The common law

One of the ways in which the judges make the law is by developing the common law. However, the
phrase ‘common law’ is not a particularly easy one to get to grips with because it can have up to five
different meanings, according to the context in which it is used.

Meaning Example

1. The term ‘common law’ can be taken to Murder is an offence under the common law of
refer to the system of law which is England; however, walking on the grass in a local
common to the whole country. park may be an offence under a local by-law, but
is not part of the common law of England.

2. The term may also be used to distinguish Damages (a monetary award; compensation) are
that law which is not equity (see further common law remedies, whereas the injunction is
below). an equitable remedy.

3. It might be used to mean case law: that is The common law principle that a manufacturer is
law developed by judges through cases. liable in negligence to the ultimate consumer of
its products derives from the case of Donoghue v
Stevenson [1932] AC 562.

4. It could be used to indicate law which has Murder is a common law offence, but the
not been made by Parliament (the law defenses of diminished responsibility and
made by Parliament is called a statute or provocation are statutory under ss2 and 3
legislation). Homicide Act 1957.

5. The term may also be used to describe France does not have a common law system
those legal systems that developed from because it developed from the Roman tradition
the English system. In this final sense, a with a civil law system. On the other hand,
common law system is distinguished from a England, Australia and New Zealand are common
civil law system. Civil law developed from law jurisdictions.
the Romano-Germanic legal system and is
the dominant legal system in continental
Europe including the European Union itself.

Problems of the common law

The story starts before William the Conqueror conquered England in 1066. Before this date, there was
no national legal system. Local laws were enforced by local lords or sheriffs. When William took the
throne in 1066, he was a shrewd leader and he recognized that he would have to establish a system of
central or national government and, with that, a centralized system of justice over which he would have
control. Only in this way would he attain real power and control over his new subjects.

William travelled throughout the land, listening to people’s grievances. He and his most powerful
advisers would judge the merits of the complaints and deliver judgments. This travelling courts system
became known as the Curia Regis (King’s Court) and it is from this court that we see the development of
the common law. Subsequent kings appointed judges to the Curia Regis and over time a national and
uniform system of laws was put in place. In this way many local customary laws were replaced by new
national laws. As these national laws would apply to everyone, they would be common to all. These laws
therefore became known as the common law. However, there were a number of problems with the
operation of the common law.

 First, the common law operated on the basis of stare decisis; that means binding precedent. One of
the main criticisms of this doctrine is that a court is bound to follow a previous decision even if the
judge disagrees with that previous decision. Mechanism do exist in the modern ELS for a judge to
avoid this process today, but such mechanisms did not exist, or were rarely used, in the more
antiquated system. This meant that the common law did not develop and parties could not
persuade a judge to change the law, even when it was obviously in need of change.
 Second, cases in the common law courts were started by means of a writ. A writ is a document used
by a party to commence a legal action. Documents are still used today, but in a different form (for
example, in order to start a civil action, the claimant must issue a ‘claim form’). Under the old
common law system, the bureaucracy of the rules dictated that if the wrong writ had been chosen
or a mistake had been made on the writ, that writ was void and could not be amended as happens
today. Instead the plaintiff (the old term for ‘claimant’) had to forego the expense and trouble of
starting all over again.
 Additionally, the common law rules required that certain civil actions (this was in the days before a
formal legal system for the resolution of criminal cases existed) had to involve certain types of
conduct. For example, an action for trespass had to involve an allegation that violence had been
used against the plaintiff. Therefore, in theory, if no violence had been used, the action could not
succeed. In practice, some common law judges were prepared to imply that violence had occurred
when they knew very well that none had.
 Third, the only remedy available at common law was damages. This is a monetary award
(compensation). In many cases, for example a breach of contract, this remedy was perfectly
adequate, but in the case of trespass, the successful plaintiff would not have found money to be an
adequate remedy – he wanted the trespasser to stop (but the order we now call an injunction did
not exist).

Development of equity
Many people felt let down by the common law system because it was unable to remedy these defects
for itself so, as had been the practice before the Curia Regis, they petitioned the king directly for a
remedy. Initially, kings would consider these petitions themselves but at some time during the fifteenth
century this work was handed over to the Lord High Chancellor, known subsequently just as the Lord
Chancellor. The number of petitions rose dramatically, so the Lord Chancellor established a court to hear
the petitions. This court was called the Court of Chancery. The rules which the Lord Chancellor adopted
in this court were not the rules from the common law courts. Actions were started by a petition rather
than a writ, and the Lord Chancellor was not bound by precedent. Instead, rules were established to
ensure that justice was obtained in those cases where the parties were able to show that the common
law courts were not able or prepared to provide a suitable remedy. These rules became known as the
rules of equity, ‘equity’ meaning even-handedness and fairness. It was never intended that the
principles of equity would replace the common law rules simply that they would fill the gaps in it and
make up for its defects.

