History and Nature of Equity

1
History and Nature of Equity

• Professor Cameron Stewart

2
The Blind Men and the Elephant

• John Godfrey Saxe

3
The Anglo-Saxon Invasions c500AD
4
The Battle of Hastings 1066
5
Norman Reorganisation

• Sovereignty
• Absolute beneficial title
• Reception of laws
• Conquering
• Settling
• Cessession
• Feudalism

6
Henry II the Father of the Common law

• Curia Regis
• General Eyre and Assizes
• Assize of Clarendon 1166 12 freemen from the
  hundred and 4 from the town
• Henry, Richard Coeur-de-Lion and John Lackland

7
ABecketts Legacy

• The Church Courts
• The benefit of the
• clergy

8
Edward Longshanks Hammer of the Scots

• Parliament begins 1275
• The use of statute as opposed to ordinance
• Nisi Prius
• Quia Emptores

9
Curia Regis embryonic courts

• Court of Exchequer revenue
• Court of Common Pleas civil actions
• Court of Kings bench crime
• Remaining Council functions split into
• Kings Council later Concilium Regis and then
  Privy Council

10
The Writ System

• Bureacracy
• Organisation of wrongs
• Remedies
• Popularity
• Recording
• Stare Decisis
• Common law

11
Whats the common law meant to do?

• Persons Property
• Quick, efficient, fair and effective
• Real property real actions- real relief
• Seisin
• Remedies return the seisin, pay monetary
  damages
• Contract and tort

12
What goes wrong?
13
The Office of the Lord Chancellor

• Around since Norman times
• Keeper of the Kings Conscience
• Cleric and Keeper of the Great Seal
• Member of Lords, Judge and Church

14
Chancery as a Court

• Around the 15th century
• Function to repair the failings of Common law
• Principles of Christian fairness/conscience
• Maxims of equity
• Substance not form
• Does not assist a volunteer
• Equity follows the law
• Clean hands
• Discretion and the Chancellors foot
• The two streams law and equity

15
What does Equity do?

• Parkinson
• (i) the exploitation of vulnerability or
  weakness, as exemplified in principles relating
  to unconscionable dealing and undue influence
• (ii) the abuse of positions of trust or
  confidence, as exemplified in the law of trusts
  and fiduciary obligations generally
• (iii) the insistence upon rights in circumstances
  which make such insistence harsh or oppressive as
  exemplified in relief from penalties and
  forfeiture, the law of equitable set-off, and the
  refusal of specific performance on the
  discretionary ground of hardship
• (iv) the inequitable denial of obligations, as
  exemplified in the doctrine of part performance
  and the principle of equitable estoppel
• (v) the unjust retention of property, as
  exemplified in certain constructive trusts and
  principles of subrogation

16
The relationship between CL and Eq

• James VI of Scotland
• The rise of protestantism
• Absolutism of sovereign Divine Right of Kings
  or King-in-parliament?
• Bacon Ellesmere Earl of Oxfords case

17
Earl of Oxfords case

• The Office of the Chancellor is to correct Mens
  consciences for Frauds, Breach of Trusts, Wrongs
  and oppressions, of what Nature soever they be,
  and to soften and mollify the Extremity of the
  Law ... When a Judgment is obtained by
  Oppression, Wrong and a hard Conscience, the
  Chancellor will frustrate and set it aside, not
  for any error or Defect in the Judgment, but for
  the hard Conscience of the Party.

18
The legalisation of equity

• The Civil War equity nearly destroyed
• Lord Nottingham (1673-82) father of equity
• Lord Eldon (1801-27) modern rules
• Precedent and fixation
• Appointment of VC
• Poor administration
• Infamous delay record 16 years and still
  interlocutory

19
19th Century reforms

• Bentham and the dog law
• Judicature Acts 1870s 1970s
• The two streams in one courtWindeyer J in Felton
  v Mulligan (1971) 124 CLR 367 at 392 1972 ALR
  33 at 46
• Fusion fallacies
• Salt v Cooper (1880) 16 ChD 545 at 549, Jessel MR
  said of the effect of the Act
• It has been sometimes inaccurately called 'the
  fusion of Law and Equity' but it was not any
  fusion, or anything of that kind it was the
  vesting in one tribunal the administration of Law
  and Equity in every cause, action, or dispute
  which should come before that tribunal. To
  carry that out, the Legislature did not create a
  new jurisdiction, but simply transferred the old
  jurisdictions of the Courts of Law and Equity to
  the new tribunal, and then gave directions to the
  new tribunal as to the mode in which it should
  administer the combined jurisdictions.

