMITTEE ON FOREIGN AFFAIRS, IN REPLY TO THE SPEECH OF SENATOR LORENZO SUMULONG, ON THE PHILIPPINE CLAIM TO NORTH BORNEO." Republic of the Philippines, House of the Representatives. Manila City: Manila Bureau of Printing, March 25, 1963.
1-11.

Salonga, Jovito R. "A POINT-BY-POINT REPLY TO THE SUMULONG REPORT ON THE
PHILIPPINE CLAIM TO NORTH BORNEO." Republic of the Philippines, House of Representatives. Manila: Manila Bureau of Printing, 1963. 1-16.

News Paper

Abdul Aziz, Fauwaz. "Philippine Consulate needed in Sabah to Protect
Detainees'." Malaysiakini, November 15, 2006.

Aning, Jerome. "Come Clean on Sabah, Sulu Sultan Urge Gov't." Philippine
Daily Inquirer, July 16, 2004.

Baginda, Abdul Razak. "Security and Military Profile." Malaysia.

"Deportation of Filipino from Malaysia." September 2002.

Ranawana, Arjuna. "The Malaysian View: K.L. wants more say over the crisis."
Asian Week, May 19, 2000.

Rasul, Amina. "Basis of the Sabah Claim." The Manila Times, May 14, 2006.

Reuters. "PHILIPPINE SULTAN VOWS TO GET BACK MALAYSIAN SABAH." October 4,
2004.

Reuters. "Another Royal Group lays claim to Sabah." The Straits Times
INTERRACTIVE, October 7, 2004.

Uckung, Peter Jaynul V. "Salvaging Sabah over Territorial Ownership." Manila
Times, September 20, 2006.

Whitman, Paul F. "THE CORREGIDOR MASSACRE-1968." THE 503d P.R.C.T.
HERITAGE BATTALION ONLINE.

World; Asia-Pacific. "Malaysia Probes Migrant Rape Claim." September 5, 2002.

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Mahmood, Kazi. "Philippine LAw Maker Challenge Malaysia's Territorial Interity."
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"Maysia protest RP's claim on Sabah." Balitang Marino.
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J. Recognition of the Sultan of Sulu of the Sovereignty of Spain over “Sulu and its dependencies” (the main island of Sulu and the tributaries) in 187

According to this interpretation, Spain acquired sovereignty over North Borneo in 1878 when it signed the protocol of March 7, 1885 with Germany and Great Britain. In that protocol of peace, Spain gave up all claims of sovereignty over North Borneo to Great Britain; hence, sovereignty over the territory was transferred to Great Britain.
The document signed by the sultan in 1878, recognizing Spanish sovereignty over “Jolo and its dependencies,” had no mention on the inclusion of the sultan’s territory in North Borneo. It is important to first clarify that Spain never acquired sovereignty over North Borneo. In the protocol signed, the term “pretension” to sovereignty over North Borneo was used; hence, there was no essence at all that Spain was transferring sovereignty to Great Britain (a sovereignty Spain never had; it was merely a pretension). Second, “Jolo and its dependencies” was a geo-political unit different and distinct from the North Borneo possession. To give a more vivid example for this argument, let us try to examine Spanish geo-political units in its Asian positions, known as “Espana Oceanica:”
1. The Philippine Archipelago proper;
2. The Island and archipelago of Jolo, conformably with existing treaties with the Sultan of Sulu;
3. The portion of Northeast cost of Borneo that forms part of the dominion of the Sultan;
4. The Marianas Islands; and
5. Other territories which now belong or which may belong in the future to Spain.
North Borneo was not considered a dependency of Jolo. As shown in the list of “Espana Oceanica,” North Borneo was a geo-political unit different and distinct from the Archipelago of Jolo. It is clear that the sultan did not include his territory and dominion in North Borneo in signing the treaty recognizing the Spanish sovereignty. Another thing to consider was the Spanish Geo-political division in “Espana Oceanica.” In the Spanish geo-political law, the regulations were clear about that.
Even if one would insist to assume that the signing of the sultan in 1885 recognizing Spanish sovereignty over “Jolo and its dependencies” resulted to transfer of sovereignty is still out of premise. Because in the protocol of peace in between Germany, Great Britain, and Spain, it was clearly stated that the Spanish claim of sovereignty was worded in the text as “pretension.” By this, it did not result in transfer of sovereignty from Spain to Great Britain. Therefore, the premise that Spain’s renunciation of sovereignty over its North Borneo territory in favor of Great Britain, that resulted in transfer of sovereignty from the Sulu Sultanate to Great Britain, was impossible.

