THE DOCTRINE OF EQUITY

 WHAT IS EQUITY?
 Equity is the body of rules administered in England by the Court
of Chancery on the one hand as distinguished from the Common
Law Courts on the other, before the Judicature Acts of 1873 and
1875. There has been development of the rules of Equity since
the Judicature Acts, such as the doctrine of estoppel developed
in the High Trees Case that where a promise intended to be
binding is made with an intention that it be acted upon and it is
in fact acted upon, it is binding as far as its terms properly apply
and the promisor cannot refuse to honour it simply by pleading
the absence of consideration.
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 The Dual Meaning of the term “Equity”.

 The term “equity” has both a broad, popular and a
narrow, technical sense.
i. The broad non-technical meaning of “equity” is
fairness or what is just, i.e justice according to
natural justice or morality. This was originally the
sense in which the term was applied to that type of
justice which the Chancellor dispensed to mitigate
the rigours of the Common Law.
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ii. Technical Sense: today, equity is a settled

body of rules of law which do not necessarily
coincide with any notions of natural justice,
fairness or morality.
 The Maxims of Equity: these are principles
which the court of Chancery followed when
deciding cases, and which are applied today
when equitable relief is claimed.
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 Maxims of Equity
1. Equity will not suffer a wrong to be without a
remedy
 This maxim goes to the root of equity. i.e no
wrong should go without a remedy/redress. It
was the attempt of equity to ensure that no
wrong went without a remedy that equity
developed. The maxim was the basis for the
enforcement of trust by equity.
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• Examples: if ‘A’ conveyed land to ‘B’ in trust for

‘C’, it was based on confidence in ‘B’ that he
would honour the terms, yet the Common Law
Courts would grant ‘C’ not even a locus standi
because legal title was vested in ‘B’ while ‘C’ the
beneficiary (cestui que trust) was not a party to
the transaction. This was wrong and equity
intervened to compel ‘B’ not to abuse the
confidence ‘A’ had in him, but to use or hold the
property for the benefit of ‘C’.
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• Examples: Another example is that at Common

Law one had to prove the case on the strength of
his own title. Thus, if the only way of proving
your case was by documentary evidence which
documents were in the custody/possession of the
defendant the plaintiff could never compel the
defendant to produce these documents. Equity
intervened and compelled the defendant to
produce what ever documents he had in his
possession bysubpoena.
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• Examples: A third example is where damages is

not an adequate remedy, equity will order
specific performance. In tort cases an injunction
will be issued against the tortfeasor. Note that
equity does not act in vain and where it would be
impossible to carry out the order of the court or
for the court to supervise that no wrong without a
remedy is committed such as in contracts for
personal services, the courts will not grant
specific performance.
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• 2. Equity Follows the Law But Not

Slavishly:
- This maxim means that equity will not disturb
common law rules even where it is unjust.
Where there is conflict between legal and
equitable interest in the same property then
preference is given to legal claimant if his
conscience is clear. Instances where equity has
not followed the law include:
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 Where the common law is too rigid, equity

will not follow the law. Where there was a
clear and direct rule of the Common Law
or of statute which cover all aspects of a
particular, equity would not intervene or
attempt to alter the effect of the rule.
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3. Where the equities are equal, the law will prevail:

At Common Law competing claims are determined according to

the time the interests was created; and the basic rule is that the first
to be created takes precedence over the later ones. If two equal
equitable claims are made against the same property and one claim
has the advantage of a legal title as well, equity steps on one side
and the legal title succeeds. Cave v Cave: ‘A’, a trustee, cancelled
the trust and sold the trust property to ‘B’, a bona fide purchaser
for value without notice of the trust, ‘B’ will have an equal equity
with ‘C’, the beneficiary, but since ‘B’ has the advantage of a legal
title or estate, he will prevail over ‘C’.
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3. Where the equities are equal, the law will