20
Fusion?

• United Scienti?c Holdings Ltd v Burnley Borough
  Council 1978 AC 904 at 924 1977 2 All ER 62
  at 68, where Lord Diplock said
• If by rules of equity is meant that body of
  substantive and adjectival law that, prior to
  1875, was administered by the Court of Chancery
  but not by courts of common law, to speak of the
  rules of equity as being part of the law of
  England in 1977 is about as meaningful as to
  speak similarly of the Statute of Uses or of Quia
  Emptores. Historically all three have in their
  time played an important part in the development
  of the corpus juris into what it is today but to
  perpetuate the dichotomy between rules of equity
  and rules of common law which it was a major
  purpose of the Supreme Court of Judicature Act
  1873 to do away with, is, in my view, conducive
  of erroneous conclusions as to the ways in which
  the law of England has developed in the last
  hundred years. Your Lordships have been referred
  to Ashburners vivid phrase ... on the effect
  of the Supreme Court of Judicature Act My
  Lords, by 1977 this metaphor has in my view
  become both mischievous and deceptive If
  Professor Ashburners ?uvual metaphor is to be
  retained at all, the waters of the con?uent
  streams of law and equity have surely mingled
  now.

21
Walsh v Lonsdale (1882) 21 Ch D 9

• It was held that a person who enters into
  possession of land under a speci?cally
  enforceable contract for a lease is regarded, by
  a court having jurisdiction to enforce the
  contract, as being in the same position, as
  between itself and the other party to the
  contract, as if the lease had actually been
  granted
• Remedy of distress granted

22
Chan v Cresdon Pty Ltd (1989) 168 CLR 242

• Cresdon agreed in writing to lease land to
  Sarcourt.
• The agreement contained the terms of the lease as
  an annexure.
• The lease was duly executed but never registered.
  
• Sarcourt defaulted under the lease and Cresdon
  took action against Chan as guarantor of the
  unregistered lease.
• Cresdons action against Chan was stated as being
  one taken on the guarantee under this lease.
• Cresdons action was unsuccessful.
• The court held that as there was no registered
  lease there was no enforceable guarantee.
  Cresdons alternative claim was based upon the
  rule in Walsh v Lonsdale.

23
Chan v Cresdon Pty Ltd (1989) 168 CLR 242

• This claim also was unsuccessful. In coming to
  its conclusion the court ruled that, although the
  rule in Walsh v Lonsdale meant that an agreement
  to lease gave rise to an equitable lease, it did
  not create a legal interest. A consequence of
  this is that the equitable lessee will be
  defeated by a bona ?de purchaser of the legal
  estate who acquires the legal estate for valuable
  consideration and without notice of the equitable
  lease

24
Chan v Cresdon Pty Ltd (1989) 168 CLR 242

• The court also con?rmed that the operation of the
  rule depended upon the availability of speci?c
  performance of the agreement to lease.
• In the circumstances of the case, two facts
  raised doubts as to the availability of speci?c
  performance. First, Cresdon had in the meantime
  mortgaged the property. Second, the lease had
  come to an end before the expiration of the term
  due to Sarcourts breach.

25
Aquaculture Corp v New Zealand Green Mussel Co
1990 3 NZLR 299

• Cooke P, in the context of a con?dential
  information case, said
• For all purposes now material, equity and common
  law are mingled or merged. The practicality of
  the matter is that in the circumstances of the
  dealings between the parties the law imposes a
  duty of con?dence. For its breach a full range of
  remedies should be available as appropriate, no
  matter whether they originated in common law,
  equity or statute.

26
Day v Mead 1987 2 NZLR 443

• Mead had been Day's solicitor for 25 years.
• He was also a director and shareholder of a
  newly-formed company, Pacific Mills Ltd.
• Acting on Mead's advice, Day purchased 20,000
  shares, at 1 per share, in Pacific Mills,
  knowing that Mead was a shareholder and that his
  firm's nominee company had lent money to Pacific
  Mills.
• Day actively participated in the management of
  the company
• Day subscribed for a further 80,000 shares in the
  company at a cost of 80,000.
• Company went into receivership, and Day lost both
  investments.
• Day sued Mead for his loss plus interest,
  claiming breach of fiduciary duty.
• Was his contribution to the loss relevant?

