Miss Thorogood – AS Law

Development of Common Law & Equity – Teacher Copy

Historical Background

Before the Norman Conquest, different areas of England were governed by different systems of law, often adapted from those of the various invaders who had settled there. This became roughly Dane law in the north, Mercian law around the midlands and Wessex law in the south and west. The king had little control over the country as a whole, and there was no effective central government.

In 1066 when William the Conqueror gained the English throne he established a strong central government and began to standardise the law. Representatives of the king (‘itinerant justices’) were sent to check the administration in the countryside and adjudicated local disputes in accordance to local laws. When they returned to Westminster they discussed the different laws which were present around the country and decided which ones to keep and which to dismiss.

By about 1250 a ‘common law’ had been produced which ruled the whole country. This was exported around the world to many Commonwealth countries.

In the days of Henry VIII or Elizabeth I the monarch was the supreme law maker and royal decisions were final. The power of the monarch gradually reduced and in the 1640s the English Civil War was fought between King Charles I and Parliament, in part over the issue of the king making decisions without consulting Parliament.

In the 19th century, the House of Commons was also becoming more important as the franchise (the right to vote) was gradually extended.

Definition of Common Law and Equity

Common Law – A law established by following earlier judicial decisions.Equity – A specific set of legal principles, which add to those provided in the common law.

How equity began

By the 12th century, common law courts had developed which applied the common law discussed above. Civil actions in these courts had to be started by a writ (a legal document), which set out the cause of the action or the grounds for the claim made, and there grew up different types of writ.

Early on new writs were created to suit the situation but this was stopped in the 13th century. Litigants had to fit their circumstances to one of the available types of writ: if

Miss Thorogood – AS Law

the case did not fall within one of those types, there was no way of bringing the case to the common law court.

At this time common law was also becoming more rigid with only one remedy being offered, which was damages. This was not always an adequate solution to every problem.

Dissatisfied parties started to petition the king, who was thought of as the ‘fountain of justice’. These petitions were commonly passed to the Chancellor, the king’s chief minister, as the king didn’t want to spend his time considering them.

By 1474 the Chancellor was being petitioned himself and had begun to make decisions on the cases on his own authority, rather than as a substitute for the king. (This was the beginning of the Court of Chancery).Litigants appeared before the Chancellor, who would question them, and then deliver a verdict based on his own moral view of the question. The court could insist that relevant documents be disclosed, as well as questioning the parties in person, unlike the common law courts which did not admit oral evidence until the 16th century, and had no way of extracting the truth from litigants.

Because the court followed no binding rules, relying entirely on the Chancellor’s view of right and wrong, it could enforce right not recognised by the common law, which, restricted by precedent, was failing to adapt to new circumstances. The Court of Chancery could provide whatever remedy best suited the case, and this type of justice came to be known as equity.

Common Law and Equity

The Court of Chancery became popular but caused resentment amongst the common lawyers, who argued that the quality of the decisions depended on the quality of the Chancellor. Because precedents were not followed and each case was considered purely on its merits, justice could appear arbitrary, and nobody could predict what a decision might be.

However, the flexibility of the court was seen as the great advantage of equity – where rules are laid down, there will always be situations in which those rules produce injustice.

The common lawyers resented the way in which equity could be used to restrict their own jurisdiction. Where common law gave a litigant a right which, in the circumstances, it would be unjust to exercise, the Court of Chancery could issue a common injunction, preventing the exercise of the common law right.

Miss Thorogood – AS Law

The Earl of Oxford’s Case 1615Conflicting judgments of the common law courts and the Court of Chancery were referred to the king for a decision; he advised that where there was conflict, equity should prevail. Had this decision not been made, equity would have been worthless – it could not fulfil its role of filling in the gaps of the common law unless it was dominant.

The rivalry continued for some time, but gradually reduced as equity too began to be ruled by precedent and standard principles, a development related to the fact that it was becoming established practice to appoint lawyers rather than clergy to the office of Lord Chancellor. By the 19th century, equity had a developed case law and recognisable principles, and was no less rigid than common law.

The Judicature Acts

Once equity became a body of law, rather than an arbitrary exercise of conscience, there was no reason why it needed it own courts. Consequently the Judicature Acts of 1873-75, which established the basis of the court structure we have today, provided that equity and common law could both be administrated by all courts, and that there would no longer be different procedures for seeking equitable and common law remedies. Although the Court of Chancery remained as a division of the High Court, like all other courts it can now apply both common law and equity.

Equity today

The Judicature Acts did not fuse common law and equity, only their administration. There is still a body of rules of equity which is distant form common law rules, and acts as an addition to it. Where there is conflict, equity still prevails.

Equitable maximsAlthough both the common law and equity lay down rules developed from precedents, equity also created maxims which had to be satisfied before equitable rules could be applied. These maxims were designed to ensure that decisions were morally fair. The following are some of them.

‘He who comes to equity must come with clean hands’This means that claimants who have themselves been in the wrong in some way will not be granted an equitable remedy.D&C Builders v Rees (1966)A small building firm did some work on the house of a couple named Rees. The bill came to £732, of which Rees has already paid £250. When the builders asked for the balance of £482, the Rees announced the work was defective, and they were only prepared to pay £300. As the builders were in serious financial difficulties (as the Rees knew), they reluctantly accepted the £300 ‘in completion of the account’.

Miss Thorogood – AS Law

The decision to accept the money would not normally be binding in contract law, and afterwards the builders sued the Rees for the outstanding amount. The Rees claimed that the court should apply the doctrine of equitable estoppels, which can make promises binding when they would normally not be. However, Lord Denning refused to apply the doctrine, on the grounds that the Rees had taken unfair advantage of the builders’ financial difficulties, and therefore had not come ‘with clean hands’.

‘He who seeks equity must do equity’Anyone who seeks equitable relief must be prepared to act fairly towards their opponent. Chappell v Times Newspapers Ltd (1975)Newspaper employees who had been threatened that they would be sacked unless they stopped their strike action applied for an injuction to prevent their employers from carrying out the threat. The court held that, in order to be awarded the remedy, the strikers should undertake that they would withdraw their strike action if the injunction was granted. Since they refused to do this, the injunction was refused..

‘Delay defeats equities’Where a claimant takes an unreasonably long time to bring an action, equitable remedies will not be available. The unreasonableness of any delay will be a matter of fact to be assessed in view of the circumstances in each case.Leaf v International Galleries (1950)The claimant bought a painting of Salisbury Cathedral described (innocently) by the seller as a genuine Constable. Five years later, the buyer discovered that it was nothing of the sort, and claimed the equitable remedy of recission, but the court held that the delay had been too long.

These maxims (there are several others) mean that where a claimant’s case relies on a rule of equity, rather than a rule of common law, that rule can only be applied if the maxims are satisfied – unlike common law rules which have no such limitations.

Equitable remedies

In your group research each of the following remedies:

Injuction Specific performance Rectification Rescission