From tracing development of English legal system up until mid 19th century, equity developed alongside the common law, correcting the areas where the common law was defective.
Equity has it’s own remedies, procedures and its own court- the Court of Chancery.
If you couldn’t find justice in the common law courts you could start proceedings in Court of Chancery in order to obtain the aid of equity.
This turnt meant that:
Two separate proceedings- expensive.
Rules of equity often conflicted with the common law. (Conflict resolved in 1615 with the Earl of Oxford's Case- equity prevailed).
Procedure in both courts were slow and antiquated (outdated). e.g. Knight v Marquis of Waterford 1844 A litigant took 14 years to appeal to the House of Lords, started action in Court of Chancery when he should have started in the common law courts, he had to go back and start again.
Reformers faced with:
System of courts needed to be simplified.
Common law and equity needed to be harmonized.
The reforming legislation
1852-1858 Various Common Law and Chancery Procedure Acts.
simplified procedure in both the common law courts and the Court of Chancery.
Common law courts able to grant equitable remedies i.e. injunctions.
Court of Chancery able to decide points of common law and award damages.
Thus, the need to apply to two different courts to obtain justice was reduced.
The reforming legislation
2. The Judicature Acts 1873-1875.
important act that altered court structure.
Created new Supreme Court of Judicature in which all common law courts, the Court of Chancery, the Ecclesiastical Court and the Admiralty Court would be united into one High Court and one Court of Appeal.
Following point 2.
High Court was given three divisions-
Queen's Bench Division.
Chancery Division. (replaced Court of Chancery, deals with equitable matters e.g. issuing injunctions).
Probate, Divorce and Admiralty Division.
All able to try civil actions, though for convenience certain actions were reserved for each division. These actions corresponded to the jurisdiction of the courts that they replaced.
Judges who sit in Supreme Court of Judicature can apply both common law and equity to all cases. They’re both administered side by side in the same court.
Act enforced principle that if conflict between equity and common law, equity will prevail, enforcing principle which was first stated in the Earls of Oxford Case.
Effects on equity
The Judicature Acts DIDN’T fuse common law and equity. It ensured that the common law and equity would be administered in the same courts. So now all courts can award common law remedies such as damages, and also grant equitable remedies such as injunctions.
Common law and equity are two separate legal systems that are based upon different principles; they are separate and independent of each other.
Equity is still discretionary- the court is under no obligation to exercise equitable remedies. And in deciding whether to award an equitable remedy the judge is guided by maxims. To award a remedy, the court must be convinced you've satisfied the maxims.
In order to be eligible for an equitable remedy, the court has to be convinced that you have satisfied the maxims. A set of rules or principles which the court uses to decide the case.
- Equitable remedies are discretionary in nature, they therefore don’t have to be granted, the decision rests on whether the parties have complied with the maxims.
There are nearly 20 maxims e.g:
1. He who seeks equity must do equity.
2. He who comes to equity must have clean hands.
3. Delay defeats equity.
4. Equity looks at the intent, not the form.
He who seeks equity must do equity.
- (a person who seeks equitable relief must have himself have acted fairly towards his opponent).
Chappell v Times Newspapers Ltd 1975
Striking employees were threatened by dismissal if they refused to go back to work. The employees applied for an injunction to prevent this threat being carried out. Equity was not granted in this case because the employees were refusing to fulfill their employment contracts by being on strike- they were not willing to do nequity therefore the injunction was refused.
He who comes to equity must have clean hands.
(a person who seeks equitable relief must have a clear conscience as to their past conduct).
D&C Builders v Rees 1966
The defendants (Rees) owed £482 to the plaintiff’s builders, he didn’t pay. The defendant knew the plaintiffs were in financial difficulties so he offered £300 to fully pay the debt, and unless this was accepted the defendant would pay nothing. The builders accepted the lesser sum and were able to recover the remaining £182 because it would have been grossly unfair and inequitable for Promissory to apply.
Delay defeats equity.
(unreasonable delay will prevent a plaintiff from claiming an equitable remedy.)
Allcard v Skinner 1887
Here the plaintiff entered a nunnery and took a vow of poverty, handing over £7,000 to the order. Later when she left the order she sued to recover money. She claimed undue influence by the Lady Superior. It was held that this was undue influence, but her claim failed due to her six-year delay in bringing the action.
Leaf v Internationsl Galleries (1950)
Claiming bought painting by famous artist Constable. After 5 years, realised not genuine but court held too much time elapsed between sale and discovery.
Equity today (1870 onwards)
From 19th century onwards laws created by Parliament began to predominate, so that today virtually all laws emanate from Parliament.
