Legal Remedies

Equitable Remedies

Remedies are of two types, legal and equitable. An example of a legal remedy is monetary damages. An example of an equitable remedy is an injunction. The origin of the distinctions between the two types of remedies is historical. The American legal system is based upon English common law.

At common law, there were two distinct systems of courts; the courts of law which had the power to award monetary damages and the courts of equity of chancery which were presided over by a chancellor and had the power to grant equitable remedies. A single wrong may give rise to a right to several different remedies.

For example, a breach of contract might entitle the injured party to an amount of money sufficient to compensate for the breach (compensatory damages) or an order from the court commanding the breaching party to perform its contractual obligations (specific performance).

Today, in the American legal system the distinctions between law and equity have been largely abolished and a court of general jurisdiction will usually have the power to grant both legal and equitable relief.

Availability of Equitable Relief

Equitable relief is not available except when plaintiff's legal remedies are inadequate. I.e., where the substitutionary remedy of money is insufficient to make the injured party whole.

One equitable remedy is that of specific performance. In a contract for the sale of goods UCC 2-716 provides that specific performance may be available where the goods are unique. Inability to cover may indicate uniqueness of the goods. The ordinary rule is that an injunction to maintain personal property will not be granted without a clear showing that the property is peculiar and money could not possibly compensate for its loss.

Contracts which require the performance of varied and continuous acts will not as a general rule, be enforced by courts of equity, because such would require constant supervision and make judicial control extremely difficult.

Maxims of Equity

The maxims of jurisprudence (Cal.Civ.Code sections 3510-3548) are intended not to qualify any provisions of the Civil Code, but to aid in their just application. (Cal.Civ.Code §3509.)

Equitable Defenses

Unclean Hands

No court of equity will enforce or entertain construction of a contract in a manner incompatible with the laws or public policies of the state. A party that has been guilty of misconduct may be denied equitable relief. The clean hands doctrine only applies when the plaintiff has acted unjustly in the very transaction of which he complains. As a general rule it is required that to be a bar the wrongdoing must be connected with the subject of the litigation and have some relation to the rights of the parties arising out of the transaction.

Unconscionability

The doctrine of unconscionability permits a court to refuse to enforce a contract if it feels it is unfair. UCC 2-302 and Cal.Civ.Code §1670.5. give statutory recognition to this doctrine.

However, UCC 2-302 was not intended to create a cause of action and cannot be used as a basis for damages. It is available only as a defense.

Laches

"The law helps the vigilant, before those who sleep on their rights." (Cal.Civ.Code §3527.) Successful invocation of laches requires that a party with the knowledge of facts giving rise to its right unreasonably delays asserting them for an excessive period of time and the other party suffers legal detriment therefrom. In determining whether the doctrine applies an examination is made of the length of delay, the reasons therefor, how the delay affected the other party, and the overall fairness in permitting the assertion of the claim. In contrast to a statute of limitations that provides a time bar within which suit must be instituted, laches asks whether the plaintiff in asserting her rights was guilty of unreasonable delay that prejudiced the defendants. (See e.g., Gardner v. Panama Railroad Co., 342 U.S. 29.)

Stone v. Williams, 873 F2d 620 (2d Cir. 1989) involved a dispute over copyright proceeds from the estate of Hank Williams, Sr. Plaintiff was Williams' illegitimate daughter. She did not discover this fact until 1973. She delayed filing suit over the royalties from his songs until 1985. The court held that although plaintiff might be arguably excused from filing suit until 1980, there was simply no reason for the delay in filing until 1985. Defendants may have been prejudiced by the delay in several ways such as the death of witnesses or stale evidence and the entry into transactions based upon the assumption as to who owned the copyrights to the songs.

