In "Junior books v Veitchi (1983) 1 AC 520" recovery of economic loss was imposed as liability. And the elements for constituting negligence such as (a) A duty of care owed by the defendant to the plaintiff (b) A bleach of that duty by the defendant (c) consequential damage suffered by the plaintiff (d) Such damages caused by the bleach are formulated. (Peter de Cruz 320)
Equity is the Creation of Courts, it is innovative and it provides various quick remedies such as injunction, rescission, rectification and specific performance. Thus equity is not a separate law but it a supplement to the common law. Discretionary is common feature of equitable remedies. Equity has wider scope than the common law.
The common law does not look into the conduct of the parties what is required is the claim has to proved. Once the claim is proved the damages are awarded. The common remedy in common law is awarding of damages. In Common law the courts have limited discretionary functions compared to law of equity. (Terence Ingaman 442)
Common Law and equity is distinguished on concept of jurisdiction such as "Equitable property interest", "fiduciary obligation", "Unconsciousness" and "Proprietary remedies", which are the distinct concepts developed by the courts of chancery.
1. Equitable Property Interest.
Where the interest in the property is vested under the law of equity such as interest in trust property, the interest of the beneficiary over the property in trust is enforceable not only against the trustee but also against the third party who acquires such property. Therefore the beneficiary interest is conceived as proprietary. The beneficiary is at liberty to convert the beneficial interest into the absolute ownership interest at any point of time.
Where the interest in the property is vested under the Common law such as through transfer of property, the interest is absolute and the person can exercise such rights over the property for his sole lawful benefits. Where as in equity a trustee with equitable property right exercise his rights over the property for the benefit of the beneficiary and cannot exercised for his benefit. (Peter Cane 187)
2. Unconscionable Conduct:
Chancery courts are conscience. As discussed in earlier topic the liability under the common law is strict liability caused due to reasonable misconduct or tortuous act. The Chancery courts under the law of equity are liberal in granting the remedies extending to suspected conduct. Unconscionable act is related to the strict liability to fiduciary and the negligence is to the strict liability in tort. The common law provides remedies to those subjected to harm due to negligence of others where as the law of equity stretches further and provides the relief against the unfair advantage taken by the others. (Peter Cane 191)
3. Fiduciary obligations:
Fiduciary obligations are created in trust. The fiduciary in relation to the trust property must act for the benefit of the beneficiary but not for the benefit