Today judges are reluctant to make laws, after all to do this would usurp the main functions of Parliament, equity is far less relevant today.
New developments in Equity in the 20th century. These have occurred when the common law was defective and there was no statute that remedied defect. In these circumstances judges were able to make new equitable remedies:
Prevents a person from denying the truth of a statement he has made when that statement has been acted upon by another to his disadvantage.
Won’t be applied when it is inequitable.
- Two types: promissory and proprietary.
When one party to a contract promises the other that he will not enforce his rights under contract. Provided the other person acts on this promises then it binds the person who made it. (If promise made it can't be withdrawn if other person has relied on it to their detriment).
Modern starting point of Doctrine was:
Central London Property Trust v High Tree House Ltd 1947
in 1937 the defendants leased a block of flats from the plaintiffs for 99 years at £2,500 per year. By 1940 (because of the war) the defendants were having trouble finding tenants to occupy flats; therefore the plaintiffs agreed to reduce the rent to £1,250. In 1945 when conditions had returned to normal the plaintiffs wanted a return to the full amount of rent. In his judgments Denning J said that the plaintiffs were entitled to receive the full rent again because the promises to accept half rent was only intended to apply during war. Denning said ‘if the plaintiffs had sued for the full rent for the period 1940-45 they would have not been successful because they would have been ‘estopped’ from going back on their promise.
One person leads another to suppose that he is giving him rights over his land, and the other person acts to his detriment over this supposed right. The landowner will be estopped from later denying that he ever granted this right.
Inwards v Baker 1965
A father encouraged his son to build a bungalow on his father's land (at his own expense). After the father had died the executors sought to evict the son. They were ‘estopped’ from doing so because the son had spent money on building bungalow and so had acted to his detriment.
Mareva Injunction. Form of injunction which arose from the case of Mareva Compania Naviera SA v International Bulkcarriers SA 1975.
Court order to a third party such as a bank/building society to freeze the assets of a defendant's so preventing them from transferring their assets abroad. (Important process in commercial law, helps party wishing to bring an action by ensuring that the defendant will have assets that can be used to pay off debts).
Mareva v International Bulkcarriers 1975:A shipowner let the ‘Maerva’ to a foreign charterer, with payment half monthly in advance. Charterer defaulted payment. Shipowner found out that charterer had money in an English bank and sought an injunction freezing the account. Held that an order would be granted to stop the characters moving money abroad before the case was heard.
Normally the application will be cx partc, means one party applies without giving notice to the other side for if the other party did have notice, they could move assets.Lord Denning ‘The greatest piece of judicial law reform in my time’.
The Search Order.
Anton Piller Order
Prevents defendant from destroying important evidence to frustrate the plaintiff’s claim.
Court instructs the defendant to allow his premises to be searched by the plaintiff’s representatives, and any material or documents relevant to the plaintiffs case may be seized.
- Usually involving intellectual propety.
Anton Piller v Manufacturing Processes 1976
A firm AP believed another firm MP were infringing AP’s copyright but feared if they took legal action MP would destroy all the incriminating evidence. They went secretly to a judge and asked him to make an order allowing them to search MP’s premises. The judge decided he would make the order asked for and the Court of Appeal agreed he was right to do so.
No such order been made before. Search warrants available only in criminal cases. Unusual for judge to make a decision without giving both sides a chance.
Type of injunction wherevy press are prevented from knowing existence and details of injunction, as well as being prevented from publishing any fatcs/allegations surrounding case.
They've recently been used against british tabloid newspapers in relation to celebrities to 'gag' press and prevent them from punlishing details of their private life. e.g. CTB v News Group Newspapers (2011) involving Ryan Giggls and Ferdinand v Mirror Group Newspapers (2010) involing Rio Ferdinand.
Important minor, role in the English legal system that grew alongside common law from the 14th to the 19th century,based on the principles of justice and fairness.
Equity’s offered those dissatisfied with the common law certain new concepts, such as equity of redemption, new remedies i.e. injunction and specific performance and new procedures like court proceedings being in English.
We’ve also traced the 19th century court reforms that fused the administration of both equity and common law so that both types of law were available in English courts.Two types of courts did not merge ‘they run in the same channel, run side by side and do not mingle’ (Ashburner). Separate areas in legal system.
It’s discretionary- means equitable remedy won’t be automatically granted.Deciding the judgment is guided by the Maxims of Equity. It’s been largely replaced by statute.
Equity’s still capable of developments e.g. Estoppel, Mareva Injunctions, Anton Piller Order- indicates that equity continues to supplement the common law when it is defective and statute provides no remedy.