Equity in United Kingdom

Definition of Equity

In accordance with the work A Dictionary of Law, this is a description of Equity :

1. That part of English law originally administered by the *Lord Chancellor and later by the *Court of Chancery, as distinct from that administered by the courts of *common law. The common law did not recognize certain concepts (e.g. uses and trusts) and its remedies were limited in scope and flexibility, since It relied primarily on the remedy of damages. In the Middle Ages litigants were entitled to petition the king, who relied on the advice of his Chancellor, commonly an ecclesiastic (“the keeper of the king’s conscience”), to do justice In each case. By the 15th century, petitions were referred directly to the Chancellor, who dealt with cases on a flexible basis: he was more concerned with the fair result than with rigid principles of law (hence the jurist John Selden’s jibe that “equity varied with the length of the Chancellor’s foot”). Moreover, if a defendant refused to comply with the Chancellor’s order, he would be imprisoned for contempt of the order until he chose to comply (See in personam). In the 17th century conflict arose between the common-law judges and the Chancellor as to who should prevail; James I resolved the dispute in favour of the Chancellor. General principles began to emerge, and by the early 19th century the Court of Chancery was more organized and its jurisdiction, once flexible, had ossified into a body of precedent with fixed principles. The Court of Chancery had varying types of jurisdiction (See auxiliary jurisdiction; concurrent jurisdiction; exclusive jurisdiction) and many of its general principles were stated in the form of *maxims of equity; equity had (and still has) certain doctrines (See election; conversion; reconversion; performance of contract; satisfaction). Under the Judicature Acts 1873-75, with the establishment of the High Court of Justice to administer both common law and equity, the Court of Chancery was abolished (though much of its work is still carried out by the *Chancery Division). The Judicature Acts also provided that in cases in which there was a conflict between the rules of law and equity, the rules of equity should prevail. The main areas of equitable jurisdiction now include *trusts, *equitable interests over property, relief against *forfeiture and penalties, and equitable remedies (*equitable remedy). Equity is thus a regulated scheme of legal principles, but new developments are still possible (“equity is not past the age of child-bearing”): recent examples of its creativity include the *freezing injunction and the *search order.

2. An equitable right or claim, especially an *equitable interest, or *equity of redemption, or *mere equity.

3. A share in a limited company.

Concept of Equity

The following is an old definition of Equity [1], a term which has several meanings:1. The point of contrast between the law of nations (see this term in this resource) and the law of nature was ” equity; ” a term which some derive from a Greek word denoting the principle of equal distribution: but that origin is to be preferred which gives the term the sense of ” leveling.” The civil law of Rome recognized many arbitrary distinctions between classes of men and property. The neglect of these distinctions was that feature of the law of nature which is depicted in equity. It was first applied, without ethical meaning, to foreign litigants

