Equity Dates Back to the Works of Aristotle

A brief historical account of the development of equity is necessary to understand how it came to be so integrated in today’s legal system. Equity was established after the Norman Conquest; they imposed a clear feudal structure which was common to all. However, the Writ system made it difficult to extract the right remedy because it was so formalised and rigid. As a result, the Lord Chancellor developed a separate system in order to account for the deficiencies in the common law. Essentially, “equity grew interstitially, to fill in the gaps of substantive common law and to provide a broader array of remedies …equity thus provided a gloss or appendix to the more structured common law” [3] . However, Moffat describes equity as a “gloss with teeth” [4] since it gradually came to be developed and understood by some individuals as a rival system, overtaking rather than fulfilling the law. The Judicature Acts of 1873 – 1875 clearly exemplify the emergence of equity as a separate ‘body of rules’. Naturally, there parallel legal structures became a source of conflict against each other as “the legal title was affirmed whilst, in effect, being subordinated to the interest of the owner in Equity by the imposition of a personal remedy against the holder of the legal title”. Understandably, this conflict had to be resolved and this is exactly what The Judicature Acts and the Supreme Court of Judicature Act 1873 did; ‘where ever there is any conflict or variance between the rule of equity and the rules of the common law with reference to the same matter, the rules of equity shall prevail’. This was affirmed in Walsh v Lonsdale (1882) [5] . This case also represented the fusion of the common law and equity.

Though a great debate still remains as to whether the common law and equity have been fused together, the substantial role equity plays in today’s legal system cannot be argued. Equity has; developed doctrines such a propriety estoppel, recognised restrictive covenants and has expanded the number of equitable remedies available. These remedies are distinct from those available at law, which enforces the argument that equity and law are still two different entities however some of the remedies available do overlap in these areas. This is most certainly an area in which equity fulfils the gaps of the common law. This is itself illustrated in the eminent case load that equity has created. Equitable remedies available are; injunctions, specific performance and rectification. In Jaggard v Sawyer [1995] [6] the Court of Appeal gave guidelines as to when an injunction could be granted. Millet LJ also pointed out that “proprietary rights cannot be protected at all by the common law…[the owner] must submit unlawful interference with his rights and be content with damages” [7] . This clearly highlights the gap in the common law which equity has fulfilled. If injunctions did not exist, owners of property would have to settle for damages which does not stop the individual from committing the act again. A way in which equity has assisted the law in a changing world is the development of injunctions. With the advancement of technology, people have sought to protect their intellectual property which can easily be destroyed without the possibility of bringing action for breach of copyright. In Anton Piller KG v Manufacturing Processes Ltd [1976] [8] the judges established the search order injunction to allow a claimant to enter a defendant’s premises to search for such property if they fear it will be destroyed before the case goes to trial.

Though equitable rights have had a slight effect on the law of tort, they have greatly enriched the law of contract. Equitable remedies for specific performance are also available unless it is unconscionable to grant them. Specific performance can be granted in order for one party to fulfil the terms of their contact as set out in the agreed terms of the contract. However equity also assists the law today by preventing the application of contract agreements from causing severe injustice. Patel v Ali [1984] [9] exemplifies the reluctance of the courts to grant specific performance when it would cause great injustice to the defendant. The case also highlights that equitable remedies unlike common law remedies are discretionary and essentially necessary in order to allow judges to dismiss contracts under unconscionability. Mason believes that “the concept of unconscionable conduct, along with the enrichment of unjust enrichment which is partly a derivative of unconscionable conduct, has been the source of the recent rejuvenation of equity”. [10] This doctrine also plays a part in reconciling equity and common law in areas such as estoppel and restitution.

Maitland declared that “If we were asked what is the greatest and most distinctive achievement performed by Englishmen in the field of jurisprudence I cannot think that we should have any better answer to give than this, namely the development from century to century of the trust idea.” [11] Equity has a very significant role in today’s legal system with the creation of trusts and the beneficiary’s interest under trusts. The advancement of English law in areas such as the law of conveyancing, the improvement of married women’s economic position, charitable enterprises and beneficiaries of wills would not have been possible if it was not for the development and recognition of trusts. One of the main concepts of equity is that beneficiaries can have an equitable interest in land under a trust. Underhill describes a trust as “an equitable obligation binding a person to deal with property over which he has control for the benefit of persons of who he himself may be one and of whom may enforce the obligation.” [12] Today, legal rights are distinguishable from equitable rights, one deals at law and the other is only valid in equity. This means there are a range of different interests invested in land which must be protected. When a trust is created there are at least three participants; the settlor who must be the absolute owner, the trustee who then acquires the legal title and the beneficiary who has the equitable interest. In essence, the settlor declares the trust in turn transferring the legal title to the trustee who then holds the item on trust for the beneficiary. The beneficiary has the most advantageous rights in the property, they have personal rights against the trustee if they do not manage the property in a correct manner and they also have proprietary rights in the trust fund. Equitable rights in estates bind everyone except a bona fide purchaser of the property who has no actual, constructive or implied notice of the other interests invested in the land. Kingsworth Trust Ltd v Tizard [1986] exemplifies the equitable right of the wife in the property. Mr Tizard had not acknowledged to Kingsworth Mrs Tizard’s equitable interest so when they sought to recover a loan but the court dismissed their claim with reasoning that they ought to have known about the equitable interest the wife had in the property. However scholars claim that “trust has often served as a means of evading the law” [13] . This is in the sense that a beneficiary is allowed all the privileges of having an interest in land and being able to hold others liable without being subjected to any liability themselves.

The intention of equity’s creation has not changed and its role in today’s legal system is representative of its purpose to fulfil the law in areas where people where individuals were deprived of a just and fair outcome because of the rigidity of the common law. Its integration into the legal system through the Judicature Acts seemed to suggest that equity was gaining the same status as the common law however the critics which believe that equity was beginning to surpass the common law overlook the fact that equity is in all manners speaking has created new doctrines to assist the law but never to overtake it. Maitland is of the opinion that equity and the common law have become integrated, “no court, no division of a court, can now say these or those rules are my exclusive property; for every division of the High Court is capable of administering whatever rules are applicable to the case that is before it, whether they be rules of the common law or rules of equity”. To conclude, it is safe to say that equity has not destroyed the law, quite oppositely, it has aided law by developing a number of important and influential doctrines which ensure that justice is achieved in a just manner not just to comply with legal principle. Equity has had exclusive jurisdiction in which it has created novel rights in areas such as mortgages, trusts, administration of estates, company law and many others. Additionally equity has created discretionary remedies which are enforceable both in equity and in law and it has had auxiliary jurisdiction in the creation of new procedural rules. Clearly the role of equity in today’s legal system is abundant and it’s hard to envision what law would be like without its creation.