I. Macaskie Dictum of 1939.

In 1939, the heirs of Sultan Jamalul Kiram filed a suit case in the court of Borneo for the purpose of collecting the money due to them under the 1878 Grant. The issue before the court was the identity of the heirs of the sultan who were entitled to receive payments after his death. Through their attorney, they had the only English translation by Maxwell and Gibson (that translated the Grant of 1878 as cessation instead of lease, which is wrong according to a later translation).
It should be recalled, that the Grant in 1878 is in Arabic and is worded in the Malayan language. At the time the lawyer of the heirs filed the case, he had no original copy of the Grant in 1878. The erroneous Maxwell-Gibson translation was the one used, quoted, and paraphrased in the complaint filed by the attorney for the heirs of the Sultan. Years after the Macaskie dictum was made (which translated the Grant as cession instead of lease), the Philippine government had the copy translated into English. According to the result of the translation, the Grant of 1878 was a Lease Agreement. Under this circumstance, the Philippine Government could not accept the dictum of Judge Macaskie. In the judgment, the Grant of 1878 was viewed as a permanent cession or sale, and that the money that is to be paid to the heirs is “cession money.”

H. The1930 Convention Between the United States and Great Britain and its implication to the Philippine Sabah Claim.

Under the Carpenter Agreement of 1915, the Sultan of Sulu agreed to relinquish its temporal power over Sulu, but retained his sovereignty over North Borneo. As Governor Carpenter clarified in this communication to the director of the Non-Christian tribe on May 4, 1920, as follows:
“It is necessary however that there be clearly (sic) of official record the fact that the termination of the temporal sovereignty of the Sultanate of Sulu within American territory is understood to be wholly without prejudice or effect as to the temporal sovereignty and ecclesiastical authority of the sultanate beyond the territorial jurisdiction of the United States Government especially with reference to that portion of the Island of Borneo which as a dependency of the Sultanate of Sulu is understood to be held under lease by the chartered company which is known as the British North Borneo Company… ” The American Governor General of the Philippine Island Francis B. Harrison made it more clear that: “It is true Governor Carpenter’s contract or treaty with the Sultan of Sulu of 1915 deprived the Sultan of his temporal sovereignty in the Philippine archipelago but did not interfere with the Sultan’s status of sovereignty over British North Borneo lands.”
It is in the context of this statement that the 1930 Convention between the United States and Great Britain defined their respective boundaries. The United States did not intend to claim North Borneo. By this act of defining their respective boundaries, the United States did not cede or waive anything to the British Crown.