27
Day v Mead 1987 2 NZLR 443

• Cooke P stated
• Whether or not there are reported cases in which
  compensation for breach of a fiduciary obligation
  has been assessed on the footing that the
  plaintiff should accept some share of the
  responsibility, there appears to be no solid
  reason for denying jurisdiction to follow that
  obviously just course, especially now that law
  and equity have mingled or are interacting. It is
  an opportunity for equity to show that it has not
  petrified and to live up to the spirit of its
  maxims

28
G R Mailman Associates Pty Ltd v Wormald (Aust)
Pty Ltd (1991) 24 NSWLR 80

• Roderick P Meagher JA, as a member of the Court
  of Appeal in New South Wales, opined that the
  views of Lord Diplock in United Scienti?c
  Holdings v Burnley Borough Council were so
  obviously erroneous as to be risible

29
Harris v Digital Pulse Pty Ltd (2003) 56 NSWLR 298

• Breach of confidence case
• Can you get exemplary damages?
• Mason P, at 3359, argued that an award of
  exemplary damages in cases of equitable wrongs
  was justi?ed. His Honour suggested that the
  rationale for exemplary damages in tort law could
  be applied by analogy to equitable wrongs, and
  characterised this approach as an example of
  fusion by analogy with the law of torts.

30
Harris v Digital Pulse Pty Ltd (2003) 56 NSWLR 298

• However, the majority of the Court of Appeal
  disagreed. Spigelman CJ, at 30710, stressed that
  if fusion by analogy was to be used, then the
  appropriate analogy was with contract law, where
  exemplary damages are not available.
• Heydon JA, in a lengthy and detailed analysis of
  the relevant authorities and arguments, rejected
  the proposition that exemplary damages should be
  available for breaches of equitable obligations.
  His Honour, at 402, also suggested that such a
  view, if based upon the view that the fusion of
  the courts allowed the new single court to award
  common law remedies for breaches of equitable
  obligations, amounted to a crude fusion fallacy

31
Areas of conflict

• Mortgagees power of sale
• Damages in equity (especially in breach of
  confidence and breach of fiduciary duty)
• Causation in breach of fiduciary duty

32
Maxims

• Spry has written the following in relation to the
  maxims
• The maxims of equity are of signi?cance, for
  they re?ect the ethical quality of the body of
  principles that has tended not so much to the
  formation of ?xed and immutable rules, as rather
  to a determination of the conscionability or
  justice of the behaviour of the parties according
  to recognised moral principles. This ethical
  quality remains, and its presence explains to a
  large extent the adoption by courts of equity of
  broad general principles that may be applied with
  ?exibility to new situations as they arise.
• I C F Spry, The Principles of Equitable Remedies,
  Speci?c Performance, Injunctions, Recti?cation
  and Equitable Damages, 7th ed, Lawbook Co,
  Sydney, 2007, p 6.

33
Maxims

• Kirby J in Australian Broadcasting Corporation v
  Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at
  271 185 ALR 1 at 49 It is a commonplace that
  equity is a living force and that it responds to
  new situations. It must do so in ways that are
  consistent with equitable principles. If it were
  to fail to respond, it would atrophy.

34
Maxims

• In Corin v Patton (1990) 169 CLR 540 at 557 92
  ALR 1 at 12, in relation to the maxim equity
  will not assist a volunteer, Mason CJ and McHugh
  J said
• Like other maxims of equity, it is not a speci?c
  rule or principle of law. It is a summary of a
  broad theme which underlies equitable concepts
  and principles. Its precise scope is necessarily
  ill-de?ned and somewhat uncertain.

35
Equity will not suffer a wrong to be without a
remedy

• A common approach of judges is exempli?ed in the
  statement in In re Diplocks Estate Diplock v
  Wintle 1948 Ch 465 at 4812 1948 2 All ER
  318 at 326, where the English Court of Appeal
  said
•  
• If the claim in equity exists, it must be shown
  to have an ancestry founded in history and in the
  practice and precedents of the courts
  administering equity jurisdiction. It is not
  suf?cient that because we may think that the
  justice of the present case requires it, we
  should invent such a jurisdiction for the ?rst
  time.

36
Equity will not suffer a wrong to be without a
remedy

• Cowcher v Cowcher 1972 1 All ER 943 at 948,
  Bagnall J said
•  
• So in the ?eld of equity the length of the
  Chancellors foot has been measured or is capable
  of measurement. This does not mean that equity is
  past childbearing simply that its progeny must
  be legitimate by precedent out of principle. It
  is well that this should be so otherwise no
  lawyer could safely advise on his clients title
  and every quarrel would lead to a law suit.

