LAW OF EQUITY I

Law of Equity I

It is a branch of jurisprudence in common law jurisdictions. Equity is the name given to the set of legal principles, in jurisdictions following the English common law tradition, which supplement strict rules of law where their application would operate harshly. In civil legal systems, broad "general clause" allow judges to have similar leeway in applying the code.

Equity is commonly said to "mitigate the rigor of common law", allowing courts to use their discretion and apply justice in accordance with principles of natural justice. In practice, modern equity is limited by substantive and procedural rules, and English and Australian legal writers tend to focus on technical aspects of equity. There are 12 "vague ethical statements"  known as Maxims of equity which guide the application of equity, and an additional five can be added.

The term equity is used in very many different ways and connotes different meanings.

In its popular parlance it signifies natural justice, equality and fairness and implies that a man shall do unto others as he would expect others to do to him. In this sense, however, it has no juridical significance for unkindness and ingratitude or other moral wrongs that clearly fall outside the scope of equity.

Equity is a measure of fairness marked by a due consideration for what is fair, unbiased or impartial, according to natural justice and which is untrammeled by technical niceties of the law.

Tomlin's Law Dictionary defines equity to be a correction, or qualification of the law, generally made in that part wherein it faileth, or is too severe. In other words "the correction of that wherein the law, by reason of its universality, is deficient."

It is a body of legal rules and remedies developed by the Court of Chancery parallel to but separate from the common law; that which is fair and right; taking recourse to general principles of natural justice to correct and supplement the ordinary law.

Legally, equity does not cover so wide a jurisdiction as that which would follow from enforcing strictly the principles of natural justice. The law does not provide relief for all inconveniences. There are many matters of natural justice for which no provisions have been made because of the difficulty of framing a comprehensive general enactment that could embrace all of them. 
Snell points out that in the technical sense the field of equity is further narrowed by the fact that it does not include nearly the whole of that portion of natural justice which is capable of being enforced by legal sanctions and administered by legal tribunals. The greater part of that portion is embodied in the rules of the common law, and the statute law. He observes that, in its technical sense equity may be defined as portion of natural justice which, although of a nature suitable for judicial enforcement, was for historical reasons not enforced by the Common Law Courts, on omission which was supplied by the Court of Chancery. In short, the whole distinction between equity and law is not so much a matter of substance or principle as of form and history.

Technically, as has been aptly put by Freeman Oliver Haynes, the equity referred to in Sacred Writ as “equity and every good path” is not equity in the legal technical sense of the word. That is not to be hoped for, nor can it be enforced in our present imperfect state. The man who, from vindictive motives, cuts off his son not even with with a rupee, and leaves his self earned property to strangers, abuses most grossly the rights conferred on him by the policy of our law but does nothing that renders him accountable in equity. Equity technically speaking, is that portion of equity in the larger sense of natural justice, which though of such a nature as to admit properly of its being judicially enforced, was omitted by common law courts-an omission which was supplied by the Court of Chancery. The distinction between equity in the technical sense and law is truly a matter of history and not of substance.

Maitland defines equity as that body of rules administered by the English courts of justice which, were it not for the operation of the Judicature Acts, would be administered only by those courts which would be known as Courts of Equity.

Maine defines equity as a fresh body of rules by the side of original law, founded on distinct principles, and claiming to supersede the law in virtue of a superior sanctity inherent in those-principles.

