The rules of equity arose in England where the strict limitations of common law would not solve all problems, so the King set up courts of chancery (equity) to provide remedies through the royal power.
Now most states combine law and equity and treat both under "one cause of action." (Law.com)
Supposed to work alongside common law.
Equity developed in 12c I believe to combat the inequities in the common law – fills in the gaps i.e. court of chancery -Broad judicial discretion- equitable estoppels and constructive trusts.
Textbook – through equitys history there have been judges who have been enthusiasts for a broadly discretionary equity and others who have scorned it. Shown in first case of Earl of Oxford’s case (1615) 1 ch Rep 1 debate over whether common law courts or equity courts judgement should take priority. Equity took priority. Lord Ellesmere purpose of equity “to correct men’s consciences”. Today courts joined. Earl of Oxford’s case (1615) 1 Ch Rep 1 in the citation in the textbook I was able to obtain a quote from the judgment saying “to soften and mollify the extremity of the law” this quote would be useful in an essay, because it perhaps proves that equity has not come to destroy the law but to fulfil it.
Maitland –destroy the law – (TB) primacy of equity over common law not simply a technical legal question it was also a matter of political crisis –judges were considered subordinate to the decisions of the Lord Chancellor. Later becomes based on differing judges attitudes...those in favour of equity and those against.
Argument against: -Creates uncertainty but justice. Equitys flexibility can lead to irrational and random decision-making and that equity would be better if it was reorganised so as to make it more akin to common law with more rigid and more predictable rules. Equity was developed on principles which were often from vague maxims and ‘half remembered remarks of earlier judges(TB) and therefore too much came from ancient judges who often made decisions which contained little internal consistency, and thus could be seen as damaging. Better nowadays however. Lord Eldon... “nothing would inflict on me greater pain...that i had done nothing to justify the reproach that the equity of this court varies like the Chancellor’s foot”. (Gee v Pritchard (1818) 2 Swans 402, 414) Follows today as often stated that the courts would only activate doctrines if they could be shown to be ‘predicated on clear authority and not simply because they appeared to be “just/right /conscionable”. (Re Diplock [1948] Ch 465, 481) Furthermore 1873 Judicature Act, according to subsection 11 “the rules of equity shall prevail”, could possibly contradict Maitland’s statement by saying this part of the Act surely demonstrates that equity is above the common law and is as a result destroying the law. backing up subsection 11 of the 1873 Judicature Act was to be found in the reading of the case of Walsh v Lonsdale (1882) 21 Ch. D. 9 in which it is said “equity prevails over the common law”
Arguments for: - view held by those schooled in the practice of chancery courts, is that equity possesses a laudable flexibility predicated on an understanding of equity’s subtle principles-these people consider that equitable discretion is a positive thing (p33 equity and trusts 5th ed Alastair Hudson, Cavendish publishing ltd 2008) and lord chancellor lord Nottingham brought large amount of order lines to equity in 17th century. Lord Jessel MR (Re National Funds Assurance Co(1878) 10 Ch D 118,128) ‘This court is not , as i have often said, a court of consciouscience, but a court of law’ – meaning not destroying as equity still bound by principles and precedent just like the common law courts. In Hanbury and Martin, the maxims of equity, at least the ones mentioned are described, such as “those that come to equity must come with clean hands”. I felt that this particular maxim of equity showed that if you wish to claim using equity you must have behaved fairly yourself, thus illustrating that equity did not come to destroy the law but merely to aid it in fairness and equality. Medforth v Blake [2000] Ch 86 102, important quote from the judgment “I do not...whether the duty is expressed as a common law duty or duty in equity. The result is the same” This is a quote from Sir Richard Scott VC which illustrates that there may be a potential fusion of remedies as it does not matter anymore whether the claim is brought through equity or common law the remedy or result achieved is the same, supporting maitland as not seen as destroying the law.
Examples on when equity steps in like promissory and propriety estoppels.
Promissory-Hughes v metropolitan railway company-parties were stopped from going back on their promise (Lord cairs ) and case of High trees (lord Denning) ‘if land lord receiver had tried to claim balance for war years he would have been estopped critics say weak precedence because creatively constructed by denning to create justice.all cases on estoppels are obita and not bindind therefore merely pursuassive. Estoppel can only be used as a shield not as a sword!
Propriety estoppels : available where a land owner for example encourages a claimant to believe that he has/or will be given an interest of some kind in the land owners land and this is done either actively ie making assurance or passively by acquiescing /going along with the claimants mistaken belief. If detriment proven on the part of the claimant and would be inequitable/unconscionable for the land owner to act inconsistently the court will grant estoppel. Confirmed in Gillet v holt where 3 key terms where identified and satisfied.
“In recent cases the doctrine of proprietary estoppel has been regarded as an extremely flexible doctrine. The doctrine seems to be well on its way to allowing the courts to grant a remedy whenever it would be fair to do so.”(don’t know where quote from) Possibly destroying of the law.
