A source of English and, later, US law, originally developed by the Lord Chancellor and later by the Court of Chancery. It arose from the right of litigants to petition the monarch. In time these petitions were handled by the Lord Chancellor. Originally flexible and administered according to fairness, as opposed to the sometimes harsh rules of common law, equity developed into a fixed set of rules, its court being notorious for delay. While the Court of Chancery was abolished under the Judicature Acts (18735), much equitable work falls within the current jurisdiction of the Chancery Division. Trust law and equitable remedies (such as the injunction) are examples. Equity is now a set of fundamental legal principles which is still capable of development as in the Mareva Injunction (the freezing of a defendant's assets) and Anton Piller Order (the power to search a defendant's house or property). Most US courts may hear both actions at law and suits in equity. In Scotland, the principles of equity and fairness were interwoven into ordinary Scots law, and unlike England (where courts of common law and equity were separate and sometimes conflicted), Scottish courts did not distinguish between the two traditions.
Equity is the name given to the set of legal principles, in countries following the English common law tradition (see English law), which supplement strict rules of law where their application would operate harshly, so as to achieve what is sometimes referred to as "natural justice." It is often confusingly contrasted with "law," which in this context refers to "statutory law" (the laws enacted by Parliament), and "case law" (the principles established by judges when they decide cases).
Distinction between law and equity
In modern practice,perhaps the most important distinction between law and equity is the set of remedies each offers. The most common remedy a court of law can award is money damages. Law courts also enter orders, called "writs" (such as a writ of habeas corpus) but they are less flexible and less easily obtained than an injunction.
Another distinction is the unavailability of a jury in equity. Equitable remedies can be dispensed only by a judge as it is a matter of law and not subject to the intervention of the jury as trier of fact. The distinction between "legal" and "equitable" relief is an important aspect of common law systems, including the American legal system. The right of jury trial in civil cases is guaranteed by the Seventh Amendment of the Constitution but only in cases that traditionally would have been handled by the law courts at Common Law. On the other hand, if the plaintiff requests an injunction, declaratory judgment, specific performance or modification of contract, or other non-monetary relief, the claim would usually be the one in equity.
A final important distinction between law and equity is the source of the rules governing the decisions. In law, decisions are made by reference to legal doctrines or statutes. In contrast, equity, with its emphasis on fairness and flexibility, has only general guides known as the maxims of equity. As noted above, a historic criticism of equity as it developed was that it had no fixed rules of its own with the Lord Chancellor from time to time judging in the main according to his own conscience. As time went on the rules of equity did lose their flexibility and from the 17th Century onwards equity was rapidly consolidated into a system of precedents much like its cousin Common Law.
Charles Dickens' Bleak House parodied the excessive time and expense associated with the Court of Equity in 19th century England.
History
The distinction between "law" and "equity" is an accident of history. The "law courts" or "courts of law" were the courts all over England that enforced the king's laws in medieval times. At the end of the 13th century the courts of law gradually froze the types of claims they would hear, and the procedure that governed the hearing of those claims. Equity, as a body of rules, varied from Chancellor to Chancellor, until the end of the 16th century.
One area in which the Court of Chancery assumed a vital role was the enforcement of uses, a role which the rigid framework of land law could not accommodate.
Development of Equity in England
It was early provided that, in seeking to remove one who wrongfully entered your land with force and arms, you could allege disseisen (dispossession) and demand (and pay for) a writ of entry.
People started petitioning the King for relief against unfair judgments and as the number of petitioners rapidly grew, the King delegated the task of hearing petitions to the Lord Chancellor.
As these Chancellors had no formal legal training, and were not guided by precedent, their decisions were often widely diverse. After this time, all future Chancellors were lawyers, and from around 1557 onwards, records of proceedings in the Courts of Chancery were kept, leading to the development of a number of equitable doctrines.
As the law of equity developed, it began to rival and conflict with the common law. Litigants would go ‘jurisdiction shopping’ and often would seek an equitable injunction prohibiting the enforcement of a common law court order. The penalty for disobeying an equitable ‘common injunction’ and enforcing a common law judgment was imprisonment.
The Chief Justice of the King’s Bench, Sir Edward Coke began the practice of issuing writs of habeas corpus, which required the release of people imprisoned for contempt of chancery orders. The Court of Chancery issued a common injunction prohibiting the enforcement of the common law order. Sir Francis, by authority of King James I, upheld the use of the common injunction and concluded that in the event of any conflict between the common law and the law of equity, equity would prevail. Equity's primacy in England was later enshrined in the Judicature Acts of the 1870s, which also served to fuse the courts of equity and the common law into one unified court system.
SOURCES: Andrew Edgecomb 2006; Equity in a Nutshell by T.
Statute of Uses 1535
In order to avoid paying land taxes and other feudal dues, lawyers developed a primitive form of trust called ‘the use’. The effect of this was that the first person owned the land under the common law, but the second person had a right to use the land under the law of equity. Profyt (after 1393): a petition to the Chancellor
See generally treatises on equity and trusts.
Comparison of Equity Traditions in Common Law Countries
As with the geographical transmission of any cultural artifact, direct English influence over equity weakened with time and distance. As the colonies gained political independence, each of their legal systems began drifting from the original in an irreversible departure from the English way of making laws and deciding cases. Nonetheless, each former colony acknowledged the reception the common law and equity of England as a vital source of their jurisprudence. Did English equity develop maturity early enough that all of its derivative systems necessarily tended toward the same doctrines because based on exactly the same set of general principles?
The answer generally accepted in America, the earliest of the English colonies to gain independence, is the former, that the outcome of a case to be decided today upon principles of equity should be expected to be substantially the same whether decided in the UK or the US.
The perfection of modern equity as a system has been authoritatively credited to Philip Yorke, 1st Earl of Hardwicke who served as Chancellor 1737-1756. See generally a review of several distinct approaches to identifying how law changes that utilize English legal history as a test bed.
United States from 1789
In the United States today, the federal courts and most state courts have merged law and equity in the courts of general jurisdiction, such as county courts. However, the substantive distinction between law and equity has retained its old vitality. This is not a mere technicality, because the successful handling of certain law cases is difficult to impossible unless a temporary restraining order (TRO) or preliminary injunction is issued at the outset, to restrain someone from fleeing the jurisdiction taking the only property available to satisfy a judgment, for instance.
Equity courts were widely distrusted in the northeastern U.S. following the American Revolution, and the northern states eliminated their equity courts by the late 1700s. However, the mid-Atlantic and southern states were slower to abandon their equity courts.
Even today, several states still have separate courts for law and equity. Besides corporate law, which developed out of the law of trusts, areas traditionally handled by chancery courts included wills and probate, adoptions and guardianships, and marriage and divorce.
After U.S. courts merged law and equity, American law courts adopted many of the procedures of equity courts. The procedures in a court of equity were much more flexible than the courts at common law. In American practice, certain devices such as joinder, counterclaim, cross-claim and interpleader originated in the courts of equity.
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