This article is written by Sanchit Kumar Sinha, LLB 2nd year at Dr. Babasaheb Ambedkar Law College, Nagpur. This article is based on the Law of equity and Equitable Remedies.
The law of equity leads off in the Court of Chancery which was set up because a fair and just remedy could not be given through common law as monetary guerdon was not suitable and sometimes a well-deserving plaintiff was denied because the writs were quite narrow and immutable. Courts were guided by the previous decisions and that’s how these 12 maxims were formulated. These maxims limit the granting of equitable remedies for those who have not acted in an equitable or reasonable manner. The decisions of the Court of Chancery and common law were constantly conflicting. This antagonism was ended in The Earl of Oxfords case 1615. In which the king stated, “Where common law and equity conflict equity should prevail”. The two courts have now coalesced and the same judges give decisions out common law and equity.
According to Jurist Maitland “Equity now is that body of rules administered by English courts of justice which were not the operation of the judicature acts, would be bestowed only by those courts which would be known as courts of Equity”. Another Jurist Henry Levey Ulman “Equity is a body of rules, the primary source of which was neither custom nor written law but the imperative details of scruples and which had been set forth and developed in the Court of Chancery”
Origin and nature of the equity
Two distinct systems of law were administered by different tribunals at the same time in England in the year 1875. The old systems have a common law and it was administered by the Kings benches. The more modern body of legal doctrine developed and administered by the chancellor in the court of Chancery as supplementary to imperious of the old law was the law of equity. The two systems of law as mentioned above were by and large identical and in harmony leading to the maxim that equity follows the law. In other words, the rules already established in the old courts were adopted by the chancellor and incorporated into the system of equity, unless there was some sufficient reason for their rejection or modification. In case of conflict, the rule of chancery prevailed, because if a common-law action was brought in the confrontation with a rule of equity.
Nature of equity
- The general rule is that equity follows the rule and the equitable interest have in general the same incidents and attributes as having corresponding legal interest. They devolve and can be settled, mortgaged and disposed of precisely in the same way as legal interest.
- Equity follows the law and as such a legal estate or interest takes procedure over the equitable estate or interest. That in case of conflict between equity and law, the law prevails.
- An equitable right arises when a right vested in one person by the law should, in the view of equity be a matter of conscience, vested in another.
- Where the equities are equal, that which is the first time will prevail.
Most of the equitable principles and rules have in India been embodied in the statute law and has been made applicable for the extent of the provision made therein. That, the provision of equity in Indian statute books might have their source in common law or in the equity or in adjustment between the two, is immaterial. Statutory recognition of the principle of equity is found in the:
- Indian Contract Act, 1872
- Specific Relief Act,1877
- The Indian Trust Act, 1882
- The Transfer of Property Act, 1882
- Indian Succession Act, 1925
The equitable doctrine featured in the Indian contract act, are mainly the doctrine of penalties and forfeiture, stipulations as a time in a contract, equitable relief on the ground of misrepresentation, fraud and undue influence. This rule is administered by the English court of equity under the head of justice, equity and good conscience are contained in the Indian trust act.
The general principle of Equity
The subject matter of the equity can be grouped around some legal maxims which embody the general principles on which the court of chancery exercised its jurisdiction, and there are some important maxims are as follows:
- Aequitaes est corectio legis generalities latae, qua deficit– Its means equity is a correction of the general law in the part where it is defective. For a long time, the English courts were guided by the doctrine ubi remedium ibi jus i.e., where there is the remedy, there is a right, but for the development of the court of chancery in England, this doctrine gave way to a more pragmatic and just doctrine. The court of chancery applied the maxim in those cases where there was a failure of justice due to the deficiencies of law, and to help the litigants in obtaining legal reliefs for the violation of legal rights by offering facilities in evidence and procedure, which the common law courts can’t secure. The maxim is to give adequate relief, but one in common law court does not provide adequate relief.
Place of the maxim in the Indian context
The maxim finds its embodiment in many Indian enactments like the specific relief act which provides for equitable remedies by the way of specific performance of contracts, the rectification of instruments etc. The Code of Civil Procedure particularly captures this maxim in section 9.
