Maxim Clean Hand Doctrine PDF

Preview

Summary

Clean Hands Doctrine...

Description

He who comes into Equity must come with Clean Hands With the development of the chancery courts in the 13th century the common law practice which was deemed to be very stiff and didn’t allow for fairness were balanced out allowing for the chancery courts to develop and operate as a court of conscience allowing for equitable remedies. These remedies however were not an absolute given as the court may withhold and relief that may be sought if reasonable criteria was not met. These criteria became known as maxims of equity. They are guidelines on how the court should proceed in certain cases. The chancery court began to overtake the common law courts due to these guidelines and the inflexibility of them as different judges would have different opinions and views, but with these guidelines the flexibility was reduced allowing for even more fairness and justice to prevail in the courts. It eventually developed into the common law courts being given the powers to grant these equitable remedies which has since developed into the justice system we now know today. The Maxim I have taken an in-depth look at is the maxim of He who comes into equity must come with clean hands. Sometimes known as the doctrine of unclean hands this maxim originated from the idea that one cannot profit from their wrongdoings or dishonesty related to the case. If a person is seeking an equitable remedy, then they themselves cannot be found to be guilty of any immoral or dishonest conduct regarding the case in question. If they are found to be guilty of any dishonesty or wrongdoings, then they cannot avail of any relief from the courts as they are found to have Unclean Hands. Delany1 describes it as “the discretionary nature of equity”. Its simple meaning is that equity requires fairness from both sides. It can be said “he that hath committed an inequity, shall not have equity.” 2 . The unclean hands principle is often found to be influential over a court’s decisions when relation to discretion in the granting of equitable remedies. The Maxim can be applied towards specific performance, fraud, misrepresentation illegality and benami transaction. I have decided to take an in depth look at three of these.



Specific Performance:

It can be shown that the plaintiff in any equitable case will be denied their decree of specific performance if it can be shown that they have been dishonest in relation to the case. In the case of Smelter Corp v O Driscoll3 where an order of specific performance of a contract was brought into question the Supreme Court refused, on the grounds that the plaintiffs agent 1 Hilary Delany 2 Unknown Source LLB Notes Facebook 3 Smelter Corporation v O Driscoll [1977] IR 305

acting on his behalf informed the defendant that if lands were not sold willingly to the plaintiff then they would be bought using an compulsory purchase order. O Higgins CJ 4 cited that the plaintiffs agent’s misrepresentation of the consequences of not selling land could in this case not allow for the specific performance remedy as it would be unjust under the circumstance. In his determination O Higgins referenced some advice that had been given by Barr J 5 where he described the clean hands principle “in seeking relief an applicant should put before the court fairly and with candour all facts known to him which are relevant to the exercise of the courts discretion and he should satisfy it about his bona fides and the true purpose of his application”6 This all shows that even if the plaintiff was not the one being dishonest it can be proven that anyone acting on their behalf being dishonest would then in turn cause the plaintiff to have unclean hands and therefore not entitled to their equitable remedy i.e. specific performance.



Misrepresentation:

When it comes to misrepresentation the plaintiff can easily be caught out when trying to avail of an equitable remedy as they misrepresented themselves in some manner which in turn leads the court to deem them to dishonest and therefore have unclean hands. In the case of Overton v Banister7 a minor (19) who was due to benefit from a substantial trust fraudulently misrepresented herself as being of age (21) in order to receive the trust. She received the funds from her trustees. When she eventually turned 21, she then proceeded to sue the trustees for failing to grant her, her entitlements and attempted to have them to reimburse the trust of the funds they had already given her. In the common law courts she may have prevailed as it was seen to be the trustees duty to ensure she was of age when handing over funds however her case was disallowed due to her misrepresentation of her age. She had been deceitful and therefore not entitled to an equitable remedy as her hands were deemed to be unclean. If she had not been the person to lie about her age but still availed of the funds provided then the court would still have denied her case as she was aware that the funds were given incorrectly and should have notified the trustees and returned the funds until she became of age.



Fraud:

Where fraud is involved it can be clear that no equitable remedy can be allowed on the part of the plaintiff. As shown in the case of Tinsley v Milligan 8 the plaintiff attempted to profit from avoiding a verbal contract. The plaintiff and the Defendant purchased a house together, but the title deeds were held in the plaintiffs’ name. They both the proceeded to defraud the state 4 Supreme Court Chief Justice Tom O Higgins 5 High Court Justice Anthony Barr 6 Judgement from Barr J in O Connor v Harrington [1987] 7 Overton v. Banister [1844] 3 Hare 503, 67 E.R. 479 8 Tinsley v Milligan [1994] 1 A.C. 340

of social welfare from the D.S.S9. After the defendant repented for her part in the fraud the plaintiff left the house they shared and proceeded to attempt to have the defendant evicted from the property claiming sole ownership of the property as the deeds were in her name. The defendant counterclaimed to have the property sold and the proceeds divided equally. The defendant won her counterclaim. However on appeal by the plaintiff the court held that due to the fraud committed by both parties and the fact that it was not of a continuing nature there should be no reason that her claim should not stand. This was showing a flexible approach towards the maxim but a fairness also as both parties were in fact entitled to an equal share of the property. This showed that fairness that the original courts of chancery developed is still relevant as even though the defendant and the plaintiff both committed fraud and therefore both had unclean hands the plaintiff was not allowed to profit alone and the defendant was entitled to her fair share of the property.

All these cases show that the fairness that had been developed in the chancery courts are still prevailing when it comes to equitable remedies. The fairness of there maxims prove that justice and equality go hand in hand. From the cases I’ve studied it have proven that anyone seeking an equitable relief will only prevail if they have been honest in their side of the case and the doctrine of clean hands can be brought into any case. It can be shown in any legal issue that if one party has been dishonest then they cannot prevail in the eyes of the law. I have learned that the courts take the view of showing conscience towards those who have been found to have disreputable conduct. It does however show that going forward the courts discretion may be brought into question with regards clean hands as shown in the last case the courts may sometimes find in favour of one with unclean hands and their discretion shown some inaccuracy but they are still valuing fairness above all else.

9 Department of Social Security

Bibliography Smelter Corporation v O Driscoll [1977] IR 305 Judgement from Barr J in O Connor v Harrington [1987] Overton v. Banister [1844] 3 Hare 503, 67 E.R. 479 Tinsley v Milligan [1994] 1 A.C. 340

Hilary Delany Equity and the law of trusts in Ireland 4 th edition Ronan Keane Equity and the law of trusts in Ireland 3 rd edition

https://www.facebook.com/1050968464957397/posts/maxim-no6he-who-comes-into-equity-mustcome-with-clean-handsintroductionthe-pers/1053454268042150/ http://mcmahonsolicitors.ie/maxims-of-equity/ https://legal-dictionary.thefreedictionary.com/ %22He+who+comes+into+equity+must+come+with+clean+hands.%22 www.Justis.com www.westlawuk.com Moodle notes on equity...