Equitable Maxims

Insight | March 2017

Equitable Maxims (I)
Image: ‘Balanced Law’ by Mike Savad

There are within the discipline of equity, a number of maxims reverted to when settling many common law matters. The aim of this article is to present them in as exhaustive a manner as possible, while including notable cases that explain their application.

Equity follows the Law (Aequitas sequitur legem)

The nature of equity is one that supports, rather than overrules the balance of justice, however it must also be stressed that where the moment calls, equity will go against those principles in pursuit of a fair outcome that common law fails to provide. A suitable case example for this is Stack v Dowden, in which an unmarried couple shared a home for over twenty years while raising their children, until the time came for separation. Upon parting, the father argued that as the two parties enjoyed joint legal title, beneficial interest was automatically deemed equal, unless robustly proven otherwise. This sentiment was echoed in the above maxim, and until this case had been presented, it remained common law that equal beneficial interest was assumed to mirror that of legal title. However, the evidence presented by the respondent was overwhelming to the point that for the first time, the percentages were divided heavily in favour of the mother. This reexamination of beneficial assumption was instigated by Baroness Hale of Richmond, who urged:

“The issue as it has been framed before us is whether a conveyance into joint names indicates only that each party is intended to have some beneficial interest but says nothing about the nature and extent of that beneficial interest, or whether a conveyance into joint names establishes a prima facie case of joint and equal beneficial interests until the contrary is shown.”

Where the equities are equal, the law will prevail

Frequently tied to property dealings, this maxim relates to two parties seeking title to a property without awareness of each others rights. An example of this might be a beneficiary to an estate who is unaware that a third party has since acquired legal title by means of a purchase (as sometime happens when wills are not updated nor properly constructed). The courts will view both potential owners as equal, however where the legal owner can prove ownership free of fraud, the latter will succeed. This position was underlined in Pilcher v Rawlins, where it was clarified by James LJ that:

“[S]uch a purchaser’s plea of a purchase for valuable consideration without notice is an absolute, unqualified, unanswerable defence, and an unanswerable plea to the jurisdiction of this court. Such a purchaser, when he has once put in a plea, may be interrogated and tested to any extent as to the valuable consideration which he given in order to show bona fide or male fides of his purchase, and also the presence of the absence of notice; but when once he has gone through that ordeal, and has satisfied the terms of the plea of purchase for valuable consideration without notice, then…this Court has no jurisdiction whatever to do anything more then allow him to depart in possession of that legal estate.”

Equity looks to the substance rather than the form

This is a fairly descriptive maxim that serves to keep focus on legal proceedings in such a way that holds the principle of fairness above that of policy or written codes of conduct. This is not to say that where statute dictates a course of action, equity will seek to ignore that. In fact, under those terms the black letter of legislation will always win the day. What it does aim to do is look at the form of the subject matter, rather than allow the intention to dissolve in favour of caveats that work against common law, and obstruct a proper outcome. This was demonstrated through the words of Lord Romily Mr in Parkin v Thorold, who remarked that an agreement between a vendor and purchaser did not rest upon the limitations of time, and that when charges brought against the vendor for specific performance altered the essence of the contract, it was equity that referred the parties to the form of the arrangement:

“[T]ime was originally not of essence of the contract…although express notice will make time of the essence of the contract, where a reasonable time is specified…the notice of the 21st October did not specify a reasonable time for this purpose.”

Equity will not permit statute to be used as a cloak for fraud

While perhaps limited in scope, the effects of this maxim can be appreciated within property law matters, as it is a legal requirement under section 53(1)(b) of the Law of Property Act 1924 that any contracts for sale or occupancy must be written. And so in Bannister v Bannister, the owner of a property conveyed a party rent free occupancy of the home for life, after which they tried to evict them. It was then argued by the defendant that an oral contract existed which thus defeated the act of statute when the respondent went back on their promise.