G. The Philippines Claim over Sabah and its Arguments.

It is the thesis of the Philippine government that the contract of 1878 was a lease, and not a transfer of ownership or sovereignty. Treacher, was present at the signing of the contract and as witness, he characterized the contract as a lease and referred to the money payment as annual rentals.
Contrary to allegations, the Philippine claim had been studied for years before 1962. While serving in the Department of Foreign Affairs in 1946, Diosdado Macapagal, who later became President of the Philippines, advocated the filing of the claim. The official filing of the claim took place on June 22, 1962. The claims are of sovereignty, jurisdiction, and proprietary ownership to North Borneo. Philippines being successor-in- interest of the Sultan of Sulu derived its legal and historical rights in North Borneo.
In the early part of the 1960’s it became an imperative for the Philippines, aside from the strong historical and legal rights that North Borneo is important to Philippine territory and vital to its security. At this time (1960’s), communism in the region was in its height and Philippines were anxious that Malaya would succumb to the potent communist threat from mainland Southeast Asia, creating a scenario in which a communist territory would be immediately at the southern frontier of the Philippines.
Philippine anxiety on the communist threat has subsided, but another form of menace developed. From the dynamics of the Muslim separatist movement in the south, there evolved a more terrifying threat. The Sabah state of present Malaysia harbored some of the kidnappers, Abu Sayyaf and Al-Quedah, provoking international concern through widespread violence, state wide terror and their vision of establishing independent states.
The British North Borneo Company based their rights from the grant signed in January, 1878. In it, the sultan of Sulu granted certain concessions and privileges to Baron de Overbeck, an Austrian national who was at the time the Austrian Consul-General at Hongkong, and Alfred Dent, a British national, in consideration of an annual rent or tribute of 5,000 Malayan dollars. Dent later bought out Overbeck, and transferred his rights to the British North Borneo Company. The Company was granted a Royal Charter on November 1, 1881.
The Philippine government argues that Overdeck and Dent (the leasors) did not acquire sovereignty or dominion over North Borneo. This is because, according to international law, sovereignty can be ceded only to sovereign entities (e.g. government to government agreement) or to individuals acting for sovereign entities (agreement between leaders of nations). Obviously, Overbeck and Dent were private citizens of their respective countries who did not represent any sovereign entities, but instead acted as mere businessmen who only acquired grant of lease from the Sultan of Sulu. Hence, neither of them did not, and could not, acquire sovereignty or dominion.3
The above letter was written by the British Foreign Minister to explain and respond to the Spanish protest regarding the grant of Royal Charter to the British North Borneo Company. It was not the Spanish crown who made the protest alone; the Dutch government also protested in the same way. Again, Lord Granville maintained in his letter to the Dutch that the British North Borneo Company was a mere administrator, and that the “British Government assumed no sovereign rights whatever in Borneo.”
The Philippine government, therefore, strongly argues that the transfer of rights, powers and interest by the British North Borneo Company to the British Crown is not possible. North Borneo Cession Order of 1946 took place just six days immediately after the Philippines was declared independent by the United States. In the International Law, a transferee (British Crown) cannot acquire more rights than the transferor (British North Borneo Company). In other words, how can the British Crown exercise sovereign rights in the form of protectorate in 1946, when the British North Borneo Company did not exercise nor assume sovereignty over North Borneo? In other words, how can the British North Borneo Company transfer sovereignty to the British Crown, which the company did not have in the first place?
It has been said that President Manuel L. Quezon of the Commonwealth of the Philippines (the transitional, semi-autonomous government of the Philippines under American sovereignty which preceded the independent republic) “had decided not to recognize the continued existence of the Sultanate of Sulu, particularly in reference to North Borneo.” The Philippine Department of Foreign Affairs was not able to find a written record of this statement. This pronouncement was against the Organic Law of the Philippine Commonwealth, since the power to give and terminate recognition during the Commonwealth Philippines was vested only in the Congress of the United States of America (being the colonial power). Aside from the political technicality, International Law dictates that any withdrawal or termination of recognition does not imply the dissolution of the entity affected by the withdrawal.
The Philippine government believes that Dent, who was granted a Royal Charter in the form of British North Borneo Company by the British government, to which the British Crown derived its claim of sovereignty, was not authorized to acquire sovereignty or dominion. Evidence to this was the official correspondence of Lord Earl Granville, British Foreign Minister at the time, in his letter to the British Minister in Madrid dated January 7, 1882, explaining the character of the Charter Grant of the British North Borneo Company, as follows:
“The British Charter therefore differs essentially from the previous Charters granted by the Crown to the East India company, the Hudson’s Bay Company, the New Zealand Company, and other Associations of that character, in the fact that the Crown in the present case assumes no dominion or sovereignty over the territories occupied by the company, nor does it purport to grant to the Company any powers of government thereover; it merely confer upon the persons associated the status and incidents of a body corporate, and recognizes the grants of territory and the powers of government made and delegated by the sultan in whom the sovereignty remains vested…As regards the general feature of the undertaking, it is to be observed that the territories granted to the Company have been for generations under the government of the Sultan of Sulu and Brunei, with whom Great Britain has had Treaties of Peace and Commerce…

