Equity and Trust
Have procedural and substantive fusion occurred between equity and the common law, and if so, to what extent?
In your essay, you should consider the purpose of the Judicature Act 1873, paying particular attention to s.25; furthermore, you should explore the concepts of both substantive and procedural fusion.
The length of this essay must be a maximum of 4,500 words. Please use the law of UK, case law and legislations.0:
City/ State:
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In the legal field the doctrine of equity refers to a specific form of remedies -equitable remedies which are procedural and are involved with particular branches of the law for instance civil law. A number of legal scholars have viewed equity as an ingredient of law that is relevant to common suits for specific relief and extraneous in most causes for damages. From this opinion of equity, the same has developed over time to suit the ever expanding jurisdiction and integrate the substantive or even procedural principles of equitable remedies hence specific damages are awarded with the aim of attaining the objectives efficiently. A matter of great concern is that, the relationship between equity and common law,has left the term equity in devoid of specific content.
The term equity is applicable in natural law, in matters of fairness and justice and also in form of a system that corrects offenders. Further the same is applicable in the theory of justice at large where legal precepts are used together to the exigencies of special circumstances that occur. Equity, in Anglo-American law was adjusted in the sense that it was a body of legal precepts which formulates the law in cases for specific/general relief- a criteria in Justice which applied greater ethical values compared to cases that require ordinary actions for damage. The above illustration depicts the place and meaning of equity in the structure of law since it bears a wide illustration as per the way it is applied.
The introduction of the Judicature act 1873 in law, brought divided opinion on to what extent can common law and equity be fussed or whether the same is inapplicable in the circumstance. The judicature act has not advocated for the fusion of common law and equity, since they are two different concepts of the law, however it maintains the sole goal of Justice. Conceivably, some scholars argue that there exists a fusion of the two systems as the granting of equitable/legal remedies for violation of any equatable right. This paper aims at an analysis of substantive and procedural fusion ,that the Judicature act does not advocate for the said coalesce.
Historical Background
The court of common plea,the king bench and the court of Exchequer were basically the main courts that were vested the duty of administering equity and common law. This was before formation of the Judicature Act 1873 ,there were two court system put in place including the court of Chancery. Though the two court systems had major difference and contest in the way they disposed and executed matters,this contest was based on the award the courts gave. This contest in turn become strenuous to litigants who had to lodge two different cases in the same court and this matters were subject to common law and equitable remedies. Clearly this would result to filling a cause of action in the wrong jurisdiction hence the court would not entertain such a suit and this turned out to be constituting unjust and unfair practise. Such actions resulted to litigants lodging claims that were remote/unknown or not applicable in common law.
Over time, specifically in the 17th and 18th century the court of chancery expanded and this lead to continuous difficulty due to the two distinct court systems, basically common law courts were limited in granting injunction and further they could not award the remedy of specific performance. While on the other hand the Court of Chancery benefited from its growth in that it was the only court that could issue injunctions and also award other remedies that were limited to the common law court. This lead to extreme frustration among litigants,a major backlog of cases and also raised smacks of injustice litigants unwillingly moved their matters to the Court of Chancery for hearing and determination.
During the same era the two courts developed a resentful co existence since the court of chancery used its powers adversely to the extent that the court used common injunction to delay/neglect and frustrate judgments and rulings obtained in the lower court. This trend lead to great injustices and the litigants complained to the royal commissions-they were also frustrated by the same. They gave a remedy by uniting and ratifying the two court system for utmost justice and rule of law. The changes included the common law courts and the courts of equity shared the power of plea of equitable defenses but the power to grant injunctions was limited ,this was by dint of common law procedure act 1854.
Further another step of reformation included subjecting the court of Chancery to all questions of common law without approval from the common law court, as much as the court maintained its discretion on what form of award to give , the reformation limited its power to award damages. The reformations did not create a binding fusion over time ,since the two systems over time differed in vital decision making. With the increased defects there was increased conflicts between the two court systems ,the chancery court neglected the stated provisions and in turn issued injunctions and gave stay of proceedings in matters.
