evidence: Sabah, formerly known as North Borneo, occupying the northern half of the island of Borneo has long been at the centre of bilateral relation between Malaysia and the Philippines. Even though the Philippines claim has lasted since the early 1960s, Sabah is still under the sovereignty of Malaysia today. [...] The Philippines allegations of being the landlord of North Borneo is based on the past territorial claims by the Sultans of Sulu. In response to the recent claims by the Philippines, an official from the Malaysian government dismissed the allegations and issued a warning that such statements could affect diplomatic relations between the two states. The official further reiterated that Malaysia does not recognize any claims by any party to Sabah. In order to understand the nature of the claims better, it is essential to look into the history of the dispute. So, let’s look at the origin of contention. [...] However, the Philippines have maintained their claim on the basis that the agreement signed in 1878 constituted a lease and not a sale of land as regarded by Malaysia and the British. Upon transfer of Sabah from the North Borneo Chartered Company to the Crown following the 1946 North Borneo Cession Order, Francis Burton Harrison , the ex US Governor General who held the position of a foreign adviser to the newly constituted Philippines Republic termed the transfer as illegal on the grounds that other interested parties where not included in the agreement. In 1963, Diosdado Macapagal, the then Philippines President declined to acknowledge the Federation of Malaysia as a result of the inclusion of Sabah.