Equity Law vs Common Law Importance

This assignment examines the relative importance of equity law versus common law for a nation. It argues that equity law holds greater significance for the nation, highlighting its influence on legal practices and societal impact.

EQUITY AND TRUST

TABLE OF CONTENTS
EQUITY AND TRUST...................................................................................................................1
INTRODUCTION...........................................................................................................................3
Equity doctrines...........................................................................................................................3
History of principle of equity and development of equitable institutions...................................5
Equitable principles and institutions............................................................................................7
Application of equitable principles to give facts and situation ..................................................8
CONCLUSION................................................................................................................................9
REFERENCES................................................................................................................................9

INTRODUCTION
In the current report case scenario of controversy between bank, financial advisers and
insurance agents is discussed in detail. In this regard different doctrines are analyzed and
relevant one are applied on the present case. In middle part of the report, remedy of equity and
law of trust are discussed briefly. Along with this, history of principles of equity and
development of equity institutes are discussed in detail. At end of the report, application of
equitable principles on the business case is done. In this way entire research work is carried out.
Equity doctrines
In the current time period controversy is going on between the banks and advisors. This is
because banks set huge target for their advisors and they have to achieve at any cost. In order to
achieve the target advisors give wrong advises and information to the investors and due to this
reason customers face huge loss on investment. Due to this reason banks suspended there
multiple financial advisors. In return advisors blame the business firm for such condition and
state that they have no choice and due to this reason in order to achieve the target they sale
wrong products to the customers. Principle of equity apply here because it is not fair to put huge
pressure on the employees just in order to achieve the target. Due to such kind of attitude of bank
customers lose their money in the market. Following are the equity doctrines that can be used to
solve the controversial issue. Equitable conversion: It is the doctrine under which when a contract is signed between
the buyer and seller of the property. It must be noted that many time contract is signed
between the buyer and seller of goods under which one entity promise other one that
specific asset will be transferred to the buyer on later date (Dietrich, 2010). From the time
of signing of contract till transfer of property buyer and seller both owned the title of the
property. In case any damage happened to the property buyer and seller both are
responsible for loss. Estoppel: Estoppel refers to the legal doctrines that are grouped collectively. Under this
doctrine one is prevented from making declarations that are opposite to his position that
was on any matter before court (Wang and Welker, 2011). It can be said that if an
individual give certain statement then same cannot move backward from its decisions. It
can be said that estoppel is the one of the main doctrine of the law of equity.

 Hotchpot: Hotchpot is another doctrine under which assets are classified among different
entities in systematic way. In the mentioned doctrine in the specific proportion asset is
classified among the different entities. Usually, this happened when any person died or is
suffered from any disease and is not able to make decisions. This doctrine state that asset
must be shared equally among the relevant entities (Latimer, 2012). Knowing receipt: It is another doctrine of the trust law and under this liability is imposed
on the individuals and knows that is given to them in breach of trust. It can be said that
under this doctrine it is clearly stated that clement must show disposal. Knowing receipt
is also known as unconscionable receipt because of theoretical foundation of same. Laches: Laches refers to the behavior of an individual under which same show less
diligence and performance of making legal claim on any asset or any other thing (Smith,
2011). It is considered as one of the most important doctrine by the people by using same
in prudent manner one makes claim on the specific issue. Doctrine of marshaling: This is the doctrine that is related to the Lord Hoffman and
same is related to the lending that usually happened in the business. This doctrine state
that there may be a situation where there may be a two creditors on single debtor. In such
a situation by following principle of equity one allow other one to recover debt from the
asset on which same does not have any sort of claim (Subedi, 2016). It can be said that
there is a huge importance of the doctrine of marshaling and it ensured that all creditors
will be paid in proper manner by the debtor. Unconstitutionality: It is related to the contract under which one party get a greater
return because same have superior bargaining power. Due to high bargaining power one
can influence others easily in terms of decision making. Unconscionsability contract are
those one party have high power and can influence others. There are number of ways in
which unconciousability is measured like power, age group and mental capacity etc. It
can be said that there is huge importance of the mentioned doctrine (Macdonald, 2010). Under influence: It is the doctrine under which one entity influence other actions and
decisions. It can be said that one entity take advantage of its position over the other
entity. In case of NAB it was identified that many financial planners are giving wrong
advises to the customers and due to this reason they were facing a loss on the investment.
Due to consistent loss on the advisory of the financial planners of NAB its wrong image

