A LINKAGE OF EQUITY TO COMMON LAW
In the 14th century, the Chancellors believed that they were responsible for the administration of any substantive rules that differed from the country's laws. As we've already mentioned in the preceding chapter, equity could be interpreted in two different ways i.e.
- In addition, extending the Common Law and
- Through the correction of by resolving Common Law.
Common Law courts gradually resented the second kind of interference since they were courts with superior jurisdiction. However, it became evident that the Chancellor was performing efficient and valuable work that courts of Common Law could not do. So, one important area in substantive law (to make sure that trusts and uses are enforced or confidence) was entrusted to him because, during the fifteenth century, the dispute between the courts of Common Law and Equity commenced. In 1482, Hussey G. J. and Fairfax J. agreed that if the Chancellor sent the plaintiffs to jail for not obeying an order to stop their activities at Common Law, then the judges were to release them following an application through the writ of habeas Corpus. In the Tudor and early Stuart periods, the Court of Chancery was finally established, and the organisation was created. Under the Chancellorship of Wolsey, the jurisdiction that was the responsibility of Chancery was expanded to the point of being a tyranny. Sure, during the Chancellorship, there was less conflict. It was a matter the issue of Common Lawyers and Chancery practitioners disagreed, not just in court but also in pamphlets. St. Germain discussed it in his pamphlet 'Dialogues Between Doctors of Divinity and an undergraduate student in the Laws of England', published in 1523 to support the jurisdiction of Chancery. Serjeant offered a convincing response to it in support of the jurisdiction in the Common Law Courts. The author argued that the pleadings made the Chancellor's decision unclear and arbitrary. There was a response to this in the Little Treatise Concerning the Writs of Subpoena. The author argued that the Chancellor only added to the law to allow justice to be performed due to the challenges resulting from strict laws in Common Law pleading. This debate continued into the beginning of the reign of Queen Elizabeth.
A PERIOD STARTING IN 1615 UNTIL 1873
In 1606, Coke was named Chief Justice in Court of Common Pleas. He immediately began to question the prerogative courts that he felt were most detrimental to the common public. The conflict between him and the Court of Chancery broke out in Neath v. Ridley, where it was declared Common Law courts could not interfere with the Chancery's jurisdiction. Common-Law courts could prohibit the Chancery from interfering in the proper trial of any case in Common Law courts. The dispute reached its height in the case of the Earl of Oxford (1615), where Lord Ellesmere, as Chancellor, adhered to the principles laid out by the Little Treatise of Subpoena. Chief Justice or Chancellor was willing to concede to the demands of the Earl of Oxford, and the case was then referred to James I for settlement. James, I took the opinion of Bacon (then Attorney General) as well as other lawyers. Finally, James, I concluded to declare that the Court of Chancery was to be superior to Common Law Courts. He thereby maintained the absolute power in Equity against Common Law. In actual fact, this determined the relationship between Equity and Common Law as a court which was created to remedy the gaps, and therefore it made equity according to the terms of Maitland to be a "gloss over Common Law." In the case of Lord Cottingham starts, the process of transforming equity. In 1690, a Bill was introduced in Parliament to grant Common Law Courts the Common Law Courts power to issue written orders of prohibition to avoid any interference in their jurisdiction and stop any equity court from hearing cases with a legal remedy in Common Law provided. From 1690 until the end of the 18th century, equity was the sole partner of the rival court of The Common Law. It filled in the law's administration gaps caused by Common Law and other courts. At the beginning of the 19th century, it was the Court of Chancery. It was given the authority to rule on matters of the law and facts to prevent earlier duplication of legal actions. The Chancery Amendment Act (Lord Cairn's Act) 1858 authorised the Court of Chancery to award damages, which is a Common Law remedy, in place of the specific performance of an injunction. In 1854, the Common Law Procedure Acts, 1852 and 1854 allowed courts of common law to adopt specific methods for equitable procedures, e.g., the discovery of documents and the giving injunctions. These laws also permitted Common Law Courts to allow defendants to bring equitable defences and pleas in a Common Law action. The Chancery Regulation Act (Rolt's Act) 1862 imposed upon the Court of Chancery the duty to decide every matter of law or fact upon which the right to relief or remedy was dependent. So, the problems were slowly removed to improve the relationships between equity and law concerning equity through various statutory provisions.