As a result of birth of limited liability companies the role of agents and trusties was formed and the two could only be sued in different court systems -this brought extreme conflicts and continuous confusion. The conflict between common law and equity became a stumbling block towards development of jurisprudence. The Earl of oxford’s case eased the rift and as a result the Judicature Act was introduced to remedy the conflict. This clearly depicts that equity interposes to maintain particular legal issues that the common law fails maintain.
Further its important to note that there was very distinct division between equity and common law and this was of substance in attaining justice. This gradually develeoped to be problematic and hence courts operated by means of conflict. However this should explain that law is not constant hence constantly and positively evolving to cater for modern trends in the society. In our study the development and evolution to bring concepts of fusion may operate to explain and illustrate -accidents in history hence its best to say remedial circumstances are not recurring and that justice and fairness constantly prevails.
Analysis of the Judicature Act 1873
The introduction of the Judicature Act 1873 changed the court system and also resolved the conflict that was between common law and equity. The procedural reforms included amalgamation and consolidation of the Courts of Common Pleas,Queens Bench,Probate Divorce,Admiralty ,Exchequer Courts of Chancery and London Court of Bankruptcy -into the Supreme Court of Judicature to allow due process of the law to attain the much needed sanity by litigants. However the Supreme Court of Judicature was divided into The Court of Appeal and The High Court of Justice, the two were awarded legal and equitable powers in handing matters at their Jurisdiction. The role and duty of the two courts was well defined and they closely co existed in most matters regarding administration and execution.
The Judicature Act dealt with the conflicts that existed before the act was introduced, the clauses thereto did not change however they were divided into clauses relating to general provisions and clauses relating to conflicts. Section 25(1) provided for orders of priority in debt payment of an insolvent ,while section 25(2) provided for grounds of raising a claim against an express trustee. This clause provided for a remedy in both courts , a claim brought to court by cestui que trust against an express trustee is null and void hence it cannot be barred by any statute of limitation. This resolved the conflict that was before the two courts since claims of limited liability companies were filled in different courts.
Activities that were tortuous in nature commited by owners of limited interest in land or property in it were provided for in section 25 (3) of the act. Under the law of equity where a tenant for life by way of malice/unprocedural manner decides or intends to destroy property in land the court will issue an injunction or firm restrictions to remedy that. However under common law a tenant for life shares the same privileges/rights and or duties the absolute owner enjoys for real property. Section 25(4) illustrates that under equity where an intention against merge was stated, no merger would occur, hence the issue of intention is of essence in merger. In common law where interest is not interfered the merger is automatic in the circumstance. Equity played a major role in protecting interests of parties where a merger was declared with not intention. Herein the law and equity depended on intention for it to apply , the same is supported by the equitable rules.
Section 25 (5) provides that even without the consent of mortgagees the mortgagor can bring a claim for possession against a third party. Under terms of an agreement or contract that time is of essence in that they have to be relevant to terms of performance. When parties arrange for performance or non performance at a stated time and then the same is violated by any party , then it amounts to breach of contract. In the case of Vane v. Lord barnard (1716), the house of Lords stated that the clause of time provides an integral legal obligation hence its equal to that applicable to option to obtain property. When it comes to tenancy this clause will have an adverse effect on the landlord and will affext their mode of income.
The section also provides that, in contract performance as well as time has to be of essence or either of them ,that time has to be within a reasonable time. That reasonable time is determined on the circumstance or performance level ,if the promise is beyond the given time then the aspect of reasonable time applies. A notice by the promisee justifies reasonable time for performances if due time and date has elapsed. However the notice must maintain the rule of seven days for it to be effective and further the notice should be clear, precise and free from any vagueness.
Section 25(8) provides guidelines for appointment of a receiver by interlocutory rules and strictly gives power to the High Court. Section 25(9) empowers the court of Admiralty to deal with matters of ship vessels that have committed tortuous actions in common law and does not restrict equity if applicable. Matters relating to custody of minors and education are expressed in Section 25(10) and it provides that the equitable rules will apply. In that respect ,the first sector clause (1-10) of section 25 offer specific instances and provisions while section 25(11) basically givings the conflict part of the two and the rules that applies in the circumstance. Leases are considered binding when they are made by way of deed. When a tenant who had written documents including a lease and had legal possession and had paid rent and duty over time, such a tenant under common law is referred to as a holding tenant. Equity on the other hand approached the issue in stating that a lease is a binding contract enabling parties to a contract to seek for specific performance, with the terms of the contract parties are at liberty to execute amicably.