was created and due to this reason number of financial planners were suspended and
eliminated from the job. On interview of the suspended employees it was commonly
identified that employees were not satisfied with their mangers. It is true that financial
advisers were giving wrong advises to the people but there was pressure on them to sale
specific fund at fast rate. Hence, without considering investor profile schemes were
recommended to them. This created controversial issue between the managers and
employees as both entities influence each other decisions (McDonald, 2011). It was the
undue influence of the managers due to which employees keep their ethics and
responsibility on one side. In order to prevent such kind of situation principle of equity
must be followed.
Remedy of equity Accounts of profit: It is the remedy to the equity under which an action is taken against
the defendant entity to cover the profit that was taken by any entity as breach of duty.
Many times in the business it happened that same is owned by an entity but decisions are
taken by the other one. In such a situation estimation of contribution is made and
accordingly amount is paid to the plaintiff (Bernstein and Cashore, 2012). Constructive trust: It is the remedy approach under which trust is imposed by court and
under this one is provided right because same was deprived from exercising the relevant
rights.
Law of trusts
There are some basic rules of trusts and under this trustee have a legal interest in
the property of trust. Apart from this entity that is in beneficiary category also have
equitable interest (Chapple, Clarkson and King, 2011). In case any individual possess
both rights then in that case equitable interest will remain in existence but the other right
will be eliminated completely or one will not be able to use other right.
History of principle of equity and development of equitable institutions
Principle of equity was developed in the Australia on the basis of fairness and conscience
factors. In the Australia principle of equity was formulated on the basis of concept of
Unconscionsability. Rules and regulations were misused in old times and due to this reason
injustice happened with number of people. Plaintiff approached the King and same give
instruction form the court of Chancery (Kend and Katselas, 2013). In the mentioned court

decisions were taken on the basis of conscience and fairness. In Australia conflict comes in
existence between common law and equity. Those people that does not get justice under
common law are getting justice under equity. Due to fairness in justice equity law become
popular in the Australia.
Equitable intuitions were developed in the Australia and in this regard number of steps
were taken in the mentioned nation. Regulatory authority take number of steps to ensure that
equitable institutions will be developed in the mentioned nation. It was observed that equity law
gain wide popularity in the mentioned nation and due this reason number of courts in respect to
equity law were established in the mentioned nation. It can be said that big change comes in the
Australia and implementation of equity ensured that equal justice will be done with all sort of
people. As it is well known fact that conflict arises between the principle of equity and common
law and in order to solve this problem number of steps were taken in the Australia. In this regard
number of steps were taken at that time (Guneratne, 2012). In the Earl Oxford case it was
identified that Coke CJ give judgment that common law action was alleged to have obtained by
doing a fraud and verdict is given in favor of wrong person. From the court of Chancery common
injunction was given under which prevent proceedings to enforce the common law judgment. It
can be said that number of steps were taken for development of equitable institution in the
Australia.
Equitable principles and institutions
There are some rules and regulations provided by government of country for providing
equal rights and opportunities to all people of the nation. It is useful for social justice and human
welfare. However, several principles are made for Australia, New Zealand, Canada are presented
for individual rights and common laws for effectiveness of nation. Including this, it is helpful for
solving out any dispute and conflicts related to human rights. In this regard, different legal
decisions including civil laws are obtained to protect human being effectively. Therefore, strong
legal system and work ethics are provided for public welfare and rescuing them from obstacles
occur in the country (Ellinger, Lomnicka and Hare, 2011). Along with this, equity and equitable
principles gives authority for judge of court to make decision for fairness regarding justice rights
and their discretion. Thus, different legislation and obligations are presented for country's
effectiveness as well enhancing its efficiency at high level.

