How Malaysia ended up owing RM57b to a sultan's heirs

Malaysia is scrambling to protect its assets as the descendants of the last sultan of the remote Philippine region of Sulu look to enforce a U$15 billion (RM67 billion) arbitration award in a dispute over a colonial-era land deal.

In 1878, two European colonists signed a deal with the sultan for the use of his territory in present-day Malaysia – an agreement that independent Malaysia honoured until 2013, paying the monarch's descendants about $1,000 (about RM5,000) a year.

Now, 144 years later after the original deal, Malaysia is on the hook for the second largest arbitration award on record for stopping the payments after a bloody incursion by supporters of Sultan Mohammed Jamalul Alam's heirs in which more than 50 people were killed.

"It is a fascinating and unusual case," said lawyer Paul Cohen, a lead co-counsel for...