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jurisprudence:law-and-equity

Law and Equity

Until the year 1873, England presented the extremely curious spectacle of two distinct and rival systems of law, administered at the same time by different tribunals. These systems were distinguished as common law and equity, or merely as law and equity (using the term law in a narrow sense as including only one of the two systems). The common law was the older, being coeval with the rise of royal justice in England, and it was administered in the older courts, namely, the King’s Bench, the Court of Common Pleas, and the Exchequer. Equity was the more modern body of legal doctrine, developed and administered by the Chancellor in the Court of Chancery as supplementary to, and corrective of, the older law. To a large extent the two systems were identical and harmonious, for it was a maxim of the Chancery that equity follows the law (Aequitas sequitur legem); that is to say, the rules already established in the older courts were adopted by the Chancellors and incorporated into the system of equity, unless there was some sufficient reason for their rejection or modification. In no small measure, however, law and equity were discordant, applying different rules to the same subject-matter. The same case would be decided in one way, if brought before the Court of King’s Bench, and in another, if adjudged in Chancery. The Judicature Act, 1873, put an end to this anomalous state of things, by the abolition of all portions of the common law which conflicted with equity, and by the consequent fusion of the two systems into a single and self-consistent body of law administered in a single court called the High Court of Justice and substituted for the old courts of common law and the Court of Chancery.

Although the distinction between common law and equity has thus become to a large extent historical merely, it has not ceased to demand attention, for it is still valid and operative for many purposes. The so-called fusion of law and equity effected by the Judicature Act has abolished only such rules of the common law as were in conflict with the rules of equity, in the sense that both rules could not be recognised and applied in one and the same court of justice. So far as common law and equity are consistent with each other and so capable of being administered concurrently in a single court, these two systems still subsist, and the distinction between them is still in force. Thus the distinction between legal and equitable ownership, legal and equitable rights, legal and equitable remedies, remains an essential part of the modern system. It is still the case that one person may be the legal owner of property and another the equitable owner of the same property, as in the case of a trustee and his beneficiary. Similarly, a mortgage or charge may still be either legal or equitable. These distinctions between law and equity are not conflicts between two irreconcilable systems of law, but are such as to be capable of recognition as part of one and the same system. A legal right and an equitable right, legal ownership and equitable ownership, although as a matter of history they originated in different courts and in different legal systems, are now two different kinds of rights and of ownership recognised in the same court administering a single and harmonious legal system.

The term equity possesses at least three distinct though related senses. In the first of these, it is nothing more than a synonym for natural justice. Aequitas is aequalitas: the fair, impartial, or equal allotment of good and evil; the virtue which gives to every man his own. This is the popular application of the term, and possesses no special juridical significance.

In a second and legal sense equity means natural justice, not simply, but in a special aspect, that is to say, as opposed to the rigour of inflexible rules of law Aequitas is contrasted with summum jus, or strictum jus, or the rigor juris. For the law lays down general principles, taking of necessity no account of the special circumstances of individual cases in which such generality may work injustice. So, also, the law may with defective foresight have omitted to provide at all for the case in hand, and therefore supplies no remedy for the aggrieved suitor. In all such cases, in order to avoid injustice, it may be considered needful to go beyond the law, or even contrary to the law, and to administer justice in accordance with the dictates of natural reason. This it is, that is meant by administering equity as opposed to law; and so far as , any tribunal possesses the power of thus supplementing or rejecting the rules of law in special cases, it is, in this sense of the term, a court of equity, as opposed to a court of law.

The distinction thus indicated was received in the juridical theory both of the Greeks and the Romans. Aristotle defines equity as the correction of the law where it is defective on account of its generality, and the definition is constantly repeated by later writers. Elsewhere he says:

“An arbitrator decides in accordance with equity, a judge in accordance with law , and it was for this purpose that arbitration was introduced, namely, that equity might prevail.”

In the writings of Cicero we find frequent references to the distinction between aequitas and jus. He quotes as already proverbial the saying, Summum jus summa injuria, meaning by summum jus the rigour of the law untempered by equity. Numerous indications of the same conception are to be met with in the writings of the Roman jurists.

