(v) We award cost of RM20,000.00 here and below to the Appellant subject to payment of allocatur. [20] We now set out our reasons for allowing this appeal to set aside the judgment of the LJC and for entering judgment on the counterclaim as above. [21] In the determination of the principal question in this appeal as to whether the LJC had erred in law and fact in allowing the Respondent’s pleaded claim for specific performance of the SPA, our primary considerations are as discussed hereafter. 8 [22] First and foremost is the important point of law raised by the Appellant that the LJC’s decision was actually based on certain facts and issues that the Respondent had not pleaded and was, therefore, wrong in principle. On this threshold question as to whether the decision of a Court, in a contested suit can be grounded on matters and issues that were not pleaded, the law is very much settled that a Court’s decision must be in strict compliance with the pleadings which bind all parties to a claim, be it in respect of the claim or the defence. It must not be of variance with the pleaded claim on the defence. [23] In RHB Bank Bhd. v. Kwan Chew Holdings Sdn Bhd [2009] 3 MLRA 162 which the Appellant cited, the Federal Court held, inter alia, that: “[33] Second, the proposition of the Court of Appeal was not even pleaded by the respondent. The respondent’s cause of action against the appellant was for breach of contract. Nowhere in the respondent’s pleading, expressly or by implication, can we detect a claim for breach of a joint venture agreement arising out of a fiduciary duty placed upon the appellant in the capacity as principal of an agent. It is a cardinal rule in civil litigation that the parties must abide by their pleadings. This is trite as can be seen from the decision of this court in Menah Sulong v. Lim Soo & Anor [1970] 1 MLRA 1; [1983] CLJ (Rep) 263; [1983] 1 CLJ 26 where Ong Hock Thye CJ said: I think it is necessary in this case to emphasise once again that the Courts should give their decision in strict compliance with the pleadings. As Loard Radcliffe said in Esso Petroleum Co Ltd v. Southport Corporation [1956] 2 WLR 81, 91 9 If an Appellate Court is to treat reliance as pedantry or mere formalism I do not see what part they play in our trial system. [34] In fact, the Court of Appeal itself has reiterated this in Amanah Butler (M) Sdn Bhd v. Yike Chee Wah [1997] 1 MLRA 143; [1997] 1 MLJ 750; [1997] 2 CLJ 79; [1997] 2 AMR 1653 where Gopal Sri Ram JCA (as he then was) said: It is trite law that a party is bound by its pleadings. [35] On this, we would like to add that it is not the duty of the court to invent or create a cause of action or a defence under the guise of doing justice for the parties lest it be accused of being biased towards one against the other. The parties should know best as to what they want and it is not for the court to pursue a cavalier approach to solving the dispute by inventing or creating cause or causes of action which were not pleaded in the first place. Such activism by the court must be discouraged otherwise the court would be accused of making laws rather than applying them to a given set of facts.” [Emphasis added] [24] We would at this point look closely at how the LJC approached the dispute between the Appellant and the Respondent. Upon evaluating the evidence, she made a positive finding that a friendly loan had in fact been given to the Respondent by the Appellant/1st Defendant [“D1”]. The LJC further found that D1 had admitted that the land was merely a security for the said friendly loan given by him to the Respondent sometime in 2015 wherein he had no actual intention to purchase the same. D1 took issue with this latter finding as being clearly erroneous on the ground that no 10 such admission had been made by him at the trial or in his pleadings. Undeniably, an admission as found by the LJC to have been proved is nowhere to be found in the Appellant’s pleadings. [25] Similarly, the LJC’s finding that the transaction was never meant to be a sale and purchase transaction but was merely a security for the aforesaid loan was contended to be in conflict with the Respondent’s pleaded case, issues to be tried and the evidence adduced at the trial. [26] As this is a central finding by the LJC which resulted in the final outcome of the trial, we scrutinised the pleaded claim, the agreed issues for determination and the evidence presented by both parties. In our considered view, the said finding is a fundamental misdirection as contended by the Appellant as, amongst others, the evidence does not disclose any admission by the Appellant as wrongly perceived by the LJC. This obvious error went to the root of the LJC’s finding that the Respondent had made out a case against the Appellant for reversion of the subject land to the former. [27] It would appear that the thrust of the LJC’s decision was that the NLC regulates and prescribes the manner in which land should be used as security for a loan and therefore, due to the non-compliance with the mandatory procedural requirements laid down in the NLC, the SPA and the Form 14A were a sham to defeat written law, namely the NLC. It was her ruling that the transaction, was illegal, against public policy, unconscionable and inequitable and should, accordingly, be set aside. 