7 Part F Common law, equity and statute law
This term refers to a particular division within the English legal system. As the common law progressed, there developed a formality among judges, typified by a reluctance to deal with matters that were not or could not be processed in the proper form of action. Such a refusal to deal with injustices because they did not fall within the particular procedural and formal constraints, led to much dissatisfaction with the legal system. A modern analogy would be with a company or Government department that refused to deal with your complaint because none of its existing forms was suitable even though you had obviously suffered a wrong. In addition, the common law courts were perceived to be slow, highly technical and very expensive, and a trivial mistake in pleading a case could lose a good argument. The only available remedy was damages, but such monetary compensation was not always the best remedy. How could people obtain justice, if not in the common law courts? The response was the development of equity.
Claimants (then called plaintiffs) unable to gain access to the common law courts could appeal direct to the sovereign, and such pleas would be passed for consideration and decision to the Lord Chancellor, who acted as ‘the King's conscience’. The Chancellor based his decisions on principles of natural justice and fairness, making a decision on what seemed ‘right’ in the particular case rather than following previous precedents. He would look beyond documents which were considered legally binding by the common law courts. To make sure his decisions were fair, new procedures, such as a subpoena requiring a witness to attend court, and new remedies, such as injunctions and specific performance, were developed. This resulted in the emergence of a specific court, a court of Chancery, constituted to deliver ‘equitable’ or ‘fair’ decisions in cases which the common law courts declined to deal with. The Court of Chancery gets its name from the fact that the court was under the control of the Lord Chancellor. The Court of Chancery was the Court of Equity which developed to provide remedies not available in the courts of common law.
There were a number of important conditions which a person seeking justice from the Court of Chancery had to meet:
They had to show that they could not receive justice in the common law courts.
They had to show that they were without blame. This was called coming to the court with ‘clean hands’. By contrast, claimants using the older common law courts did not have to show they were acting in a morally blameless way.
They had to show that they had not delayed in bringing this case before the court.
The common law courts and Court of Chancery operated separately. On occasion, this led to conflict, as the common law courts would make an order in favour of one party, and the Court of Chancery the other party. This situation was resolved by the Earl of Oxford's case (1615), when the King ruled that in such cases equity would prevail. The division between the common law courts and the courts of equity continued until they were eventually combined by the Judicature Acts 1873–5. Prior to this legislation, it was essential for a party to raise their action in the appropriate court: for example, the courts of common law would not implement equitable principles, so if an injunction was sought, the case had to be heard by the Court of Chancery. If damages were sought, then the case had to be heard by the common law courts. The Acts, however, provided that every court had the power and the duty to decide cases in line with common law and equity, with the latter being paramount in the final analysis (section 25 Judicature Act 1873).
Table 3 Comparing common law and equity
|Originally operated the doctrine of stare decisis strictly. This meant the law did not develop even when it was obviously in need of change.||The Lord Chancellor in the Court of Chancery was not bound by precedent. Rules were established to ensure fairness was done.|
|Strict procedural rules were followed.||Rules and maxims of equity were developed. These were flexible to ensure even-handedness and fairness.|
|The only remedy available was damages.||Recognised the limits of usefulness of money and created new remedies including injunctions and order of specific performance.|