Equity in the english legal system

Equity today:

Equity law is derived from old English common law, when courts used their discretion to apply justice in accordance with natural law. Equity law supersedes common law and statute law when there is a conflict between the two and neither can appropriately bring the correct verdict.

The judicature acts didn’t merged the equity and the Common Law, it still exist: rules of equity system and rules from Common Law system.

The principle that equity prevails on Common Law is still in force. It was writing in black and white in the judicature act and now this principle is in the Supreme court act of 1981.

It relies on certain maxims designed to ensure that the outcome of the case is really fair.

1) Equitable maxims:

• “He who comes to equity must come with clean hands”.No claimant can get an equitable remedy if he has done a wrong before and a wrong that there is a relationship with this claim. He shouldn’t be able to get an equitable remedy.
• “He who seeks equity must do equity”. That means that no person can get an equitable remedy if he or she refuses to act fairly to words it opened.

Basically both maxims express the same idea. However, these 2 maxims apply in different times.

=> The first maxim is applied to the behavior of the claimant before he or she brings the claim, that means that before bringing the claim he should have behaved fairly. For instance, in the case D&C Builders v Rees (1966): in this case a small company has worked on the else of a couple and when the work was done the builders claim to the prize but the couple refuse to pay the entire prize saying that the worse was flowed, the job hasn’t be done correctly. The builders didn’t accept this some but they accepted this limited amends of money but after having accepted, they want to have the rest of the prize. The couple opposed this claim by invoking an equity principle to oppose the doctrine of estoppel means that you cannot receive in a way that create an expectation for somebody else and then change your mind.

It was decide that the couple hasn’t behave fairly enough to be able to be invoked this legal argument, this doctrine of estoppel.

=>Chappell v Times Newspapers Ltd (1975): employees of the newspapers have been threatened to be fired if they didn’t stop it. They ask the court for an injunction preventing the employer from firing the employees. The court was ready to issue the exemption but only if employees accept to stop their strike after the injunction was granted. The employees refused so the injunction was refused. The second maxim was used. As they said that they wouldn’t stop the strike, they wouldn’t behave fairly in equity, the equity remedy could not be issued because during the process employees show that they aren’t agree.

• “Delay defeats equities”. If a claimant waits too long before bringing his action then he cannot claim an equitable remedy anymore. Leaf v International Galleries (1950): here the claimant bought a painting described by the seller as a gaining constable and five years later, the claimant discovers that the painting isn’t constable. He claimed the equitable remedy of rescission (nullité). He asks to have his money back. As he waited five years before claiming it was considered to be too long and so this equitable remedy wasn’t committed.

Where a claimant case relies on a rule of equity rather than a rule of Common Law that rule of equity can only be applied if the maxims are satisfied. In Common Law there is nothing of that sort.

2) Equitable remedies:

In Common Law, the only remedy possible was damages. And the written while equity developed in chancellery courts was because other remedies were given by the chancellery court.

– Injunctioneither ordering or forbidding the defendant for two some things. There are different types of injunction:

=>Mareva injunction: injunction freezing the assets of the defendant that is prohibiting him for disposing of his accept or removing them from the court’s jurisdiction.

=>Anti-suit injunction: prohibit someone to bring a claim before another court. For instance, the judges in London prohibit the defendant of bringing before another tribunal in England. Whether he can do when the defendant has brought his claim before a foreign tribunal. A German and English are entered into a contract, they have chosen that in case of dispute the tribunal which should know the case, solve the dispute will be a tribunal in London. A dispute arose between them; the German party doesn’t respect that clause and bring the claim before a German tribunal. The English businessman will go before the English court and ask for a anti-suit injunction. It’s really something specific to Common Law system.

– Specific performance (executionforcée): orders the defendant to perform the contract he has bridged.

– Rectification: orders to alter the terms used in a document if they are erroneous and if they don’t reflect the real intent of the parties.

– Rescission (récision): it’s a sort of amendment of a contract and it restores parties to a contract to the position they were in before the contract was signed.

There is actually a discussion within English jurist about the possible murder of these remedies in the Common Law set of rules. There is a discussion some are for some are against the fusion meaning that what is it needed? These remedies don’t make the distinction between equity remedies and Common Law remedies. It’s a specificity of the equity system.

3) Legal concept created in equity: TRUST :

There is no real equivalent to trust in the European civil law system. In the recent years, France has adopted the fiducy in 2011 which is a concept closed to the trust.

It’s a Common Law institution.

A trust is created by a person, that is called the settlor, that transfers some property to another person, who is called the trustee, for the benefit of another or others persons, called the beneficiaries of the trust.

Ancestor: the USE:

The ancestor of the trust was called the use and the use was the same institution but only the name was different. It’s when a person who are named the feoffor has transferred the legal title to some property to another person (feoffee to uses), for the benefit of some other person, called the cestuique use.

It emerge when the knights enrolled in a crusade before leaving the country they were often given the title of the property to a friend or relative in order for that person to take care of the property in his absence and for the benefit of his family. But sometimes this relative who was given the legal title didn’t act in a fair way and chasing the family away. The legal title of the property was in the hands of this relative.

Only the legal title means that you had the property. Common Law courts recognized only the legal title and not the act which said that the feoffee to use should take care of the property. If family wants to be protected by courts, court denied because they haven’t the legal property.

If Common Law didn’t recognize their rights then the only solution that they had was to go to the chancellery court. They went to the chancellor to get some redress and the chancellor accepted to enforce the obligations undertaken by the feoffee to uses.

=>Created a new form of ownership:the equitable ownership. It was recognize that 2 types of ownership could exist: the legal title and the equitable ownership.

This institution of trust comes from that time. The problem was that the king is opposite.

This new equitable ownership would deploy him of his feodo rights. The king tries to get read of this uses.

=>The statute of uses:

The statute didn’t abolish uses but whether was comfort the legal title to the property to the beneficiary of the use.

But

Dead only with land… and speaks only of “a person”.

It spoke only about a person. The transfer of a property which wasn’t a land was possible and the feoffee could be a corporation because it wasn’t a person and statute speaks just about the person. The statute didn’t put an end to the practice of having uses.

For which purposes is the trust used?

– Succession: it’s the trust for succession purposes. In a will it is often used when a father has his children and upon his death a certain price of his property should be transferred to a trustee for the benefit of his children until the rich of 25.

– Commercial purposes: when 2 companies want to carry out a big project together they may create a trust where they each transfer some good to the trustee for the purpose of carrying out the activity which the trust has been set up.

– Charitable trust – purpose trust: a kind of purpose trust. In that case, the trust isn’t set up for a benefit of a specific person but for the completion of a specifically. For instance, a trust may be set up for the benefit of a category of person.

Can it be created outside a declaration of will?

Yes it can.

– Express trust (will): it is a voluntary trust, a trust set up to the will of one person.

– Statutory trust: trusts which are set up by the operation of law.

– Constructive trust: when courts decide that the trust has been, it’s constructive trusts (interpretation), they are constructed by a court that is to say that courts construct the will of parties. They said that they remark that such person had wanted to set up one trust.

Hague Convention(La Haye) on the Law applicable to the Trust:

This is a convention which was made in 1985 which enter into force in 1992 and as it named suggest, it determines the law applicable to trust. Even if a country doesn’t know the legal concept of trust, it mightrecognize the trust if it uses this convention.

For instance, when a North American sets a trust over a house in France, this convention will determine what is the law applicable to the relationship between the set law, and the trustee and the trustee and the beneficiary.