THE JUDICATURE ACTS

THE JUDICATURE ACT, 1873- 1875

The Judicature Acts are a series of Acts of Parliament, beginning in the 1870s,
which aimed to fuse the hitherto split system of courts in England and Wales. The
first two Acts were the Supreme Court of Judicature Act 1873 (36 & 37 Vict c. 66)
and the Supreme Court of Judicature Act 1875

Before the passing of the Judicature Act of 1873 there were two distinct systems of
justice administered by the English Court. The Courts of Queen's Bench,
Common Pleas and the Exchequer were governed by the principles of the common
law, while the court of chancery was guided by the principles of equity.
The common law courts did not grant equitable remedies like specific
performance, injunction of appointment of receiver, while the court
of chancery as a rule had no power to grant damages. The result was that the
litigants had to suffer great inconvenience and, as Snell points out, in many cases,
in the course of the same litigation parties were driven backwards and forwards
from courts of law to courts of equity, and from courts of equity to courts of law.
No court had full power to grant complete relief in all cases. And although
the Chancery Amendment Act, 1858, and the Common law Procedure Act,
1854, enabled the Chancery Court to award damages instead of or in addition to,
an injunction or specific performance, and the common law courts to grant a
limited power of Injunctions, it remained for the Judicature Acts to fuse the
administration of the two systems and to abolish wholly any possibility of a direct
conflict between them. The Judicature Act of 1873 abolished the old courts
of chancery and common law and in their place established a High Court of
Justice with a Court of Appeal over it. The High Court of Justice was divided into
five divisions, viz., the Chancery, Queen's Bench, Common Pleas, Exchequer
and the Probate, Divorce and Admiralty. And this Court and the Court of
Appeal were directed to administer both law and equity. Instead of different courts
administering different systems, the Judicature Act established one Supreme Court
administering both law and equity.
No doubt for the sake of convenience the High Court is split up into divisions and
most of the equitable matters dealt with by the old court of chancery are assigned
to the Chancery division of the High Court, while the King's Bench division
mostly deals with matters which formerly came before the common law courts.
But this division was quite different 'from the old independent courts. And every
Judge to whatever division he might belong administered both the rules
of equity and common law and gave effect to all equitable rights, obligations and
defences as also to all legal rights and obligations.

Fusion of law and Equity

Having thus fused the administration of law and equity, the Act of 1873 then
provided that where the two were In conflict, equity should prevail over the legal
rule. In Wash v. Lonsdale (1882, 21 Ch.D. 9) Lonsdale agreed in writing to grant
a seven years lease of a mill to Walsh at a rent payable quarterly in arrear, but with
a year's rent payable in advance if demanded. Walsh entered into possession
without any lease having been granted and paid his rent quarterly in arrear.
Subsequently Lonsdale demanded a year's rent in advance, and Walsh refusing to
pay put in a distress. Walsh prayed for an injunction claiming that at law he was a
tenant from year to year at a rent not payable in advance. The Court of Appeal
repelled the contention of the plaintiff on the ground of the absence of a deed and
held that Walsh held on the same terms as if a lease has been granted since the
agreement was one of which the court would order specific performance. Jessel,
M.R., observed that there were not two estates as there were formerly, one estate
at common law by reason of the payment of the rent from year to year, and an
estate in equity under the agreement. There is only one court, and equity rules
prevail in it.

Similarly, the equity rule prevailed over common law rules in the case of Berry v.

Berry (1929,.2 K.B. 316) where it was held that a subsequent change in the terms
of the deed by an agreement in writing not under seal was a good defence to an
action brought on the deed, although at law a contract made by deed could only be
varied by another deed. The Act had thus the effect of rendering it always possible
to vary a deed by a subsequent simple contract.
The Judicature Acts, however, only apply to principles and not to practice for in
case of difference in the practice of the two former courts, the more convenient one
is now followed by the High Court of Justice. The enactment, however, retains the
distinction between legal and equitable rights and between legal and equitable
remedies. Thus a person who acquires the legal interest in property for value and
without notice of another person's equitable interest therein, takes free from that
equitable interest. This is based on the maxim that equity follows the law. But in
case there are equal equities, the first in time prevails and he who acquires merely
an equitable interest is subject to the prior equitable interest, in spite of the fact that
he had no notice, actual or constructive, of its existence and that he gave value for
acquiring the same.
Snell, therefore, concludes that what the Judicature Acts have really done is to
provide for the administration of law and equity in the same courts, for the
recognition by those courts of both legal and equitable rights, remedies and
defences, and for the submission of law to equity where they were previously in
direct conflict. It is a fusion of administration rather than of principles. And, as has
been well said by Prof. Ashburner, the two streams have met and now run in the
same channel but their waters do not mix.

CHANGES INTRODUCED BY JUDICATURE ACTS

The Judicature Acts abolished the old courts, viz., the Chancery, Queen's Bench,
Common Pleas, Exchequer and also the Courts of Probate, Divorce and Admiralty.
In their place there came into existence a High Court of Justice with a Court of
Appeal above It. The High Court of Justice was divided into five divisions,
viz., Chancery, Queen's Bench, Common Pleas, Exchequer and the fifth being
Probate, Divorce and Admiralty. Certain business was assigned to each division,
but this division was merely for administrative convenience and the distribution of
business might at any time be· changed without any Act of Parliament by rules·
made by the judges and even the divisions could be abolished by an Order in
Council. Every Judge to whatever division he belonged applied both the rules
of common law and the rules of equity.

