INTRODUCTION TO EQUITY JURISPRUDENCE
[The following article was excerpted from John T. Blanchard's law school textbook,
California Remedies: Commentary, Materials and Problems (3d ed. ©1997)]
It is commonplace to begin textbook discussions of equitable remedies with a brief history of equitable jurisprudence. As dull as most such discussions usually are, they are necessary because, though California has never had separate courts of law and equity, our judicial system still refers to the prior English system and the completion of the merger of law and equity into a single form of civil action will surely not be completed in our lifetimes. Since this merger is only partial, some principles have successfully completed the migration from law to equity (or the reverse) while others have not. The only explanation for certain differences between law and equity is historical.
The judicial officer in a law case was (and is) commonly known as a "Judge"; the bench officer in equity was commonly known as a "Chancellor". As one would guess, the difference is historical. It has been claimed that the office of "Chancellor" - an office that later became roughly equivalent to Prime Minister - had appeared as early as the reign of Edward the Confessor (born 1002, ruled 1042-1066 A.D.). It is likely that this claim overstates a slim historic record; however, Archbishop Stigand is known to have been a favorite of Edward the Confessor and, because of the clergy's literacy, much of the king's administration - his administration of justice - was supervised by various bishops, abbots and other clerics.
The Inadequacies of the Law Courts
Aside from what are now mere quibbles about a chronology that likely can
no longer be stated with precision, it is surely true that by the reign
of Henry II (born 1133, ruled 1154-89), the courts of law in England had
been established on a national scale. The king was vested under this
system with all power and, therefore, the courts exercised only power
delegated to them by the king. The right to resort to the king's courts
was obtained by purchasing a "writ" from the king. The writ authorized
and directed the king's courts to hear the case and to grant appropriate
relief. New circumstances allowed the Chancery, at that time merely the
king's secretarial department, to create new writs, thus providing some
flexibility in that generally crude system. No distinction between "law"
and "equity" existed at this time, there was only the "king's justice".
The distinction between "law" and "equity", a distinction that causes
confounding complexity to this day, developed over the next few hundred years.
"New circumstances allowed the Chancery... to create new writs, thus providing some flexibility in that generally crude system."
In the ensuing generations England was not always blessed with competent
monarchs. King John (born 1167, ruled 1199-1216) is now thought of as a
weak and untrustworthy administrator. Though some significant part of
this common impression is undoubtedly based on nothing more than Errol
Flynn movies, it is undisputed that, whatever their motives and goals, the
barons forced King John to sign the Magna Carta in 1215. The restriction
of the king's powers was periodically restated. It continued during the
reign of Henry III (born 1207, ruled 1216-1272), the elder son of King
John and grandson of Henry II, an undeniably weak and incompetent ruler.
In 1258 a group of barons, led by Simon de Montfort, agreed to grant the
king money only if he accepted the Provisions of Oxford, a body of reforms
to be carried out by a commission of barons; the Provisions of Oxford
specifically prohibited the creation by the Chancellor of new writs to
cope with new situations without the express consent of both the king
and his council (not surprisingly consisting of the same barons who had
insisted on limiting the power of the king's chancellor). Of course,
this prohibition led in time to fossilization of the writ system. Moreover,
in the ensuing centuries the relief granted in the courts of law was
gradually limited to money damages.
By contrast, in France, at about the same time, Louis IX (born 1214, ruled 1226-70), called "St. Louis", was improving his government by appointing local officials who were responsible to him for the administration of justice, the collection of taxes, and the government of their districts and by encouraging his subjects to appeal to him if the nobles oppressed them or if his officials were unjust. He improved the administration of justice by abolishing trials by combat and by introducing lawyers, trained in the Roman law, into his courts in place of the churchmen who formerly were the only people who could read and write. Of course, while abolishing trial by combat may generally be thought desirable, it can hardly be thought the ne plus ultra. As salutary as the changes initiated by St. Louis undoubtedly were, France history outlines a sort of congestion in its legal system different from the English and, in any case, was drastically altered by Napoleon Bonaparte. Shortly after France's entry into the Treaty of Amiens in 1802 he introduced the Code Napoleon, the first clear, compact statement of French law in centuries.
The fossilization of the writ system in England lead to three major
inadequacies in the remedies available in the courts of law:
- No suit to compel the performance of a contractual obligation would be entertained before damage had been caused. The only remedy available was an award of money damages for the loss caused by the breach of contract.
- No suit to prevent a threatened injury to property would be entertained. Instead, the injured party was limited to an award of money damages for the injury after it was completed.
- All contracts were construed exactly as written; no correction of the language of a contract or other instrument was allowed no matter how compelling the evidence that the written expression of the parties' agreement was erroneous.
The Limitations on the Equity Courts
The inadequacies and inefficiencies of the law courts became increasingly obvious and intolerable. Since justice was, at least until the mid-17th century, still the "king's justice", petitions for special treatment were addressed to the Chancellor, the king's chief administrative officer (and a member of the king's council). Until St. Thomas More - a layman - was appointed Chancellor after the death of Cardinal Wolsey in 1530, all of the king's Chancellors had been officials of the Roman Catholic Church. The fact that the medieval Chancellors were all trained in Canon Law and the moral precepts of the Roman Catholic Church is significant in the development of equity. A medieval Chancellor was known as "Keeper of the King's Conscience" and by the 14th century his court came to be called a "Court of Conscience". Thus, one scholarly source unequivocally states that the ecclesiastical training of the Chancellors was "exceedingly beneficial" because "it may well be doubted whether judges trained in the practice of common law [a term in use as early as the reign of Edward I (born 1239, ruled 1272-1307)] would have possessed the courage to interfere with its rules, in the face of the professional opinion of their brethren, or indeed have been sufficiently detached in mind to discover that the rules stood in need of correction." Whether this somewhat extravagant claim is absolutely true or not, the fact is that - subject to several important limitations - medieval churchmen had a more cosmopolitan perspective than many other citizens and, likely because of this broader view, the Chancellors administered a more flexible jurisprudence than the law courts. However, this flexibility had a significant limitation: the law courts could quash the writs (orders) issued by Court of Chancery. Among other things, this hierarchy resulted in the maxim that "equity follows the law".
