Xerte Rescource For Introduction

Section 1: Development of Equity
 Common law was developed after the Norman conquest in 1066 which made
a system of judge-made law common to all England. Had to be a writ which
was basically an early claims form.
 Without a writ, there is no remedy. If the claimant had no remedy, they could
petition the kind directly.
 This became too much for the king, so he transferred his function to the
chancellor.
Origins of equity
 Equity developed from the early decisions of the chancellor which was later
expanded on by the court of chancery.
 There were problems between distinctions of the common law and equity.
Earl of oxford case (1615) decided that in cases of conflict, equity should
prevail.
 The judicature act of 1873 and 1875 abolished the separate common law and
chancery courts were replaced by a high court. High court divided into three
divisions and the 1873 act stated that in cases of conflict, equity will prevail.
 All courts can administer the rules and remedies of common law and equity
but they remain distinct bodies of law.
Equitable maxims – embody the general principles which were developed

in the court of chancery.
 Equity is discretionary
 Those who seek equity must do equity
 Those who come to equity must come with clean hands
 Equity follows the law
 Equity looks to substance rather than form
 Equity is equality.
Contributions of equity
 Promissory estoppel – a party has made a promise, and another party has
relied but there is no consideration.
 Equitable remedies – injunctions ( force someone to do something), specific
performance.
 Equity is still very rule based – Guest v Guest.
 Equitable maxims are cited by judges to summarize a complex body of law,

so they are basically guidelines. Lord Upjohn in Boardman v Phipps
recognised that rules of equity can be applied to such great number of
circumstances and must be applied to particular attention to the certain
circumstance of the case.
 Equitable maxims are a set of statements that can provide guidance about
equity, but sometimes can be misleading. They are so old that its not accurate.
 There are fourteen maxims that are useful and relevant today as guidelines for
the operation of the equitable jurisdiction.
 (1)
 Equity is discretionary.
 (2)
 Equity is triggered by unconscionability.
 (3)
 Those who seek Equity must do equity.
 (4)
 Those who come to Equity must come with clean hands.
 (5)
 Equity treats as done that which ought to be done.
 (6)
 Equity protects the weak and vulnerable.
 (7)
 Equity is cynical.
 (8)
 Equity is imaginative.
 (9)
 Equity follows the Law.
 (10)
 Equity looks to substance rather than to form.
 (11)
 Equity will not assist a volunteer.
 (12)
 Equity assists the diligent.
 (13)
 Equity is equality.
 (14)
 Equity acts in personam.
 Not all maxims should be regarded as valid.
Section 2: the trust in basic terms
The origins of a trust
 EXAMPLE - People can transfer land to another person whilst they

are away and then return ownership when they come back (transfer
of ownership). If the transferee does not want to give the land back,
they can seek a remedy through the common law courts. If this does
not work, they can challenge the chancellor.
 It is not possible to define a trust as there are so many in the present

world.
 Trust – an arrangement involving property where one person holds

and uses property for the benefit of another person. 3 characteristics
for a trust: is to do with property ( it has to do with a property), a
fragmentation of ownership, there is an obligation component of
trust.
 Trust can be involved with intangible property such as shares.
Section 3: the many uses of a trust
What are trusts for?

 Trusts can be created intentionally where an owner of property decides
they want that property to be held on a trust (express trusts).
 They can also eb created due to a circumstance through equity and a
trust is imposed (non-express trust).
Express trusts
 Protective trusts can be used to leave money to someone who is
irresponsible with their money. Trustee can look after property for the
benefit of the B, and the B cannot get the property outright.
 Trusts are useful in succession planning. E.g. – husband dies so wife
benefits and when she dies the children will benefit.
 Secret trusts can be made.
 Wealthy individuals can appoint a trustee that liven in a tax haven to
manage your assets and reduce the amount of tax you must pay.
Non-express trusts
 These trusts can arise as a result of many different circumstances such

as cohabiting relationships in the family home and the failure of an
express trust.
 They rise from an operation of law.
Section 4: the parties of the trust
 Settlor – create the express trusts and is the absolute owner of the
property. They create an express trust through a self-declaration of trust
where they declare themselves a trustee. They can also create a trust by
transfer. Settlors can also create testamentary trusts where a trust is
made in your will.
 Testator – like a settlor as they can both create trusts, but a testator
creates a trust when their trust becomes active in their will.
 Trustee- hold legal title to the property, but hold the property for the
benefit of the B. There is no limit to the maximum number of trustees
except for non-charitable trusts of land (Trustee act 1925, s34(2)). they
are subject to judiciary duties. Must comply by duties set out by the
trust instrument and comply with fiduciary duties.
 Fiduciary – the main duty of a fiduciary is loyalty. The trustee must

keep in mind the interests of the beneficiary first.
 Beneficiary – Have two types of rights: equitable proprietary rights and
personal rights against the trustee so they can hold the trustee
accountable- often claims for money when things go wrong. The B has
equitable title to the trust property.
 Equitable proprietary rights are so important because they are

enforceable against third parties so if the trustee decided to give the
property away in breach of trust, the B can try and claim the property
back. They may want it back as property could have increased in value.
The B can claim any profit that the trustee made off the property.

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Section 1: Development of Equity

Equitable maxims – embody the general principles which were developed

 Equity is still very rule based – Guest v Guest.

 Equitable maxims are cited by judges to summarize a complex body of law,

Section 2: the trust in basic terms

The origins of a trust

 EXAMPLE - People can transfer land to another person whilst they

 It is not possible to define a trust as there are so many in the present

 Trust – an arrangement involving property where one person holds

 Trust can be involved with intangible property such as shares.

Section 3: the many uses of a trust

What are trusts for?

 These trusts can arise as a result of many different circumstances such

Section 4: the parties of the trust

 Fiduciary – the main duty of a fiduciary is loyalty. The trustee must

 Equitable proprietary rights are so important because they are

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