THE JUDICIAL ACT OF 1873-ITS OBJECTS, EFFECTS
The most serious flaw of the English Legal system is the presence of two distinct legal systems, which caused severe hardships, even though there was no clash between equity and law as in the earlier times. To correct these flaws, The Judicature Act, 1873 was adopted. Graveson has explained his contention that Judicature Act 1873 was approved with three major goals:
- To combine law enforcement and equity. But the equity rules and law weren't merged. The term "fusion" simply refers to the application of these rules by all courts;
- To create an entirely to create a new version for Rules of Court;
- To establish a single Supreme Court.
In The Judicature Acts and Amending Acts to establish a single Supreme Court, the High Court of Chancery, the Courts of Common Law, Admiralty, Probate, Divorce and Bankruptcy were joined to form a one Supreme Court of Judicature, comprised of two divisions: that of the High Court of Justice and the Court of Appeal.
The High Court of Justice was divided into five divisions:
- The King's Bench
- Common Pleas
- Probate, Divorce, and Admiralty.
In 1881, the King's Bench, Common Pleas and Exchequer were combined into one Division, forming it became the King's Bench so that the High Court now has only three Divisions:
- Queen's Bench Division,
- Chancery Division,
- Probate Divorce, Probate as well as Admiralty Division.
The Court of Appeal was vested the power and jurisdiction by the Lord Chancellor, members of the Court of Appeal in Chancery for the exercise of its appellate jurisdiction and those of other courts. The Judicature Act contains several provisions. Section 25 in the Act stipulates that "in any matter ... which there is a conflict or a difference in the rules of Equity and the regulations of Common Law concerning the same subject, it is the rule of Equity will prevail". So it is that the Judicature Act, 1873 gave the same tribunal power to exercise its jurisdiction separately in courts of Common Law and the Court of Equity. Court of Equity and courts of Common Law. It brought about a restructuring of the system of judicial procedure, making it possible to recognise all laws and equity within all courts. The Act also extended some legal rules for equitable use to Common Law. While the Act combined only the law of equity and law, it did not incorporate the rules of both systems, but they were becoming more and more a multi-system. Ashburner clearly states: "But the two streams of authority, even in the same river, are in tandem and do not mix their waters. The distinction between equitable and legal claims and between equitable and legal defences and between legal and equitable remedies has not been broken in any way by the current law." Hanbury has said: "But the law is still the law, and equity remains equity. In no way is this fact more clearly discovered than through the ongoing operation of the trust, which was completely unaffected under legislation like the Judicature Act." Hood Philips has stated: "The effect of the Judicature Acts, then was to transform the 'exclusive' jurisdiction of equity to concurrent jurisdiction and remove its auxiliary authority; a person who is in the Queen's Bench Division of the High Court does not need to seek help from the Chancery Division, let alone to an independent Court of Chancery.