Comes about when express/implied agreement OR mistaken belief as to C’s rights. Agreement can relate to rights other than beneficial ownership of family home, e.g. a right to live in a property for life/right of way. Equity arises which gives C right to ask court for a remedy. Remedy may not fully reflect extent/nature of assurance. Remedy not restricted to interest in land but can include compensation
From the fairly extensive case law, it seems that the test for proprietary estoppel, leading to the acquisition of an equity by estoppel, is fairly stringent. The courts do look to award appropriate remedies, based on the detriment suffered opposed with any benefits enjoyed.
The question of proportionality also prevents the remedies from being “unfair” or disproportionate
-Reliance necessary - Doesn’t have to be detrimental to C, it’s the detriment that arises when the assurance is withdrawn that’s important. Sufficient that landowner knows/should have known of this reliance
-Detriment -Occurs when assurance/representation is withdrawn, and C, who has changed his position in reliance on the assurance, is disadvantaged.
-Unconscionability necessary -It must be unconscionable for landowner to rely on his strict legal rights.
Look at all circumstances – sometimes C has already benefited from change of position more than he’s been disadvantaged by it (Sledmore v Dalby)
If all these criteria are met → an equity: can bind a purchaser who took the land with express notice of the equity (E.R. Investments v High)
Gives C right to apply to the court to claim promised right in the land and the landowner will be stopped from denying the claim.
Sledmore v Dalby – no claim in prop estoppel – was not unconscionable for mother in law to take possession of house.
Gillett v Holt - G was awarded an immediate interest in ONE of H’s properties, as well as £100,000
Jennings v Rice – awarded £200,000 (value of estate/property disproportionate to services rendered).
Constructive Trusts- Express/implied agreement. Agreement = to share the beneficial ownership of the family home. Equitable interest arises and is subject to the normal rules relating to equitable interests in land. Equitable interest gives effect to the express/implied agreement. Remedy = equitable interest in land. (Paper) It was on the maxim Equity will not suffer a wrong to be without a remedy: Where there is a right, there is a remedy,that the Court of Chancery based its interference to enforce uses and trusts. Where A conveyed land to B for the use of and in trust for C, and B claimed to keep the benefit of the land to himself, C had no remedy at law. But this was an abuse of confidence, which was a wrong capable of redress of a Chancery Court. a recourse to the Chancery Courts had to be made for the common law courts had no such power; consequently the wrongs at common law becoming “wrongs without remedies”. This situation was remedied by equity courts. Judicature Acts have now made the discovery automatic. A trustee for the breach of a trust could be sued in equity because it was a wrong a no wrong should go un-redressed
Mxim -Equity follows the law: The theory indicates the discipline which the Chancery Courts observed while administering justice according to conscience. A case on the point is Stickland Vs. Aldridge. (1804) 9 ves 516. As regards legal estates rights and interest, equity was and is strictly bound by the rules of law and it has no discretion to deviate therefrom. At common law, where a person died intestate who owned an estate in fee-simple, leaving sons and daughters, the eldest son was entitled to the whole of the land to the exclusion of his younger brothers and sisters. This was unfair, yet no relief was granted by equity courts. But in this case it was held that if the son had induced his father not to make a will by agreeing to divide the estate with his brothers and sisters, equity would have interfered and compelled him to carry out his promised, because it would have been against conscience to allow the son to keep the benefit of a legal estate which he obtained by reason of his promise. Equity recognized and respected legal rules but the circumstance of giving a promise by the son to the father had added and element of conscience to the rule which the equity must considered, because it acts on the conscience of a person.
Doctrines like Estoppel are designed to enforce a trust where someone who is entitled to property may not receive this property leading to some unconscionable consequences. Much case law on trusts to illustrate these particular points. Equity in modern times - equitable assignments - donatis mortis causae the concept of trusts etc
Conclusion: Equity looks on that as done which ought to have been done...equity still operates within bounds. In practice, modern equity is limited by and rules Moreover “It is, indeed, a vain thing to imagine a right without a remedy” (Ashby vs. White)
Bibliography:
Mike Mcnair, “Equity and Conscience” (2007) Oxford Journal of Legal Studies
Mason A, “The Place of Equity and Equitable Remedies in the Contemporary Common Law World (1994) 110 LQR 238.
Maitland
Alastair Hudson, Equity and Trusts, Routledge and Cavendish 5th edition, 2007 Glossary,
Baker, An Introduction to English Legal History, 4th ed Butterworths LexisNexis 2002
Earl of Oxford’s case (1615) 1 Ch Rep 1
Gee v Pritchard (1818) 2 Swans 402, 414
Re Diplock [1948] Ch 465, 481
Re National Funds Assurance Co(1878) 10 Ch D 118,128
Walsh v Lonsdale (1882) 21 Ch. D. 9
Medforth v Blake [2000] Ch 86 102
Hanbury and Martin
Ashby vs. White
Stickland Vs. Aldridge. (1804) 9 ves 516.
Hughes v metropolitan railway company (1877)
Central London Property Trust Ltd v High Trees House Ltd (1947)
Gillet v holt
Sledmore v Dalby
Jennings v Rice
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