Equitable Remedies

Purpose of Equitable Remedies

Definition

• Equitable remedies are remedies developed by the Courts of Equity to supplement the common law.
• They exist because common law damages are not always sufficient to achieve justice.
• Equity intervenes where monetary compensation is inadequate.

Main Equitable Remedies in Contract Law

• Specific Performance.
• Injunctions.

Examination Principle

• Equity acts where damages are inadequate.
• Equitable remedies are discretionary rather than automatic.

Historical Development of Equity

Common Law Problems

Limitation of Common Law

• Common law courts traditionally awarded only damages.
• In some situations damages failed to provide adequate justice.

Examples

• Sale of unique property.
• Sale of rare goods.
• Protection of confidential information.
• Prevention of continuing breaches.

Result

• Petitioners sought relief from the Lord Chancellor.
• Separate equitable principles developed.

Earl of Oxford’s Case (1615) 1 Ch Rep 1

Facts

• Conflict arose between common law and equitable principles.

Judgment

• Equity prevailed where conflict existed.

Legal Principle

• Equitable principles supplement common law.

Importance

• Foundational authority explaining the relationship between common law and equity.

Application

• Important historical authority.

Fundamental Purpose of Equitable Remedies

General Principle

Objective

• Achieve fairness and justice where damages are inadequate.

Examination Application

Always ask:

Can damages adequately compensate the claimant?

If yes:

• Equity usually refuses intervention.

If no:

• Equitable remedies may be available.

Beswick v Beswick [1968] AC 58

Facts

• Uncle transferred business to nephew.
• Nephew promised to make weekly payments to widow.
• Payments stopped.

Judgment

• Specific performance granted.

Legal Principle

• Equity intervenes where damages would be inadequate.

Importance

• Leading illustration of equity’s purpose.

Application

• Frequently cited.

Equity Acts In Personam

General Principle

Meaning

• Equity acts against the person rather than directly against property.

Effect

• Court orders a party to:
  • Perform obligations.
  • Refrain from conduct.

Application

• Important distinguishing feature.

Penn v Lord Baltimore (1750) 1 Ves Sen 444

Legal Principle

• Equity acts in personam.

Importance

• Classical authority.

Application

• Frequently referenced in historical discussions.

Equity Is Discretionary

General Principle

Legal Rule

• Equitable remedies are not available as of right.
• The court exercises discretion.

Consequence

• Even where breach is established, the remedy may be refused.

Examination Application

Contrast:

Damages

• Available as of right.

Equitable Remedies

• Discretionary.

Patel v Ali [1984] Ch 283

Facts

• Specific performance sought concerning property sale.
• Defendant became seriously ill and disabled.

Judgment

• Specific performance refused.

Legal Principle

• Court may refuse equitable relief where it would operate unfairly.

Application

• Important authority demonstrating discretion.

Written and Compiled By Sir Hunain Zia (AYLOTI), World Record Holder With 154 Total Personal A Grades, 7 Distinctions and 11 World Records For Educate A Change A Level Law Full Scale Course

Equity Responds to Inadequacy of Damages

General Principle

Core Test

• The most important question is whether damages provide an adequate remedy.

If Damages Adequate

• Equity normally refuses relief.

If Damages Inadequate

• Equity may intervene.

Cohen v Roche [1927] 1 KB 169

Facts

• Contract for sale of ordinary commercial goods.

Judgment

• Specific performance refused.

Legal Principle

• Damages were adequate because replacement goods could be purchased elsewhere.

Application

• Demonstrates limits of equitable intervention.

Sky Petroleum Ltd v VIP Petroleum Ltd [1974] 1 WLR 576

Facts

• Petrol supplier ceased deliveries during national shortage.
• Alternative supplies unavailable.

Judgment

• Injunction granted.

Legal Principle

• Equity intervenes where damages would not provide adequate protection.

Application

• Important authority.

Equity Protects Unique Interests

General Principle

Examples

• Land.
• Rare property.
• Unique goods.
• Confidential information.
• Valuable contractual rights.

Application

• Monetary compensation often insufficient.

Beswick v Beswick [1968]

Application

• Damages could not adequately protect claimant’s rights.

Importance

• Demonstrates equity’s protective role.

Sky Petroleum Ltd v VIP Petroleum Ltd [1974]

Application

• Business survival required continued performance.

Importance

• Highlights practical necessity of equitable intervention.

Equity Prevents Continuing Wrongdoing

General Principle

Purpose

• Damages compensate past losses.
• Equity can prevent future breaches.

Application

• Particularly important for injunctions.

Warner Bros Pictures Inc v Nelson [1937] 1 KB 209

Facts

• Actress Bette Davis agreed not to work for competing studios.
• Attempted to breach contract.

Judgment

• Injunction granted.

Legal Principle

• Equity may prevent future breaches.

Application

• Classic injunction authority.

Lumley v Wagner (1852) 1 De GM & G 604

Facts

• Opera singer agreed not to perform elsewhere.
• Threatened breach.

Judgment

• Injunction granted.

Legal Principle

• Equity may restrain contractual breaches.

Application

• Foundational injunction case.

Written and Compiled By Sir Hunain Zia (AYLOTI), World Record Holder With 154 Total Personal A Grades, 7 Distinctions and 11 World Records For Educate A Change A Level Law Full Scale Course

Equitable Maxims Influencing Remedies

He Who Comes to Equity Must Come With Clean Hands

Meaning

• Claimant must act fairly.

Dering v Earl of Winchelsea (1787) 1 Cox Eq Cas 318

Importance

• Classical authority concerning equitable conduct.

Delay Defeats Equity

Meaning

• Unreasonable delay may defeat a claim.

Leaf v International Galleries [1950] 2 KB 86

Application

• Demonstrates consequences of delay.

Equity Will Not Act in Vain

Meaning

• Court will not grant orders that cannot realistically be enforced.

Co-operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd [1998] AC 1

Facts

• Specific performance sought requiring supermarket to continue trading.

Judgment

• Refused.

Legal Principle

• Courts avoid making orders requiring constant supervision.

Application

• Important limitation.

Relationship Between Common Law and Equity

Evaluation of the Purpose of Equitable Remedies

Advantages

Fairness

• Allows justice where damages are inadequate.

Flexibility

• Courts can adapt remedies to circumstances.

Protection of Unique Rights

• Particularly valuable for land and unique property.

Prevention

• Can prevent future breaches.

Supporting Cases

Beswick v Beswick

• Damages inadequate.

Sky Petroleum v VIP Petroleum

• Commercial necessity.

Lumley v Wagner

• Prevention of future breach.

Disadvantages

Uncertainty

• Discretion may reduce predictability.

Limited Availability

• Numerous restrictions apply.

Dependence on Judicial Discretion

• Outcomes less certain than damages.

Supporting Cases

Patel v Ali

• Remedy refused despite breach.

Co-operative Insurance v Argyll Stores

• Enforcement difficulties prevented relief.

Written and Compiled By Sir Hunain Zia (AYLOTI), World Record Holder With 154 Total Personal A Grades, 7 Distinctions and 11 World Records For Educate A Change A Level Law Full Scale Course

Essential Examination Cases

Core Examination Principles

Written and Compiled By Sir Hunain Zia (AYLOTI), World Record Holder With 154 Total Personal A Grades, 7 Distinctions and 11 World Records For Educate A Change A Level Law Full Scale Course

Written and Compiled By Sir Hunain Zia (AYLOTI), World Record Holder With 154 Total Personal A Grades, 7 Distinctions and 11 World Records For Educate A Change A Level Law Full Scale Course