The above letter was done by the British Foreign Minister to explain and respond to the Spanish protest regarding the grant of Royal Charter to the British North Borneo Company. It was not the Spanish crown who made the protest alone; also the Dutch government protested the same. Again Lord Granville maintains, in his letter to the Dutch, that the British North Borneo Company was a mere administrator, and that “British Government assumed no sovereign rights whatever in Borneo.”
The Philippine government therefore, strongly argues that the transfer of rights, powers, and interest by the British North Borneo Company to the British Crown is not possible, known as North Borneo Cession Order of 1946 (that took place six days immediately after the Philippines was declared independent by the United States). In the International Law, a transferee (British Crown) can not acquire more rights than the transferor (British North Borneo Company). In other words, how can the British Crown acquire sovereign rights (in the form of protectorate in 1946), when the British North Borneo Company did not exercise nor assume sovereignty over North Borneo? Again, since Overbeck and Dent did not acquire rights of sovereignty or dominion over North Borneo their transferee (British North Borneo Company), also, did not acquire rights of sovereignty or dominion.

F. Territorial Lease from Sulu.

From Labuan, Baron von Overbeck, Joseph W. Torrey, and William Clark Cowie sailed to Jolo on board the steamer, America, arriving at their destination on January 16. Consul Treacher also reached Jolo on the same day, having sailed separately on the British Warship, Fly.
Von Overbeck and his companion were shrewd negotiators and their combined effort brought to bear on the sultan, already hard-press by an ongoing campaign in Sulu, was hardly in a position to refuse. During the bargaining, Cowie, whom the sultan had great confidence as a gun-smuggling partner, contributed his own persuasive influence after having been led to believed that von Overbeck would reward him.
Treacher, whom the sultan consulted, said that Overbeck represented “a bona fide British company,” and intimated to the Sultan that the Spanish Captain-General himself was at the head of the expedition already in Zamboanga poised and ready to destroy Jolo; and that the Sultan of Brunei had recently ceded to them the territory and was already to take possession of it anyway. Evidently a lease of the sultan’s possession in Sabah, its pertinent provisions read thus:
“We Sri Paduka Maulana Al Sultan Mohammad Jamalul A’lam, son of Sari Paduka Marhum Al Sultan Mohammad Pulalum, Sultan of Sulu and of all dependencies thereof, on behalf of ourselves and for our heirs and successors, and with the expressed desire of all Datus in common agreement, do hereby desire to lease of our own free will and satisfaction, to Gustavus Baron de Overbeck of Hong Kong, and to Alfred Dent, Esquire, of London, who act as representatives of a British company, together with their heirs, associate, successors, and assigns forever and until the end of time, all rights and powers which we possess over all the territories and lands tributary from the Pandasan River on the east, and thence along the whole east coast as far as Sibuku on the South, and including all territories, on the Pandasan River and in the coastal area, known as Paitan, Sugut, Banggai, Labuk, Sandakan, China-Batangan, Murniang and all other territories and coastal lands to the south, bordering on Darvel Bay and as far as the Sibuku River, together with all the lands which lie within nine miles from the coast.”
The cession (as the Malaysian prefer to interpret it) or lease (as the Sulu Sultanate maintain) of Sabah to the British began in the Treaty of 1878 between Baron de Overbeck and His Highness the Sultan Jamal Al-Alam was signed for an annual payment of 5,000 Malayan dollars.
It should be noted that Consul Treacher succeeded in formalizing the participation of his government in the agreement, by affixing the participation of his government in the agreement, by affixing his signature as a sole witness to the transaction. Unlike in the Brunei grants of the previous year, Treacher’s recommendation were accepted by the Sulu Sultan, namely, that the “consent” of the British government would first be obtained before any transfer of territory and that its “consideration and judgment” shall be sought in event of any dispute.
Together with the Territorial Agreement , the sultan also appointed von Overbeck as “supreme and independent ruler” with the title of “Datu Bandahara and Rajah of Sandakan,” delegating him as a vassal power with which to administer the territory. However, the sultan made it clear that Oberbeck made the title not him.

