Historical Development of Equity

Compiled by: Khalid Muhammad Shezan

Legal system of England has 3 elements. They can be classified as follows:

1. Common law
2. Equity
3. Statutory law

Equity is an important part of the English legal system. It means ‘equalisation’. But
the law of equity refers more in comparison with the literal meaning, basically it is
based on fairness and good conscience.

Equity can be expressed as:

1. Broad Sense → resembles natural justice.

2. Narrow → a portion of natural justice developed since mediaeval times,

applied by the Chancellor of England and subsequently the Court of
Chancery.

DEFINITION OF EQUITY

Blackstone → Equity is the soul and spirit of all law, synonymous with justice, in
that it is the true and sound interpretation of the rule.

Al-Quran → If you do justice, do that with equity. [Surah Mayeda: 42]

Story → Equity has 3 functions: to protect confidence, to prevent oppression, to

promote fair dealings.

DEVELOPMENT OF EQUITY

Stages of development of Equity:

1. Roman
2. Norman
3. England
ROMAN PERIOD: The Romans first introduced the idea of law. The ‘Praetor’ was
an elected judicial magistrate who was assigned to dispense justice in the city of
Rome. He used to provide intent-based-judgement for the sake of fair and effective
justice. Since then equity was emerging under the title of edictum novum which
literally means new set of rules.

NORMAN PERIOD: The English conquered Norman in 1066. Since then they helped
develop common law and establish the principles of equity more effectively. From
this period, custom was regarded as the main source of law, the idea of common law
also developed thus. That is why common law is mainly based on custom or earlier
practice. In this period, equity principles was developing gradually and they were
applied in the common law courts although their scope was limited.

ENGLAND: From the reign of Edward I, there were 3 great courts in England. They
are as follows:

1. King’s Bench
2. Court of common pleas
3. The exchequer

These three courts are known as common law courts or royal courts. Of the three
courts, the Exchequer was more than a court of law; it was also an administrative
department of the government to collect revenue.

The office of the Exchequer was named the Chancery. The head of the said office
was called the Chancellor. The Chancellor was often regarded as the King’s Prime
Minister due to his significant role. The Chancellor expanded his power in
promulgating laws beside collecting revenues.

At that time in England, if a person wanted to bring an action in any of the common
law courts, he had to obtain a writ from the chancery section. The Chancery was
entitled to issue such writ although the number of writs was limited. Besides this,
there were several problems emerging which a person had to face to bring an action
in the common law courts.

Deficiencies of Common Law Courts:

✒ The number of writs were very limited. If a person’s cause of action could
not be brought under any writ, the person was not entitled to any remedy.
 ✒ The relief granted by the common law courts were not adequate. They
could give monetary damages for the breach of contract, but could not provide
specific performance.

✒ The procedure of common law courts was way too rigid and formal, thus
defective and unsatisfactory.

Rise of Equity and Chancery Court as the Court of Equity:

Due to the deficiencies and inadequacy of the common law courts, the equitable
jurisdiction in England grew eventually.

King was considered the fountain of justice. So, the parties who could not get
adequate relief due to the deficiencies of the common law courts began to present
their petitions before the King-in-Council. Day by day, the number of such petitions
were increasing and it became hard for the King to hear every petition. Therefore,
the hearing of such petitions fell on the Chancellor. With the laps of time, such
petitions were presented directly before the Chancellor.

The Chancellor started granting relief to the aggrieved party by issuing a Royal
decree. In doing so, he had the power to override common law rules, instead he
could settle any case on the ground of fairness and conscience. Thus, the
Chancellor was widely spoken as the Keeper of the King’s Conscience.

In 1474, formally the Court of Chancery came into existence as a distinct court. This
court could grant three possible remedies. They are as follows:

1. Injunction
2. Writ
3. Specific Performance

Competition with Common Law:

The early Elizabethian period featured a dispute

between the court of Chancery and common law courts over who held
pre-eminence. There grew a competition between Common law and Equity and
common law judges felt that equity has come to supersede common law. In this
regard, the Earl of Oxford case has answered all the questions regarding this issue.

The judgement held that equity takes precedence over the common law. Later on,
the king decreed that if there is a conflict between the common law and equity, equity
would prevail.
Fusion of Law-The Judicature Acts:

After the establishment of the Court of Chancery. England had a dual system of
courts with two different bodies of law. The common law courts were administered by
the principles of common law and the court of Chancery was guided by the principles
of equity. This peculiarity was finally abolished with the passing of the judicature acts
of 1873 and 1874. This act abolished the old courts of common law and Chancery
and established a single Supreme Court of judicature which is guided by both
principles of common law and equity.

Effect of the Judicature Act:

1. Fusion of Courts.
2. Unification of common law and equity principles
3. Uniform procedure
4. Avoiding multiplicity of proceedings.

(these four points have to be elaborated)