11 [28] It was, thus, apparent that the LJC had proceeded on a mistaken factual premise in arriving at her finding that the instant claim had been proved. [29] In view of the importance of the Plaintiff’s pleaded case to our decision, in our appellate capacity, some elaboration of the Plaintiff’s pleaded claim is called for. [30] Most importantly, it was explicitly pleaded that the SPA was genuine and valid. The express and unanimous unequivocal averment was that he had offered the subject property for sale and the Appellant/First Defendant had accepted the offer and both parties had then signed the SPA signifying their consensus. [31] Under cross-examination, the Plaintiff himself had conceded that he had executed the Memorandum of Transfer [Form 14A] as well as the SPA. [32] Importantly, the Plaintiff prayed for specific performance of the SPA, under which the consideration to the vendor was payment of the full purchase price. It was evident from her stand that she is entitled to be paid the said purchase price under the SPA, but she did not seek for return of the subject property. [33] As for the Defendant/Appellant’s pleaded defence, he pleaded in his Defence and Counterclaim that he had signed the SPA dated 12.4.2016 with the Respondent/the Plaintiff in order to purchase the subject property with a selling price of RM2,7000,000.00. There was no doubt that there was a binding agreement between the Appellant and the Respondent 12 whereby the latter genuinely intended to sell the subject property to the former who was a genuine purchaser for value. [34] As both parties were on common ground that the SPA was a genuine and enforceable agreement, the question of the SPA being a sham agreement in the sense that it was meant only as security for a loan as wrongly found by the LJC should not arise at all. It was on this flawed basis that the LJC found the transfer of the subject property to the Appellant to be illegal, null and void. The finding by the LJC that the SPA was a sham agreement that infringed the provisions of the NLC, was, thus, a serious error and plainly wrong. [35] It bears reiteration that the Respondent herself had admitted in cross-examination that she had agreed to sell the subject property to the Appellant at the agreed price. [36] It must also be noted that the issue of the SPA being a sham agreement was not among the agreed issues to be tried. Hence, it was incorrect for the LJC to determine this dispute based on an issue that was not agreed, not pleaded and not raised for determination. [37] We are also in agreement with the Appellant’s contention that the LJC has failed to judicially appreciate and properly evaluate the evidence before her by finding that the SPA was a sham and unenforceable agreement under the NLC. In support of the Appellant’s proposition, reference was made to Gan Yook Chin (P) & Anor v. Lee Ing Chin & Ors [2004] 2 MLRA 1 where the Federal Court held as follows on judicial appreciation and assessment: 13 “[5] Here, counsel for the appellants submitted that the Court of Appeal applied a new technique of appellate intervention called “insufficient judicial appreciation of the evidence”. He drew attention to para 27 of the judgment which in part stated: Suffice to say that we re-affirm the proposition that an appellate court will not, generally speaking, intervene unless the trial court is shown to be plainly wrong in arriving at its conclusion. But appellate interference will take place in cases where there has been no or insufficient judicial appreciation of the evidence. …. [12] In our view, the Court of Appeal in citing these cases had clearly borne in mind the central feature of appellate intervention ie, to determine whether or not the trial court had arrived at its decision or finding correctly on the basis of the relevant law and/or the established evidence. In so doing, the Court of Appeal was perfectly entitled to examine the process of evaluation of the evidence by the trial court. Clearly, the phrase “insufficient judicial appreciation of evidence” merely related to such a process. This is reflected in the Court of Appeal’s restatement that a judge who was required to adjudicate upon a dispute must arrive at his decision on an issue of fact by assessing, weighing and, for good reasons, either accepting or rejecting the whole or nay part of the evidence placed before him. The Court of Appeal further reiterated the principle central to appellate intervention ie, that a decision arrived at by a trial court without judicial appreciation of the evidence might be set aside on appeal. This is consistent with the established plainly wrong test”. [38] The Appellant also correctly highlighted an important admission by the Respondent [PW1] herself in cross-examination which the LJC 14 appears to have failed to consider or have overlooked before making her finding in this case. PW1 had unequivocally admitted that she had agreed to sell the subject property to the Appellant and had voluntarily executed the statutory transfer form [Form 14A] together with the SPA dated 12.4.2016. This was a glaring confirmation of what she had deposed to in her witness statement. [39] The LJC was, in our view, mistaken about the Appellant having admitted that the subject property was merely meant as a security for a loan that he had given to the Respondent sometime in 2015 when in fact no such admission is to be found in the evidence at the trial. It is clear from the Notes of Proceedings that what the Appellant (DW3) agreed to under cross-examination was that he had purchased the subject property from the Respondent/Plaintiff and he had signed the SPA around April