Similarities and Differences of the Issue in Malaysian Law and Common Law.

It is pertinent to note that the issue in the case of Alagappa Chettiar v Colliseum Café
[1962] 1 MLJ 111 involved with the status of a partnership firm; whether firm is a legal
entity and whether firm can hold a tenancy. The Court of Appeal decision in 1962 then
became a leading case to be referred to in determining legal existence of a firm and its ability
to enter into a tenancy agreement.

The Court of Appeal in the case had dismissed the appeal from the Appellant and
hence, gave judgment for Respondent. The ratio decidendi of the judgment was because, even
though the court realise that it is trite law that firm has no legal existence, and as such cannot
hold tenancy, but, the firm-name can be used in official business transaction, therefore, the
partners and owners of the business individually and collectively can be the tenants of the
premises.

It can be concluded that the decision made by the Court of Appeal had upheld the
status of a partnership’s firm in Malaysia and it is also pertinent to note that the status of
partnership’s firm in Malaysia and common law are of no difference. Owing to that fact, it
can be seen in the judgement of Good JA, where his Lordship had referred to the case of
Sadler v Whiteman [1910] 1 KB 868, whereby, Farewell L.J said that it is fallacious to say
that a partner in a firm does not, but the firm does, carry on business. His Lordship further
referred to the position in English law that firm has no existence, it is a mere expression and
partners carry on the business both as principals and as agents for each other within the scope
of the partnership business. On top of that, in his judgment, his Lordship also referred to Lord
Lindley’s explanation with regard to legal status of a firm in which Lord Lindley stated that
the general rule is that “partnership is not a legal entity”. In other words, a partnership is not
an entity separate and distinct from the partners who at any time may compose it. The firm
cannot acquire rights, nor can it incur obligations. The rights and liabilities of a partnership
are the collection of the individual rights and liabilities of each of the partners. His Lordship
then contended that the position in Common law is consistent with the definition of
partnership in our local ordinance (as it was then before).
 With that being so, it is undoubtedly seen that in both Malaysia and Common law, the
position is that, a firm is not a legal persona, but is a label used by a number of individuals
trading in partnership under the name. Thus, if a premise can be leased to an individual
person, then, it can also be leased to any number of individual persons jointly; partners of a
partnership.