- Aequitas Sequitur legem- It means equity follows the law; Equity does not claim to override the law. Equity generally operates by savvying the legal rule and adding some further rule, remedy or other machinery of its own. The Court of Chancery, which developed equitable law never wanted to give equity a stellar effect to the common law. The jurisdiction of the equity is debarred from overreaching the boundaries established by the prior course of adjudication. In India there is no distinction between legal interest and equitable interest, therefore, in all matters relating to legal as well as equitable interest, the statutory provisions shall apply if there are any.
- He who seeks equity must do equity – This maxim put a mandate on the seeker of equity that he must in his turn, be equitable in recognizing and submitting to the right of his adversary as no one can be justified in requiring another be to incarnate without himself being so. A litigant claiming something by way of equity must himself be ready and willing to grant to his opponent, that which the opponent is entitled according to the case of Sturgis vs Champneys.
This maxim does not apply when the relief sought by the plaintiff and equitable right to relief secured to or sought by the defendant’s belongings to or originates from two entirely separate and distinct matters.
- Equity delights in equality– The English Court of Chancery, incorporated into the equity jurisprudence of English law, the concept of acquittal i.e., the notion of equality and nonequivalence as conceived by the roman jurist, and this equity is so far as possible put the parties to a transaction on an equal footing, although the strict rules of law may give one party an advantage over the other. Equality has does not mean to have literal equality, but it means to have proportional equality.
Place of the maxim in the Indian context
CPC, 1908 section 49 provides that where assets are held by the court and more person than one has made application to the court for the execution of a decree for the payment of money passed against the same judgment debtor and have not obtained satisfaction thereof, the assets after deducing the cost of realization will be reliably distributed among all such persons.
- Vigilantibus, non-dormient bus Jura subvenient – It means the laws help the vigilant and not the dormant, while a legal claim is not barred by any lapse of time less than the prescribed statutory period of limitation and equitable claim on the other hand may be barred by delay on the part of the plaintiff seeking relief. Delay, however, means a reasonable delay in claiming relief and not an ordinary or reasonable delay. A court of equity has always refused to aid to demands where a party has slept upon his rights and accede for a great length of time.
- Legal estate prevails over the equitable estate- Where there is the question of selection between equity on one hand over the text of the law on the other, the court shall choose the latter. To say it differently, the person in possession of legal estate is entitled to ascendency over any person having merely or simply an equitable estate in that property. Where there is equal equity then law shall prevail is another reworking of the maxim. Accordingly, the clear text will outweigh the equities, the law shall prevail, which is another version of the maxim. Accordingly, the clear text will override the equities written or legal estate prevails over the equitable interest.
Doctrine of Election
In equity, the doctrine of election is founded on the rule that a person who takes under an instrument, must give effect to every part of it. It’s an obligation imposed upon the party to choose between two inconsistent or alternative rights or claims in cases where there is a clear intention of the person from whom he derives one, and should not enjoy both. The purpose of the doctrine of election is merely to carry out the intention expressed by the grantor in the parchment of the grant. If one agrees to receive a benefit then one must accept the symbiotic obligation also. It is choosing between rights where there is a clear intention that both shall not be enjoyed.
- The intention of the grantor or testator to dispose of the property which is not his own should be clear.
- The grantor or testator must give his own property to the person whose property he has attempted to dispose of by his will or deed.
How is the election made?
An election made is binding, on the legal representation of them done. However, if a party bound to elect dies without having elected and both, the benefits are given to him and the property of which is given away, devolve upon the same person then that person can be elected. If, however they devolve upon several people in the same proportion, then each can elect according to his interest.
The laws related to equity have evolved through precedent and the intention is to grant equitable rights and remedies to the parties. The decisions of equity have largely been based on the judge’s gumption and understanding of the fair and just cause. Law and equity both are important for justice. Where the sternness of the law threatens justice, equity prevails, and where equity has no remedy the letter of law is followed. Justice, thus, depends upon both and thus, both must be consulted in order to deliver justice.