Equity and Common Law

Before the Norman Conquest 1060,

England:
- Dare Law (Based on local custms they varied)
- Wessex Law
- Mercian Law

What are customs?

- It refers to the rules of behavior that develop in a community without
being deliberately invented.

William the conquer – 1066

- Established a strong central government (included justice system)
- Standardized the Law by collecting local customs and listen & solve
disputes

Later on, Henry II

- Divided the land into circuits (area) for the judges to visit.
- Over time, only the best customs were selected to be use and implement.
- This had led to creation of Common Law since it was common to the
whole country.

By 1250, Common Law had developed from the cases heard in Curia Regis
(King’s court), which applied to the whole country.

Defects in Common Law:

- Claims could only be brought under common law by way of writ. This
document is a detailing basis of the action. Hence, if the matter is not
provided for in a writ, the action cannot be brought to court.
- The only remedy in common law was damages, which were often
inadequate.
- Common law brought too many formalities. As a result, many grievances
were lost due to procedures defects and technicalities.
- Common law was expensive
- Common law did not recognize trusts
- Common law brought about the principle of stare decisis and was based
on the doctrine of binding precedent. Hence the courts had to follow a
previous decision of another court and back then the courts could not go
against the previous decision even if it was wrong. Today there are
mechanisms such as distinguishing and overruling to avoid a precedent.

1. Writ system – King refused to produce new writs

2. 1 remedy = Monetary Compensation
3. Rigid
4. Precedent
What is Equity?
- Refers to a wider sense, it means fair and just.
- In legal term; equity refers to a specific set of legal principles which came
into existence to complement and fill gaps in the common law.

Development of Equity:
1. Defects of common law > People Petition > King (Fountain of Justice) >
(very busy so he passed it on to) Lord Chancellor “Keeper of the King’s
conscience” > (decide & pass) > Justice & Fairness (Court of Equity)
2. Common law lawyers were unhappy
a. Because when Common Law gave an unjust right, Court of Equity
could overturn that decision
b. Fairness is subjective varied according to LC

Problems caused by equity:

1. Initially there were conflicts between common law and equity and the
common law judges were dissatisfied with the Court of Chancery as their
powers and authority were being overridden. This can be seen in the Earl
of Oxfords case 1615 where two courts came into direct conflicts.

Held: Equity fills the gaps of common law 19th century, Equity was rigid

Take in to account that, although so, there was still a degree of contention
between two courts until,

Judicature Act 1873-75

- Merged courts
- Every court could use equitable remedies

Equity created Maxims:

- Equity will not assist a volunteer
- Equity is equality
- Equity will not suffer wrong without a remedy
- He who comes to equity must come with clean hand (D&C Builders v
Rees) Lord Denning held that the defendant had taken advantage of the
builders’ financial difficulties and therefore not come with clean hands.

Changes brought by Equity:

1. Introduce of Injunctions
a. What are equitable remedies?
i. Equity provided a number of remedies that the courts could
turn too to resolve any specific issues at hand.
b. An order of the court compelling the defendant to do or not to do
something. Mandatory Injunction is an order of the court
compelling the defendant to do something while a prohibitory
order is an order of the court preventing the defendant from doing
something.
c. In 1970s’ two new remedies were created that extended the scope
of injunctions:
 i. Mareva Injunction (freezing order)
 To restrain the defendant personally fro dealing
with assets or disposing of assets under the
defendant’s control in order to avoid making
payment
ii. Anton Pillar Order (Search warrant)
 Permit claimant to enter into the defendant’s
premise and search for specific documents and
others
iii. Specific performance
 An order of the court compelling a party to perform
his part an agreement that he has promised to fulfill
iv. Rectification
 An order that alters (changes) the words of a
document, which does not express the trues
intention of the parties to it.
v. Rescission
 An order that restores the parties to a contact to the
position that they were in before the contract was
entered into.
2. New Rights
a. The rights of the beneficiary under the law of trust
b. The rights of the mortgagor to redeem his property from the
mortgagor upon payment of the principal and interest outstanding
3. Doctrine of Promissory Estoppel
a. Is an order of a court restraining a person from denying the
promise he has made previously?
b. It was developed by an obiter statement by Lord Denning in
Central London Property Trust Ltd v High Trees Ltd (1947) & D&C
Builders Ltd v Rees (1966)
i. D&C did some work for Mr and Ms Rees. The bill came up to
732 pounds. So the Rees claimed that the work was
defective and only agreed to pay 300 pounds, knowing that
the firms was experiencing difficulty. The firm took the
money and sued Rees for outstanding sum
 Rees claimed Promissory Estoppel
 Held: The judge refused to apply the doctrine of
Promissory Estoppel on the ground that Rees had
taken an unfair advantage of D&C’s financial
situation and therefore Rees did not come to the
court with clean hands

4. Other areas affected by Equity:
a. Trust
i. The absolute owner of the property (settlor) passes the
legal title in that property to a person (trustee) to hold that
property on trust for the benefit of another person
(beneficiary) in accordance with the terms set out by the
settlor.
b. Mortgages
i. Common law
 Land conveyed to Mortgage
 Date is whereby the money is fully paid and the land
conveyed back to the mortgagor
c. Maxims of Equity
i. Equity must follow the law
 Rhode v Stephens 1994
- Will not depart from the common law rule that a
3rd party cannot be made to perform a contract.
ii. He who seeks equity must do equity
 Chappell v Time Newspaper
- A person seeking an injunction will not succeed if
he is unable or unwilling to carry out of his own
future obligations.
iii. He who comes to equity must come with clean hands
 Argyll (Duckess) v Argyll (Duke) 1967
- The fact that the wife’s adultery had led to the
divorce proceedings was no ground for refusing
her an injunction to injunction to restrain her
husband from publishing confidential materials.
iv. Equity looks to the intent rather that the form
v. Delay defeats equity