Equitable Remedies

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Equitable Remedies



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Contract Law Remedies for Breach: Equitable Remedies

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The latter part of the twentieth century saw increased debate over the utility of treating equity as a separate body of law. These debates were labelled the "fusion wars". After the Norman Conquest of England in the 11th century, royal justice came to be administered in three central courts: the Court of King's Bench , the Court of Common Pleas , and the Exchequer. The common law developed in these royal courts, which were created by the authority of the King, and whose jurisdiction over disputes between the King's subjects was based upon the King's writ. During the 12th and 13th centuries, writ procedure gradually evolved into something much more rigid.

All writs to commence actions had to be purchased by litigants from the Chancery , the head of which was the Lord Chancellor. Because the writ system was limited to enumerated writs for enumerated rights and wrongs, it sometimes produced unjust results. Thus, even though the King's Bench might have jurisdiction over a case and might have the power to issue the perfect writ, the plaintiff might still not have a case if there was not a single form of action combining them. Lacking a legal remedy, the plaintiff's only option would be to petition the King. Litigants began to seek relief against unfair judgments of the common law courts by petitioning the King.

Such petitions were initially processed by the King's Council, which itself was quite overworked, and the Council began to delegate the hearing of such petitions to the Lord Chancellor. By the 14th century it appears that Chancery was operating as a court, affording remedies for which the strict procedures of the common law worked injustice or provided no remedy to a deserving plaintiff. Chancellors often had theological and clerical training and were well versed in Roman law and canon law. Equity, as a body of rules, varied greatly from Chancellor to Chancellor, until the end of the 16th century. Because the early Chancellors lacked formal legal training that is, in the common law tradition and showed little regard for precedent, their decisions were often widely diverse.

In , a lawyer, Sir Thomas More , was appointed as Chancellor, marking the beginning of a new era. After this time, all future Chancellors were lawyers. Beginning around , records of proceedings in the Court of Chancery were regularly kept, several equitable doctrines developed, and equity started to evolve into a system of precedents like its common law cousin. Chancery continued to be the subject of extensive criticism, the most famous of which was 17th-century jurist John Selden 's aphorism:.

Equity is a roguish thing: for law we have a measure, know what to trust to; equity is according to the conscience of him that is Chancellor, and as that is larger or narrower, so is equity. One Chancellor has a long foot, another a short foot, a third an indifferent foot: 'tis the same thing in a Chancellor's conscience. A criticism of Chancery practice as it developed in the early medieval period was that it lacked fixed rules and that the Lord Chancellor was exercising an unbounded discretion. The counter-argument was that equity mitigated the rigour of the common law by looking to substance rather than to form.

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 an unconscionable 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 that required the release of people imprisoned for contempt of chancery orders. This tension reached a climax in the Earl of Oxford's case where a judgment of Chief Justice Coke was allegedly obtained by fraud. The two courts became locked in a stalemate, and the matter was eventually referred to the Attorney General , Sir Francis Bacon. 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 equity, equity would prevail.

One area in which the Court of Chancery assumed a vital role was the enforcement of uses , a role that the rigid framework of land law could not accommodate. This role gave rise to the basic distinction between legal and equitable interests. The effect of this trust 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.

Henry VIII enacted the Statute of Uses in which became effective in in an attempt to outlaw this practice and recover lost revenue. The Act effectively made the beneficial owner of the land the legal owner and therefore liable for feudal dues. The response of the lawyers to this Statute was to create the 'use upon a use'. The Statute recognized only the first use, and so land owners were again able to separate the legal and beneficial interests in their land. Equity remains a cornerstone of Australian private law. A string of cases in the s saw the High Court of Australia re-affirm the continuing vitality of traditional equitable doctrines.

The state of New South Wales is particularly well known for the strength of its Equity jurisprudence. It remains one of the most highly regarded practitioner texts in Australia and England. Equity remains a distinct part of the law of England and Wales. The main challenge to it has come from academic writers working within the law of unjust enrichment.

Scholars such as Professor Birks and Professor Burrows argue that in many cases the inclusion of the label "legal" or "equitable" before a substantive rule is often unnecessary. The courts of Scotland have never recognised a division between the normal common law and equity, and as such the Court of Session the supreme civil court of Scotland has exercised an equitable and inherent jurisdiction and called the nobile officium.