Another limitation on the powers of the Chancellor was that, as was the case historically with the ecclesiastical courts, Chancery had no in rem jurisdiction; that is, the Chancellor could act only in personam (leading to the maxim that "equity acts in personam"). Entirely too much emphasis has been placed on that tired maxim. In fact, the Chancellor always had substantial (albeit indirect) power over property because he could order a person to act or refrain from acting as to property (and punish disobedience by contempt); equitable liens and servitudes are now commonly enforced; and modern "standing" and "personal jurisdiction" concepts generally answer situations historically controlled by the maxim. Nevertheless, the principle stills exists and bears upon such things as the identification of defendants in such actions as suits to declare laws unconstitutional and the like.
The primary limitation on the power of the courts of equity was that equity will not intervene in all circumstances; in particular, it will not intervene when a litigant's legal remedy is sufficient. Historically, equity intervened when a party had been induced by "fraud or breach of confidence" to alter legal rights by, e.g., entering into a contract or had by "accident" lost a legally significant document. Though the merger of law and equity is well underway, that merger is not yet complete and at least "lip service" - and arguably a good deal more - is still paid to this limitation by the requirement for equitable remedies that the plaintiff's "legal remedy is inadequate". Of course, the standard "legal remedy" is money damages.
Right to Jury Trial
The importance of distinguishing between legal and equitable causes of action has been minimized by the modern procedural unification of legal and equitable claims (a unification that, among other things, diminishes conflicts as to allowable evidence, etc.). However, distinctions between these two kinds of claims remain important as to a party's right to trial by jury.
It is not the function of this text to explore thoroughly how the right to jury trial is analyzed under state and federal law. However, since the general topic of "Remedies" requires consideration of numerous other subject matter areas (e.g., the substantive law of contracts and torts, and applied civil procedure) those other areas must be recalled when considering the availability of any given remedy. Thus, these materials recall basic principles of federal jurisprudence regarding the basic right to jury trial (principles that should have been dealt with in detail in Civil Procedure) and note the different approach to such issues in most state courts. With these differing approaches in mind, the balance of this text considers various legal and equitable remedies. Determination that a given remedy is legal may trigger a right to a jury trial; conversely, determination that the remedy is equitable may foreclose a litigant's right to jury trial. In particular, "restitution" of unjust enrichment presents subtle analytic difficulties. Sometimes "restitution" is a measure of damage and, thus, is deemed legal; however, in other instances the existence of unjust enrichment and the consequent need for restitution of such enrichment forms the predicate of equitable decrees (e.g., establishment and enforcement of involuntary trusts).
The right to a jury trial in an action at law is constitutionally protected where certain standards (e.g., minimum amount in controversy) are met. However, neither constitutions (state or federal) nor history attaches a right to jury trial to a suit seeking equitable (sometimes termed "extraordinary") relief; instead, suits in equity have historically been tried solely to the court (in what are conventionally termed "bench trials"). Of course, difficult issues are posed by cases in which the same set of operative facts may sustain either legal or equitable remedies. Analysis of the right to jury trial in such cases depends on whether the plaintiff seeks both legal and equitable relief based on the same set of facts or whether the conflict between law and equity is raised by a defendant's cross-complaint (and, if so, whether that cross-complaint was compulsory or merely permissive). In addition to the historic analysis that is at the heart of most constitutional analysis, the possibility of a special statute or rule affecting the right to jury trial must be considered.
The primary focus of these materials is not on the right to trial by jury. That right is of constitutional dimension precisely because it is freighted with not only a long and complex history but, in addition, substantial tactical and strategic importance. Determination of whether a jury trial is available and, if so, whether it precedes or succeeds a bench trial becomes acute if the facts would be better received by a jury than by a judge (e.g., judges are often thought to be more receptive to technical arguments while juries are thought to be more apt to ignore technicalities if the claimant is otherwise sympathetic). An equity court has discretionary power to submit issues of fact in a case before it to a jury for determination (by empaneling a so-called "advisory jury"); however, such proceedings are not generally favored because they are an inefficient use of the court's limited resources and raise the possibility of embarrassing (if nothing else) inconsistencies between the judge and the jury.
In cases where both legal and equitable remedies are, at least in part, founded on the same operative facts (e.g., the existence of a contract between the parties) the identity of the finder of those facts is often of crucial importance. Once a fact has been "found" by a competent trier of fact the second trier of fact is bound by the initial trier of fact's decision; indeed, the initial finding may completely dispose of the second aspect of the litigation. For example, if one party refuses to perform an alleged contract on grounds that no legally binding contract was formed between the parties and seeks a judicial declaration to that effect (conventionally deemed an equitable action) and the other party cross-complains for damages for breach of that same agreement (obviously on the theory that a binding contract was formed), then the identity of the finder of the "fact" of the "contract" may be critical. If the court tries the declaratory relief action first and determines that no contract existed between the parties, then an essential element of the legal action for money damages must, a fortiori, fail (and, thus, there would be no trial on the legal claim). Conversely, if a jury decides the breach of contract damage claim first and awards damages to the cross-complainant it follows automatically that it must have decided that a binding contract existed and was breached and, thus, that a declaration of rights and responsibilities by the court would be superfluous.