Nallini Pathmanthan FCJ:

Introduction

[1] The primary issue that arises in this appeal is whether:

(i) an absolute assignee under a letter/contract of assignment executed earlier in time; or

(ii) a creditor entitled to payment in respect of goods sold and delivered,

is entitled to monies in a bank account in the name of its common debtor. The appellant, Sabah Development Bank Berhad (the Bank) is the absolute assignee of all proceeds of monies in the bank account of one Swakaya Sdn Bhd (Swakaya) by reason of a sum of RM85 million loaned to Swakaya, while the respondent, Petron Oil (M) Sdn Bhd (formerly known as ExxonMobil Borneo Sdn Bhd) (Petron) is the creditor, by reason of goods sold and delivered on behalf of Swakaya to Sabah Electricity Board.

[2] In the courts below it was determined that it was the respondent, Petron that was entitled to the proceeds. This conclusion was premised on the grounds that a constructive trust could be inferred over the subject monies/proceeds deposited by another entity, namely the Sabah Electricity Board (SESB) into Swakayas bank account, as payment to Petron for goods sold and delivered. In other words the constructive trust inferred took prio