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Equity in Australia’s Legal System: Role and Impact


Discuss about the Equity in Australia’s Legal System for Role and Impact.



A legal system comprises of an integrated framework of institutions, governing bodies and their relevant rules.  Such a framework is developed for particular societies, with the aim to develop and foster growth in that society. The main objectives of these governing bodies and institutions are to regulate activities between the individual citizens of the state and the state bodies. Australia follows the federal system of governance. It has a State and a federal parliament along with distinct legal and judicial systems in the state and the federal. The entire legal system at federal and state level is similarly structured however within each system there are varied laws as per the requirement of that particular system.

In the most commonly accepted definition, laws are referred to the rules, which govern society and individuals. The main essence of law is to establish ‘rights’ and ‘duties’ for the citizens of a particular state. In a federal state, every citizen has the right to work without being interfered in a suitable and safe environment, right to access to adequate support, welfare and counseling services and to be valued equally with other individuals without any discrimination.

The legal system of Australia is based on the concepts of justice, rule of law and equality before law. The three most eminent pillars of the legal system in Australia include justice, fairness and equality.  Both the lawmakers as well as legal system strives hard to achieve the above outcomes for all and thereby ensure higher level of protection of citizens by integrating a system that work towards just and fair decision making. The High Court of Australia in the case Pilmer v. Duke Group Limited, [(2001) 207 CLR 165], held that there is distinct identity of the substantive rules of equity in Australia and they form a coherent as well as separate body of principles (Australasian Legal Information Institute, 2001). Further, the principles, remedies and doctrines of equity are distinct than those adopted at common law.

It is pertinent to develop effective laws within the legal framework of a country. Effective laws are most easily interpreted and understood by the people, they help in reflecting the values of the society at large and thus can be easily and quickly implemented in the society. The government, law enforcement agencies, courts, judicial officers and individuals work collectively towards achieving the ideals of justice, equality and fairness in the society.

Rules of Equity in Australia

The term equity means to be treated equally and at par with others. In other words, it can be said that equity stands for equal treatment granted to all the citizens. Equity holds that everyone in the society must get the opportunity to enjoy same right and that no one should be at a disadvantageous position. In a society of equals, people enjoy same level of opportunities in terms of employment, education and living environment. The aim to bring equality in society may cater to various areas of society where we seek to ensure equal opportunity irrespective of the inequalities that already exist. Government and law agencies enforce various mechanisms to enforce regimes of equality including, affirmative law programs, dispute resolution procedures, anti-discrimination laws and using interpreters. These mechanisms assist the legal system and help in creating more opportunities for implementing and achieving the objective of equality.

Equality cannot be come just with the mere notion of treating individuals equally. For equality to actually be implemented it has to be mixed with the concept of fairness and justice. Fairness helps in achieving equal outcomes. Fairness ensures that individual situations are taken into consideration. On the other hand justice is a combination of access to basic human rights, fairness and equality. When justice is served, the citizens are ensured that punishments are given to those who have acted against their responsibilities. A decision is just only when it has fair and equal outcomes as per the legal principles, ethics and values followed in the society.

The rules of equity have been intervened in the legal system of Australia. Both the law makers as well as judiciary ensure that the rules of equity including fairness and justice are guaranteed to the citizens. The implementation of rule of equity in Australia is not new but is done past century. The famous Harvester Judgment [Ex parte HV McKay (1907) 2 CAR 1] established the very principle of basic or minimum wage to establish and promote aspects of equality amongst the laborers (Skwirk, 1907).  

Principle of Rule of Law in Australian Legal System

A system of equity in the legal system helps the system in accommodating to changing situations and circumstances. In Garcia v. National Australian Bank Ltd. [(1998) HCA 48], it was stated that the equitable principles directly impact the aspects of growth and development in the society. The principles of equity are in a state of constant evolution in response to which even developments in the society can be witnessed (ACL, 2010). Further, even historians have remarked equity with is outstanding characteristic of developing new rights and remedies that suits the interests of the plaintiff (Pearce et al., 2010).

Equity also promotes the doctrine of rule of law, which was also adopted by the Australian system in Sue v. Hill [(1999) 199 CLR 462]. The essence of the doctrine of rule of law is that no authority or government is above law and thus cannot act in arbitrary manner (UniStudy Guides, 2011). Thus, rule of law ensures proper implementation of law, which promotes equality. The principle of equity and rule of law is not only bound by the territories of Australia but International Courts. In the North Sea Continental Shelf Case [ICJ Rep 1968], the International Court stated that where equity cannot be applied in the case by quoting abstracts of justice, rule of law is applied, which in itself mandates the implementation of equitable principles (International Court of Justice, 1969). Equity cannot be merely used to fulfill the gap in existing law but it must be used in a manner to ensure application and proper interpretation of laws (Lowe, 2000).

The two main components of rule of law are, first, it opposes unconfined discretion and arbitrariness and second, it ensures equal subjective of law for all (Griffith, 2001). In R v. Shrestha [(1991) 173 CLR 48] and Leeth v. The Commonwealth [(1992) 174 CLR 455], the court stated that rule of law is wide to include equality of citizens before law (Jade, 1992; Jade, 1991).

