AGY-1060 | Equity Jurisdiction (1823-1970) / Equity Division (1970 - ) [Supreme Court of New South Wales]

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The New South Wales Act of 1823 (4 Geo. IV, cap. 96) had stipulated that a single Judge be responsible for Equity hearings. The incumbent Master in Equity became insolvent in 1832, and no immediate successor was appointed. The Act for the Administration of Justice, 1840 appointed the Chief Justice as the Judge in Equity, or if he should decline, one of the Puisne Judges may take the role. The following year An Act for the Further Amendment of the Law and for the Better Advancement of Justice, 1841 (5 Vic. Act No.9) allowed for another Judge to sit for the Judge in Equity during illness or absence from Sydney. There was also an appeal mechanism for Equity Court decisions. Appeals were heard before three justices. The Primary Judge in Equity did not sit exclusively on equity cases.

The Third Charter of Justice gave the Supreme Court responsibility to appoint guardians for both ‘natural fools’ and those ‘deprived of their reason or understanding by act of God’, and to rule regarding the management of their estates. In making its determination the Court was entitled to call on medical evidence. The courts were rarely called upon to hear cases of lunacy, and the Sydney Gazette published what it believed to be the first case in the Court in May 1828.

The Australian Courts Act, 1828 (9 Geo. IV Act No.83) gave the Equity jurisdiction the same powers as the Chancellor in Great Britain but still fell short of specific empowerment for rulings in Lunacy.

The Administration of Justice Act, 1840 (4 Vic. Act No.22) enabled the Governor to appoint a primary Judge in Equity who dealt with all lunacy cases although this was not precisely laid down in the Act. Following criticism that the Judge in Equity had no jurisdiction in Lunacy, the Equity (Validating and Enabling Act) of 1847 (11 Vic. Act No.27) retrospectively gave the Judge in Equity jurisdiction in lunacy. An Act to Expedite Suits and Proceedings in Equity and to Facilitate the Despatch of Business in the Supreme Court in Banco of 1858 (22 Vic. Act No.14) section 6 allowed for the Primary Judge in Equity to hear cases related to lunatics and their property. The Act was interpreted to mean that either the full court or the Judge in Equity could hear the cases, and that appeal to the full Court was available.

The first colonial legislation relating to lunatics was the ‘Dangerous Lunatics Act of 1843 (7 Vic. Act No.14) which made arrangements for the admission and confinement of the insane in asylums. The Act was amended in 1845 to enable any Judge of the Supreme Court to conduct a hearing which was to include evidence from medical witnesses, to enable a person of sound mind to be discharged from an asylum. An Act to Amend the Law for the Care and Treatment of the Insane of 1868 (31 Vic. Act No.19) enabled the Superintendent of any asylum to make application to the Equity Division of the Supreme Court to rule regarding the income from the property of a lunatic’s estate, or the sale of his property to be used for his living expenses. This clause addressed the issue of the abuse of some lunatics mainly by their relatives in attempting to obtain possession of their property.

By the 1850s the Chief Justice Sir Alfred Stephen was speaking of the complication and difficulty in commercial lawsuits and the enormous amount of sums at stake in them. There were in Equity alone 97 suits in 1853 and 114 in the next year. Within a decade the boom of mining partnership companies and of banks and secondary industries almost halted the Chancery business of the Supreme Court. Barristers briefed in that jurisdiction had to contend with cumbersome practices and antiquated procedures. It was not long before Counsel advised parties to these suits to settle them, even on unfavourable terms rather than risk being involved in continuous litigation for several years. Henry Cary, a barrister who for a time occupied the Master’s office summarised the position as a great denial of justice amounting in some cases to the ruin of suitors. (2)

In the second half of the nineteenth century Equity Procedures were modified in response to the streamlining of procedures occurring in the United Kingdom. These were embodied in An Act to Amend the Practice and Course of Proceeding in the Supreme Court in Equity of 1853 (17 Vic. Act No.70). More complete reform of the Court awaited An Act to Amend the Law Respecting the Procedure and Practice of the Supreme Court in its Equitable Jurisdiction of 1880 (44 Vic. Act No.18). The Act required that one of the Supreme Court Judges was to be the primary Judge in Equity. The Act set rules for pleading, parties, Court procedures, taking of evidence and permitted appeals to a full Court. An Act for Consolidating Enactments Relating to the Practice, Procedure, and Powers of the Supreme Court of New South Wales in its Equitable Jurisdiction, 1901 (Act No.24, 1901) consolidated previous legislation relating to the Jurisdiction and further regulated the conduct of the Court.