Equity imputes an intention to fulfil an obligation

Relating to ambition and intention, the aim here is to hold to account the statements or actions by a party that are later required to be enforced, regardless of any reasonable changes in circumstance. When the court finds that no such fulfilment has occurred, the obligation to do so will be levied through equity. An example of this is Lechmere v Lady Lechmere, in which a Lord bound himself to purchase land for an agreed sum, that would then pass through death to his wife. Upon his passing, it was discovered that he had failed to uphold his requirement during the lifetime of their marriage, by purchasing other lands that now fell within the residue of his estate, and required a successor in title other than his son. Through the application of this maxim, the court allowed the transfer to his wife for the amount agreed, and thus his obligations were deemed satisfied, as was expressed within the judgment which read:

“[W]herever a thing is to be done either upon a condition, or within a time certain, yet if a recompence can be made which agrees in substance, though perhaps not in every formal circumstance, such a recompence shall be good, and shall go in satisfaction of the thing covenanted to be done.”

Equity regards as done that which ought to be done

There are times in law where the misdeeds of others wind up obscuring the natural order of events, and so it is that the equitable maxim above is crucial to redressing the imbalance, and putting matters where equity can reign. A fitting case example would be Attorney-General for Hong Kong v Reid, where a senior crown prosecutor received bribes to obstruct the course of justice, while employed in a manner that bestowed fiduciary duties. When it was discovered that those illegal payments had been invested in a number of properties, it was agreed that those homes were held on trust by the appellant for the benefit of the Crown; and while the rules of equity prevent a debtor to the injured party being a trustee for the monies received, the Court of Appeal allowed that conflict to stand in order for the outcome to find form, and for natural remedy to occur. This decision was supported by Lord Templeman, who commented:

“It is unconscionable for a fiduciary to obtain and retain a benefit from a breach of duty. The provider of a bribe cannot recover it because he committed a criminal offence when he paid the bribe. The false fiduciary who received the bribe in breach of duty must pay and account for the bribe to the person to whom that duty was owed.”

Equity acts in personam

Because some matters involve effects belonging to individuals that may have since moved abroad, the principle that equity acts against the person provides domestic courts with an ability to extend their reach without interruption of foreign laws. This may come into play when a property owner or business person has entered into a contract that binds them within the United Kingdom, but whose absence may permit avoidance of liability for remedy. There are of course limitations to this maxim, and where the laws of the country occupied prevent such imposition, the party accused may yet evade its grasp. This was explained by Lord Cottenham in ex parte Polland, when he outlined:

“[C]ontracts respecting lands in countries not within the jurisdiction of these courts…can only be enforced by proceedings in personam which courts of equity are constantly in the habit of doing; not thereby in any respect interfering with the lex loci res sitae.”

Equity will not suffer a wrong to be without a remedy (ubi jus ibi remediam)

Much like the founding principle of equity itself, there are times when common law can inadvertently create unjust reward for those who deserve no such fortune. And so it is that when defective legal rulings are left wanting, the maxim ‘no misdeed should go unpunished’ can be applied to restore equality, while in many respects mirroring the maxim ‘equity regards as done that which ought to be done’.

An example of this is Ashby v White, in which a member of the public community was denied the right to vote by local policemen, who wrongly acted on the damning advice of parish members, claiming he was unfit to cast opinion. When taken to court, the claimant was awarded damages, after which the ruling was later overturned in favour of the policemen. This compelled the man to issue a writ of error against Parliament, on grounds that such a verdict allowed any member of a local authority to choose who could vote, when such powers were conferred upon central government. When it was appreciated that a legal process had allowed this kind of miscarriage, the initial judgment was upheld and damages paid, while expressed:

“[A]s all parliamentary causes are to be determined in parliament, it was conceived that this matter was properly determinable in the House of Commons only; and that the courts of Westminster-Hall not being authorized by any act of parliament, had no cognisance of it.”

He who seeks equity must do equity

‘Do unto others as you would have them do to you’, might be another phrase better known to some, and so again equity commands the same from those seeking remedy. It is after all, the bedrock of law that fairness and equability must at all times remain in view should the rule of law justify its own existence; so when one party brings action against another, it must act accordingly should it wish those accused to do the same. An excellent example of this is Chappell v Times Newspapers, where Megarry J explained:

“If the plaintiff asks for an injunction to restrain a breach of contract to which he is a party, and he is seeking to uphold that contract in all its parts, he is, in relation to that contract, ready to do equity. If on the other hand he seeks the injunction but in the same breath is constrained to say that he is ready and willing himself to commit grave breaches of the contract…then it seems to me that the plaintiff cannot very well contend that in relation to that contract he is ready to do equity.”

