Equitable Relief
A legal remedy applied by a court when remedies such as monetary damages are considered inadequate to rectify the situation
What is Equitable Relief?
Equitable relief, also referred to as an equitable remedy, is a type of court-ordered relief for an aggrieved party that is used when ordinary legal remedies – such as awarding damages – are considered inadequate justice for the suffering party.
Equitable relief is a part of common law that has been used for centuries, beginning with the Chancery Courts of England, whose jurisdiction was civil matters, as opposed to criminal legal matters.
Equitable relief is most commonly applied in relation to contracts, where a situation arises in which one party either has suffered or will suffer in an extremely specific manner that makes monetary compensation alone inadequate as a remedy.
For example, if the subject of a contract is unique and irreplaceable, or in a situation where irreversible harm may occur, then equitable relief may be considered by a court to be the only fair legal remedy.
Summary
- Equitable relief is a legal remedy applied by a court when remedies such as monetary damages are considered inadequate to rectify the situation.
- Equitable remedies may be used either instead of ordinary legal remedies or in addition to them.
- Orders for equitable relief typically require someone to either perform or refrain from performing, a specific act.
Forms of Equitable Relief
Equitable remedies are often granted along with traditional legal remedies such as monetary compensation. In such cases, the equitable relief granted is supplemental to the more typical remedies applied by courts.
Equitable relief orders issued by a court may take a variety of specific forms, but usually fall under two general categories of orders – either a specific performance order that requires a person or entity to perform an action, such as fulfilling the terms of a contract, or an injunction, which is a court order for a person or entity to refrain from doing some specific action.
Listed below are the most commonly used forms of equitable relief:
1. Specific Performance
Court orders for specific performance, where the court orders one party to perform a specific action that benefits another party, are typically only used where the court has the ability to monitor and verify the actions taken.
An instance where a court might order a specific performance could be one where a concert venue has booked a certain performer to appear, but the performer seeks to avoid fulfilling their obligation. If the performer is a particularly popular star, then a court might determine that nothing other than the performer doing the contracted concert can adequately compensate the concert venue.
2. Rescission
Rescission refers to the cancellation of a contract. Such a type of equitable relief may be granted when a court determines that one party to the contract is guilty of bad faith or misrepresentation and that it would, therefore, be unjust to require the other party to fulfill their contractual obligations. The remedy of rescission may also be applied when a court determines that one party entered into the contractual agreement under duress.
3. Injunction
An injunction, which legally bars someone from doing something, is commonly used when a court believes that allowing the person to commit the act the injunction is issued against, may result in irreparable harm to another person.
For example, a court may issue an injunction preventing the publication of a book or an article that may do irreparable damage to someone’s reputation or career.
4. Rectification
Rectification is a court order that essentially alters the terms of an existing contract to more accurately reflect the original intentions of both parties entering into the contract.
5. Account of Profits
An “account of profits” is considered a form of equitable relief even though it involves monetary compensation for the complaining party. When someone with a fiduciary duty to the complainant is found to have breached that duty, the court may order the fiduciary to return to the complainant all the money they lost, or all the profits illegally gained by the fiduciary.
Practical Example
To better understand the concept of equitable relief, let us look at a situation where a court might consider an equitable remedy the only adequate legal remedy for a complaining party.
Assume that Bob, an antique dealer, has agreed to sell a unique treasure, such as a one-of-a-kind piece of antique jewelry, to Richard, for an agreed-upon price. However, Bob subsequently sells the piece to another person who offers him a higher price.
In a situation such as the one above, a judge may reasonably determine that the only adequate remedy is a specific performance order requiring Bob to sell the piece of jewelry to Richard as originally agreed. It is because the piece of jewelry is a unique item. Therefore, merely awarding monetary damages to Richard would not suffice, as he is unable to buy a duplicate piece of jewelry elsewhere.
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