Equity

Principles stated.

Whether common law rule on account of profits is now outdated.

Any person may have an enforceable right but if he fails to enforce such right within the time stipulated by law then the right becomes unenforceable.

All doctrines of equity are only applicable where an order on the basis of which a benefit or entitlement is sought is a legal order.

Equitable relief cannot be granted to the person whose claim is based upon illegality or he approaches the court with unclean hands.

Equity moves in the aid of law and not to defeat the law.

He who seeks equity must do equity.

Equity moved in the aid of law and not to defeat the law.

One who seeks equity must have equities in his favour and anyone who seeks justice must come with clean hands.

Law favours vigilant and not the indolent.

Equity is the soul of law in dispensation of justice.

Transactions undertaken by taxpayer based in part on the interpretation of provision of law by the government revenue service

Courts subsequently interpreting the provision differently resulting in issuances of notices of reassessment by the revenue service imposing tax liability on the tax payer

Whether equitable remedy of rescission of transaction is available in a case where the taxpayer is mistaken about the tax consequences of transaction freely agreed upon]

[Per Brown J: (Majority view): Transactions that do not call for relief as a matter of conscience or fairness are properly outside equity's domain

Nothing is unconscionable or unfair in the ordinary operation/ application of tax statutes to transactions freely agreed upon

Tax consequences do not flow from parties' motivations or objectives

Rather, they flow from their freely chosen legal relationships, as established by their transactions

Taxpayer should neither be denied nor judicially accorded a benefit based solely on what they would have done had they known better

Proper inquiry is into what the taxpayer agreed to do and not into whether there is a windfall for the public treasury or a taxpayer

Court may not modify an instrument/ transaction merely because a party discovered that its operation generates an adverse and unplanned tax liability]

[Per Côté, J: (Minority view): Rescission is, in strictly limited circumstances, an available remedy that can be used to unwind transactions that were undertaken on the basis of a mistaken assumption, even if permitting it would effectively relieve the taxpayer from payment of unexpected taxes

Rescission on the ground of mistake is available in a tax context, but should be granted only in rare circumstances

Equity will not intervene to relieve a taxpayer from the consequences of a risk that was knowingly or recklessly accepted

Taxpayers should not engage in bold tax planning on the assumption that it will be possible to rescind their transactions should that planning fail

Since rescission is a remedy of last resort, it can only be granted if no alternative remedies are available; it is not sufficient for an alternative remedy to merely exist; the alternative remedy must be practical and adequate.

Rectification requires a valid antecedent decision to carry out a particular transaction that was incorrectly transcribed on paper

Premise underlying this remedy is that it would be unfair to hold a person to be bound by a transaction they never agreed to

As for rescission, it relieves against a mistake; it presupposes that the transaction was transcribed correctly but was entered into under a mistaken assumption about the facts or the law

If granted, rescission puts the parties in status quo ante and restores things, as between them, to the position in which they stood before the contract was entered into

In other words, the purpose of rectification is to ensure that a written instrument accurately reflects the parties' antecedent agreement, whereas rescission enables a court to retroactively cancel a transaction that was entered into by mistake, thereby restoring the parties to their original position.

Since rescission is a remedy of last resort, it can only be granted if no alternative remedies are available; it is not sufficient for an alternative remedy to merely exist, the alternative remedy must be practical and adequate.

Delay would defeat the equity.

Person taking equitable relief must not sleep over his right, if he does so, delay will defeat him.

Law helps the vigilant and not the indolent.

Relief of the specific performance had its origin/roots in equitable system of justice, wherein amongst others the hallmark principle was "he who comes to equity must come with clean hands"

Litigant sought remedy of specific relief but chosen improper, deceiving, fraudulent means to reach the destination the same would be against good conscience

Court's aiding such litigant for approaching the destination would amount to inequity

Court could not act as abettor to a party who was ill-motivated and knocking the door of court of justice with unfair conduct

In the maxim: "He who comes to equity must come with clean hands", word "must" retained significance and depicted the intent of introducers of the maxim of equity.