He who comes to equity must come with clean hands

Once again we look to integrity and depth of character when assessing claims of inequitable conduct, except those claiming must themselves prove their argument does not rest upon misdeeds of their own within the parameters of the matter. An example of this is Barrett v Barrett, where two brothers worked together to avoid the loss of a property during business liquidation. When the party losing their business asks the other to purchase the home (held by the assigned trustee) before refurbishing it and selling it for a substantial profit, the buyer later refuses to pass the sale proceeds back to his sibling. The brother retaliates by taking action against him, but unfortunately during the hearing it emerges that the former owner acted in collusion so as to avoid surrendering the property as payment to his creditors, therefore his request for equitable remedy was built upon deception and avoidance of duties owed. This lapse of moral fibre was explained by Richards J, who noted:

“He has in effect pleaded the unlawful purpose in paragraph 15(1)(a) of his particulars of claim : the purpose of purchasing the property in the name of John was “to avoid its being repossessed by the Trustee in Bankruptcy”. Without that purpose, the agreement or arrangement has no rational explanation. Thomas needs to allege and prove it in order to establish the agreement, but in doing so he relies on his own illegal purpose and thereby renders his interest unenforceable.”

Delay defeats equity

Fettered through the confines of the Limitation Act 1980 and the estoppel doctrine of laches, this maxim underlines that when seeking legal remedy, it is imperative that the claimant moves to argue with haste, as the passage of time will ultimately work against any reasons to the contrary. That aside, there are particular beneficiary rights exempt from delay, and those include breach of fiduciary duty, undue influence or recession of contract; while s.36 of the 1980 Act refuses to prevent claims on grounds of acquiescence, as this in itself can stand as evidence of that restraint. An excellent case for the examination of this maxim is Erlanger v New Sombrero Phosphate Co, in which Lord Jackson cited the comments in Lindsay Petroleum Co v Hurd:

“The doctrine of laches in courts of equity is not an arbitrary or a technical doctrine. Where it would be practically unjust to give a remedy, either because the party has, by his conduct done that which might fairly be regarded as equivalent to a waiver of it, or where, by his conduct and neglect he has, though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards to be asserted, in either of these cases lapse of time and delay are most material. But in every case if an argument against relief which otherwise would be just, is founded upon mere delay, that delay of course not amounting to a bar by any statute of limitations, the validity of that defence must be tried upon principles substantially equitable. Two circumstances always important in such cases are the length of the delay and the nature of the acts done during the interval, which might affect either party and cause a balance of justice or injustice in taking the one course or the other, so far as relates to the remedy.”

Equity will not allow a trust to fail for want of a trustee

As clearly explained within the title, this maxim states that in the event that a trust has been constructed in the absence of a trustee, or that through time those appointed have since passed, the courts will take the necessary steps to ensure the trust is honoured, and a suitable trustee will stand in receipt. This power is conferred to the courts under the Trustee Act 1925 and requires no reliance upon common law to succeed.

Equality is equity (aequalitus est quasi equitas)

Often applied to manage the distribution of assets between beneficiaries, this maxim will allow the court to distribute equal shares between any number of parties where no prior agreement has been found. While used primarily with trusts, this is also found in divorce proceedings, where evidence aside, the husband and wife cannot fully establish the exact proportions of the monies remaining after the fact. An example of this is Burrough v Philcox where Lord Chancellor Cottenham remarked:

“I think myself justified in giving effect to the intention, which appears to me to be sufficiently apparent upon the will, of giving the property to the nephews and nieces, and their children, subject to the selection and distribution of the survivor of the son and daughter; and that they all constitute the class to take all the property as to which no such selection and distribution has been made.”