37
Equity will not suffer a wrong to be without a
remedy

• Farah Constructions Pty Ltd v Say-Dee Pty Ltd
  (2007) 230 CLR 89 at 1512, 155 236 ALR 209 at
  2523, 2556, made it clear that trial judges and
  intermediate appellate courts should not depart
  from decisions of intermediate appellate courts
  in other Australian jurisdictions, nor radically
  change existing law unless such decisions or
  existing law were plainly wrong. The High Court
  made it clear that such changes to the law were
  properly within the domain of the High Court only

38
Equity follows the law

• Equity recognises common law rights, estates,
  interests and titles and does not say that such
  common law interests are not valid. Thus, in
  Leech v Schweder (1873) 9 LR Ch App 463 at 475,
  Mellish LJ said that where a right existed at
  law, and a person came only into equity because
  the Court of Equity had a more convenient remedy
  than a Court of Law there equity followed the
  law, and the person entitled to the right had no
  greater right in equity than at law

39
Equity follows the law

• In DKLR Holdings Co (No 2) Pty Ltd v Commissioner
  of Stamp Duties 1980 1 NSWLR 510 at 519, Hope
  JA said
•  
• Where the trustee is the owner in fee simple, the
  right of the bene?ciary although annexed to the
  land, is a right to compel the legal owner to
  hold and use the rights which the law gives him
  in accordance with the obligations which equity
  has imposed upon him. The trustee, in such a
  case, has at law all the rights of the absolute
  owner in fee simple, but he is not free to use
  those rights for his own bene?t in the way he
  could if no trust existed. Equitable obligations
  require him to use them in some particular way
  for the bene?t of other persons.

40
Equity follows the law

• Time stipulations inn contract
• s 25(7) of the Judicature Act 1873 (UK) resolved
  the con?ict between the common law and equity
  approaches to the effect of a contractual time
  stipulation by giving statutory effect to the
  equitable rules, effectively transforming a time
  stipulation from an essential term of a contract
  to an intermediate term of a contract Zaccardi v
  Caunt 2008 NSWCA 202 at 92.
• Consideration in common law vs consideration in
  equity
• Co-ownership when there is a 5050 contribution
  Delehunt v Carmody

41
Where the equities are equal, the ?rst in time
shall prevail, and, Where there is equal equity,
the law shall prevail

• Remember these?

42
One who seeks equity must do equity

• Plaintiffs in equity must ful?l their legal and
  equitable obligations before seeking a remedy.
  The maxim represents equitys version of the
  biblical golden rule set out in the Book of
  Matthew (712) do unto others as you would be
  done by. The maxim emphasises that the Court of
  Chancery originated as a court of conscience.

43
One who seeks equity must do equity

• In Hanson v Keating (1844) 67 ER 537 at 5389,
  Wigram V-C said the following in relation to this
  maxim
• It decides in the abstract that the court giving
  the plaintiff the relief to which he is entitled
  will do so only upon the terms of his submitting
  to give the defendant such corresponding rights
  (if any) as he also may be entitled to in respect
  of the subject matter of the suit what these
  rights are must be determined aliunde by strict
  rules of law, and not by any arbitrary
  determination of the court. The rule, in short,
  merely raises the question of what those terms
  (if any) should be.

44
One who seeks equity must do equity

• In Hanson v Keating (1844) 67 ER 537 at 5389,
  Wigram V-C said the following in relation to this
  maxim
• It decides in the abstract that the court giving
  the plaintiff the relief to which he is entitled
  will do so only upon the terms of his submitting
  to give the defendant such corresponding rights
  (if any) as he also may be entitled to in respect
  of the subject matter of the suit what these
  rights are must be determined aliunde by strict
  rules of law, and not by any arbitrary
  determination of the court. The rule, in short,
  merely raises the question of what those terms
  (if any) should be.

45
One who comes to equity must come with clean
hands

• This maxim is closely related to and descends
  from the maxim just discussed FAI Insurances Ltd
  v Pioneer Concrete Services Ltd 1987 15 NSWLR
  552
• It requires a plaintiff in equity not to be
  guilty of some improper conduct, or else relief
  will be denied
• This maxim confirms that equity is not solely
  concerned with preventing unconscientious conduct
  by a defendant, but also requires conscientious
  behaviour by a plaintiff.