The Judicature Acts also brought about a great change in procedure introducing

a Code of Civil Procedure, which combines the best features of the two old
systems, viz., the common law and equity.
The Judicature Acts gave immunity from the bar of limitation to a claim of a cestui
que trust against the trustee in respect of any property held on trust.
Sub-section (8) (a) section 25 of the Act of 1873 enabled a mandamus or
injunction to be granted or a receiver to be appointed by a interlocutory order by
any division of the High Court.
The most important provision was the residuary clause as contained in section 25
(11) (d) of the Act of 1873, which provided that generally in all matters not
hereinbefore particularly mentioned, in which there is any conflict or variance
between the rules of equity and the rules of common law with reference to the
same matter, the rule of equity shall prevail.

RESIDUARY POWERS UNDER SECTION 25 (11) (D) OF JUDICATURE

ACT OF 1873
The first thing that is apparent on a reading of section 25 (11) (d) is that the sub-
section is quite non-committal. It does not recognise that there was any conflict
between the rules of equity and the rules of the common law in any case. The
question, however, as to whether there was ever any conflict between the two
system is difficult to answer. The Chancellor Ellesmere argued that there was no
conflict in the issue of common injunction, but Lord Chief Justice Coke strongly
refused that contention. There are no doubt admitted cas.es of conflict where the
above provision definitely uprooted the legal rule and replaced it by the equitable
rule. An example is furnished by the case of Berry v. Berry (1929, 2 K.B.
316) where the provisions of common law that the terms of a deed could be varied
or dispensed with only by another deed were superseded by the equitable rule or
vary a deed by a that it was always possible to rescind subsequent simple contract.
.
In this connection Maitland observes that the first thing that we have to observe is
that relation between law and equity was not one of conflict. Equity had come not
to destroy the law but to fulfill it. Every jot and every title of the law was to be
obeyed but when all this had been done something might yet be needful something
that equity would require. There might have been conflicts but, according
to Maitland for two centuries before the year 187 the two systems had been
working together harmoniously.
It was held in the case of Pugh v. Heath (7 App. Cas., 237) that the Supreme
Court is now not a court of law or a court of equity but a court of complete
jurisdiction, and if there is any variance between what a court of law and a court
of equity would have done the rule of the court of equity must now prevail. But it
was observe in Joseph v. lyons (15 Q.B.D. 280) that the distinction between legal
and equitable interest is not abolished by the Judicature Acts, otherwise they would
abolish the distinction between trustee an cestui que trust.
It will thus be apparent that, although the residuary power of  S. 25 (11)
(d) sounded high, .it was not of very great significance". The distinction between
the legal ownership of the trustee and that of beneficial ownership of the  cestui
que trust still existed. The Judicature Acts left the law of trusts just where it
stood because there was no conflict, no variance even, between the rules of
the Common law and the rules of equity. Further, the Judicature Act also did not
destroy the distinction between legal and equitable claims, between legal and
equitable defences and between legal and equitable remedies. They still maintained
that a person who acquired the legal estate for value and without notice of another
person's equitable interest therein took precedence over the person having only
equitable estate. This was in consonance with the maxim that equity follows the
law.

NEW REMEDIES

In recent times the courts have used their equitable jurisdiction to develop new
remedies:

Mareva Injunctions

In 1975 the Court of Appeal recognised the Mareva injunction for the first time.
This is a court order freezing the assets of a party to an action or stopping that
party moving the assets out of the country.
In Mareva v International Bulkcarriers [1975] 2 Lloyd’s Rep 509, a shipowner let
the ‘Mareva’ to a foreign charterer, with payment half monthly in advance. The
charterer defaulted on a payment. The shipowner found out that the charterers had
money in an English bank and sought an injunction freezing the account. It was
held that an order would be granted to stop the charterers from moving the money
abroad before the case was heard. Normally the application will be ex parte, which
means that one party applies without giving notice to the other side for if the other
party did have notice, they could move the assets.

In The Due Process of Law (1980) Lord Denning described the Mareva injunction
as “The greatest piece of judicial law reform in my time”.

Anton Piller Orders

In 1974 the High Court started to grant what later became known as Anton Piller
orders. This is an order to a defendant to allow the plaintiff on to the defendant’s
premises to inspect, copy or remove documents or other objects relating to the
plaintiff’s property. The aim is to stop the defendant removing or destroying vital
evidence. The defendant may refuse entry, but such action would be regarded as
contempt of court, for which the defendant could be sent to prison. Once again it is
an ex parte application. The use of such orders was confirmed in the following
case.

In Anton Piller v Manufacturing Processes Ltd [1976] Ch 55, the plaintiffs made

electrical equipment and employed the defendants as their agent in the UK. They
suspected that he was selling their technical drawings to competitors and so
applied for an order. The court held that an ex parte mandatory injunction would be
granted, to the effect that the plaintiff could enter the defendant’s premises and
inspect relevant documents.

These orders have been used for breach of copyright, passing off and matrimonial
disputes.

THE SUBJECT-MATTER OF EQUITY

It may be helpful to the understanding of equity to list the subjects which should
properly be included within it. No list can be exhaustive. However, the following
matters are assigned to the Chancery Division by the Supreme Court Act 1981:

* The sale, exchange or partition of land, or the raising of charges on land;

* The redemption or foreclosure of mortgages;

* The execution of trusts;

* The administration of the estates of deceased persons;

* Bankruptcy;

* The dissolution of partnerships or the taking of partnership or other accounts;

* The rectification, setting aside or cancellation of deeds or other instruments in

writing;

* Probate business, other than non-contentious or common form business;

* Patents, trade marks, registered designs or copyright;

* The appointment of a guardian of a minor’s estate;

* All causes and matters involving the exercise of the High Court’s jurisdiction
under the enactments relating to companies.