Alternative Meaning

Equality of right; exact justice between contending parties; fairness in determining conflicting claims; justice. 3. That portion of natural justice which is made up of the decisions of the judges of the English court of chancery in the exercise of their extraordinary jurisdiction. See further Chancery. ” In this sense, equity is wider than law, and narrower than natural justice, in the extent of the subject-matters within its jurisdiction: it cannot he defined in its content otherwise than by an enumeration of these matters.” Not the chancellor’s sense of moral right nor of what is equal and just, but a complex system of established law. That portion, of remedial justice exclusively administered by a court of equity, as contradistinguished from the portion exclusively administered by a court of common law. In the most general sense we are accustomed to call that equity which, in human transactions, is founded in natural justice, in honesty and right, and which properly arises ex aequo et bono. In this sense it answers precisely to the definition of justice, or natural law, given by Justinian in his Pandects. And the word jus is used in the same sense in the Roman law. . . It would be a great mistalce to suppose that equity, as administered in England and America, embraced a, jurisdiction as wide and extensive as that which arises from the principles of natural justice above stated. Probably the jurisprudence of no civilized nation ever attempted so wide a range of duties for any of its judicial tribimals. Even the Eoman law, which has been justly thought to deal to a vast extent in matters ex mqno et bono, never affected so bold a design. On the contrary, it left many matters of natural justice wholly unprovided for, from the difficulty of framing general rules to meet them, and from the doubtful nature of the policy of attempting to give a legal sanction to duties of imperfect obligation, such as charity, gratitude, and kindness, or even to positive engagements of parties, where they are not founded in what constitutes a meritorious consideration. . . A still more limited sense of the term is that in which it is used in contradistinction to strict law – strictum et summum jus. Thus, Aristotle has defined the very nature of equity to be the correction of the law, wherein it is defective by reason of its universality. It is of this equity, as correcting, mitigating, or interpreting the law, that, not only civilians, but common-law writers, are most accustomed to speak. The general purpose of equity is to moderate the Vigor of the law, supply its deficiencies, and bring it into harmony with conscience and moral justice. See Conscience. The term ” equity ” is also used, elliptically, for a court o f equity or a court administering the principles of equity: as when it is ‘said that equity will reform an instrument, or will afford relief or redress. And “equities” is often employed to denote the several rights or interests, whatever they may be, belonging to one person or party, which will receive recognition and enforcement in a court of equity. ” This court held that there was no equity in the bill, on the ground that, if the plaintiff had any right of action for money had and received, it was an action at law.” See Demurrer, General. Court of equity. The essential difference between a court of equity and a court of law consists in the different modes of administering justice in them, in the modes of proof, of trial, and of relief. A court of equity – (1) adapts its decrees to all the varieties of circumstances which may arise, and adjusts them to all the peculiar rights of all the parties in interest; whereas a court of common law is bound down to a fixed and invariable form of judgment in general terms, altogether absolute, for the plaintiff or the defendant. (2) It can administer remedies for rights which a court of common law does not recognize at all; or, which, it recognized, are left wholly to the conscience and good-will of the parties. Such are trusts, many cases of losses and injuries by mistake, accident, and fraud; cases of penalties and forfeitures; cases of impending irreparable Injuries, or meditated mischiefs; cases of oppressive proceedings, undue advantages and impositions, betrayals of confidence, and unconscionable bargains. (3) Remedies in a court of equity are often different, in nature, mode, and degree from remedies in a court of law, even when each has jurisdiction over the subject-matter. Thus, a court of equity, if a contract is broken, will often compel specific performance; whereas a court of law can only give damages for the breach. So, a court of equity will interfere by way of injunction to prevent wrongs; whereas a court of common law can grant redress only, when the wrong is done. (4) The modes of seeking and granting relief differ. A court of law tries a contested fact by means of a jury; and the evidence is generally drawn from third persons, disinterested witnesses. But a pourt of equity tries causes without a jury; and, addressing itself to the conscience, requires the defendant, under oath, to give his knowledge of the facts stated in a bill in the nature of a bill of discovery, see, in this resource, the term Perhaps the most general, if not the most precise, definition of a court of equity is, that it has jurisdiction in cases of rights, recognized and protected by the municipal juris-prudence, where a plain, adequate, and complete remedy cannot be had in the courts of common law. In America, this branch of jurisprudence has grown up chiefly since the formation of the National government. It follows ttie model of the English court of chancery; except that, in some States, and in the National tribunals, it is administered by the common-law courts; in some the jurisdiction is very imperfect, in others scarcely known. The great advantage possessed by a court of equity is not so much in its enlarged jurisdiction as in the extent and adaptability of its remedial powers. Generally its jurisdiction is as well defined and limited as that of a court of law. It cannot exercise jurisdiction