Defects in Common Law:
- Writ system
♣ The Lord Chancellor – known as the chancery, started all actions in the common law via the issuing of writs.
♣ Each wrong was assigned a writ.
♣ The wrong must fit the writ available in order to have a successful application.
♣ If the wrong did not fit the writ, an action will not be started.
- Provisions of Oxford 1258
♣ Common law court judges are inhibited from creating a new writ according to this statutory law. So many wrongs suffered without remedies.
- Monetary payment only
♣ Common law only provides monetary compensation
In some case this would not be the best method of putting matters right between the parties.
E.g. trespass to land:
1. In a case of trespass to land, where perhaps the defendant had built on his neighbor’s land, the building would still be there and the plaintiff would have lost the use of that part of his land.
2. In such cases, the plaintiff would probably prefer to have the building removed, rather than be given money in compensation
The plaintiff is a person who brings a case against another in a court of law. The defendant is an individual, company, or institution sued or accused in a court of law.
- Look at the form instead of intention
- Common law only looks at the form (contract details etc.) but the intention behind the crime or case.
- Corruption and intimidation of juries
- Juries can be intimidated or bribed to support a certain judgment
Equity: Historically and till today, equity is an important source that plays a part with many of our legal concepts. The word ‘equity’ has a meaning of ‘fairness’, and this is the basis on which it operates, when adding to our law. The word “equity” means rules developed to solve the defects of common law. Equity developed because of the flaws in the common law. Only certain types of cases were recognized. People who could not obtain justice in the common law courts appealed directly to the king. Most of these cases were referred to the King’s Chancellor, who was both a lawyer and a priest, and who became known as the “keeper of the king’s conscience”. This was because the Lord Chancellor’s duty is to “establish the truth and to ensure justice without undue adherence to technicalities and procedures. To ensure that the decisions were ‘fair’ the Chancellor used new procedures such as subpoenas, which ordered a witness to attend court or risk imprisonment for refusing to obey the Chancellor’s order. He also developed new remedies, which were able to compensate plaintiffs more fully than the common law remedy of damages. These were called equitable remedies. The main equitable remedies were: injunctions; specific performance; rescission; and rectification. Eventually a Court of Chancery under the control of the Chancellor came into being which operated these rules of fairness or equity. Equity was not a complete system of law; it merely filled the gaps in the common law and softened the strict rules of the common law.
*Grounds of petition:
-When common law is deficient in providing a remedy
-The jurors are easy to be influenced because the defendant is too powerful
-Common law court has lack of jurisdiction in deciding foreign merchants’ situations.
Conflict between Equity and Common Law;
The two systems of common law and equity operated quite separately, so it was not surprising that this overlapping of the two systems led to conflict between them. One of the main problems was that the common law courts would make an order in favor of one party and the Court of Chancery an order in favor of the other party. The conflict was finally resolved in the Earl of Oxford’s case (1615) when the king ruled that equity should prevail; in other words, the decision made in the Chancery court was the one which must be followed by the parties
Earl of Oxford’s case (1615)-
1. Merton College, Oxford has been granted a lease of Covent Garden for 72 years at £9 per year.
2. 50 years later the college sold the lease to the Earl of Oxford at a rent of £15 per year.
3. The college later tried to retake possession of it.
4. It said that, an Elizabethan Statute prevented the sale of church or college lands.
5. The Earl brought an action to eject the college from the land but failed due to common law.
6. The Earl filled a bill of Equity.
7. Lord Chancellor set aside the common law judgment ‘not for any error or defect in judgment, but for the hard conscience of the parties’.
8. When consulted, King James I decided that where there is a conflict between common law and equity, equity shall prevail.
This ruling made the position of equity stronger and the same rule was subsequently included in section 25 of the Judicature Act 1873. The conflict was finally resolved by the Judicature Acts 1873-75:
The Lord Chancellor must be legally qualified.
All courts are now courts of common law and equity. Judges shall apply common law and if it is found to be insufficient, they may then apply equity.
There is now a well-established appellate system applying both common law and equity.
The role of the judiciary is not only limited to interpreting statues and applying them, but is also to find, extend, or create law.
When there is a conflict between common law and equity, equity shall prevail. Remedies are still separate in nature.
Equitable Maxims – How Equity Operates;
Initially, as already stated, there were few guidelines for Chancellors to use. However, as time went on a series of maxims were developed which formed the basis of the rules on which equity operated.