VIEWS OF MAITLAND, HOHFELD AND OTHERS
Maitland's view is that the relation between law and equity is not an issue of dispute. Equity did not come to undermine the law but to make it more effective. Maitland declared: We ought not to consider Common Law and Equity as two different systems. Equity was not an independent system. In every instance, it predicated that there was Common Law. Equity with no Common Law could be a castle floating in the air and a flimsy possibility." Hood Philips is of the view "that the relationship to Common Law, as well as Equity, was not in actual fact been one of rivalry or conflict over the last 200 years, but one of collaboration." In talking about the role of the Judicature Acts, Hood Philips has written: "The Judicature Acts provided that in all cases, except for those in conflict laws that were the norms of Common Law as well as equity were to be applied in conformity with the same rules in the same manner as they were interpreted by separate courts. This means that damages can still be granted to those who violate legal rights in line with the law, and specific injunctions and performance are given to enforce the equitable obligations in accordance with the principles of equity. The application of equity is the same as the one described above, since it is the application that is the subject of Common Law and Equity, which has been merged, not the actual principles." On the other hand, Professor. Hohfeld believes that "the guidelines for equity that fall under the exclusive and auxiliary jurisdictions are not in accordance with the lawful rules". Hanbury has stated: “The difference between Maitland and Hohfeld is a difference in importance. The real relationship between law and equity has to be located in a compromise of both views." Holdsworth has pointed out that "Though Common Law and equitable theories can produce the identical results in practical terms, they are based on an entirely different theoretical foundation and often lead to different outcomes". There is a rumour that the fusion of both theories, i.e., Law and Equity, was proposed in the hands of Lord Mansfield in the 18th century to foresee Judicature Acts. Indeed, the Judicature Acts only fused with the courts that governed law and the courts that were responsible for equity. However, Mansfield was more interested in that which the Judicature Acts did. In reality, Mansfield disliked separating the law's rules and equity. If he had his way, the future relationship between the law and equity could have slowly been abridged. Judicature Acts might have affected the fusion of substantive and adjectival law. However, jurists at the time opposed Mansfield's theories.
In the same way, equity and law were developed in the 18th and the nineteenth centuries; they were developed in the latter half of the 17th century in partnership but on a distinct technical basis. The error in Mansfield's argument was that equity wasn't distinct from Common Law merely because of its mechanism like Lord Mansfield was rumoured to believe; however, historically, its entire attitude to the subject to be prosecuted was distinct. Ashburner is right in concluding: "Law and Equity were the two streams of legal jurisdiction, even though they operate within the same channel and run side-by-side and do not mix the waters of both."
MAXIMS OF EQUITY
Here, we can look at some of those maxims and general axioms of equity that are frequently used in discussions of equity.
EQUITY ACTS IN PERSONAM
Maitland's basic premise is that the equitable rights aren't Iura in rem, and they can never be so because every equity must yield to the supreme rights of a legitimate buyer from the lawful estate. Ames has claimed that this principle is the fundamental principle behind equity jurisdiction. The entire doctrine of the follow-up of trust funds held by beneficiaries shows the equitable right is much higher than the iura in personam. Today judges tend to diminish the historical foundations that underlie trust law and make the beneficiary's right to certain situations similar to the rights in the rem. Cases such as Sinclair v. Brougham (1914) have inspired contemporary legal scholars to believe in the existence of hybrid rights in equity that sit somewhere between 'iura in personal and iura Rem'. The same issue arises when it comes to the covenant of restrictive. Keeton has stated that: "Although modern developments in equity, both statutory and judicial and judicial, have created an end to the past and are creating an equitable right to overlook their roots, it shouldn't be forgotten that the principle that is being considered has been the basis of development in equity. This is the reason why equity is a personae entity in personam that English Courts of Equity have always been able to have a note of mortgages, trusts and other agreements relating to property located abroad." For instance, in the most prominent decision, Penn v. Lord Baltimore the principle that used was "the property was not subject to the jurisdiction of the court, however, that of the defendant... The court was within its discretion to block the defendant from ever being able to his property if he did not fulfil the conditions of his contract". This principle is most often utilised in cases that concern land. According to Hanbury, the law may be summarised as follows: "The court will decree the specific performance of a contract for land that is outside of the jurisdiction, provided that the defendant is within court's jurisdiction and nothing more than the confinement of the defendant is necessary to make the decree valid." Hanbury has well stated, "Equity acts in personam remains a crucial element to mastery of Equity; however, it's an instrument with a little dust over it".