when there is an adequate and complete remedy at law. It cannot assume control over that large class of obligations called imperfect obligations, resting upon conscience and moral duty only, unconnected with legal obligations. Generally its jurisdiction depends upon legal obligations and its decrees can only enforce remedies to the extent and in the mode estab- lished by law. It cannot, by avowing that there is a right but no remedy known to the law, create a remedy in violation of law, or even without authority of law. It acts upon established principles not only, but through established channels. Courts of law and of equity are independent. They act upon different principles, and, except where some recognized ground of equity jurisdiction is concerned, are each alike boimd to recognize the validity and conclusiveness of the record of what the other has done. Equity, in such cases, does not contradict but supplements. It does in this way what right and justice require, and what, from, the inflexibility of the principles upon which a court of law proceeds, it could not do. When a court of equity has once acquired jurisdiction of a cause it may go on to a complete adjudication, even to the extent of establishing legal rights and granting legal remedies. A too severe application of the common-law rules forced the courts of chancery into existence in England. The body of the chanceiy law is nothing more than a system, of exceptions; of principles applicable to cases falling within the letter, but not within the intention of particular rules. The exercise of equity powers, in every government of laws, is conclusive proof of a necessity that they be lodged somewhere. Every rule, from its universality, must be defective. A legislature can do little more than mark out general principles; their application, as well as the more minute details, must in general be left to the courts, as cases arise. ^6 The absence of a plain and adequate remedy at law affords the only test of equitable jurisdiction, and the application of this principle to a particular case must depend altogether upon the character of the case as disclosed in the pleadings. Where there is plain, adequate and complete relief at law, the defendant has a right to a trial by jury. The office and jurisdiction of a court of equity, unless enlarged by express statute, are limited to the protection of rights of property. It has no jurisdiction over the prosecution, the punishment, or the pardon of crimes, or over the appointment and removal of public officers. To assume such a jurisdiction would be to invade the domain of the courts of common law, or of the administrative department of government. Any jurisdiction over criminal matters that the English court of chancery ever had became obsolete long ago, except as incidental to its peculiar jurisdiction for the protection of infants, or under its authority to issue writs of habeas corpus for the discharge of persons unlawfully imprisoned. Equity does not enjoin against a crime as a crime. But injunctions have often been granted against acts injurious to individuals, though they have also amounted to a crime against the public. The equity jurisdiction of the Federal courts is derived from the Constitution and laws of the United States, and is not affected by State statutes. Section 913 of the Revised Statutes, which declares that the modes of proceeding in equity causes shall be accordr ing to the principles, rules, and usages which belong to courts of equity, refers to the principles, rules, and usages by which the English court of chancery was governed at the time of the passage of the Judiciary Act in 1789. The test of equity jurisdiction in the Federal courts- namely, the inadequacy of the remedy at law – is the remedy which existed when the Judiciary Act of 1789 was adopted, imless subsequently changed by Congress.^6 The practice in a court of equity is regulated by law or rule, and cannot be varied by the agreement of parties. See Probate, Court of. Bill in equity. The document by which a suit is begun in a court of equity. Is in the style of a petition; and in the nature of a declaration at law. Sets forth the circumstances of the case at length, alleging that a trust relation exists, or that some fraud, accident, mistake, or peculiar hardship exists or has been or is attempted; avers want of adequate relief at law; asks for a subpcena to compel respondent to answer the charges, and, perhaps, for an injunction. Calls into court as parties all persons interested in the subject-matter. Should contain no scandalous or impertinent matter. Filing the hill is followed, in different suits, by service of the subpcena, sequestration, appearance, demurrer, plea to the jurisdiction or to the person, answer, amendments, supplemental bills, cross bills, decree or reference to a master for a report as to the tacts and the form of a decree, exceptions to the report, final hearing, final decree, bill of review, appeal to a higher , court. See further Bill, IV. Better equity. A claim to property superior, in contemplation of a court of equity, to another claim. In this category is a second mortgagee who has no knowledge of the existence of a prior unrecorded mortgage. Countervailing equity. Such equity as offsets or counteracts another equity; an adverse counter-balancing right or equity. Equal equity. Equality of equitable right. Exists between persons who have been equally innocent and equally diligent. Equity of a statute. The intention of the law-maker, as evinced by the spirit and reason of an enactment. See further Statute. Equity of redemption. The reasonable time within which a mortgagee may redeem his estate after forfeiture. See further Redeem. Equity of settlement; wife’s equity. See Settle, 3. Secret equity. An interest or claim, cognizable in a court of equity, of which notice has been withheld from one or more interested persons or from the public generally. Equitable. 1. According to natural right or justice; just and right in a particular case, as distinguished from the strict rule of a general, positive law. Opposed, inequitable

