EQUITY IMPUTES AN INTENTION TO FULFILL AN OBLIGATION

Meaning
Equity considered and estimated acts of parties. Thus where a person is under an obligation to do
a certain act, and he does some other act which is capable of being regarded as an act in
fulfillment of his obligation. In other words a person is presumed to do what he is bound to do.
In Sowden v. Sowden, a husband covenanted with the trustee of his marriage settlement to pay to
them £50,000 to be laid out by them in purchase of land in a particular area D. He, in fact, never
paid the sum, but after marriage purchased the land at D in his own name, for £50,000. He died
and could not bring the land into settlement. Equity courts construed that he purchased land to
fulfill his obligation.
Application and cases
i) Doctrine of performance and satisfaction
ii) Ademption
iii) Doctrine of presumption of advancement
iv) Relief against defective execution of power of appointment.

Recognition
i) The Succession Act- Presumption against satisfaction is mentioned here. In Hasanali v.
Popatal, a testator, who had a sum of Rs 9000 as deposit from his brother, gave to is brother a
legacy of Rs 9000 and it was held that the brother was entitled to both, the legacy and his
deposit. But as decided in Rajmanuar case where a will contained a clear indication that the
legacy was meant as a satisfaction of the debt due to X, X could not claim both as the section
explains.
ii) The Trust Act- Where a person contracts to buy property to be held on trust for certain
beneficiaries and buys the property accordingly, he must hold the property for their benefit to the
extent necessary to give effect to the contract. Equity thus imputes an intention to fulfill an
obligation.
INDIVIDUAL EQUITY:
Individual equity means recognizing and rewarding individuals for their contributions. Since
employees would do the comparison among their salary and others in the organization working
similar jobs it is quite important for the organizations to have mechanisms through which the
individuals would be paid based on their contributions like merit pay programs: Centralized –
first the salary budgets would be determined by considering relevant factors like cost of living,
average labor market pay increase, ability to pay, etc. and then the differences  among
individuals in terms of performance  or productivity would be considered. In this approach the
HR professionals have a greater control on the system; Decentralized – Managers forecast the
pay increase that they want to recommend to both retain employees and being competitive and
then a rolling up of the salaries would make the salary budget clear. In this approach the
managers has a greater control on the system. Regardless of the approach it requires a huge
amount of calculations with the lowest error rate. On the other hand the information should be
collected from different places which seem the organization is faced with the islands of
information.
 Executory Trust Law and Legal Definition
Executory trusts are trusts that require further drafting and/or execution of documents before it is
completely effective. In executory trusts, the instrument creating the trust is intended to be
provisional only. Conveyances are contemplated by the trust instrument before the terms of the
trust can be carried out. Executory trusts are also termed imperfect trust.

Nature of Fiduciary Relationship:

Fiduciary relationship covers variety of relations having some common features. Whether the
relation between the two persons is of fiduciary or not, depend upon the fact and circumstances
of the case. Though there is no hard and fast rule to determine the existence of fiduciary
relationship but it could be said that whether one has reposed confidence in another, i.e. whether
confidential relationship exists, is the material test to determine the existence of fiduciary
relationship.

Generally fiduciary relationship is a confidential relationship created by the equity in the interest
of good consciences and justice. It was held by Supreme Court in Jaya Singh v. Krishna, (2) that
wherever a person clothed with a fiduciary character obtains some personal advantage by
availing himself of his position, such person remains as fiduciary for all the profits which are to
be held for the benefit of person at whose expenses and in derogation of whose rights, the profit
has been made or advantage has derived.
EQUALITY IS EQUITY
Meaning
Plato defined that “If you cannot find any other, equality is the proper basis.” This maxim is also
explained as “equity delighteth in equality”, which means that as far as possible equity would put
the litigating parties on an equal level so far as their rights and responsibilities are concerned.
Justice Fry said, “When I say equality, I do not mean equality in its simplest form, but which has
been sometimes called proportionate equity.”
Application and cases
Application of this maxim can be understood from the following:
i)    Equity’s dislike for joint tenancy and presumption of tenancy-in-common
ii)   Equal distribution of joint funds and joint purchases
iii)   Contribution between co-trustees, co-sureties and co-contractors
iv) Ratable distribution of legacies
v)   Marshalling of assets

Court of equity
A court of equity, equity court or chancery court is a court that is authorized to apply
principles of equity, as opposed to those of law, to cases brought before it.
These courts began with petitions to the Lord Chancellor of England. Equity courts "handled
lawsuits and petitions requesting remedies other than damages, such as writs, injunctions,
and specific performance". Most equity courts were eventually "merged with courts of law"
United States bankruptcy courts are the one example of a US federal court which operates as a
court of equity.