The landmark case of Walsh v Lonsdale, provides a notable precedent in terms of Judicature Act, willingly parties herein entered into a contract of seven years lease of a mill. A rent of one year was paid and a balance was to be by subject of loan runs. The defendant assumed possession without any lease or legal documentation and he paid the rent in arrears,thus becoming a yearly tenant under common law. The plaintiff demanded for an yearly pay as per the terms ,the defendant refused an neglected to pay . the plaintiff sought for legal action against the defendant for illegal distress for an injunction and specific performance. The defendant acknowledged having been let into possession and having the legal documentation he was a yearly tenant, under common law the same was null and void. However ,through its maxims equity, ‘do that ought to done’ equitable rules prevails herein. Though common law offers precise rules considering tenancy, Judicature Act provides precautionary rules where the two can be applicable together in special circumstances to avoid miscarriage of rule of law.
The decision in the above-mentioned of Walsh v Lonsdale was made in conformity with the doctrine of procedural fusion. Jessel M.R advised that the case herein is based on the primary rules of procedural fusion section 25 (11) and of the Judicature Act 1873. Emphasis is based on the idea of supremacy of equity,Sparkes in his argument concurs with Jessel M.R. Summarily from their discussion its clear that rent is may be recovered at law in given circumstances and when a party violates a condition. Rent distress is a legal remedy and the same relies whether there is a legal right. The decision in Walsh v Lonsdale is only binding if a party concedes that the Judicature Act created the principles of substantive rules of law and equitable remedies. By dint of Judicature Act Lonsdale appreciated the “use equitable defence for a legal claim” and the court applied the maxim of equity that ‘equity places acts as they are supposed to be done.’ Generally equity complements the law by means of equitable damages.
The Aspect of Fusion of Law and Equity
Fusion will be based on law and equity, for instance the law be sufficient to cater for wrongful acts, omissions or breach of rights then equity should be integrated to cater for breach of legal rights and offer equitable remedies. The fusion of law and equity over years has been a matter of great concern and the conflict has created a great debate in the legal field. The social foundations of law aim at blending with all aspects of law and equity to form a just society. As a result Equity on its own, is in place not to over rule and to exercise superiority in matters of the law but to assist the law where the law is not sufficient to offer remedy. In spite of this ideology ,legal scholars and precedents of the law have appreciated the fusion of equitable remedies but in a procedural manner with law for instance where matters of breach of fiduciary duties are in place.
In matters of fiduciary duty a Court with Jurisdiction will administer and practice the two systems of law and equity and accord a remedy subject to precedents made by the common law courts but relating to a tortuous act recognized in courts of equity without changing the pleadings or prayers in such a claim. However this process must be procedural involving ‘amicable judicially engineered change’ of law, in that court system is prejudiced or party to the claim in the circumstance. As much as common law is strict in putting awards the change and advancement of jurisprudence affects matters in that for a fair award the two must be fussed to offer an equitable award in law. Emphasis now arises on the procedural way of fusing the two and what exceptions are likely to occur as a result.
Special circumstances include matters involving breach of confidence, the supreme court of Canada offered to enjoin and ratify provisions of law and equity in order to award a claim for breach of confidence. There exists instances where monetary awards cannot remedy a wrongful act, The New Zealand Court of Appeal consistent in awarding the plaintiff exemplary damages by dint of equity. The bench Judges stated that in such cases equity will be applicable since monetary awards cannot be an award or whatsoever and by justice compensate for the wrongful acts committed by the defendant hence in such a case equity offers a sufficient and satisfactory equitable remedy. The bench Judge further stated that matters that impose and subject the clause of duty of confidence,such matters should be treated as special in the circumstance. That for purposes of justice merging of common law and equity will be sufficient for parties involved. As a result of the merge a wide range of remedies should be available as appropriate, even if the same remedies are based on or originated from statutes,common law or equity.