Estoppel

Any claim of estoppel is predicated on proof of two essential elements: the party against whom estoppel is claimed must do or say something calculated or intended to induce another party to believe that certain facts exists and to act on that belief; and the other party must change his position in reliance on those facts, thereby, incurring some injury. Estoppel can be used either defensively or offensively. The doctrine of estoppel is applicable to the government where justice and fair play require it. (U.S. v. Pennsylvania Industrial Chemical Corp., 411 U.S. 655.)

The Right to a Jury Trial on Equitable Claims

The right to a jury trial is founded in the Seventh Amendment. That amendment does not "create" the right to jury trial. Rather it "preserves" the right as it existed at common law in 1791 the date of the Seventh Amendment's ratification. Historically, there was no right to a jury trial for equitable claims. Although the Federal Rules abolish the procedural distinctions between law and equity and substitute a single form of action, (F.R.C.P. 2) they do not abrogate the differences between the substantive and remedial rules of the two systems.

Since a party may now enter a single court with both legal and equitable claims the question recurs as to when there is a right to a jury trial. In federal courts, F.R.C.P. 38(a) expressly grants the right to a jury trial and equitable causes of action are treated as incidental to the legal causes of action so that the right to a jury trial is preserved. (See, Dairy Queen, Inc. v. Wood 369 U.S. 469 82 S.Ct. 894, 8 L.Ed.2d 44 (1962) and Ross v. Bernhard 396 U.S. 531 90 S.Ct 733, 24 L.Ed.2d 29 (1970).

Although the thrust of the Seventh Amendment was to preserve the right to jury trial as it existed in 1791, it has long been settled that the right extends beyond the common-law forms of action recognized at that time. The Seventh Amendment applies to actions enforcing statutory rights, and requires a jury trial upon demand, if the statute creates legal rights and remedies, enforceable in an action for damages in the ordinary courts of law. Curtis v. Loether, 415 U.S. 189, 94 S.Ct. 1005, 39 L.Ed.2d 260 (1974). (But see, Lehman v. Nakshian, 453 U.S. 156, 101 S.Ct. 2698, 69 L.Ed.2d 548 (1981) [jury trial not available under the Age Discrimination in Employment Act.])

An exception to the federal approach to preferring jury trials is with respect to complex issues, such as patent suits. (See, Markman v. Westview Instruments, Inc., ___ U.S. ___ (1996). In California, the right to a jury trial is guaranteed by the state Constitution. (Cal.Const., art. I § 16.)

Enforcement of Equitable Decrees, Contempt

Contempt of court is an affront to the dignity of the court. When language forms the basis of contempt the words used must constitute an imminent, not merely a likely, threat to the administration of justice. Craig v. Harney, 331 U.S. 367, (1947) see also In re Little, 404 U.S. 553 (1972). Contempt may be either criminal or civil.

The purpose of criminal contempt is punishment through fine or imprisonment of the contemnor for past conduct. Civil contempt proceedings are for the purpose of coercing compliance with the order of the court and/or to compensate the complainant for losses sustained by defendant's noncompliance. Coercion may be achieved by imprisonment of the contemnor until he purges himself of the contempt, and/or by a prospective, conditional fine. Civil contempt fines may be imposed in an appropriate circumstance either to compensate complainants or as a coercive sanction.

"Direct" or "Indirect" Contempt?

When the contempt is in the presence of the court, the judge may act summarily without notice or order to show cause. This requires that the act or omission must occur in the presence of the court so that no further evidence need be adduced for the judge to certify to the observation of the contemptuous behavior and the act must impact adversely the authority of the court. If proof of the contempt depends on evidence from persons other than the judge, then it is an "indirect" contempt and the better practice is to proceed on order to show cause.

Jury Trial for Contempt

Criminal contempt is a crime in the ordinary sense; (see, e.g. Cal.Pen.Code § 166) it is a violation of the law, a public wrong which is punishable by fine or imprisonment or both. When serious punishment for contempt is contemplated, a jury trial is Constitutionally required. (Bloom v. Illinois, 391 U.S. 194, 88 S.Ct. 1477, 20 L.Ed.2d 522 (1968).)

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