Maxim is a broad statement of principle, the truth and reasonableness of which are self-evident. A rule of equity, the system of justice that complements the Common Law.
As equity became more formal, judges became more likely to follow past decisions. Today the doctrine of judicial precedent applies to cases involving equity, just as it applies to cases involving the common law.
Many of the rules on which equity is based are expressed in a series of sayings. The most
important of these maxims are as follows:
a. He who seeks equity must do equity.
- This was applied in the case of Chappell v Times Newspapers Ltd (1929) where a group of workers led by Chappell took a strike action.
- Times Newspapers threatened that if they were to continue to do so they will face dismissal.
- The workers applied for injunction against dismissal.
- The court held that the plaintiffs had to be prepared to do equity, if they were telling the employers that they must keep to their part of their contract.
b. He who comes to equity must come with clean hands.
- In other words an equitable principle or remedy will not granted to a plaintiff who has not acted fairly.
- This is shown in D & C Builders Ltd v Rees (1965) where a small building firm had done work for Mr. and Mrs. Rees.
- The total bill was £732 of which Mr. and Mrs. Rees had paid £250 in advance.
- When the builders asked for the remaining £482, the Rees, who knew the builders were in financial difficulties and needed money urgently, claimed that the work had not been done properly and they were only prepared to pay £300.
- The builders reluctantly agreed to accept the £300 ‘in completion of the account’, but afterwards sued the Rees for the remaining £182.
- At common law, part payment of a debt is not considered as satisfying the debt and the builders could claim the extra.
- Equity, however, has a doctrine of equitable estoppel under which the courts can declare that the plaintiff is prevented from asking the rest.
- Lord Denning, in the Court of Appeal, refused to apply the doctrine of equitable estoppel because the Reeses had taken unfair advantage of the fact that they knew the builders were in financial difficulties.
- So far as equity was concerned the Reeses had not come to court with ‘clean hands’
c. Delay defeats equity
- This means that a plaintiff must not wait too long before making a claim as this might lead to unfairness to the other party
- In Leaf v International Galleries (1950), a plaintiff was sold a painting, which both parties mistakenly believed was by Constable J.
- The court did not award the equitable remedy of rescission, since there had been a delay of five years between the contract and the discovery that the painting was not by Constable.
- Equity imposes responsibilities on its seeker to act fast.
Equitable Remedies;
As already stated, one of the important aspects of equity was that it created new remedies to supplement the common law remedy of damages.
Equitable remedies are awarded where damages are inadequate and justice would not be served merely by damages. Equitable remedies are at the discretion of the court, so that the court does not have to grant them even if the plaintiff wins the case.
This is in contrast to the common law remedy of damages, which will be awarded to a winning plaintiff as of right. An equitable remedy will only be granted where the court thinks it is fair in all the circumstances.
If a party ignores an equitable remedy this is considered contempt of court and the court can fine that party or even send them to prison.
The following are the most important equitable remedies:
Injunctions An injunction is an order to one of the people involved in the case to do something or not to do something.
Court order instructing someone not to breach in term of the contract. Prohibitory injunctions prevented a future breach of contract
Lauritzencool V Lady Navigation
An injunction can be temporary, a temporary injunction is called Interim Injunction.
Injunctions are often applied for in intellectual property rights and also in employment contract to prevent an employee from leaving employment in there notice period.
An injunction will not be awarded when a party wants to enforce a personal work contract e.g cleaner as the courts can’t enforce such a contract
Page One Records Ltd v Britton.
An injunction will not be awarded where it would be unfair on the D Shell V Lostock Garage.
Specific performance This is an order that a contract should be carried out as agreed. It is granted only in exceptional circumstances where the court feels the common law remedy of damages could not adequately compensate the plaintiff, e.g. in a contract to purchase land. Specific performance is never granted to order someone to carry out personal services, such as singing at a concert; nor it is granted for a breach of contract where one of the parties is a minor.
Rectification
Freezing Order
Searching Order
Modern day use of equity- in mortgages and trusts. Equitable remedies still used and 2 new ones created in 20th century. Moreover, equitable maxims still apply
Equity is an historical source: it has no role in the modern legal system. Critically consider the accuracy of this statement.
Describe the development of Equity and discuss its relevance today.
Explain the historical development of Equity. Using cases and examples discuss how relevant it is today.
Equitable remedies, concepts and maxims still play an important role. Using cases and examples, explain how equity continues to be relevant in the courts today.