A wide range of jurisdictions practising English Law and even Scholars of the law have dismissed and criticized the ideology of fusion and terming it as a fallacy. This has created a heated debate among scholars, the same scholars who are perspective purport that there exists no unification and a merge of law and equity. Additionally stating that its a mere fallacy for reasons that the two should maintain attained dependency to attain justice in issuing awards and there was no procedural rules or legislative procedure put in place to allow for fusion. The scholars that are not in support of the fusion further state that the dispute is characterised with inherent and extreme assumption on how equitable and legal actions operate such that the plaintiff or a suffering party has extra grounds for redress and may use any legal action in the circumstance.
A handful of scholars claim that administration and the cause for justice is at stake since the enactment of the Judicature act. That substantive unification of equity and law leaves Judges with a wide but not specific mode of awarding damages. As much as awarding of damages is a discretionary duty of the court, limiting the court to specific ways of awarding damages is important. The advantages are expressed by some scholars that equity will maintain its position in law where as common law will operate freely where equitable damages are not sufficient. Emphasis is laid where matters that require pure applicability of equity will suffer from gradual prejudice hence with time leading to a weak system of law.
A celebrated philosopher Roscoe Pound creates an illustration in four ways indicating that substantive fusion in regarded to equity and the law. First he stated equitable principles are advancing fast and becoming applicable in the circumstance and thereafter he states legal rules over ruling equitable damages in some instances of law. Further the neglected rules becoming irrelevant hence disappearance and then adoption of equity to overrule instead of supplementing legal rules. In contrary, Walsh stated that modern equity aims at advancements and to the extent that it can solely remedy its shortcomings and develop further to establish a strong jurisprudence and structure of justice and equality.
The fact that equity provides a wide range of remedies to tortuous actions of modern jurisprudence, then this clears the issue of fusion.Law and equity can develop to meet the demands of the ever changing and advancing legal society. That is if the two are left to function on their own, its clear they be advancements in law unlike when each system tries to fight for supremacy in law. Further this leaves legal scholars and Judges in a position where they can easily evaluate the situation and also choose the mode of remedy that will be sufficient for damages.
The ideology of substantive merger of law and equity encourages some scholars to believe there exists a fusion in terms of legal and equitable causes of action or even when granting legal remedies for the damages incurred- this ideology brings complications in law at large. By the terms of Fusion is that, the two will inter-rely on one another, and further it means that one cannot function without the other even in special cases. This ideology by some scholars amounts to pure fallacy and as a result it makes the law rigid to modern amends and advancements. Its evident that the doctrine of merging law and equity will result to ambiguity of rules of remedies in awarding a final judgement in any court of law.
Equity does not dispute common law or dismiss common law, as a result it only supplements where equitable legal action is insufficient. The doctrine of fusion on the other hand means justice will be denied since fusion will result to delay of action of law. Litigants in turn will have to choose on whether to seek equitable remedies or the legal actions under common law. The landmark case of Canson Enterprise limited v Boughton and Company(1991) depicts that the fusion equity and law by dint of the Judicature Act brings about ambiguity, upon appeal the appellant explained to court stating that his prayers in the claim were nullified by the lower court. This clearly shows that fusion will promote ambiguity even in drafting of prayers by litigants.
In the celebrated case of Tinsley v Miligan (1994) ,Lord Browne advised the court that in matters regarding property rights, is a clear and vivid to find distinction in matters advocating for rules of equity and matters that require law. That fusion is unworkable for such matters and as a statement of fact, the English Courts have only successfully completed one case for over 100 years of property constituting legal and equitable remedies. This clearly shows how fusion will result to a delay in justice and how litigants in turn will be frustrated in the corridors of Justice. The case of MCC Proceeds Inc v. Lehman International (1998) , proves how fusion did not attain the intended justice hence parties had to amicably resort to moving the case to a different forum for justice to prevail this was for reason that even if an award could be issued, it could be lacking sufficient damages or even problematic in execution.