E. Territorial Grant from Brunei

Baron von Overbeck, Austrian Consul-General at Hongkong at that time, convinced Dent in supporting a venture in Sabah and together they planned to sell their rights to any interested government. With the money he received from Dent to conduct negotiations, the baron sailed to Brunei. He succeeded in persuading the Sultan, who presumably could not resist the tempting compensation offered. On December 29, 1877, the sultan entered into agreement with von Overbeck, in which the latter gained three territorial “grant” and for which the sultan received a total annual payment of 12, 000 Malayan Dollar.
Together with the above-mention grants, the sultan appointed von Overbeck “supreme ruler” with the title of “Maharajah of Sabah and Rajah of Gaya and Sandakan,” with delegated powers to govern the territory.
The Baron, however, evidently realized that several factors tended to depreciate the value of the grants he had obtained. This is because; more than a century and a half earlier the territory had already been ceded to the Sultan of Sulu who was in actual possession. Moreover, Brunei chiefs refused to recognize the Sultan of Brunei’s rights to cede the territory.
Von Overbeck, aware of the Sultan of Sulu’s dominion in North Borneo, found it necessary to entered into negotiation with the sultan for the lease of the territory. Overbeck and William W. Treacher (Acting British Consul-General at Labuan Island in Borneo), went to Sulu in January 1878. The contract dated January 22, 1878, was drafted by Overbeck himself and was written in Malayan language with Arabic character.

D. Brunei’s Cession of Sabah to Sulu.

Although considerable wealthy, the Sultan of Brunei had a court that was corrupt and ridden with intrigues. Consequently, the sultan found difficulty in extending control to many of his datus throughout the domain, rebellion and strife was frequent in the sultanate. It was under this circumstances that the territory, comprising most of what is now Sabah State, was ceded to the neighboring sultanate as the prize for military assistance.
The murder of the 12th Sultan of Brunei, Muhammad Ali, by Bendehara Abdul Mubin resulted to civil war. The perpetrator claimed the throne but was contested by Pengeran Bongso, a nephew and son-in-law of the deceased sultan. Both contestants to the throne asked the support of Badarud-din, a relative of both and the reigning Sultan of Sulu. Badarud-din was unable to solve the crisis, but supported Pengeran Bongso (who took the name Sultan Muaddin). Sultan Muaddin emerged victorious and the large territorial land known today as “the State of Sabah” was ceded to the Sultanate of Sulu in exchange of the military help and support.
The observation of the contemporary British officer will give us more insight of the territory ceded:
“The first material alteration in the sovereignty of the territorial possession took place in the kingdom of Borneo Proper, when his Raja was obliged to call in the aid of the Solos to defend him against an insurrection of the Maruts and Chinese. In consideration of this important aid, the Raja of Borneo Proper ceded to the Sultan of Solo all that portion of Borneo then belonging to him, from Kimanis in latitude 5° 30’ north to Tapean-durian, in the straits of Macassar, which include the whole north of Borneo.”

The sultanate’s connection with Northern Borneo goes back as early as 1521, as far as the written record is concerned, when a Brunei Sultan was married to a Sulu princess. This early connection between the two sultanates cemented the familial relationship. This political marriage developed into a politico-military allegiance.
Meanwhile, as trade flourished in the region, the mercantilist policies adapted by the colonial powers deprived the Sultanate of Bornei and Sulu of their own profitable commercial activity. Thus driven into piracy and smuggling, the Sulus and the Bruneis continually menaced western trade, presenting a problem that was to persist for many years.