Equity will not assist a volunteer

In its most simplest of forms, this maxim provides that equity will not, by virtue of their proximity, assist a party indirectly involved in a matter of grant, whether by marriage or by trust (as is most often applied). In the latter instance, a lack of consideration for the benefits of such a trust automatically renders the claimant void of support when seeking remedy, and further renders them incapable of instructing a trustee to the same end. A volunteer can however, sue for breach of duty or agreement where they are so associated, and can attain that those in trust are there for the benefit of the volunteer and hold only for their needs (where applicable).

Equity will not perfect an imperfect gift

The willingness to give freely of something must extend beyond words and take effect through action, or equity cannot enforce the gesture within the courts. This would apply to anything under common law, but is typically found in property and trust matters where a party alleged to have been conferred that of a physical form are left wanting, and so in search of remedy through the principle above. An excellent case example for this denial is Curtis v Pulbrook, in which a company director made efforts to pass on a number of shares to his daughter while in the process of liquidation, but who did so without formalising the transfer within the requirements required under company law. In concluding the error, it was remarked by Justice Briggs that:

“…without his assistance in making available the duly completed stock transfer forms, neither his wife nor his daughter could perfect the intended gifts without further assistance from Mr. Pulbrook…it follows that there was not an effective gift of Mr Pulbrook’s beneficial interest either in the 14 or in the 300 shares which he attempted to give respectively to his daughter and to his wife so that, in the result, there is nothing to prevent the charging order being made final in relation to all of them.”

Lifting the Corporate Veil

Insight | March 2017

Lifting the Corporate Veil
Image: ‘Tuscan Window’ by Vivi de Candido

As a doctrine under question, the effects of lifting the corporate veil can be far-reaching if supported through case law, and yet it appears that the judiciary are reluctant to apply it unless under extreme circumstances, and even then with some trepidation.

The primary function of ‘lifting’ or ‘piercing’ the veil of corporations is one of transparency. As is no stranger to the world of enterprise, many an entrepreneur has  undoubtedly found themselves at odds with where the boundaries are with conversion of assets, or even fiduciary duties in line with corporate ownership. When matters reach a level that requires legal intervention, the venturing of the courts into financial accounts and expenditure records, is something that rests uneasily on the shoulders of judges.

It is not uncommon after all for businessmen and investors to construct fake companies to provide cover for illegal dealings, no more than shareholders to dominate the actions of their corporations under the guise of boardroom decision making. Paradoxically, it is precisely this subterfuge that beckons court intrusion, and yet for reasons that can be appreciated in their overall meaning, it does not bode well for the victims of those immoral undertakings when the rule of law refuses to fully extend.

Starting at the roots of this clearly under utilised principle, it is important to understand  that supply always creates demand, and so examination of how this doctrine has flourished reveals that the limited liability of incorporation almost invites abuse, regardless of the stakes in hand.

Salomon v Salomon, which dates back to 1897, is considered the birthplace of limited liability, as during the liquidation of a failed business, the shareholder and company were held as separate entities, and therefore unencumbered by obligation to one another. This perhaps dangerous distinction, served well the rule of law, but consequently opened the way to defendants establishing unaccountability for the deviances behind insolvency, or the withholding of property release during matrimonial disputes, as was seen in Prest v Petrodel Resources Ltd and Others, where despite having grounds to ‘pierce’, the judges went instead with beneficial interest accrued through powers conferred under the Matrimonial Causes Act 1973. Since Prest is now considered the leading authority on the protection or exposure of corporate misdeeds, it might pay to look at overseas opinion.

Despite taking a similar vein in most American courts, the small state of Delaware has become reputed as the home for around sixty-five percent of the Fortune 500 companies, and the reasons are clear. Aside from most other county-wide laws shared between states, there appears to be consolidated support for the protection of the corporate veil, under the strongly held belief that without it, the wheels of commerce simply cannot turn. A notable 2014 case Cornell Glasgow LLC v Nichols, is now considered the poster boy for the prevention of access to corporate transactions in middle America, however when the facts of the case are examined, there appears no justifiable reason to pierce the corporate veil, despite such clandestine and unprofessional behaviours on the part of the defendants. In fact, when taken in its proper context, the whole matter was tantamount to a classic breach of contract and nothing more.