Fairness:- Under this equitable law system, rules and legislation are made related to
providing equal rights, opportunities, education and employment for Australian people.
However, it is legal obligation for Australia to create fairness in human rights and their
freedom to live freely (The nature and history of equity, 2016). According to this
common law, human rights justice should be similar for all nation's people that impacts
on welfare and social justice. Along with this, it is legislation for country to make fair
decisions for human welfare and social justice that impacts on social and ethical factors
of country.
Bias:- There is strict legislation made for human rights' equitableness. Under this system,
various laws and obligations are made to reduce bias. According to this equitable
principle, it is determined that it is needed for country to provide each public to their
human rights and freedom. There would be no discrimination allowed in employment,
education, healthcare, social justice and different sectors (Dietrich, 2010). However,
several people can take advantage of justice through court and reducing disputes occur
for human rights. In addition to this, various common laws and systems are made for
equality and treating all human of the country as equal and also can take advantage of
justice in case of crime. Therefore, this equitable principle is able for reducing
discrimination and treating all human of the society as same.
Equitable institution:- Some institutions have been established in Australia and other
countries that is effective for public welfare and providing equal rights and opportunity to each
individual of the nation. It includes institutions such as court etc that is effective for fairness and
justice for innocent people of the country who feels inferior due to discrimination or biasses
(Wang and Welker, 2011). In addition to this, different laws and legislation are made for
effectiveness of nation as well reducing bias for providing social justice for each individual.
Application of equitable principles to give facts and situation
There are two components of the equitable principles namely fairness and lack of
baiseness. In the Australia currently controversy is going on between the banks, insurance firm
and the financial advisers. It is observed that there were number of advisers of the NBA and
number of them were made responsible for giving wrong financial advice to the clients. Due to
this reason clients lose money on the investment amount. On interview employees state that there
was huge work pressure on them and organization wants to achieve its target of profit

maximization at any cost (Subedi, 2016). Due to this reason managers put huge pressure on the
employees and they in order to achieve the target follow unethical and wrong ways. Relevant
employees were suspended by the business firm. On application of equitable principles this
situation can be handled. First principle of fairness applied on this case according to which it is
liability of firm and its managers to set only achievable targets for the employees. Secondly,
employees also need to follow their ethics while fulfilling their responsibility (Woellner and
et.al., 2011). By doing so it can be ensured that clients will not be cheated by the business firm
and their needs will be satisfied. Principle of lack of biasness also applied in the present case
which state that managers must not made discrimination among their subordinates. In this way
equitable principles applied in relevant case.
CONCLUSION
On the basis of above discussion it is concluded that equity law have a due importance
for the nation. This is because by following same justice can be done with the people of the
nation. There are two basic principles of the equity which are fairness and lack of biasness. Strict
compliance with these two principles ensured that justice will be done in proper manner with the
people of the nation. It can be said that there is a huge importance of the equity law for the nation
in comparison to common law.

REFERENCES
Books and journals
Dietrich, J., 2010. Liability of Accessories under Statutes, in Equity, and in Criminal Law: Some
Common Problems and (Perhaps) Common Solutions. Melb. UL Rev. 7(5). pp.106.
Wang, S. and Welker, M., 2011. Timing equity issuance in response to information asymmetry
arising from IFRS adoption in Australia and Europe. Journal of Accounting Research.
785(1). pp.257-307.
Latimer, P., 2012. Australian Business Law 2012. CCH Australia Limited.
Smith, M., 2011. Gender equity: The Commission’s legacy and the challenge for Fair Work
Australia. Journal of Industrial Relations. 7(5). pp.647-661.
Subedi, S.P., 2016. International investment law: reconciling policy and principle. Bloomsbury
Publishing.
Woellner, R. and et.al., 2011. Australian Taxation Law Select: legislation and commentary. CCH
Australia.
Macdonald, J.J., 2010. Health equity and the social determinants of health in Australia. Social
Alternatives, 29(2), p.34.
McDonald, J., 2011. The role of law in adapting to climate change. Wiley Interdisciplinary
Reviews: Climate Change. 67(2). pp.283-295.
Bernstein, S. and Cashore, B., 2012. Complex global governance and domestic policies: four
pathways of influence. International Affairs. 78(3). pp.585-604.
Chapple, L., Clarkson, P.M. and King, J.J., 2011. Private equity bidders: Barbarians or best
friends?. Company & Securities Law Journal. 768(3). pp.159-177.
Kend, M. and Katselas, D., 2013. Private equity coming out of the dark: The motivations behind
private equity activity in Australia. Qualitative research in accounting & management.
8(2). pp.172-191.
Guneratne, C., 2012. Genetic resources, equity and international law. Edward Elgar Publishing.
Ellinger, E.P., Lomnicka, E. and Hare, C., 2011. Ellinger's Modern banking law. Oxford
University Press.
Online

The nature and history of equity, 2017. [Online]. Available through :<
http://www.findlaw.com.au/articles/138/the-nature-and-history-of-equity.aspx>. [Accessed
on 3rd May 2017].