46
Delay defeats equity

• In seeking equitable relief a plaintiff must act
  promptly and diligently Smith v Clay (1767) 27
  ER 419 at 420. Equity will not allow defendants
  to remain for too long in a position of not
  knowing whether equitable relief will be ordered
  against them because it would be unconscientious
  to do so.
• Laches
• Acquiescence

47
Equality is equity

• Idea of proportionate equality
• Co-ownership
• Resulting trusts
• Also, equity will generally, but not always,
  execute a trust power of appointment equally
  among the objects of the power if the donee of
  the power has failed to exercise the power
  McPhail v Doulton 1971 AC 424

48
Equity will not assist a volunteer

• In Colman v Sarrel (1789) 30 ER 225 at 227, Lord
  Chancellor Thurlow said that a plaintiff seeking
  equitable relief has to have a valuable or at
  least meritorious consideration. This
  requirement is expressed in the maxim that
  equity will not assist a volunteer, a volunteer
  being a person who has not given valuable
  consideration. The maxim does not require that
  the consideration be paid or executed Reef
  Rainforest Travel Pty Ltd v Commissioner of Stamp
  Duties 2001 QCA 249 at 10.

49
Equity will not assist a volunteer

• The rationale for this maxim is that it would not
  be unconscientious for equity to decline
  equitable assistance to a plaintiff who is a
  volunteer, whereas it would be so if he or she
  had provided valuable consideration Redman v
  Permanent Trustee Co of New South Wales Ltd
  (1916) 22 CLR 84 at 96. Thus, it is the presence
  of valuable consideration that will attract the
  intervention of equity Director of Public
  Prosecutions for Victoria v Le (2007) 232 CLR 562
  at 575 240 ALR 204 at 215. However, in Conlan v
  Registrar of Titles (2001) 24 WAR 299 at 338,
  Owen J suggested that this rationale was a
  little strange given that the common law would
  (and will) accept something that is entirely
  inadequate or lacking in actual value as being
  good consideration.

50
Equity will not assist a volunteer

• The maxim is primarily associated with the rule
  that a voluntary covenant is not enforceable in
  equity Corin v Patton (1990) 169 CLR 540 at 557
• Valuable consideration
• In The Bell Group Ltd (in liq) v Westpac Banking
  Corporation (No 9) (2008) 225 FLR 1 at 741, Owen
  J said
• The notion of valuable consideration usually
  requires finding some economic worth as compared
  with something that is purely nominal, trivial or
  colourable Valuable consideration is more than
  the nominal consideration that would be
  sufficient to support a common law contract.

51
Equity will not assist a volunteer

• Maxim doesnt apply to gifts under Milroy v Lord
• In Morris v Hanley 2000 NSWSC 957 at 35,
  Young J said that when one looks behind the
  maxim one can see that the real truth is that
  equity rarely helps a volunteer.
• This stems from the fact that the maxims
  precise scope is necessarily ill-de?ned and
  somewhat uncertain and subject to certain
  clearly established exceptions Corin v Patton
  at CLR 557 ALR 12.

52
Equity looks to the intent rather than the form

• In Parkin v Thorold (1852) 51 ER 698 at 701, Lord
  Romilly MR said
• Courts of Equity make a distinction in all cases
  between that which is a matter of substance and
  that which is a matter of form and if it ?nd
  that by insisting on the form, the substance will
  be defeated, it holds it to be inequitable to
  allow a person to insist on such form, and
  thereby defeat the substance.

53
Equity looks to the intent rather than the form

• Part performance
• Express trusts
• Rectification

54
Equity looks on that as done which ought to be
done

• In Frederick v Frederick (1721) 24 ER 582 at 583,
  Lord Chancellor Maccles?eld said that where one
  for valuable consideration agrees to do a thing,
  such executory contract is to be taken as done
  and the man who made the agreement shall not be
  in a better case, than if he had fairly and
  honestly performed what he agreed to

55
Equity acts in personam

• Earl of Oxfords Case (1615) 21 ER 485 at 487
  (see 1.34), where Lord Ellesmere said that equity
  could restrain a plaintiff at common law from
  enforcing a judgment of that court not for any
  error or Defect in the judgment, but for the hard
  Conscience of the Party.
• Extra territoriality

56
Equity acts in personam

• Oz-US Film Productions Pty Ltd v Heath 2000
  NSWSC 967 at 13, Young J explained this
  development as follows
•  
• A court of equity basically exercises only in
  personam jurisdiction. That is, it makes orders
  against people who are present in the
  jurisdiction or who have submitted to the
  jurisdiction. The in personam jurisdiction may,
  in proper cases, be exercised where the defendant
  has property in the jurisdiction over which the
  Court can enforce its order. In recent times,
  this jurisdiction has been further developed by
  the presumption that a defendant is considered to
  have property within the jurisdiction unless the
  evidence shows otherwise.