Alternative Meaning

That which can be sustained or made available or effective in a court of equity, or upon principles of equity jurisprudence. Opposed, legal. The remedies for the redress of wrongs and the en- forcement of rights are: (1) those which are administered in courts of common law; and (2) those which are administered in courts of equity. Rights which are recognijied and protected, and wrongs which are redressed, by the former courts are called “legal” rights and ” legal ” injuries. Rights which are recognized and protected, and wrongs which are redressed, by the latter courts only, are called “equitable” rights and ” equitable “injuries. The former are said to be rights and wrongs at common law, and the remedies, remedies at common law; the latter, rights and wrongs in equity, and the remedies, remedies in equity. It is customary to speak of “equitable” (and legal) – action, assets, assignment, consideration, conversion, defense, estate, estoppel, execution, interest, jurisdiction, levy, lien, mortgage, owner, plaintiff, remedy, title, value, waste, qsee, in this resource, the term In the Federal courts, the distinction between legal and equitable proceedings is strictly maintained; distinct proceedings must be instituted for the enforcement of equitable rights. Separate courts of equity exist in Alabama, Delaware, Kentucky, Maryland, Mississippi, New Jersey, and Tennessee. In Arkansas, Connecticut, Florida, Georgia, Illinois, Iowa, Maine, Massachusetts, Michigan, New Hampshire, North Carolina, Oregon, Pennsylvania, Rhode Island, Texas, Vermont, Virginia, and West Virginia, chancery powers are exercised by the judges of the common-law courts. In the other States, the distinction between actions at law and suits in equity have been abolished, but certain equitable remedies are still administered under the statutory form of the civil action. In a given case equity jurisdiction may be exclusive of the law, auxiliary to it, remedial of it, or concurrent with it – that is, executive, adjustive, or protective. Maxims embodying fundamental piinciples upon which equity jurisprudence rests, are: Equity, once having had, does not lose, jurisdiction; follows the law – in affording redress; assists the vigilant; suffers no right to be without a remedy; suffers tlie law to prevail, where there is equal equity or equality; delights in equality – is equality;^6 requires that he who seeks equity must do equity – must come with clean hands: as to the particular transaction in review: ^8 looks on that as done which ought to be done^9 – imputes intention to fulfill obligations; delights to do justice, and that not by halves. Nothing can call forth a court of equity into activity but conscience, good faith, and reasonable diligence.0 See further terms in this title, and, especially, Accident; Adequate, 2; Discovery, 6; Election, 2; Fiction; Fraud; Hearing; Ignoranoe-; Issue, 4; Master, 4; Mistake; Party, 2; Patent, 2; Peace, 1, Bill of; Performance, Specific; Prejudice, Without; Quia Timet; Receiver, 2; Reform; Relief, 2; Rescission; Satisfaction, (2); Sequestration, 2; Set-off; Trust, 1; Use, 2.

Resources

Notes and References

1. Meaning of Equity provided by the Anderson Dictionary of Law (1889)

Concept of Equity

Traditional meaning of equity [1] in the English common law history: That system of jurisprudence administered first by the English Court of Chancery; a jurisdiction originally resident in the Crown and exercised by the Chancellor. Courts of equity: see the entry on types of courts, 15, 109. Equity of a statute: the sound interpretation of a statute, taking into consideration its reason and spirit. Equity of redemption: 1. The estate of a mortgagor in mortgaged land. 2. The mortgagor’s right of redeeming after breach of conditions or foreclosure. Equity side of the exchequer: see the entry on types of courts, 11. Equity to a settlement or wife’s equity: the right which a wife has in equity to have a portion of her equitable estate (usually one half) settled upon herself and children. It may now be claimed by her; but was originally granted only when the husband sued in equity for the purpose of reducing her property into possession. [rtbs name=”history-of-english-law”]

Resources

Notes and References

1. Based on A concise law dictionary of words, phrases and maxims, “Equity”, Boston: Little, Brown, and Company, 1911, United States. This term and/or definition may be absolete. It is also called the Stimson’s Law dictionary, based on a glossary of terms, included Equity.

See Also

The Equity

Name

The Equity is the standarized name of one of the UK Historic Courts (see the entries in this legal Encyclopedia about court rules and procedural law for more information on some aspects of the Equity in the UK court legal history).