The exercise of this power is limited by adherence to precedent , and when legislation or the common law already specify the relevant remedy. Thus, the Court cannot set aside a statutory power , but can deal with situations where the law is silent, or where there is an omission in statute. Such an omission is sometimes termed a casus improvisus. In India the common law doctrine of equity had traditionally been followed even after it became independent in Under the Act, most equitable concepts were codified and made statutory rights, thereby ending the discretionary role of the courts to grant equitable reliefs. The rights codified under the Act were as under:. With this codification, the nature and tenure of the equitable reliefs available earlier have been modified to make them statutory rights and are also required to be pleaded specifically to be enforced.

Further to the extent that these equitable reliefs have been codified into rights, they are no longer discretionary upon the courts or as the English law has it, "Chancellor's foot" but instead are enforceable rights subject to the conditions under the Act being satisfied. Nonetheless, in the event of situations not covered under the Act, the courts in India continue to exercise their inherent powers in terms of Section of the Code of Civil Procedure, , which applies to all civil courts in Australia and India.

Constructive trusts and tracing remedies are usually used where the claimant asserts that property has been wrongly appropriated from them, and then either i the property has increased in value, and thus they should have an interest in the increase in value which occurred at their expense, or ii the property has been transferred by the wrongdoer to an innocent third party, and the original owner should be able to claim a right to the property as against the innocent third party. Equitable liens normally only arise in very specific factual circumstances, such as unpaid vendor's lien.

Equitable principles can also limit the granting of equitable remedies. This includes "he who comes to equity must come with clean hands" that is, the court will not assist a claimant who is himself in the wrong or acting for improper motives , laches equitable remedies will not be granted if the claimant has delayed unduly in seeking them , "equity will not assist a volunteer" meaning that a person cannot litigate against a settlor without providing the appropriate consideration, for example, Money and that equitable remedies will not normally be granted where damages would be an adequate remedy.

The most important limitation relating to equitable remedies is that an equitable remedy will not lie against a bona fide purchaser for value without notice. Damages can also be awarded in "equity" as opposed to "at law", [12] and in some legal systems, by historical accident, interest on damages can be awarded on a compound basis only on equitable damages, but not on damages awarded at law. Two versions of the legislation are in force in Australian jurisdiction with one version placing emphasis on "commission of a wrongful act" and the other omits the reference to wrongdoing.

The classification of a remedy as equitable has various consequences. For example, equitable remedies may be enforced by contempt, [15] and equitable remedies are subject to equitable defenses. From Wikipedia, the free encyclopedia. The Constitutional History of England. Cambridge University Press. The Discipline of Law. This prompting often takes the form of a court injunction, which enforces the remedy by punishing non-compliance with civil or criminal penalties.

Jurisdictional clauses that provide for equitable relief often require such cases to include an acknowledgment between both parties that legal relief wouldn't compensate for a breach of contract or that a breach would result in irreparable damages or injury, and acknowledgment between parties that a breach of contract could result in the offended party seeking an injunction or another form of equitable relief. The offended party must also be found to be entirely free from blame in the dispute. Often called the "clean hands" principle, it can be applied to deny equitable relief if the offended party has not acted entirely in good faith, or has delayed unnecessarily in seeking a remedy.

Equitable relief is almost always incurred when there has been a breach of contract. A common form of equitable relief will order the rescission of a contract, which cancels all terms and obligations and restores both parties to their pre-contract position. These often occur during contracts involving property because the personal value of property to a party can often extend beyond monetary compensation. A court could order the property to be sold pursuant to the terms of the original contract, or cancel the contract. Courts could order rectification, a revision to a contract so that it more accurately reflects the intentions of both parties—in essence, stating what had been initially understood.

They could also order that the obligations of a contract be fulfilled as initially drafted if they are found to have breached its terms. Equitable relief is often provided in cases where intellectual property or other sensitive information has been stolen or otherwise ill-gotten. For example, gag orders, which prevent a party from publishing sensitive information, are often issued in cases of intellectual property theft. In these cases, the potential business or reputation challenges of the offending party releasing the ill-gotten information could not be adequately rectified with monetary compensation. Real Estate Investing. Estate Planning.

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