57
Equitable interests

• Legal vs beneficial
• DKLR Holdings Co (No 2) Pty Ltd v Commissioner of
  Stamp Duties (NSW) (1982) 149 CLR 431 at 463 40
  ALR 1 at 26, where Aickin J said
• If one person has both the legal estate and the
  entire beneficial interest in the land he holds
  an entire and unqualified legal interest and not
  two separate interests, one legal and the other
  equitable. If he first holds the legal estate
  upon trust for some other person and thereafter
  that other person transfers to him the entire
  equitable interest, then again the first-named
  person does not hold two separate interests, one
  the legal and the other the equitable estate he
  holds a single entire interest he is the
  absolute owner of an estate in fee simple in the
  land. The equitable interest merges into the
  legal estate to comprise a single absolute
  interest in the land. It is a fundamental
  principle of both the common law and of equity
  that the holder of an estate in fee simple cannot
  be a trustee of that fee simple for himself for
  what he holds is a single estate, being the
  largest estate in land known to the law.

58
Complexity

• Does the equitable right give rise to the
  interest?
• Or does the interest give rise to the right?
• In National Provincial Bank Ltd v Ainsworth
  1965 AC 1175 at 12478 1965 2 All ER 472 at
  494, Lord Wilberforce, speaking of proprietary
  interests, said
• Before a right or interest can be admitted into
  the category of property or of a right affecting
  property, it must be definable, identifiable by
  third parties, capable in its nature of
  assumption by third parties, and have some degree
  of permanence or stability.

59
Property?

• Meagher, Heydon and Leeming suggest that the
  proprietary nature of any equitable interest can
  be measured by reference to the following four
  criteria
• 1. The power to recover the property the subject
  of the interest or the income thereof as compared
  with the recovery of compensation from the
  defendant payable from no specific fund.
• 2. The power to transfer the benefit of the
  interest to another.
• 3. The persistence of remedies in respect of the
  interest against third parties assuming the
  burden thereof.
• 4. The extent to which the interest may be
  displaced in favour of competing dealings by the
  grantor or others with interests in the subject
  matter.
• . R Meagher, J D Heydon M Leeming, Meagher,
  Gummow and Lehanes Equity Doctrines and
  Remedies, 4th ed, LexisNexis Butterworths,
  Sydney, 2002, p 126.

60
Fixed Beneficiaries under bare trusts

• Gummow J in Herdegen v Federal Commissioner of
  Taxation (1988) 84 ALR 271 at 281, as follows
• Today the usually accepted meaning of bare
  trust is a trust under which the trustee or
  trustees hold property without any interest
  therein, other than that existing by reason of
  the office and the legal title as trustee, and
  without any duty or further duty to perform,
  except to convey it upon demand to the
  beneficiary or beneficiaries or as directed by
  them, for example, on sale to a third party

61
Rights of beneficiaries in unadministered estates

• Commissioner of Stamp Duties (Qld) v Livingston
  1965 AC 694
• Mr Coulston died leaving a one-third share in his
  residue to his wife
• The estate included real and personal property
• Mrs Coulson then died before her husbands will
  was administered
• The Stamp Duties Commission of Qld sought to tax
  her interest
• Did she have an equitable proprietary interest?