Maxims of Equity 

1 Equity sees that as done what ought to be done

2 Equity will not suffer a wrong to be without a remedy

3 Equity delights in equality

4 One who seeks equity must do equity

5 Equity aids the vigilant, not those who slumber on their rights

6 Equity imputes an intent to fulfill an obligation

7 Equity acts in personam

8 Equity abhors a forfeiture

9 Equity does not require an idle gesture

10 He who comes into equity must come with clean hands

11 Equity delights to do justice and not by halves

12 Equity will take jurisdiction to avoid a multiplicity of suits

13 Equity follows the law

14 Equity will not aid a volunteer

15 Where equities are equal, the law will prevail

16 Between equal equities the first in order of time shall prevail

17 Equity will not complete an imperfect gift

18 Equity will not allow a statute to be used as a cloak for fraud

19 Equity will not allow a trust to fail for want of a trustee

Development of Equity

The development of equity may be traced from the reign of Edward I at the end of the thirteenth century. There were in England at the time three great courts, viz., the King's Bench, the Common Bench or Court of Common Pleas and the Exchequer. The law formulated, developed and administered by these courts was the common law, based on the common custom of the country. Of the three courts, the Exchequer was more than a court of law; it was also an administrative department of the Government and the Chancery formed the secretarial department. At the head of the Chancery stood the Chancellor, who was the King's Secretary of State for all departments and kept the King's great seal and did other writing work in the name of the King.

Issue of writs.-A very important function of the Chancery was the issuing of writs to enable a suitor to bring an action at law. The common law had grown up round the royal writs and remedies for wrongs were totally dependent upon them. A person who wanted to bring an action had to go to the Chancery and obtain an appropriate writ from the clerks there after paying the proper fees. The number of writs, however, were limited and, if a person's cause of action could not be brought under any of the recognised writs, the Common law provided no remedy. Moreover, in the days of thirteenth century, even though a plaintiff's action fell within one of the recognised writs he was often unable to obtain a remedy in the common law courts because of the strength of the defendant who would defy the court or intimidate the jury.

Deficiencies of Common law.-The common law was deficient in the following three respects:

(1) Remedy was not available in all cases for many wrongs remained un-redressed for want of proper writs. The number of writs was very small and many claims could not be brought under any of them.

(2) The relief granted by the Common law courts was not always adequate. They gave relief only in damages for breach of a contract but did not provide for specific performance. Reliefs such as injunction, accounting, and appointment of receiver were outside the jurisdiction of the common law courts.

(3) And, lastly, being a reminiscence of the feudal period the procedure in common law courts was defective and unsatisfactory; was very cumbersome and formal.

The equitable jurisdiction in England grew up from the deficiencies of the law and inadequacy of remedies provided by the common law courts. Persons who could not get adequate relief owing to these shortcomings of the common law began to present their petitions to the King--in,-Council. The number of such petitions to the, King as fountain of justice increased and it was not possible for him to cope with the work. The hearing of such petitions fell on the Chancellor, who was an ecclesiast-generally a bishop. He was also the King's Prime Minister and an important member of the King's Council learned in the civil and common law. With the lapse of time these petitions began to be presented-to the Chancellor direct. The expansion of equity through the Chancellor was facilitated by the power delegated to the Clerks of the Chancery by the Statute of Westminster II in 1285 of issuing writs in consimili casu whereby a limited power was granted to them to invent new writs for certain cases-for which there were no appropriate writs.

Development in 13th and 14th centuries - Maitland points out that in the thirteenth and fourteenth centuries the Chancellor very probably did not regard himself as administering new law; in many cases he worked hand in hand with the common law judges. He recognised the authority of the common law courts and, interfered when there arose an occasion to protect litigants in hard cases which were un-justiciable by the common law courts owing to the rigid and circumscribed nature of the writs. The great weapons in the armory of the Chancery were the writs of subpoena and quibus dam cerits de causis whereby the Chancellor had the power to summon a defendant before him to answer certain unspecified charges.

