Equity and Trust Law

This article discusses the principles of equity and trust law, their application in common law, and the discretionary power of courts in awarding equitable remedies. It also highlights the importance of equity in providing relief to the aggrieved party and the need for courts to strike a balance between the relevant matter in question and the provision of law that has been challenged.

Running head: EQUITY AND TRUST LAW
Equity and Trust Law
Name of the Student
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Author Note

2EQUITY AND TRUST LAW
Equity is a misunderstood term and hence, often misinterpreted and wrongly applied by
the Court of common law in terms of granting equitable remedy1. As per Jurisprudence, Equity
refers to the power to bring justice to an aggrieved by exercising discretionary power to settle the
rigidity and harshness of the strict laws and rules. In a broader sense, Equity refers to the caliber
to acclimatize the assistance to the situation of a certain case in effect. Nevertheless, in
jurisprudence, equity is not an open-ended phenomenon of endless or immeasurable discretion
vested upon a single judge. While the Common Law Court functioned based on the customs,
tradition and letters of the written law that governed England2. It has been held that the Chancery
Court would not consciously try to correct the strictness of law or to remove its defects under
any given circumstance, beyond the pre-settled principles and rules of equity jurisprudence.
Often the terms ‘equity’ and ‘equitable’ are difficult to be segregated and defined. Both of them
refers to fair, compassionate, just and flexible which results in ambiguous meanings when the
court pronounce its discretionary decisions based on the principles of equity. When the court of
common law points out that it ordered to rescind a contract for relieving a party of its harshness
and rigidity, and pins such decision on the ground of equity, such order speaks nothing about the
principles of equitable interest, precedents or remedies.3 When a decision is delivered based
solely on equity, it lacks the sense of legal analysis and seems more like the Judge’s feeling of
just and fairness under a certain circumstance. However, one of the fundamental element of
equity is its flexible nature, while such flexibility is exercised against some specific rules4.
1 Virgo, Graham. The Principles of Equity and Trusts. (Oxford university press, 2018).
2 Sherwin, Emily L. "Fiduciary Law and Equity: Enforcing Loyalty." (2018).
3 Llewellyn, Karl N. The common law tradition: Deciding appeals. Vol. 16. (Quid Pro Books, 2016).
4 Sorell, Tom. "Law and equity in Hobbes." (2016) Critical Review of International Social and Political
Philosophy 19.1, 29-46.

3EQUITY AND TRUST LAW
In Anglo-American law, the two courts that existed were the Common Law Courts
presided over by Judges, and the Equity Court controlled by the Chancellors who were the high
Minster of the King and also a Bishop of the Church. The Chancellors came up with a list of
substantive rules and remedies, which practically could alter the orders passed by the Common
Law Courts5. In the attempts to define and elucidate the concept of equity, commentators have
laid down that equity is a phenomenon or concept under jurisprudence that used to be
administered by the Chancery Court of England, and now adopted and implemented by the
Courts of all modern country with a sound legal system. In today’s legal system the legal persons
still refers and compares legal remedies with that of the orders of the Common Law Court and
equitable remedies with the remedies provided by the Chancery court or the Equity court. The
court of Chancery have always strived to handle the urgent and the critical matters by means of
preventive justice and specific relief, which the principle of equity advocates. With the advent of
more cases to the Chancery court, a sense of steep competition grew in the mind of the Common
Law Courts judges and it was declared that the equitable remedies had limitations by saying that
the a equity courts did not have the authority to lessen the risk of legal consequences of a party6.
It was also held that judges should not be distracted by the charming tone and fairness of the
concept of equitable remedy as they lack analytical value and precision. It is said that while
granting an equitable remedy, a court cannot deviate from the letters of the law only as it seem
easier and fairer in that circumstance. Principles of equity can only be implemented where a
particular case meets the underlying norms and principles of the maxims of equity7. The
principles of equity comprises a list of rules and norms, some of which are highlighted and
discussed below.
5 Milsom, Stroud Francis Charles. Historical foundations of the common law. (Butterworth-Heinemann, 2014).
6 Klinck, Dennis R. Conscience, Equity and the Court of Chancery in Early Modern England. (Routledge, 2016).
7 Katz, Stanley. "The politics of law in colonial America: Controversies over chancery courts and equity law in the
eighteenth century." (1971) American Law and the Constitutional Order, 46-52.