Person who knocked the door of an equity Court with an inordinate delay, had to justify such delay.

He who seeks equity must do equity.

Delay defeats the equity.

Equity aids the vigilant and not those who sleep on their rights.

Courts cannot come to the rescue of persons, who are not vigilant regarding their rights.

One who seeks equity, must do equity.

He who seeks equity must do equity.

He who comes into equity must come with clean hands.

Equity did not relieve a party from the consequences of its own negligence.

Equity was a means to remedy the imperfections of a contract and re-establish an equilibrium where its division of burdens and benefits did not align with its intended scheme

While courts may not modify or revise contracts, they could enforce what appeared to be equitable.

Such entitlement for allotment of plots by itself had its own value, apart from the price that was paid to the housing authority

Had the plots in question been purchased by the plaintiff/third party from the open market, the price would have been much higher than what was actually paid

Irrespective of the fact that it was held by the High Court that the plaintiff paid the entire amount to the housing authority for both the plots from her own source, the fact remained that the plots were allotted, not at their full market value but at concessionary price only for the reason that the defendant was in the service of the army

In such peculiar circumstances, the monetary contribution made by the plaintiff could not be regarded as the true reflection of the entire value of the suit property and hence could not be regarded as sufficient to treat the plaintiff as full owner of the suit property though she paid the entire price

Plaintiff's share in the plots on account of her financial contribution could not be considered more than half and the remaining half had to be attributed purely to the defendant on account of the privilege which she enjoyed in seeking allotment from the housing society at much lower rate than the true market value

Based on such distinction, the defendant was entitled to sell one of the two residential plots

In equity the defendant was justified in entering into a sale transaction for one of the plots

Appeal was partly allowed.

Person who sought equity must do equity.

Person who seeks equity must do equity.

Equity would restrain an apprehended breach of confidential information and would do so with respect to documents which were the subject of legal professional privilege and which were confidential

Equity would restrain third parties if their conscience was relevantly affected.

Damages could be awarded in substitution for an injunction or specific performance where the court had jurisdiction to grant such a remedy when the proceedings were commenced

Damages on this basis were a monetary substitute for what was lost by the withholding of the remedy

One method of quantifying damages under such head was by reference to the economic value of the right which the court had declined to enforce

Such a valuation could be arrived at by reference to the amount which the claimant might reasonably have demanded in return for the relaxation of the obligation in question.

Such relief could not be granted to a person who came to the court with unclean hands.

Person who sought equity, must do equity and must come to the court with clean hands.

Where as a result of the illegal and unlawful conduct of the government and/or officials of its departments, any loss was caused to a citizen of the country, same had to be appropriately compensated

Such principle was a fundamental rule and also a principle of equity.

For seeking a relief under Art.199 of the Constitution, of course, one had to approach the court besides clean hands, with a bona fide claim

Conduct of a litigant was of a paramount importance for seeking relief under Art.199 of the Constitution.

Court does not grant an injunction in a case where there was an adequate legal remedy; in particular, it does not do so where damages would be an adequate remedy

Where an injunction was granted, it was usually because the injury to the claimant was "irreparable", in the sense that money could not atone for it.

Equitable relief could not be granted to the person whose claim rested on illegality or mala fide.

Equity had to give way to law and its principles could only be resorted to and invoked when the resolution of a proposition was not provided and available by or under the law; it was equity then which came into play to fill up the vacuum, where the law provided no answer for doing justice

Rules of equity could not be taken into account to frustrate and defeat the law.

Person seeking equitable relief should show his bona fide first.

Letter of law was to be followed literally, even if the same was harsh in nature.

Equity would aid vigilant and not an indolent.

Equity would aid vigilant and not an indolent.

Suppression of material fact by a party alone would be sufficient for refusal of discretionary relief.

Illegal occupant was not entitled to any discretionary relief.

Person seeking equity must also do equity.

Person seeking equity must come to court with clean hands.

He who seeks equity must come with clean hands.

Person seeking equity must come with clean hands.