This over complication of the argument does beg the question of whether claimants are all too quick to attack the character of those accused, in order to alleviate doubts as to a right of claim, where proper evaluation of the facts would likely reveal a swift path to justice that allows reduced costs and minimised court time.

In Canada, the controversial Chevron Corp v Yaiguaje has now become the watermark for corporate exposure, after coming close to setting a precedent for foreign enquiry into asset liability and covert misdeeds, after the indigenous peoples of Ecuador were subject to extreme pollution through the actions of an overseas corporation subsidiary. While pursuing them through the Canadian courts, and almost becoming a pivotal argument for the extension of ‘piercing’ qualification, it was ultimately overturned in the Superior Court by Justice Hainey, who explained:

“Chevron Canadaʼs shares and assets are not exigible and available for execution and seizure by the plaintiffs in satisfaction of the Ecuadorian judgment against Chevron Corporation.”

This overruling stance (amongst other cases) also fell back on the domestic line taken in Adams v Cape Industries Plc, where it had been decided that:

“Our law, for better or worse, recognises the creation of subsidiary companies, which though in one sense the creatures of their parent companies, will nevertheless under the general law fall to be treated as separate legal entities with all the rights and liabilities which would normally attach to separate legal entities.”

While this principle already poses great resistance to those seeking damages, the primary reason the courts declined to lift the corporate veil in Chevron, was simply that since the inception of the claim, there were no suggestions of fraudulent behaviour levelled toward the defendants, so no matter how aggrieved the claimants felt, it would not be equitable to overstep the boundaries set by the incorporation, and limited liabilities enjoyed by many firms, in order to achieve remedy for damages arising from contractual breach on the part of the actual offending party Texaco; who not long after acquiescing to the judgment bought against them in Ecuador, were taken over by Chevron California (the parent company). In fact, quite why the claimants were pursuing Chevron Canada is frankly unfathomable given the background to the matter, so it comes then as no great surprise that the ruling to ‘pierce’ was quickly dismissed.

So to summarise, it would suggest that on the strength of the cases discussed, it is not really an issue of judicial reluctance, rather a failure for the right matter to present itself. It would also pay to exercise caution when supporting foreign claims that display absolutely no logical bearing on (i) how this confused claim should ever have been initiated, and (ii) why any jurisdiction would move to lend credence to such a fruitless endeavour; while from an equitable perspective, the principle of traceability immediately springs to mind when seeking restitution from companies no longer in existence, and whose assets have long since been laundered.

Estoppel

Insight | March 2017

Estoppel
Image: ‘Girl Interrupted at Her Music’ by Johannes Vermeer

‘Estoppel’ or by virtue of its purpose ‘interruption’, is a legal source of remedy often used in connection to land or property related matters, but is readily used in numerous fields of dispute. The concept behind this intervening doctrine is one that prevents a miscarriage of justice where through discourse and action, a party is found to suffer at the expense of another’s profit. Because this approach often falls outside of common law rules, it frequently requires equity to redress the balance in favour of a fair and reasoned settlement where proven as fact.

To date, there are distinct and overlapping forms of estoppel, and so the list below while no means definitive, aims to cover the more familiar (and unfamiliar) versions used within domestic and international law.

Promissory Estoppel (or Equitable Estoppel)

Founded within contract law, this form of estoppel relies upon the promise of one party to another that is later revoked and proven detrimental to the promisee. Naturally circumspect of the rules of contract, the essence remains equitably valid, and was best witnessed in Central London Properties v High Trees Ltd, where Denning J remarked:

“The logical consequence, no doubt, is that a promise to accept a smaller sum in discharge of a larger sum, if acted upon, is binding notwithstanding the absence of consideration.”