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Equity speaks for what ought to be done is done
Having its source in the doctrine of equitable estoppel, this maxim refers to the
circumstance where an individual is required to do as per the agreement on which he has entered
into the contract with another. Equity will assume that the act has been done exactly the way it
needed to be done, even before it was performed. It involves the principle of equitable interest of
a party to the contract and therefore, a breach of such contract would attract equitable remedy8.
Equity focuses on the intent to meet an obligation
Performance of an obligation needs to be considered as enough unless the law requires
specific performance of the case. Equity regards such specific performance as a gift so that the
creditor cannot demand exercise of both legacy of law and the specific performance of the
contract.
One must do equity to seek equity
The aggrieved party seeking equitable relief must agree to complete all the needful
obligations pertaining to the contract. His own actions must be just and fair before he seeks
fairness from the court of law.
Equality is equity
Equity stands for equality among the parties to a dispute. The maxim stands upon the
fundamental principles of equality among equals and therefore has a wider sense on which
8 Ramjohn, Mohamed. Unlocking Equity and Trusts. (Routledge, 2017).

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several equitable doctrines are based on. It points out that the rule of common law may be partial
or advantageous for one party in comparison to another; however, the law of equity measures the
litigation parties of the same case on an equal footing9.
For two equal equities, the first in time shall be applied
This principle of equity comes to action when two or more principles of equitable interest
can be implemented to a case, the one that comes first and foremost in time shall be applied;
provided that such number of principles are have the same interest.
Law shall prevail when equities are equal
This principle of equity speaks that specific performance or equitable remedy cannot be
implemented where both the party to an agreement has equal grounds to remedy and neither of
them has wronged. Parties had the tendency to approach the equity court for their flexibility,
however not knowing to be redirected to the common law court due to the lack of legal defense.
One must come for seeking equity with clean hands
It is most commonly stated that one who seeks equity must come with clean hands, which
means that an individual should not seek equity or equitable remedy for making profit out of his
own wrong or when the other party has not wronged him. However, it is not implied that a
previous convict or a ‘bad person’ cannot claim for equitable relief. It only claims that the person
9 Gorski, Paul C., and Katy Swalwell. "Equity literacy for all." (2015) Educational Leadership 72.6, 34-40.

6EQUITY AND TRUST LAW
asking for the implementation of equity must have a cause that is actionable under the principles
of equity. The point of unclean hands only comes to picture when a person’s wrongful act
coincides with the right he claims to be enforced by equitable remedy10.
Equity serves the vigilant
It is laid down by the principles of equity that an aggrieved person should delay the
actionable cause and must act swiftly as justice should not be delayed or ignored. Otherwise, the
aggrieved party are considered to be guilty of laches, an unanswered and unreasonable delay in
bringing a litigation to action. In most times, the cases comes under the obstacle of limitation
statute where the cases are prohibited to be heard by a court on the grounds of delayed filing11.
Equity observes the law
Although it is believed that principles of equity serves equitable relief to aggrieved
parties, however it needs to be understood that equity does not provide a remedy, which
contravenes the letters of the law. The Chancery court never intended to override the decisions or
procedure of work of the Common law court; it only meant to give a different approach to the
conventional and traditional remedies and wanted to operate in a more flexible way.
Nevertheless, equity does not speak for contravening the legal principles or statutes; it only
delivers equitable rights and relief. Yet, in modern times, this principle of equity has been seen to
be violated in many cases when the common law rules have contradicted with the equity; the rule
of equity has stand still.12
10 McDonald, Iain, and Anne Street. Equity & Trusts Concentrate: Law Revision and Study Guide. (Oxford
University Press, 2018).
11 Macpherson, Jane Elizabeth. Leading for Equity: Principals' Strategies. (Diss. 2016).
12 Gorski, Paul C., and Katy Swalwell. "Equity literacy for all." (2015) Educational Leadership 72.6, 34-40