Thus we find that in the fourteenth century the Chancery Courts had to deal with two cases of complaints which escaped the meshes of ordinary courts. In the first class of cases on account of general complaints of legal wrongs, assaults, batteries, imprisonments, eye., the petitioners could not enforce their remedy in the courts of law because of their poverty and the corresponding superiority Of their adversaries This kind of interference by the Chancery Courts was, however, not permitted either by the Parliament or by the law courts. Maitland points out that the Chancellor was warned off the field of common law he was not to hear cases which might go to the ordinary courts, he was not to make himself a judge torts and contracts, of property in lands and goods. The second class of cases where relief was provided by the Chancery Courts was where the petitioner had a moral right which was left unprotected by the common law courts due to the peculiar system of procedure obtaining there. This was the recognition of equitable ownership the Chancery Courts, enforced fiduciary obligations of uses and trusts. These were transactions under which a man transferred land to another with the definite understanding that the transferee was to hold it for the benefit of the former or his nominee. We thus find that a great field of substantive law, viz., the enforcement of trust and uses fell into the hands of the Chancellor.

15th Century.-We find that in the fifteenth century use and trusts became very popular in the hands of the Chancellor. Maitland observes that the rapidity with which the jurisdiction of the Chancellor was expanding naturally evoked vociferous comments and excited jealousy from the common law courts and the result was that the Chancellor henceforward did not step in on the slightest pretext but interfered only when there was no adequate remedy at common law.

16th Cent:ury.-The sixteenth century witnessed the development of the rules of equity and good conscience which the Chancellors were administering in the field of equity. The latter part of this century, however, reveals that the days of the ecclesiastical Chancellors were coming to an end; Wolsey being the last of them. Ellesmere, Bacon and Coventry began now to administer equity with an established set of rules; equitable principles were discussed and published in reports.

17th Century-- In the seventeenth century James I finally settled at rest the dispute between the Common law Courts and the Chancery with regard to the issue of injunction. The dispute arose between the Chancellor Ellesmere and Chief Justice Coke in the Earl of Oxford's Case 8 (1 Ch. 1). King James I decreed that the Court of Chancery issue could an injunction restraining parties from suing in a common law court from seeking enforcement of a judgment obtained in that court.

Period of Transformation- Coming the period of the transformation of equity, we find that Bacon was the successor of Chancellor Ellesmere. He was the most learned man of his time. Lord Nottingham became Chancellor in 1672. He has been called the father of modern equity. He systematized the rules of equity. The great work of systematization was continued by subsequent Chancellors, notably lord Hardwicke and Lord Eldon. Equity thus became pre-eminently the great force that molded the progress of English jurisprudence till about the nineteenth century.

18th and 19th Centuries.-During the eighteenth and nineteenth centuries the great Chancellors were Talbot, Hardwicke, Camden and Eldon. in this period the Chancery Reports improved and equity made its way into the textbooks as an important part of the law of the land.

Two Systems of Justice.-In spite of the development of equity a:, an important part of the law of the land there was the curious spectacle that there were two distinct systems of justice administered by Pleas and the Exchequer were governed by the principles of the common law, while the Court of Chancery was guided by the principles of equity. Complete reform, however, came with the passing of the Judicature Acts of 1873 and 1875. The Judicature Acts abolished the old courts of Chancery and Common Law. In their place there came into existence a High Court of Justice with a Court of Appeal over it. The High Court· of Justice was divided into five divisions, viz., the Chancery, Queen's Bench, Common Pleas, Exchequer and lastly the Probate, Divorce and admiralty. This division of the High Court was quite different from the old independent courts. Certain particular business was assigned to each new division. All these divisions administered both law and equity together. And although the Chancery Division was now assigned the execution of trusts and the redemption of foreclosure and mortgages, this was merely as a matter of convenience and the distribution of business could be changed without any Act of Parliament by an Order-in-Council.

As said above, every Judge administered both the rules of law an equity and recognised and gave effect to all rights and obligations whether they were legal or equitable.

The procedure of the Court was governed by the rules embodied in the Code of Civil Procedure which embodied in itself the best features of the common law and equity.

The object of the Judicature Act was thus not to fuse the two systems of law but to amalgamate the two types of court though it has to be said that the amalgamation did gradually bring about the fusion of two systems of law.