Proprietary Estoppel

As founded and used most in property law, there are three main elements to qualifying action in proprietary estoppel, namely (i) that the landowner leads the claimant to believe he will accumulate some proprietary right, (ii) the claimant acts to his own detriment in reliance of the aforementioned right, and (iii) those actions are demonstrably in reliance of the expected right, where otherwise different choices might have been made. This was explained by Lord Scott of Foscote in Cobbe v  Yeoman’s Row Management Ltd who said:

“An estoppel bars the object of it from asserting some fact or facts, or, sometimes, something that is a mixture of fact and law, that stands in the way of some right by the person entitled to the benefit of the estoppel. The estoppel becomes a proprietary estoppel – a sub-species of a promissory estoppel – if the right claimed is a proprietary right, usually a right to or over land but, in principle, equally available in relation to chattels or choses in action.”

Estoppel within Public Law

This is often used where a member of a public body has issued assurances that (i) an action can be undertaken by  member of the public, or (ii) that the specific body will exercise its power to the benefit of the person enquiring. Where either fact has been proven correct, the designated department or authority is held liable to follow through on that action where reasonable, and in line with public interest, as was discussed in Southend-on-Sea Corporation v Hodgson (Wickford ) Ltd, although the applicable claim was never upheld after it was stressed by Lord Parker CJ  that:

“[I]t seems to me quite idle to say that a local authority has in fact been able to exercise its discretion and issue an enforcement notice if by reason of estoppel it is prevented from proving and showing that it is a valid enforcement notice in that amongst other things planning permission was required.”

Estoppel by (unjust) Conduct

This phrase is largely self-explanatory, but can be best surmised as visibly manipulative or unreasonable behaviour by one party toward another, for example when securing an annulment, as was explored in Miles v Chilton, where the groom falsely induced his fiancée into a marriage that was by all accounts, illegal, as the bride-to-be was in fact still married to her previous husband, despite his misleading her that the annulment had succeeded. The destructiveness of this self-created dilemma was explained by Dr. Lushington, who despite awarding in favour of the claimant, warned that:

“[H]ere the averment of marriage is made by the party having an opposite interest, and we well know that every one is bound by his admission of a fact that operates against him.”

Estoppel by Per rem Judicatam (or issue estoppel)

This is another family law approach, which translates that a judicial decision to grant nullity cannot be overturned after the fact, except in circumstances where the annulment is proven invalid, after which any party aside from the divorcing couple, can challenge the direction of the court. This form of estoppel can however, be found in criminal law cases, as was seen in Hunter v Chief Constable of the West Midlands Police and Others, where Lord Diplock commented that:

“The abuse of process which the instant case exemplifies is the initiation of proceedings in a court of justice for the purpose of mounting a collateral attack upon a final decision against the intending plaintiff which has been made by another court of competent jurisdiction in previous proceedings in which the intending plaintiff had a full opportunity of contesting the decision in the court by which it was made.”

Estoppel through Acquiescence (or Laches or Silence)

As used in a number of fields, there are requisites that the party claiming estoppel has had their hand forced into complying with matters that they had in fact not been properly consulted upon, as was argued in Spiro v Lintern, where a husband was held to agree to the sale of his co-owned property, despite not having consented to his wife’s putting it up for sale, and the purchaser proving able to enforce the contract in his name through her individual representation. It is also applied in cases where a secondary party to a contract or notice, fails to challenge it within a reasonable period, after which estoppel of acquiescence can be used to deter any claim to the contrary, as was used in Kammins v Zenith Investments, where Lord Diplock again explained:

“[T]he party estopped by acquiescence must, at the time of his active or passive encouragement, know of the existence of his legal right and of the other party’s mistaken belief in his own inconsistent legal right. It is not enough that he should know of the facts which give rise to his legal right. He must know that he is entitled to the legal right to which those facts give rise.”

And in the U.S case Georgia v South Carolina, where it was held that:

“South Carolina has established sovereignty over the islands by prescription and acquiescence, as evidenced by its grant of the islands in 1813, and its taxation, policing and patrolling of the property. Georgia cannot avoid this evidence’s effect by contending that it had no reasonable notice of South Carolina’s actions. Inaction alone may constitute acquiescence when it continues for a sufficiently long period.”