The doctrine passed from Greek and Latin literature into the traditional jurisprudence of the Middle Ages. We may see, for example, a discussion of the matter in the Tractatus de Legibus of Aquinas. It was well known, therefore, to the lawyers who laid the foundations of English system, and like other portions of scholastic doctrine, it passed into the English law courts of the thirteenth century. There is good reason for concluding that the King’s courts of that day did not consider themselves so straitly bound by statute, custom, or precedent, as to be incapable upon occasion of doing justice that went beyond the law. It was not until later that the common law so hardened into an inflexible and inexpensive system of strictum jus, that aequitas fled from the older courts to the newly-established tribunal of the Chancellor.

The Court of Chancery, an offshoot from the King's Council, was established to administer the equity which the common law had rejected, and of which the common law courts had declared themselves incapable. It provided an appeal from the rigid, narrow, and technical rules of the King’s courts of law, to the conscience and equity of the King himself, speaking by the mouth of his Chancellor. The King was the source and fountain of justice. The administration of justice was part of the royal prerogative, and the exercise of it had been delegated by the King to his servants, the judges. These judges held themselves bound by the inflexible rules established in their courts, but not so the King. A subject might have recourse, therefore, to the natural justice of the King, if distrustful of the legal justice of the King's courts. Here he could obtain aequitas, if the strictum jus of the law courts was insufficient for his necessities. This equitable jurisdiction of the Crown, after having been exercised for a time by the King's Council, was subsequently delegated to the Chancellor, who, as exercising it, was deemed to be the keeper of the royal conscience.

We have now reached a position from which we can see how the term equity acquired its third and last signification. In this sense, which is peculiar to English nomenclature, it is no longer opposed to law, but is itself a particular kind of law. It is that body of law which is administered in the Court of Chancery, as contrasted with the other and rival system administered in the common law courts. Equity is Chancery law as opposed to the common law. The equity of the Chancery has changed its nature and meaning. It was not originally law at all, but natural justice. The Chancellor, in the first days of his equitable jurisdiction, did not go about to set up and administer a new form of law, standing side by side with that already recognised in the Court of Common Pleas. His purpose was to administer justice without law, and this purpose he in fact fulfilled for many a day. In its origin the jurisdiction of the Chancellor was unfettered by any rules whatever. His duty was to do that “ which justice, and reason, and good faith, and good conscience require in the case. ”

And of such requirements he was in each particular case to judge at his own good pleasure. In due time, however, there commenced that process of the encroachment of established principle upon judicial discretion which marks the growth of all legal systems. By degrees the Chancellor suffered himself to be restricted by rule and precedent in his interpretation and execution of the dictates of the royal conscience. Just in so far as this change proceeded, the system administered in Chancery ceased to be a system of equity in the original sense, and became the same in essence as the common law itself. The final result was the establishment in England of a second system of law, standing over against the older law, in many respects an improvement on it, yet, no less than it, a scheme of rigid, technical, predetermined principles. And the law thus developed was called equity, because it was in equity that it had its source.

Closely analogous to this equity-law of the English Chancellor is the jus praetorium of the Roman praetor. The praetor, the supreme judicial magistrate of the Roman republic, had much the same power as the Chancellor of supplying and correcting the deficiencies and errors of the older law, by recourse to aequitas. Just as the exercise of this power gave rise in England to a body of Chancery law, standing by the side of the common law, so in Rome a jus praetorium grew up distinct from the older jus civile. “ Jus praetorium,” says Papinian, “ est quod praetores introduxerunt, adjuvandi vel supplendi vel corrigendi juris civilis gratia, propter utilitatem publicam. ” The chief distinction between the Roman and the English cases is that at Rome the two systems of law co-existed in the same court, the jus praetorium practically superseding the jus civile so far as inconsistent with it; whereas in England, as we have seen, law and equity were administered by distinct tribunals. Moreover, although the jus praetorium had its source in the aequitas of the praetor, it does not seem that this body of law was ever itself called aequitas. This transference of meaning is peculiar to English usage.


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