prevail:
Where the prior or first interest is an equitable
interest, but there is a late claimant with the
legal interest which was acquired in good faith
and for value without notice of the previous
equitable interest, then he acquires a better title.
Notice in this context may be actual,
constructive, or imputed.
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Cole v Folami (1956) 1 FSC 66.
Facts: the appellant, in support of his claim of ownership to the
disputed land, tendered in evidence a receipt for £25 as evidence of
his purchase of the property in dispute. No conveyance was executed
in his favour. But the court upheld the respondent’s evidence that he
bought the land along with an executed conveyance without notice of
the appellant’s prior equitable interest.
Held, per Jibowu Ag. FCJ (at p.69): “Although the respondent had the
legal estate conveyed to him, in equity the claim of the appellant
would have been preferred to his, if he had bought the land in dispute
with knowledge of the appellant’s prior equitable interest. The
respondent testified that he was a buyer for value without notice of
any equities attaching to the land and that was not disproved.”
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3. Where the equities are equal the first in time prevail.

Kofi v Adjei (1942) 8 WACA 198
Facts: On June 10, 1939 KD bought a piece of land at a
sale by public auction. The next day the same property
was bought by the defendant at a sale by public auction. In
an action to determine who should have priority, it was
held that KD who bought the property first in point of
time obtained a good title to the land in dispute and so the
subsequent sale to the defendant had no effect and gave
him no title.
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4. He who seeks equity must do equity:

This means that anybody who relies on Equity
must be fair in his dealings with the other
party. For example, if a person contracts in
illegal loans, then he cannot ask for relief
through equity, if he fails to give the other
party fairness.
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5. He who comes to Equity must come with

clean hands:
This means that a person seeking an equitable
relief cannot get it if he himself has failed to
perform certain terms of the contract. Whilst
the third maxim looks at the future conduct of
the person, the fourth maxim looks at the
present conduct.
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6. Delay Defeats Equity:

This means that equity aids the vigilant and not the
indolent. For a delay or LACHES to be used to prevent a
party from asserting his rights, the following conditions
must be present:
a. The party must know his right
b. Must have full capacity, and
c. Should not have acted voluntarily. The equitable
doctrine of laches has been put in a statutory form
under Act 54 – The Limitation Act.
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7. Equality is Equity:
This means that equity delights in equality, and
this will be followed where there is no
indication as to the proportion in which each
party is entitled to something. For example,
partners share in the profits of a partnership will
be presumed to be of equal ratio, where the
partnership agreement does not specify any
ratio.
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8. Equity Looks to the Intent rather than the form

Equity frowns on formality, when it is seen that it affects the
substance of the transaction. Thus where there is a statutory
requirement that certain formalities must be present for
something to be valid, but a contrary formality was followed
even though the parties intended the right thing, then equity
will intervene. In spite of the formality, it is the substance
which is important, and equity will prevail. Equity looks at
the purpose of a transaction. It considers a mortgage as a
security transaction even though in form it is a conveyance.
Hence, a mortgagor’s equity of redemption.
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9. Equity Imputes an Intention to Fulfil an

Obligation
This may mean that where a person is already
liable under various obligations and he does
something to discharge these obligations, then
that particular act can be set off or imputed to
the discharge of any of these outstanding
obligations
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10. Equity Acts in Personam

This means that equity will compel a person to fulfil an
obligation under a contract, but not in damages, where
damages will not be fair.

11. Equity Regards as Done That Which Ought to be

Done.
Equity assumes that parties to a concluded contract
already have rights conferred by the contract. Walsh v
Londstale.
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12. Equity Will Not Assist a Volunteer

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 Priority and the Doctrine of Bona Fide Purchaser