Maxims of equity
One of the ways in which equity was able to plug the gaps of the common law was by using guidelines
called maxims of equity. One of the better-known maxims is ‘He who comes to equity must come with
clean hands’. This means that equity will not assist a party who has acted in bad conscience.

For example in D & C Builders v Rees (1966), the plaintiff company sued Mr and Mrs Rees for failure to
pay a bill in full for building work done to their home. The plaintiff had sent three bills and the defendant
had paid only one-third ‘on account’. The defendants then made complaints about the quality of the
work and, knowing that the plaintiff company was in severe financial difficulty, offered to pay a further
third, but ‘in full settlement’. The plaintiff company agreed, only because without the money the
company would have gone bankrupt. The company later sued the defendants for the outstanding
amount.

Lord Denning MR (denoting that he was, at the time of judgment, the Master of the Rolls) held at the
Court of Appeal: ‘the creditor (the plaintiff) is only barred from his legal rights when it would be
inequitable for him to insist upon them. Where there has been a true accord, under which the creditor
voluntarily agrees to accept a lesser sum in satisfaction, and the debtor acts upon that accord by paying
the lesser sum and the creditor accepts it, then it is inequitable for the creditor afterwards to insist on
the balance. But he is not bound unless has been truly an accord between them.

. . . In the present case, on the facts as found by the judge, it seems to me that there was no true accord.
The debtor’s wife held the creditor to ransom. The creditor was in need of money to meet his own
commitments, and she knew it. When the creditor asked for payment of the ₤480 due to him, she said to
him in effect: “We cannot pay you the ₤480. But we will pay you ₤300 if you will accept it in settlement. If
you do not accept it on those terms, you will get nothing. ₤300 is better than nothing”. She had no right
to say any such thing . . . There is also no equity in the defendant to warrant any departure from the due
course of law. No person can insist on a settlement procured by intimidation.’

As you can see, Lord Denning was scathing of the conduct of Mr and Mrs Rees. The other Lord Justice,
Danckwerts LJ, found that the Reeses ‘really behaved very badly’. A person who behaves ‘very badly’ is
unlikely to benefit from equity’s protection, as the Reeses found to their cost. As equity would not
intervene on behalf of the couple to protect them from having to pay the full amount, the common law
rules prevailed. One of these rules is that part-payment of a debt does not satisfy (fulfill) the debt. They
had to pay up.

The ‘clean hands’ maxim is one of many maxims of equity. Others include:

 ‘equity is equality’ (unless there is clear evidence one way or another, property should be divided in
equal shares);
 ‘equity looks to the intention and not the form’ (equity looks at what the parties meant to do, not
necessarily what they did do): This was applied in the case of Beny Berry (1929) where a deed was
held to have been altered by a simple contract. Under common law rules, a deed could only be
altered by another deed, but equity decided that as the parties had intended to alter the deed, it
would be fair to look at that intention rather than the fact that they got the formalities wrong.
 ‘equity acts in personam’ (equitable remedies take effect against the person, not their property, so
in the days of the development of equity, a defendant could go to prison for failure to honor an
equitable remedy made against him);
 ‘equity will not suffer a wrong without a remedy’ (if equity considers that a person has a good claim,
equity will ensure that that person has the right to bring a legal action. This allows equity to create
new remedies where otherwise the plaintiff would not have an adequate remedy for the case and
 would only be able to claim the common-law remedy of damages. This maxim allows equity to
continue to develop new remedies when they are needed, such as freezing orders and search
orders.
 Delay defeats equity: A plaintiff must not wait too long before making a claim as this might lead to
unfairness to the other party. In Leaf v International Galleries (1950) a plaintiff was sold a painting
that both parties mistakenly believed was by Constable. The court did not award the equitable
remedy of rescission, since there had been a delay of five years between the contract and the
discovery that the painting was not by Constable.

Equitable remedies
Equity created not only new rights, such as a trust, but also new remedies. As stated above, the only
common law remedy was damages. Equity recognized the limits of the usefulness of money as an award
and developed, among others, the following additional remedies:

Injunction This is an order of the court compelling or restraining the performance of

some act.

Specific performance This is an order compelling a party to perform his part of an agreement that
he had promised to fulfill.

