Lord Scarman:

Mr. Wong Ah Suan, who is the appellant before their Lordships' Board, instituted two civil suits in 1976. It will be convenient to refer to him as the plaintiff. The first was an action against the Sarawak Electricity Supply Corporation ("SESCO") in which he claimed:

(1) a declaration that SESCO was precluded from using, working or operating any installation for the supply of electrical energy within that area of Saratok covered by a licence dated 20 January 1961, and granted by the Governor to the plaintiff;

(2) an injunction; and

(3) damages.

His second action was against the Government of the State of Sarawak, in which he claimed:

(1) a declaration that the action of the Government-in-Council in dispensing with his consent to a supply of electricity by SESCO within the area of his licence was ultra viresand void; and

(2) a declaration that a licence granted by the Governor on 10 May 1974 to SESCO to supply electricity within the area of his licence was also ultra viresand void. There was no claim for damages against the Government.

The actions were consolidated. At the hearing of the consolidated action it was agreed that the question of damages in the first suit be deferred until after the main issue in the two cases had been determined.

In consequence, the question was not dealt with at first instance or in the Federal Court. All issues related to that question, both as to liability and quantum, would appear to be open to the parties, if and when damages have to be considered by the Court after the conclusion of this appeal.

The action came on for trial before Seah J. The plaintiff was successful: and on 14 December 1978, the learned Judge ordered:

1) a declaration that the action of the Governor-in-Council purporting to dispense with the consent of the plaintiff was null and void:

2) a declaration that the licence granted to SESCO on 10 May 1974, was null and void in so far as it purported to cover the area designated in the plaintiff's licence. The learned Judge refused injunctive relief, taking the view that damages would provide an adequate remedy, and ordered that the question of costs should be reserved to a later date.

The defendants appealed to the Federal Court, who allowed their appeal and dismissed the two actions with costs. On 4 March 1980, the Court gave the plaintiff leave to appeal to His Majesty the Yang di-Pertuan Agong. In this appeal the plaintiff seeks to have the order of the learned trial Judge restored, while the respondents seek to uphold the decision of the Federal Court.

The facts from which the litigation arises are fully set out in the very careful judgment of the learned trial Judge and were reviewed with equal care by the Federal Court. Save on one matter which has become the critical issue of the appeal the two Courts are agreed both on fact and on law. It is, therefore, unnecessary for their Lordships to do more than give an outline of the essential facts before dealing with the question which in their view is determinative of the appeal.

Since January 1961 the plaintiff has supplied a substantial area of the town of Saratok with electricity. He does so pursuant to a licence dated 20 January 1961, whereby, subject to certain conditions, which do not require consideration in this appeal, he was granted the sole and exclusive right and full power to supply electricity in the area specified. The licence was to continue in force until 31 December 1985, and thereafter for further successive terms of five years each until determined in the manner set out in the licence. The licensee was obliged to maintain installations and apparatus for the supply of electricity in proper order and repair, to ensure a continuously and constantly maintained supply during the hours of darkness; additionally, he was to ensure a continuous supply for 24 hours a day where demand "will afford [him] reasonable profit upon the additional capital and ... running costs thereby incurred": clause (5)