Issues of Equity and Shortcomings of Common Law: Critical Analysis

1. Equity was created to supplement not to supplant the common law. Do you agree?

The issue in question is whether equity came to take common law’s place or assist the common law in the judicial system. To understand this, we need to look at the creation of equity and how it came to affect the common law system.

In the Earl of Oxford Case (1615) 1 Rep CH 1at 6, the common law had awarded a judgment against a defendant to an action. The defendant petitioned the Chancery on the basis that the judgment was obtained by fraud. The essence of the petition was to prevent the enforcement of the judgment against the defendant. Chief Justice Coke immediately indicted the defendant but Lord Ellesmere issued an injunction to restrain the plaintiff from enforcing the judgment. This caused common law and chancery to clash.

Lord Ellesmere summarized the rationale for the chancery as; “men’s actions are so diverse and infinite that it is impossible to make any general rule which may aptly meet with every particular and not fail in some circumstances. The office of the Chancellor is to correct men’s consciences for frauds, breaches of trusts, wrong and oppressions of what nature soever they are, and so soften and mollify the extremity of law.”

This decision challenged the power of the common law courts, and Lord Chief Justice Sir Edward Coke of the King’s Bench responded by declaring that the defendant acted unlawfully by petitioning the Chancellor. The matter was resolved when the King, James I, issued a decree stating that where a party had a good argument in equity, they would not be left to languish at common law.

Section 49 of the Supreme Court Act 1981 provides that; “subject to the provisions of this or any other Act, every court exercising jurisdiction in England or Wales in any civil cause or matter shall continue to administer law and equity on the basis that, wherever there is any conflict or variance between the rules of equity and the rules of the common law with reference to the same matter, the rules of equity shall prevail.”

Common law was prevalent in England way before equity was established. It had three courts which were; King’s Bench, Common Pleas, and Exchequer. For a person’s grievances to be heard, he had to be issued with a writ disclosing a cause of action. The courts worked through precedents and plaintiffs were often not able to obtain a remedy in common law that they had a right to.

Equity refers to those principles that were initially created in the English High Court of Chancery. They were developed in response to the rigid technical procedures of the common law. The Chancellor gave remedies where the Common law did not provide for one. The role of equity was established by the decision in the Earl of Oxford’s Case, but still, equity occupied a separate jurisdiction to the common law.

Equity aimed in fixing and stepping up in common law shortcomings which were; the available remedies were inadequate and could not satisfy the requirements of justice in particular cases, the justice was slow and the courts were corrupt and there were limited remedies.

Equity was developed to cover up the deficiencies of common law and to bring about justice. Hence it can be seen to be supplementing the common law in essence filling in the gaps left by the common law.

After the Earl of Oxford case, equitable rules were thought to be more systematized, and rigid and cases of equity began to be reported.[footnoteRef:1] Equity’s growth posed threats to the common law system and equity had its way till 1873 when acts were put in place to establish rules and it was regulated. [1: Richard Clements & Ademola Abass, Equity and Trusts, p.g. 9]

The Judicature Act 1873 established a Supreme Court replacing the courts of Chancery. It is argued whether the Acts fused rules of Equity and common law so that they became one or that they retained their identity but got administered by a single court. Section 49 of the Supreme Court Act backs up the fact that the rules of equity and common law were fused by administration.

Lord Diplock “the innate conservations of English lawyers may have made them slow to recognize that by the Judicature Act 1873 the two systems of substantive and adjectival law formally administered by courts of law and equity have surely mingled now.”

Lord Denning MR “over 100 years have passed since the supreme court of judicature act 1873 have flown together and combined so as to be indistinguishable the one from another. We no longer have to ask ourselves what we should do now so as to ensure fair dealings between parties. The question must be asked in each case as it arises for decision and then from case to case we shall build up a series of precedents to guide those who come after.”

From the two arguments, it is clear that common law and equity law have to some extent mingled to seemingly work together towards justice and equity has neither tried to outdo or replace the common law.

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In conclusion, we argue that equity was created to supplement the law since it fixed all the niches that common law left out

Discuss the genesis and evolution of equity noting any relevant cases and statutory provisions.

Equity can be defined as the principles that were initially created in the high court of chancery that were developed in response to the technical procedures of common law.

After the Norman conquest of England in 1066 by William duke of Normandy, a systematic and orderly form of government and law was introduced. It was referred to as common law. It emanated from the common cultures and practices of the people of England. There were three distinct courts namely: King’s Bench, common bench /court of common pleas, and the exchequer that operated independently and administered the common law. The exchequer performed more than just judicial functions, it served as a government office, a modern-day treasury. This court was headed by a chancellor not a judge. The chancellor oversaw many departmental works such as issuing of writs (sealed with the king’s seal) for the commencement of actions in the courts of law.