Rescission This is an order restoring parties to a contract to their pre-contractual

positions, releasing them entirely from their contractual obligations.

Conflict with the common law

The common law judges came to view the Court of Chancery as a rival to their authority. This rivalry
came to a head in the Earl of Oxford’s case [1616] where the common law judges refused to recognize
that interest of a beneficial owner of a trust; yet the Chancery judges threatened to imprison the
trustees (the legal owners) unless they recognized that same interest. James I was required to intervene
and he settled the situation; where the common law and equity conflict, equity was to prevail. Had
James I not decided the matter in this way, the purpose of equity would have been fundamentally
undermined.

Having a dual system of courts administering different remedies did cause other problems, however,
and by the passing of the Judicature Acts of 1873-75, the courts system was reformed. The result was
that the administration of the common law courts and the Court of Chancery was merged, to create a
unified system of courts and procedures. Thus, all courts in the modern legal system can use both
common law and equitable principles and give either type of remedy. In the event of a conflict, s25 of
the Judicature Act 1873 provided that equity should prevail and s49 (1) of the Senior Courts Act 1981 is
the modern embodiment of that rule. Common law rules and equitable ‘rules’ have not merged into one
source of law, however. For example, common law rules have a strong influence in contract, tort and
criminal law, and common law remedies such as monetary damages are frequently used in the first two
mentioned areas. By contrast, the Chancery Division of the High Court conveyance (the legal transfer of
property involved in the buying and selling of land and buildings), wills and probates (administration of
the property of persons who have died) and patent and copyright law where the rules of equity are used
frequently. Another important aspect of Chancery work is the administration of trusts.

The relevance of equity today

Equitable rights, interests and remedies remain important in the law today. Concepts such as mortgages
and trusts are equitable concepts. They are both founded on the idea that one person owns the legal
interest in property but has to use that property for the benefit of another. This other person is said to
have an equitable interest in the property.

Today mortgages are a common way to get the finance to buy a home. In fact it is difficult to imagine life
today without mortgages the vast majority of homeowners buy their property with the aid of a
mortgage. Trusts are widely used in setting up such matters as pension funds, as well as within families
when property is settled on younger members of the family or between husband and wife.

New concepts
Equity can still create new concepts in the law. This happened on a number of occasions in the
twentieth century.

Another equitable concept developed in the twentieth century was the “deserted wife’s equity”. This
was the idea that where a husband deserted his wife and children, the wife had an equitable interest in
the matrimonial home, even if it was solely owned by the husband. This allowed the wife to remain in
the home while the children were dependent. This right for partners was eventually put into an Act of
Parliament in the Matrimonial Homes Act 1967.

Modern use of equitable remedies

Equitable remedies are still important and used in a variety of circumstances

One development was equitable or promissory estoppel. This was first suggested by Lord Denning in
Central London Property Ltd v High Trees House Ltd (1947).

Injunctions are often used today. They can be ordered in cases of domestic violence as a protection for
the abused partner. Such an injunction often forbids the violent partner from entering the premises
where the other partner is living or even going within a certain distance of the place. Injunctions are also
used to prevent trespass to land or to prevent excessive noise, or smoke or other nuisances. They are
used in employment law in various situations; for example, a former employee can be prevented from
disclosing trade secrets to anyone, or an injunction may be granted against a trade union to prevent
unlawful industrial action. In one case an injunction was used to limit the number of times power boats
could race in order to prevent the plaintiff from having to suffer too much noise and inconvenience. In
the other an injunction was granted to prevent an actress from breaking her contract with a film
company.

Modern equitable remedies

The courts have been prepared to expand equitable remedies, though the principle that they are
discretionary still remains. Two twentieth century expansions were Mareva injunctions and Anton Piller
orders. The Mareva Comapania SA v International Bulk Carriers SA and is used where there is a risk that
the assets of one of the parties will be removed out of the UK before the case comes to trial. It allows
the courts to order that third parties, such as banks, must freeze any assets in their control. This
important as, at the end of the case, it means there will be assets available to pay damages or costs that
the court awards.

The Anton Piller order was used in Anton Piller KG v Manufacturing Process Ltd and it ordered the
defendant to allow the plaintiff to search his premises and take away any documents or other material
that could be relevant to the case. The thought behind it is to prevent the defendant destroying any
goods or documents which could be used as evidence in the case.
Both these equitable remedies have been absorbed into the civil court procedure rules. The Mareva
injunction is now known as a freezing order and the Anton Piller order as a search order.

From all of this it can be seen that equity still has a role to play in the modern legal system, and that it
can still create new concepts and remedies to fit the justice of particular case