The fusion fallacy is justified also in Boyer V. Warbley (1977) Lord Diplock used a metaphor and stated that ( of two streams running side by side). This statement brought confusion whether is two systems of substantive or adjective law meaning they were fused or whether they law and equity were two separate identities aiming at a sole goal of justice. This showed the role of Judicature Act but in the end it suffered a lot of short comings. There was miscarriage of Justice, unprocedural and unfair means of justice hence the same was termed as a fallacy in modern day law.
To ensure justice and coherence law, all procedures of law must be respected. Its not a foreign notion for judges to borrow ideas time to time from between Law and equity, however the same must not create a dispute. For instance where the idea of contributory negligence is involved, where a trustee has breached rules and duties, what effect will such an act have on a trust, borrowing such ideas with the old common law and equity will bring about conflict between the rules of law and also parties. Amalgamation advisably should not result to rejection and violation of equitable proprietary rights.
Another opinion that should be considered to be of meaning in attaining the meaning and purpose or even applicability of fusion is to what extent can the same be applied. The case of Harris v Digital pulse (2003), in this case the bench judge stated that fusion is partially applicable where common law and equity do not co exist or even rely on the given circumstance. Further the judge recommends that where torts are committed and both equity and law encourage compensation, remedial responses are recommended. Whilst the Judicature Act (1873) UK, the reasoning clearly shows that the purpose of fusion is not to separate reasoning and logic or even decisions from the rationale enhancing the cause of action.
The judicature act did not comprehensively form binding rules of fusion as a result of our discussion. Application of substantive fusion will result to violation of different legal systems. This is because most of the legal system rely on common law and if not their remedies or cause of action is linked to equity. Common law and equity aim at utmost fidelity of the rule of justice and a conflict between the two will mean no binding decision can be made or even matters of executions cannot be carried out.This also will create room for many injustices in that the offenders or tortfeasors will not be subjected to the recommended punishment and when a system shows procedural shortcomings it is considered a weak one.
To merit some advantages of the Judicature Act, is that the act has introduced the substantive effect which has lead to the two systems aiding in attaining justice but has not shown signs of fusion. Sheridan and Keeton derived a celebrated opinion that the close co existence has resulted to amalgam of common law rules and rules of equity. This clearly depicts that fusion of the two is viewed more as a progressive realization however the same of indefinite in current times. Thus this can be regarded as a positive step to attain sanity in the system after a heated debate on what rules should apply in the said circumstances. Appreciating the opinion of Shridan and Keeton shows that the Judicature Act was not at fault in its efforts to attain the much needed co existence in order to remedy the damages that were characterised with a a blend of the two. To sum up the analysis of procedural and substantive fusion, the substantively fused system, creates and causes legal actions and remedies which can be termed as inherent and can co exist in this form.
Conclusion
The paper through the above examination on the Judicature act firmly states that the act did not regard fusion of law and equity as argued by other scholars. The determination is that fusion of law and equity is a mere progressive realization and as such the same can not be applicable or defined in law at the moment. The paper also analyzed to what extent substantive and procedural fusion have enjoined and integrated with the two systems . Prior to the Judicature Act 1873, two distinct and separate court were mandated with the duties and this was problematic to the litigants in place. After time the Earl of Oxford case gave birth to the Judicature Act. The paper also explains how as a result of the said act equity conciliates to maintain circumstances which as a result the law fails to meet. From the above critically analyzed paper it may be summarily argued that the jurisdictions of law and equity are truly braiding hence the question of law should be ‘what’ can be put in place in the circumstance rather than ‘where’ they came from, this question if carefully analysed,the issue of applicability of law and equity by way of fusion is resolved.
Bibliography
Cases
A-G v Wellington Newspaper Ltd [1988] 1 NZLR 129
Attorney-General v Blake [2001] 1 AC 268.
Cadbury Schweppes Inc v FBI Foods Ltd (1999) 167 DLR
Felton v Mulligan (1971) 124 CLR 367
G R Mailman & Assoc. Pty Ltd v Wormald (Aust) Pty Ltd (1991) 23 NSWLR
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Lord Dudley and Ward v Lady Dudley (1705) Pr Ch 241
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