The Testator’s Family Maintenance and Guardianship of Infants Act, 1916 (Act No.41, 1916) added further responsibilities to the Equity Jurisdiction of the Supreme Court. The Court could now make orders concerning bereaved families who had been left without adequate provision for their proper maintenance, education, or advancement in life. The Court could adjust the burden of provision upon beneficiaries, order periodic or lump sum payments, and regulate asset distribution. The Court also determined guardianship of infants (including questions of grandparent access).

Under the Child Welfare Act, 1923 (Act No.21, 1923) orders of adoption for children were to be made in the Equity Jurisdiction of the Supreme Court. (3)

The Supreme Court Act, 1970 (Act No.52, 1970) identified the following cases for hearing in the Equity Division: administration of estates; dissolution of partnerships, redemption or foreclosure of mortgages; charges on land, sale and distribution of property which is the subject of lien or charge; execution of private or charitable trusts and rectifying or cancelling deeds, contracts, sale of land, wardship of infants and management of infants’ estates.

The Court grants equitable relief by enforcing rights not recognised at Common Law. The Equity Court includes a jurisdiction in infancy. In some cases the Court may award damages. The two remedies used by the Equity Court are injunction and specific performance. Appeal is available to the full Supreme Court and thence to the Privy Council. Historically the Equity Court has contributed much to the development of real property law, the law of mortgages, company law, trusts and wills. In 1975 the Division also took on the responsibility for the adoption of children, births, deaths and marriages, custody of infants and orders for the custody and access to minors.

The development of the Equitable Jurisdiction both in England and Australia over the last 20 years has involved new areas of Equitable doctrine in respect of:

a) Unconscionability (a transaction will be unconscientious within the meaning of the relevant equitable principles only if the party seeking to enforce the transaction has taken unfair advantage of his or her own superior bargaining power, or of the position of disadvantage in which the other party was placed)

b) proprietary estoppel (a person who stands by and keeps silence when observing another person acting under a misapprehension or mistake, which by speaking could have prevented by showing the true state of affairs, can be estopped from later alleging the true state of affairs)

c) Mareva injunctions (preventing the removal of assets of a defendant from the jurisdiction)

d) Anton Pillar Orders (preventing the destruction of evidence)

e) contractual licences

f) the basis for rescission of contracts for mistake

g) principles of restitution and constructive trusts (a constructive trust is to some extent a remedial device used by equity to correct perceived injustices).

With the creation of the Family Law Division of the Supreme Court under the Administration of Justice Act 1973 (Act No.19, 1973) from 19 April 1973 matters relating to adoptions were heard in the Family Law Division. (4)

The New South Wales Supreme Court maintained its Family Law Division as part of its Civil Law Division until 2 May 1977, when following the change of Supreme Court rules, family and divorce issues were moved to the Equity Jurisdiction.

The proceedings of the Equity Division are held in any one of the following locations – Law Courts Building, Queens Square, Sydney, St James Road Court, St James Road, Sydney, King Street Courthouse, Corner King and Elizabeth Streets, Sydney, Darlinghurst Courthouse, Taylor Square, Sydney, and Wentworth Chambers, 180 Phillip Street, Sydney. The Court’s Registry is in Sydney, with Sub-Registries located at Newcastle, Wollongong, Lismore, Orange, and Wagga Wagga. (5)

Endnotes
1. Governor Phillip’s Second Commission 2/4/1787, H.R.A. Series 1, Volume 1, p. 5.
2. Bennett J. M. A History of the New South Wales Bar, The Law Book Company, Sydney, 1969, pp.78 and 85.
3. Child Welfare Act, 1923 (Act No.21, 1923), s.123.
4. Administration of Justice Act, 1973 (Act No.19, 1973), s.5; commencement NSW Government Gazette No.51, 19 April 1973, p.1424.
5. Attorney General's Department website www.lawlink.nsw.gov.au/lawlink/Supreme_Court/11_sc.nsf/pages/SCO_aboutus (cited 22 February 2008).

References
University of New England Law School, LS 240 Equity and Trusts http://uniserve.edu.au/law/pub/edinst/une/LS240Topic2.html#LS240 Topic 2,Law and equity.