EQUITY IS INSPIRED BY LAW
The meaning of this maxim can be read in a variety of ways. One way to interpret it is that it's valid, while in other ways, the other hand, it's not. In the literal sense, the maxim is valid. In the literal sense, as Maitland stated: "Equity was not a self-sufficient system. In every instance, it relies on that it is a part of Common Law". Thus, in many cases, equity acted by analogy to laws. The Trust estate is placed in a parallel fashion to the legal estate and presupposes the existence of the legal estate. Equity took on several Common Law rules, such as the rule enacted in Shelly's Case (1582) and the prohibition against perpetuities. When common-law rules harsh, equity refused to follow these law rules. This does necessarily mean that the equity had the right to rescind the statute's provisions. However, equity will not allow a statute to aid in the prevention of fraud and will interpret the statute in a manner to stop it from being used in this way. Keeton has outlined three fundamental principles of equity to illustrate the above statement:
- The Doctrine of Concealed Fraud
- The Doctrine of Past-Performance
- The doctrine of secret Trusts
In the end, one could say in a nutshell that the phrase "Equity is a matter of Law" is a truism that can be adapted to many variations. However, it is not true that there is no reason for equity in the absence of a legal remedy, and equity does not respect the laws of law.
WHERE EQUITIES ARE EQUAL, THE LAW RULES
This principle applies when multiple properties are legally protected and the other is an equity interest. Before 1926, the legal estate was prioritised over equity that was equal. Equities weren't equal if the buyer of the legal estate purchased without notice. However, the amendments of 1925 have made progress in this principle. The 1925 Acts introduced the vital concept of registration of many kinds of interest in the land, which are equitable. Therefore, registration regulates the precedence of mortgages. This contrasts with the principle "Qui prior is tempore, portior is iure". In this case, the law was established within Dearle v. Holl. It could be summarised in the following manner: "As between two encumbrances of an interest in a trust fund with pure personal character, the priority is given to the one that was first provide notice to the trustee or the debtor, and it doesn't matter how long ago the first is." The rule will be applied only when the equities are not in any other way identical.
A PERSON WHO SEEKS EQUALITY MUST BE ABLE TO DO IT.
This rule focuses on the future actions of the person who seeks equity. The past has seen several significant branches of equity emerge from this. Hanbury has offered two key examples of the maxim. First, the law was laid out in 'Cherry. Bonetbee'. The premise of the rule was formulated in Serjeant, J.: "Where the person who is eligible to be a member of an account is also bound to contribute to the fund's support, he will not be permitted to participate in the fund in the fund unless and until he has satisfied his obligation in delivering." The second rule is found in Ramsden V. Dyson on 'equitable estoppel'. This principle is at the heart of the principle of equity of marshalling and of the consolidation principle. Therefore, this maxim is vitally important.
HE WHO ENTERS THE MARKET MUST DO SO WITH CLEAN HANDS
The maxim was made in the decision in the case of Eyre, C. B., who ruled in Dering in Dering v. Earl of Win Chelsea (1787). This rule protects a potential suitor in the court from having a preconceived notion of fraud in his head from the fraud. In trust law, there are numerous examples of this rule.
EQUITY IS BASED ON THAT WHICH SHOULD BE DONE
The story reveals the real meaning of this maxim "Equity will deal with the subject matter about collateral consequences and events in the same way as when the final acts contemplated by the parties were completed exactly as they should be executed, and not as the parties could have executed the acts. The rule is generally applicable to agreements that are enforced inequity and, consequently, creates the doctrine outlined in the case of Walsh in v. Lonsdale'. For the Law of Property, this maxim also plays a significant part. For instance, in the Law of Trusts, this maxim has triggered two significant rules, specifically the rule in Howe. Lord Dartmouth and the one in the Earl of Chesterfield's Trusts. Lord Hardwicke has stated that the maxim applies in all cases, except for dower. However, the story has stated: "There are exceptions to this rule, in cases where other equitable considerations are involved or when the motive of the parties goes to the opposite direction, such as when the sale is contingent; however, these cases demonstrate more than thwart the validity of the rule in general."