62
Commissioner of Stamp Duties (Qld) v Livingston

• No
• Viscount Radcliffe noted that, pending
  administration of the husbands estate, his
  executors held the whole of the property in the
  estate with no distinction between legal and
  equitable estates. The executors had the property
  to carry out the administration of the estate and
  not for their own benefit
• She had no property interest that could be taxed

63
More recent cases

• In Re Maguire (deceased) 2010 2 NZLR 845 at
  851, Asher J said that the executors of an
  unadministered estate owe the residuary legatees
  a fiduciary duty to carry out their
  administration tasks honestly and diligently, and
  the residuary beneficiaries have remedies
  against the executors should they fail to carry
  out those duties.
• n In re Hemming, decd Raymond Saul Co (a firm)
  v Holden 2009 Ch 313 at 324, the right of the
  beneficiary of the deceaseds residuary estate
  was described as a composite right to have the
  estate properly administered and to have the
  residue (if any) paid to him as and when the
  administration is complete.
• In the High Court in Kennon v Spry (2008) 238 CLR
  3666 at 394 (251) ALR 257 at 276, French CJ
  described the right to proper administration of
  the estate as being connected to a real
  expectancy of an interest in the property.
• in Brennan v McGuire 2010 FCA 1443 at 108,
  Rares J opined that the interest of a residuary
  beneficiary in the assets of an unadministered
  estate is probably best characterised as a
  financial resource, not as property

64
Horton v Jones (1935) 53 CLR 475

• Horton looked after Jones who was old and sick.
• In return Jones made an oral promise to leave
  his fortune to Horton.
• The agreement was never reduced to writing. Jones
  died and at his death had rights as next-of-kin
  in the unadministered estates of his four
  children. The estates of the children included
  land.
• After Jones death Horton sued his estate on the
  oral contract. The High Court of Australia held
  that Horton was not entitled to the benefit of
  the contract.

65
Horton v Jones (1935) 53 CLR 475

• Starke, Evatt and McTiernan JJ dismissed the
  claim on the ground that the contract was void
  for uncertainty.
• Rich and Dixon JJ looked at the case from the
  perspective of the statutory requirement that
  contracts involving land or interests in land had
  to be evidenced in writing to be enforceable. In
  this respect it was crucial to determine whether
  or not Jones rights in the unadministered
  estates of his children were equitable interests
  in land for the purposes of the statutory writing
  requirement eg Conveyancing Act 1919 (NSW) s
  54A(1)

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Rich and Dixon JJ

• But it is not the consequence that no right of
  property subsisted in the deceased, nor that no
  right of property subsisted involving an interest
  in land. The deceased possessed equitable rights
  enforceable in respect of the assets considered
  as a whole. It is true that he had no immediate
  right to possession or enjoyment and that his
  precise rights involved, at any rate prima facie,
  administration, and possibly necessitated
  conversion and calling in of investments. But,
  none the less, he had more than a mere equity. He
  had an equitable interest and it related to
  assets, which included interests in lands.
• So its property

67
Official Receiver in Bankruptcy v Schultz (1990)
170 CLR 306

• Schultz was bequeathed what was ultimately
  determined to be a remainder interest in a house.
  
• At the time of the testatrixs death Schultz was
  an undischarged bankrupt.
• The High Court of Australia ruled that even
  though the remainder interest took effect only
  after Schultz was discharged from bankruptcy, it
  nevertheless vested in the Official Receiver,
  because the chose in action arose at the time
  Schultz was an undischarged bankrupt.
• Schultz did not, at the time of the testatrixs
  death, have any legal or equitable interest in
  any of the assets of the testatrixs estate, but
  did have the right to see that the estate was
  properly administered.
• Schultz had the expectation of gaining a property
  interest after administration of the estate was
  completed.
• When the remainder interest in the house took
  effect it vested in the Official Receiver, not
  Schultz, even though Schultz had by then been
  discharged from bankruptcy.

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The spectrum of interests

• Equitable property or interest (equitable fee
  simple, mortgages, covenants etc)
• Personal Equities (Gill v Gill (1921) 21 SR(NSW)
  400)
• Mere Equities (Latec Investments Ltd v Hotel
  Terrigal Pty Ltd (1965) 113 CLR 265)

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Other mere equities

• the right to claim an interest in property
  pursuant to proprietary estoppel principles
• the right to obtain enforcement of an oral
  mortgage pursuant to the doctrine of part
  performance (Double Bay Newspapers Pty Ltd v A W
  Holdings Pty Ltd (1996) 42 NSWLR 409)
• the right to the retransfer of land where, as a
  result of a unilateral mistake by a vendor, the
  area of land transferred exceeded the area
  stipulated in the contract of sale (Tutt v Doyle
  (1997) 42 NSWLR 10 at 15) and
• the right to a constructive trust pursuant to
  principles laid down by the High Court in
  Muschinski v Dodds (1985) 160 CLR 583 62 ALR 429
  and Baumgartner v Baumgartner (1987) 164 CLR 137
  76 ALR 75.