DELAY DEFEATS EQUITIES

Meaning
A Latin term in this regard is “Vigilantibus, non dormentibus, jurasubvenient.” which means
“Equity aids the vigilant and not the indolent”. So, if one sleeps on his rights, his rights will slip
away from him. Legal claims are barred by statutes of limitation and equitable claims may be
barred not only by limitation law but also by unreasonable delay, called laches.
Application and cases
To cases which are governed by statutes of limitation either expressly or by analogy the maxim
will not apply. Such cases fall into three categories-
i) Those equitable claims to which the statute applies expressly.
ii) to which the statute applies by analogy.
iii) Equitable claims which are covered by ordinary rules of laches.
Doctrine of laches- Plaintiff’s unreasonable delay is a weapon of defence by the defendant
against the plaintiff.
In a Bombay  case, the plaintiff allowed his land to be occupied by the defendant and this was
acquiesced  by him even beyond the period of limitation. On a suit of the land it was decided that
as the period of limitation to recover possession had expired, no relief could  be granted. Also the
case of Allcard v. Skinner is worth mentioning here.
Limitation
This maxim does not apply when-
i) where the law of limitation expressly applies
ii) where it applies by analogy, and
iii) where the law of limitation does not apply but the cases are governed by ordinary rules of
laches.
Recognition
The English doctrine of delay and laches showing negligence in seeking relief in a court of
equity can not be imported into the Bangladeshi law in view of Article 113 of the Limitation Act,
1908, which fixes a period of one year (previously three years) within which a suit for specific
performance should be brought. Section 51 of the Transfer of Property Act embodies this
doctrine but with a difference.
CREATION OF TRUST
The elements of valid trust are presented in section-6.The act defines how the author could create
the trust, assign trustees and give them his monetary assets to be controlled by the trust. It may
be express or implied. It includes-
 Intention of the author to create the trust.
 Purpose of the trust.
 The monetary asset is assigned for the benefit of the trustee.
  Gives control or transfer the trust property to the trustee which includes intention of the
author.
 Trustee can claim expenses & salary from the benefits from the trust of his work.
The requirement of the trust law is that the author should indicate by words or conduct with the
reasonable intention to create a trust.

EQUITY ACTS IN PERSONAM

This is a maxim that governs how equity is administered in law. To act in personam means it acts
upon a person” conscience. This is as opposed to acting in rem which is a characteristic of
common law where it acts upon the property that is subject to the suit. As stated in the Earl of
Oxford case, in case of a conflict between equity and common law, equity shall prevail. Lord
Ellesmere insisted that Equity was not in competition with common law, rather, it acted upon the
conscience of the parties to a suit. King James I held the same view.

This maxim comes in handy with regard to properties held abroad. The subjects most contested
under this maxim include trusts and mortgages. It is also required regarding receivership.

Grounds for applying this maxim include:

1. The defendant must be within the jurisdiction.

2.The maxim cannot be relied on to grant an order in person when such will violate legal rules of
another country.
3.The maxim will not be relied upon to grant an order which would not be enforceable since
equity does not act in vain.

The maxim however has its limitations:

1.The defendant has to be within the jurisdiction of the court.

2.The order must not violate the legal rules of another country.
3.The order given must be capable of being executed without intervention of a foreign court.
4.Legal proceedings must not have been started in the appropriate court.

WHERE THERE ARE EQUAL EQUITIES, THE FIRST IN TIME SHALL PREVAIL 
Where Two Parties are entitled to same equitable right in same manner, i.e. both of them have no
legal right, both are entitled to equitable right only and to same extent then the right of the party
who first claimed that right shall prevail over the right of another party. Court held in Rise vs.
Rise that; as between persons having only equitable estate/interest, if their interests are in all
other aspect equal, priority in time gives the better equity.

CONDITION REQUISITES TO INVOKE THE MAXIM

 In order to take advantage of this maxim the parties have to prove that;
 They have equal equitable rights in the subject matter;
 Both of the parties have no legal right in the property, because in that case priority shall
be given to legal right as legal right prevails equitable right;
Executed Trust Law and Legal Definition
Executed trusts are trusts in which the estates and interests in the subject matter of the trust are
completely limited and defined by the instrument creating the trust. Such trusts have all of the
relationships among the parties defined, the management of the trust assets defined and all
required documents signed. Executed trusts are complete trusts and needs no further
documentation to be completely effective. Executed trusts are also known as complete voluntary
trusts.

Settlor or Author of the trust.

The person who reposes or declares the confidence is called the “author of the trust.Settlor is also
the Author of the Trust. In more simple words, Settlor is the person who intends to form
the Trust. Settlor knows the reason for creation of the Trust, why the Trust is important, what
purpose its formation would serve, who would manage the Trust, and most important how it
would be managed

Equitable interest
An interest or right enforceable in a court of equity, protected by equitable remedies. An
equitable interest is an interest in or right over property, which gives the holder the right to
acquire formal legal title. The concept of an equitable interest only exists in jurisdictions with
common law backgrounds. Examples of recognised equitable interests include:
1. A beneficiary’s interest in a fixed trust
2. A partner’s interest in the partnership
3. Proprietary interests that are counterparts to common law interests
4. Equitable security interests
5. Equitable rights over land
An equitable interest is usually defeated by a legal interest (such as one registered on the PPSR),
as it has not been registered, or is incapable of being registered, but there are exceptions to this.
An equitable interest arises where formal legal requirements have not been complied with for
whatever reason, and looks primarily to the intention and not the form of a legal transaction. An
equitable interest usually has to be in writing, but does not require creation by deed.

Extinction of Trusts under the trust laws in India

According to Section 77 a trust is extinguished
(a) when its purpose is completely fulfilled; or
(b) when its purpose becomes unlawful ; or
(c) when the fulfillment of its purpose becomes impossible by destruction of the trust property or
otherwise; or
(d) when the trust, being revocable, is expressly revoked.