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In equity, every wrong has a remedy
It is perhaps the most important aspect of the principle of equity, which says that a wrong
cannot persists without an appropriate remedy. It is said that a wrongful act must always have a
relief or remedy which the aggrieved party deserves to be awarded by the way of equitable
remedy. The wronged or the aggrieved party has an advantageous position in terms of seeking
the equitable relief. In terms of equity, such wrongs are dealt and awarded with specific
performance or injunction. The Latin maxim to this principle is cited as ‘ubi jus ibi remedium’,
which means where there is a wrong, there is a remedy13. This principle was first discussed at
length in the case Ashby v. White14. While it was applied in its full sense in the case Marbury v.
Madison15.
The Dworkin theory based on a model of common law adjudication says that the judges
of the common law court have a limited discretionary power16. It is said that the judges of the
common law court is under an obligation to weigh and apply legal principles and statute to come
up with a decision. However, it is argues that equitable discretion can be applied to the
Dworkinian model by the judges of the court of equity while deciding whether to award or hold
the equitable remedy. Dworkinian theory does lay down certain facts about judicial discretion
and distinguishes between weak and strong discretion. He writes that a weak discretion is
exercised while pronouncing judgment where there is application of legal standards, whereas for
strong discretion, the judge has the liberty to choose between two or more legal outcomes and
13 Louis, Gregory E. "A Proposal to Support Enforcing Regulations for the Rule of Law." (Clearinghouse
Rev.2016):1
14 Ashby v. White [1703] 92 ER 126
15 Marbury v. Madison 5 U.S. (1 Cranch) 137 [1803]
16 Gould, Mark. "Equity or Dworkin’s Egalitarianism: Principles that Incorporate Policies Versus Principles that
Stand on their Own." (ANCILLA IURIS (anci. ch) 61 2016): 61.

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can also deviate from the conventional or traditional way of delivering remedy. Nevertheless, it
is evident that equitable jurisdiction have a concrete ground for exercising discretion17.
In situations where an unconventional or equitable remedy is necessary, the Court is
required to apply the principle of equity by adopting necessary changes. It has been observed that
courts have made use of their discretionary power to grant in different matters where it was
utmost necessary, like in death sentences. Although, in criminal matters, discretionary power of
the court is curbed to the maximum as they require following the letters of the law strictly. Yet,
on the grounds of principles of equity, an equitable remedy is often awarded. Most of the times,
High Courts use their discretionary power in matters of staying petitions where the judgment was
delivered by a lower court. However, it is to be considered that the discretion given to the court
to deny or allow stays of petition has resulted in injustice and inconsistency. Therefore, it is
claimed that courts should strike a balance between the relevant matter in question and the
provision of law that has been challenged.
Bibliography
1. Articles/Books/Journals
Gorski, Paul C., and Katy Swalwell. "Equity literacy for all." (2015) Educational
Leadership 72.6, 34-40
17 Jansen, Linde. TOWARDS A MORE COHERENT DWORKIAN THEORY OF JUSTICE: a critical analysis of the
objections to Dworkin’s theory of justice regarding the ideal/non-ideal dichotomy. (2016) BS thesis.

9EQUITY AND TRUST LAW
Gould, Mark. "Equity or Dworkin’s Egalitarianism: Principles that Incorporate Policies Versus
Principles that Stand on their Own." (ANCILLA IURIS (anci. ch) 61 2016): 61
Jansen, Linde. TOWARDS A MORE COHERENT DWORKIAN THEORY OF JUSTICE: a
critical analysis of the objections to Dworkin’s theory of justice regarding the ideal/non-ideal
dichotomy. (2016) BS thesis
Katz, Stanley. "The politics of law in colonial America: Controversies over chancery courts and
equity law in the eighteenth century." (1971) American Law and the Constitutional Order, 46-
52.
Klinck, Dennis R. Conscience, Equity and the Court of Chancery in Early Modern England.
(Routledge, 2016)
Llewellyn, Karl N. The common law tradition: Deciding appeals. Vol. 16. (Quid Pro Books,
2016)
Louis, Gregory E. "A Proposal to Support Enforcing Regulations for the Rule of
Law." (Clearinghouse Rev.2016):1
Macpherson, Jane Elizabeth. Leading for Equity: Principals' Strategies. (Diss. 2016)
McDonald, Iain, and Anne Street. Equity & Trusts Concentrate: Law Revision and Study Guide.
(Oxford University Press, 2018)

10EQUITY AND TRUST LAW
Milsom, Stroud Francis Charles. Historical foundations of the common law. (Butterworth-
Heinemann, 2014)
Ramjohn, Mohamed. Unlocking Equity and Trusts. (Routledge, 2017)
Sherwin, Emily L. "Fiduciary Law and Equity: Enforcing Loyalty." (2018)
Sorell, Tom. "Law and equity in Hobbes." (2016) Critical Review of International Social and
Political Philosophy 19.1, 29-46
Virgo, Graham. The Principles of Equity and Trusts. (Oxford university press, 2018)
2. Cases
Ashby v. White [1703] 92 ER 126
Marbury v. Madison 5 U.S. (1 Cranch) 137 [1803]