Common law had the following shortcomings:

1. The available remedies were inadequate and could not satisfy the requirements of justice in particular cases
2. Delay of justice since the courts were corrupt
3. Limited remedies

By issuing new writs and varying existing ones the chancellor was able to develop common law. His chief concern was substantial justice. He granted or withheld relief not based on precedents but according to his own sense of justice. Reliefs adapted to meet particular justice. Writs issued by chancellor were subject to be quashed by the common law courts. Initially, dissatisfied claimants would go to the king to seek justice if they the court’s decision, the judicial petitions were so many by the end of the 13th century that it had to involve the chancellor whom acted as the king’s prime minister. The chancellor was involved in the king’s council and decided on certain cases thus the courts of chancery evolved. The Chancery evolved into a judicial body known as the Court of Chancery until by the end of the 15th century the judicial power of the Chancery was fully recognized. The Court of Chancery was in effect developed as a court of conscience to counteract the defects that existed in the common law system. The rules of equity varied from Chancellor to Chancellor until the end of the 16th century.

As equity developed it began to conflict with common law. Litigants used equity to their advantage often seeking an equitable injunction prohibiting the enforcement of a common law order. If a common law judgment was enforced in disobedience of a common injunction then the person enforcing the judgment could face imprisonment. S25 (2) of the Judicature Act “where there is conflict between common law and equity, the equity should prevail. In the Earl of Oxford’s Case: - The Chancellor issued a common injunction to prevent the enforcement of a common law judgment which was alleged to be obtained by fraud. - King James I ruled in favor of the Chancellor and established that in cases of conflict, the rules of equity shall prevail. This case resulted from a clash of equity and common law courts to a greater extent.

Lord Ellesmere pointed out in the above case why there was a need for a Chancery. He stated ‘Men’s actions are so diverse and infinite that it is impossible to make any general law which may aptly meet with every particular and not fail in some circumstances. The office of the Chancellor is to correct men’s consciences for frauds, breaches of trust, wrongs, and oppression of what nature soever they be, and to soften and mollify the extremity of law.’

By the 17th century, lawyers were appointed to the office of the chancellor and by the 19th century, the court of chancery became the court of equity. Equity and common law were later fused by the Judicature acts 1873-1875

Discuss whether members will come to the decision that the fusion debate is of any relevance

This view states that the Judicature Act 1873 fused, and codifies both common law and equity into one subject. Lord Diplock “the innate conservations of English lawyers may have made them slow to recognize that by the Judicature Act 1873 the two systems of substantive and adjectival law formally administered by courts of law and equity have surely mingled now.”

Lord Denning MR “over 100 years have passed since the supreme court of judicature act 1873 have flown together and combined so as to be indistinguishable the one from another. We no longer have to ask ourselves what we should do now so as to ensure fair dealings between parties. The question must be asked in each case as it arises for decision and then from case to case we shall build up a series of precedents to guide those who come after.”

From the two arguments, it is clear that common law and equity law have to some extent mingled to seemingly work together towards justice. To understand the fusion theory clearer it is important to keep in mind the equity law was developed to cover up the deficiencies of common law and to bring about substantial justice. The two laws, therefore, had different functions which were seemingly mingled from the justice system. There are arguments that the Judicature Act 1873 merely consolidated the administration of the two laws. S25 (2) of the act “where there is conflict between common law and equity, equity should prevail. In the Earl of Oxford’s Case: - The Chancellor issued a common injunction to prevent the enforcement of a common law judgment which was alleged to be obtained by fraud. - King James I ruled in favor of the Chancellor and established that in cases of conflict, the rules of equity shall prevail. This case resulted from clash of equity and common law courts to a greater extent.

Some of the difficulties caused by the two courts working separately and in conflict included: Common law courts could not recognize equitable rights, titles & interests (Castlereagh v Davies-Roe) subject to some limited exceptions where equitable claims are subject to a claim in tort or k (Roberston v Wait), Equity courts had no power to award disputed rights, no power existed to allow the transfer of cases from one jurisdiction to another, therefore there was a risk of commencing proceedings in the wrong court (Carter v Smith). In light of the above conflicts between the two legal systems, there was an urgent need for a solution which was marked by the introduction of the Judicature Acts 1873-1875 that established one Supreme Court of Judicature to replace the Court of Chancery & common law courts. The Supreme Court consisted of a High Court of Justice (divided into 5 divisions example the Chancery Court and Queen’s Bench) & a Court of Appeal (to hear appeals from all 5 divisions). This resulted in the fusion of the administration of common law and equity

In Walsh v Lonsdale the court submitted that to talk of fusion of law and equity is misleading. This assertion is substituted by virtue of the Judicature Act 1873, where it was the administration of common law and equity that was fused into a court not the substantive laws themselves. They were not to be fused but rather run side to side in the court. Sommers J in Elders Pastoral LTD v Bank of New Zealand, “neither law nor equity is now stifled by its own origin and the fact that both are administered by one court has inevitably meant that each has borrowed from the other in furthering the harmonious development of the law as a whole.”