Estoppel through Encouragement

Similar to acquiescence, this form of estoppel was discussed in Taylors Fashions Ltd v Liverpool Victoria Trustees Co Ltd,  where Oliver J defined it in the following passage:

“The fact is that acquiescence or encouragement may take a variety of forms. It may take the form of standing by in silence whilst one party unwittingly infringes another’s legal rights. It may take the form of passive or active encouragement of expenditure or alteration of legal position upon the footing of some unilateral or shared legal or factual supposition. Or it may, for example, take the form of stimulating, or not objecting to, some change of legal position on the faith of a unilateral or a shared assumption as to the future conduct of one or other party.”

Estoppel by Convention

Often used in contract law, this principle comes into effect when two parties have relied upon an assumed true statement of fact, only to learn otherwise after the actions undertaken have been shown as unreasonable or unlawful. Any wrongful decision to then undo the damage is by definition, estopped on those grounds, as was discussed in Amalgamated Investment & Property Co Ltd v Texas Commerce International Bank Ltd, where Denning LJ  eloquently concluded that:

“When the parties to a contract are both under a common mistake as to the meaning or effect of it – and thereafter embark on a course of dealing on the footing of that mistake – thereby replacing the original terms of the contract by a conventional basis on which they both conduct their affairs, then the original contract is replaced by the conventional basis.”

Estoppel by Representation (or Pais)

Again found in many contractual matters, this doctrine is bought into effect when a party that has agreed to a change in the terms of the relationship (often supported by a promise of trusted representation of their own) later chooses to renege on that statement, despite the other party altering their position to accommodate that express arrangement. This was found in Royal Bank of Scotland v Luwum, where Lord Justice Rimer outlined that:

“[T]he clear sense of the arrangement was that Mr Le Page was making a representation or promise to Mr Luwum that the Bank would hold its hand on enforcing its rights for three months, and Mr Luwum changed his position in reliance upon that by borrowing £260 from friends and family in order to make a payment to the credit of the account, which was the very purpose of the arrangement that was made. In my judgment those circumstances had the consequence of estopping the Bank from reneging on its promise and starting the proceedings it did before the expiry of the three-month period.”

Estoppel by Deed (or Agreement)

This doctrine is applied when two parties agree to contract with each other for whatever intended gain or purpose, in the knowledge that the terms of the contract (or in these instances deeds) are based upon fraudulent fact, and nothing more. It is suggested that the motivation for such covenants is one of singular gain on the pretence that should the truth out, those facts will remain unchallenged. It is this kind of clandestine deception that was explored in Prime Sight Ltd v Lavarello, where Lord Toulson JSC mused:

“If a written agreement contains an acknowledgement of a fact which both parties at the time of the agreement know to be untrue, does the law enable on of them to rely on that acknowledgement so as to estop the other from controverting the agreed statement in an action brought on the agreement?”

Estoppel by Contract

Again, the terms of the contract can themselves prevent enforcement between disputing parties, as was discussed in Peekay Intermark Ltd v Australia and New Zealand Banking Group Ltd, where it was said:

“Where parties express an agreement…in a contractual document neither can subsequently deny the existence of the facts and matters upon which they have agreed, at least so far as concerns those aspects of their relationship to which the agreement was directed. The contract itself gives rise to an estoppel…”

In closing, it must be iterated that the doctrine of estoppel exists as a rule of evidence and not a cause of action, therefore any idea that this principle can, and should, be wielded as a defence or prosecution, falls outside the intended design and usurps its undiluted use.

Access to Justice

Insight | March 2017

Access to Justice
Image: ‘Lady Justice’ by Eraclis Aristidou

What exactly is ‘access to justice’, and why do we need to preserve it? To answer that we need to first understand how the phrase came about, and then why it may be in danger of becoming a legal bygone.

‘Access to Justice’ was a phrase used by Lord Woolf in 1996, when attempting to streamline the litigation processes attached to personal injury claims suffered by everyday people in the United Kingdom. Largely based upon the combined incentives of Alternative Dispute Resolution (ADR) and part36 (early offers strategies), it was suggested that by expediting claims, there would by default, become a lesser chance of spiralling legal costs, and reluctance of the poor seeking recovery for damages sustained in events beyond their control.