C. Borneo and the Western World

The Portuguese and the Spaniards, in search of spice, were the earliest among the westerners to arrive in the East Indies and establish themselves in Malacca early in the 16th century. British interest in the Sulu-Borneo area stemmed primarily from the East Indian Company’s desire to establish a factory. The head of this particular project was Alexander Dalrymple, who, in January 1761, negotiated a Treaty of Friendship and Commerce with the Sultan of Sulu. The agreement was confirmed by another treaty in February 1763 reiterating the major provision, emphasizing defense alliance.
But the company appeared unable to take advantage of this concession. When it finally decided, in 1769, to occupy Balambangan and made use of the ceded territory, disease and strained relations with the Sultan of Sulu erupted that led to open war; hence, prevented the development of the enterprise. The Balambanagn settlement was abandoned in 1775 until a second attempt was made in 1803, which again abandoned in 1805.
Under the Act of 1858, the East Indian Company was dissolved and their interests were transferred to the crown. However, evidence seems to suggest that the territires ceded by the Sulu failed to interest the British government further. Lord Canning, as the first viceroy to British India, repudiated the “doctrine of lapse” and was further enunciated by his predecessor (the Earl of Derby). The Earl of Derby, in explaining to the British Ambassador in Germany the nature of Spanish claim to North Borneo:
“It should be mentioned that previously to 1836 Spain claimed the island on the ground of first discovery, ancient treaties, and alleged occupations; but those claims were never admitted by Great Britain…Great Britain also had rights under Treaties with Sulu, dated 1761, 1764, and 1769, BUT those treaties must be considered as having lapse…” (Emphasis provided)
Almost two decade before the dissolution of the East Indian Company, an Englishman named James Brooke visited Sarawak, and shortly after was offered by the Sultan of Brunei the governorship of Sarawak in exchange for aid in the face of continuing rebellion. Later in 1841, Brooke was proclaimed Rajah and in subsequent years, he succeeded in minimizing piracy in Sarawak, brunei, and North Borneo with the cooperation of the British Navy. The involvement of Brooke made him “the supreme ruler of Sarawak or the White Rajah.”
In 1846, the British flag was raised on Labuan Island off the cost the east coast of Sabah. And in the following year, Great Britain and Brunei the concluded a Treaty of Friendship and Commerce, at the same time that Labuan was ceded in perpetuity to the crown.
The United States became similarly attracted to Borneo, eager of obtaining the favors that had been secured by other western powers. In 1850, a treaty was signed for the United States advantages for the most favored nation, and later an American consul was appointed to Brunei. Borneo-Sulu area became increasing attractive in terms of commerce for its strategic location in the region, especially maritime traffic.

B. The foundation of the Sultanate of Brunei and Sulu

The sultanates of Sulu and Borneo were well established political entity in the Malay world during the late 15th and 16th century. The Arabs, who had settled in Malacca in 1400, did not extended political control over the two sultanates other than spreading the teaching of Islam. The Chinese did the same who frequented the areas held by the two sultanates to trade with the natives.
The sultanate of Sulu was founded in 1380, nearly one and a half century before the arrival of the Spaniards in the Philippines. The sultanate possessed an efficient political organization, extending its influence in Zamboanga, Basilan, Palawan, aside from the Sulu archipelago. During its supremacy, the sultanate extended its control as far as the Visayas and Luzon until controlled by the Spanish conquistadores in the Philippines. For many years to come, as the colonial government consolidated it territory, the sultanate was to remain a problem by the Spanish and American colonial government (viewed as pirates and buccaneers).
The Sultanate of Brunei, on the other hand, was founded in the 15th century. For a brief period, it became a tributary of the Majapahit Empire. Before the British entry in to the region, the sultanate exercise nominal control over the whole northwestern and eastern coast of the island.
Related by its common Malay origin, the two sultanates were bounded together by religious ties with the spread of Islam in the Malay world. Trade between their respective subjects served to reinforce this relationship even more.