of the Legal Estate Without Notice.
 Okoye v Dumez (1985) 1 NWLR 783, PT.4.
 Facts: the appellant brought an action claiming the ff:
a. A declaration of leasehold title to a piece of land at
Cloba Ikwere in River State
b. Damages for trespass committed by the defendants on
the said land and
c. Perpetual Injunction restraining the defendants and
their servants and agents from committing further acts
of trespass on the land.
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The 1st defendant was granted a lease in the disputed land by the Plaintiff
Landlord. The lease contained an option to renew on the expiration of the
term of years granted. The option to renew the lease was not subject to the
consent of the landlord. At the expiration of the original term, the lease was
renewed for a further 6 months. When the subsequent term of 6 months
expired, the lessee (1st defendant) exercised his option to renew for a further
term which option was refused by the landlord on the ground that they
(landlords) had committed themselves to the Plaintiff/Appellant. In spite of
the landlord’s refusal to give consent, the defendant remained on the land.
Despite the knowledge that the defendants were in possession of the land, the
Plaintiff/Appellant obtained a lease of 99 years over a large piece of land
from the 1st defendant’s land. The large piece of land embraced the land in
dispute. The trial judge granted the reliefs sought by the Plaintiff/appellant.
The defendant/respondent appealed to the Court of Appeal which allowed the
appeal, set aside the decision of the High Court and ordered a dismissal of the
Plaintiff’s claim.
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Per Bello JSC at p.790: “where a purchaser of

land or lease is in possession of land by virtue of a
registrable instrument which had not been
registered and had paid the purchase money or
the rent to the vendor or the lessor, the purchaser
or the lessee has acquired an equitable interest in
the land which is as good as a legal estate and the
equitable interest can only be defeated by a
purchaser for value without notice of the prior
equity.”
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Under What Circumstances Can a Subsequent Legal Title Overreach

a Prior Equitable Interest in Land?
Osage v Oyeyinka (1985) 3 NWLR 52, pt. 11.
Martins v Molade (1930) 9 NLR 53.
Facts: the D. held a plot of land in the Northern Region of Nigeria
under a Certificate of Occupancy. He erected buildings on the plot
and sold these buildings to one R. The consent of the Governor was
not obtained for this disposition as required by S.4 of the Land and
Native Rights Ordinance which provided, inter alia, that no title to
the occupation and use of any land shall be valid without the consent
of the Governor. Subsequently, the plaintiff obtained a judgment
against D. and proceeded to levy execution on these buildings. R.
resisted the execution.
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Held: “The sale was only effective as between

the vendor and the purchaser (conferring mere
equitable interest) and could not affect the
right of a third party such as a judgement
creditor (who thus acquired a legal estate) who
had no notice of any equities in favour of R.
Judgment was given for the plaintiff.”
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Johnson v Onisiwo (1943) 9 WACA 189
Facts: the plaintiff acquired the legal estate of the land in dispute and brought an
action to evict the defendants who had an unregistered lease in the property. It was
held that his legal estate was subject to the equitable interest which he had
constructive notice of.
Held, per Kingdom C.J (at pp.192-93): “The plaintiff at the time of his purchase had
notice of the defendants’ lease which constituted an unregistered equitable estate in
the defendant. It is clear therefore that at the time of his purchase, the plaintiff was in
equity bound by the lease and the estate he acquired by his purchase was in equity
subject to the lease. Where an estate is affected by an equitable interest a subsequent
purchaser for value will not be affected by that equitable interest provided three
conditions are fulfilled:
i. He must have obtained the legal estate
ii. He must have given value for the property
iii. He must have had no notice of the equitable interest at the time when he gave
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Types of Notices:
i. Actual notice,
ii. Constructive notice, and
iii. Imputed notice.
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 DISTINCTION BETWEEN LEGAL &

EQUITABLE RIGHTS:
 A legal right is a right in rem (i.e it is
available against the whole world.
 An equitable right is essentially a right in
personam (i.e it is capable of enforcement
against certain persons only and not
against the world at large.
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 DISTINCTION BETWEEN LEGAL & EQUITABLE RIGHTS:
 When we say equity acts in personam, we mean that equity acts on the
person, but common law acts in rem. The common law would grant
damages and if judgment was not respected it would be enforced by the
sale of the judgment debtor’s property.
 Equity on the other hand acted in personam because it specifically
ordered the defendant to do a particular thing or desist from doing a
particular thing
 the classical common law remedy was damages (i.e monetary
compensation for legal injury and available as of right.
 In contrast, equitable remedies are discretionary (only granted where in
all the circumstances it is fair that they should be granted.
 Equitable remedy would only be granted where the common law
remedy would not adequately meet the case.