While from a superficial slant this ‘quickening’ of justice appears to embrace those without the means of representation and the legal acumen to work alone, it is now suggested that in fact the contrary has become true. With the collective impact of legal aid cuts, increased court fees and numerous court closures, the resulting options take on a less attractive sheen, in lieu of the growing hesitance to seek legal reparation. This gross misdirection translates as a more cloaked prevention, over the illusion of equitability, and to date there are now many activists campaigning for a dramatic change in policy.

As was discussed in my own academic paper, the dangers inherent to early offers far outweigh the genuine reward for pursuance of authentic remedy, but unless fiscally challenged claimants are determined enough to transcend the aggressive manoeuvres of defendant representatives, the odds will by majority, remain stacked against them. This in effect, strangulates the innate purpose of accessible justice, and places far greater value upon the currency of industry; therefore while far from helping the weak, it runs a calculable risk of leaving them powerless and unable to fight back.

Legal Aid

In a report published in October 2016, Amnesty International summarised that three key groups were directly affected by arbitrary cuts to legal aid support, namely (i) the vulnerable, (ii) the transitory and (iii) the disabled. And while taking great strides to illustrate the far-reaching consequences of such inconsiderate narrowness, the message was quite simply that:

“Amnesty International is therefore calling on the UK government to urgently fulfil its promise to review the impact of the cuts and take steps to ensure the right of the most disadvantaged sectors of society to access justice is adequately protected.”

 

Writing as a father of a special needs child, the first and third groups possess immediate implications for families similar to my own, who for one reason or another, might find themselves facing legal action, whether through public body frustrations, or simple damages-based incidents. Yet knowing that in the first instance there is no legal counsel, and no validation of a right to claim without parallel concerns of costs, there remains only the stark realisation that the price of justice now relies upon the roll of a loaded dice.

Legal Costs

Interestingly, while this area of discussion might prove hard to quantify with any  degree of exactness, the Legal Ombudsmen publication ‘Ten Questions to ask your Lawyer about Costs‘, proves instantly invaluable when evaluating the merits of private law claims.  More notably, recent changes to the fixed fees threshold within litigation, has to some extent, appeased the fears of those predominantly affected by previous reforms; yet the issue remains that claimants subject to a deprivation of counsel (pro-bono or otherwise), might still think twice before filling out their CNF forms. This is a frank but cautious sentiment echoed by Jonathan Smithers of The Law Society, who remarked:

“A single approach for all cases, regardless of complexity, will lead to many cases being economically unviable to pursue which undermines the principle of justice delivering fairness for all.”

However, when all is said and done, it is unlikely that both the practice industry and public interest will ever read from the same page, but that should never encourage the marginalisation of legal support in a world that is only becoming more crowded and prone to collisions of priority.

The Courts

While there is understandable anger at the gradient closure of almost 90 courts across the country, the promise of a heavily invested tech and user-friendly system, could prove the one positive in this tempering of justice, and so it would be remiss to level accusations of deliberate prevention, when the suggestion of ‘pop-up’ courts is peddled through various forms of digital media.

There is however, cause for concern when terms such as ‘makeshift’ and ‘public houses’ are used in the same context as the ‘fair’ and ‘reasoned’ dispensation of justice, within  an (albeit shrinking) framework of purpose built environments, before calm and attentive audiences. In fact, one might go so far as suggest that legal discourse is becoming diluted, by virtue of the fact that ‘quickie’ courts will themselves, overlook the precision of judicial application in favour of higher case turnover. Contrastingly, the option to pursue legal ends through online portals would seem to proffer greater structure, less chance for media intrusion and a significant cost saving, as was shown during Gary Linker’s recent divorce.

In closing, the point in greatest need of clarification, is that the true meaning of ‘access to justice’ is not one of quick fixes to complex problems. Rather it is about an equal right to a domestic jurisprudence generations in the making. By weakening the fabric of reparation in favour of mass appeasement, the English judicial system will only prove itself counter-productive and rushed; and so it is crucial that any consideration for public interest, and those employed to serve them, must be delicately balanced, rather than a mere continuance of treating every legal problem like a nail.