The word ‘equity’ can be seen to have a wide range of meanings- to many it is a synonym for ‘fairness’ or justice’. Those within the legal community recognise equity as the body of rules developed and applied by the Court of Chancery; a court previously presided over by the Lord Chancellor with rules developed under his authority. The law of equity developed due to the inflexibility of the common law. Before the development of equity, The law was rigid (which was often cited as a weakness) for example, claimants would only have a successful claim in common law courts if their claim could be matched with an existing writ and even then, the only remedy available to them was damages, even in cases where monetary compensation was not seen as the most suitable remedy. However, claimants who were unsuccessful in receiving a solution in the common law courts were able to appeal directly to the sovereign, who would then delegate cases to the Lord Chancellor for a decision. The Chancellors’ role, in time, was taken over through the development of the Court of Chancery, the aims of which were to deliver ‘equitable’ or ‘fair’ decisions in cases where justice could not be achieved in the Common law Courts. The creation of equity as a system of law was to serve as a means by which the English legal system could strike the balance between the rule-making process and the need to achieve fair results in individual and separate circumstances.
Both the Common law Courts and the Court of Chancery operated separately, which inevitably lead to conflict between the two in instances where the courts delivered separate decisions. It wasn’t until 1615 that this situation was resolved in the Earl of Oxford’s case1, where it was established that when there is a “conflict between equity and common law; equity must be seen to prevail”; a maxim that has since been embodied in statute, in the Senior Courts Act 19812. Prior to the Judicature Acts 1873 – 1875, the two courts continued to operate separately and it was essential for a claimant to raise their action in the appropriate court. Subsequently, section 25 of the Judicature Acts 18733 provided that, every court had the duty and right to decide cases in line with both equity and common law. The amalgamation of both the Courts of Equity and the Common law Courts to form the Supreme Court of Judicature has led to the distinction that although both approaches still appear to remain distinct from one another, they are viewed as mutually dependent features of law. The Court is now seen as “not a Court of Law or a Court of Equity, it is a Court of Complete Jurisdiction.”4
Although it can be argued that certainty, stability and consistency are essential components in maintaining an effective legal system, it should be noted that as each problem dealt with within our legal system is individual and often complex, there is undoubtedly a need to achieve fair results in each case. The flexibility equity provides, “mitigates the rigour of common law”, “to soften and mollify the extremity of the law”5; and in balancing the need for certainty within the law with the need to achieve just results, permits the achievement of fair results which otherwise, under literal application of common law, could not be achieved. To this extent equity can be seen as a form of “natural justice”,6 the purpose of which has been described in the case of Earl of Oxford as to “correct men’s consciences for frauds, breach of trusts, wrongs and oppressions . . . and to soften and mollify the extremity of the law”7
The ability and willingness of equity to subvert legal formalities by perfecting transactions the law would otherwise fail to recognise as such is often viewed as a positive development. However we must determine whether equity has been able to effectively balance its objectives, which are to achieve just and fair outcomes, with the need to maintain certainty, stability and consistency within the English legal...
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