Leigh R. Wright in the journal article “Historical Notes on the North Borneo Dispute” published in The Journal of Asian Studies, Vol. 24, No 3 (May, 1966) made some rather interesting and salient points to the discussion. She notes that while the Sulu claim of sovereignty over North Borneo prior to the 1878 treaty with Baron Overbeck is open to dispute, there is ample oral and written documentation which proves that Brunei held sway over North Borneo before it was even ceded to the British North Borneo Company. In fact, after the signing of treaties, “[f]ew people seriously questioned the British North Borneo Company’s rights of sovereignty until the Philippines pressed their claim in 1962. Most observers of the last and present century refer to the cession as complete.” In any case, she says, the effect of the Madrid Protocol of 1885 signed by Spain and Britain effectively demonstrates that Spain as the colonial power of the Philippines Islands had abandoned all claims that it may have over North Borneo.
On 22nd April 1903, Sultan Jamalul Kiram of the Sulu Sultanate signed a document known as “Confirmation of Cession of Certain Islands”, under which he has “ceded” additional islands in the neighbourhood of the mainland of North Borneo from Banggi Island to Sibuku Bay, to British North Borneo Company. The sum 5,000 dollars a year payable every year increased to 5,300 dollars a year payable every year. Note that this Agreement further clarifies the treaty of 1878, where it further affirms that the original word padjak clearly means cession, and not “lease”.