Equity in law refers to a set of legal principles and doctrines that developed in England during the Middle Ages as a means of providing a more just and fair outcome in cases where the common law rules were inadequate or unjust. Equity is based on the principle of fairness and it is designed to complement the common law and to provide an alternative or additional remedy where the common law is inadequate.
In Victoria, Australia, equity is governed by the principles and doctrines that have been developed by the courts over time, and it is applied by the courts in addition to the common law. These principles and doctrines include, but not limited to, the following:
- The principle of fairness, which holds that equity will not permit a person to take advantage of their own wrong or to retain a benefit obtained by fraud or other misconduct.
- The principle of trust, which holds that equity will enforce trusts and other fiduciary relationships, such as the relationship between a trustee and a beneficiary.
- The principle of equity of redemption, which holds that a borrower has the right to redeem a mortgage on payment of the debt, despite the lender's right to foreclose the mortgage.
- The principle of specific performance, which holds that equity will order a party to perform a specific contract, rather than awarding damages for its breach.
In Victoria, equity is applied in cases where common law remedies are inadequate or unjust, and it is applied by the court of equity which is the Supreme Court of Victoria, and also by the Federal Court of Australia.