Role and Impact of Rules of Equity

Equity alone cannot be considered sufficient to run the legal systems of a country. Equity is the basic principle that forms the essence of Constitution and on which laws are formed. Thus equity in itself cannot be a law rather the main objective of a law. Further, the notions of equity including fairness, justice and rule of law are also principles which help in implementing equity within the legal systems in the State. Thus, equity is supplemental in nature cannot be considered as a principle, which is self sufficient and capable of running the entire legal system (Leeming, 2014).

In the Australian legal system, equity has been integrated within the Constitution along with the rule of law. These are not mere principles but they even control effective functioning and operations of the courts. The Rule of Equity has impacted in the following manner in the legal system of Australia:

  1. Judicial Review of Legislative Action- even when the Constitution has the provision of judicial review and it has been accepted in Marbury v. Madison [(1803) 1 Cranch 137] by the court, it was taken for granted in real. Disputes between citizens and government or government and government bought before the society that the authorities are acting in excess of their powers and thereby violating the rights of equality granted to the public (Justia, 2016). Thus, the rules of equity helped in making people aware of their rights and thereby enforcing such rights before the court of law. Judicial review of legislative action was on mere papers until it was heard before the courts and was backed by the rules of equity, particularly the rule of law (Gleeson, 2001).
  2. Judicial Review of Administration Action- equity rules have been used at various instances to seek judicial review in administrative matters. Administrative law basically deals with the powers and duties granted to the administrators to run the state. The rules of equity ensure that administrators are restricted to their powers and prevented from acting beyond them. In Ex Parte Fox and Clinton [(1803) 1 Cranch 137], the court held that problems relating to administrative action must be considered by way of statutory construction of laws and thereby the inconsistencies should be resolved by ensuring equity in such actions (Federation Press, 1945).
  3. Equity has evolved as an essential part of law and it runs with the law, since it has the power to change as per changing conditions in the society as held in Allen v. Synder [(1977) 2 NSWLR 685]. To focus on broader development of legal systems in the court, it is pertinent to develop equitable rights and remedies (Wade, 1979). Australian courts have by far accepted the equity rules more than common law rules and thus it has helped them develop an edge in its legal system (Kirby, 2008).
  4. The Australian legal system comprises of various laws that prohibits discrimination on any ground, promotes equal wages for the workers, seeks to promote aspects of liberty for the citizens and also aims at providing welfare facilities to all the citizens irrespective of inequality levels. All of these laws have been well enacted and implemented within the legal system of Australia and guide the courts as well as individuals regarding their rights and obligations. These laws impact the society as they help in ensuring a better and safe environment for the individuals, who must feel motivate to contribute towards development of the nation.
  5. Equity rules help in formation in formation of basis of Constitution, which is the most significant legal document for a nation. It is the Constitution, which derives powers and meaning of the state and its functionality. Thus, equity guides the Constitution on how should the State be governed and what are the prospects of a State.
  6. The rules of Equity also impact by legal system by providing a constantly developing area for the lawyers and advocates to work on. Equity is not framed into a single law and thus it can be interlinked in any aspect of a case law to protect the interest of the plaintiff. Thus, equity helps in enhancing the legal system by focusing on improved knowledge of lawyers and better protection of people whose rights have been infringed.


The rule of equity is Australia is very much accepted and intervened in the legal system but for it to flourish without any impediments, it is pertinent for the courts to ensure continuous development of equitable principles so that changing needs and requirements can be met. Further, individual lawyers and the community of lawmakers are bestowed with the very responsibility of implementing rules of equity in the legal system and achieving the aims of such rules in the society.

Equity cannot be defined as a mere term which promotes equality amongst individuals. Equity is wide and includes in itself various rules and principles like that of fairness, justice and rule of law. All of these principles work together with equity so that objectives of a state to treat its citizens equally can be achieved. The main role of equity is to guide law, policymakers, judicial officers and individuals. Equity also plays a pivotal role in protecting rights and interests of the citizens by ensuring that all individuals have equal access and opportunity in terms of law. On the other hand, equity rules also impact the legal system and elevate the level of justice imparted by the judiciary. Australia being a federal state seeks to ensure equality amongst citizens. Thus, equity checks that such equality is granted. Thus, it can be concluded that even with huge acceptance of common law principles, equity has a unique and distinct place in the legal system of Australia, which helps the system to constantly improve and work towards achieving its objectives for a better society.


ACL, 2010. Garcia v National Australia Bank. [Online] Available at: [Accessed 18 August 2016].

Australasian Legal Information Institute, 2001. Pilmer v Duke Group Ltd (In Liq) [2001] HCA 31; 207 CLR 165; 75 ALJR 1067; 38 ACSR 122 (31 May 2001). [Online] Available at: [Accessed 17 August 2016].

Federation Press, 1945. R v Hickman; Ex parte Fox and Clinton. [Online] Available at: [Accessed 18 August 2016].

Gleeson, M., 2001. Courts and the Rule of Law. In The Rule of Law Series. Melbourne, 2001.

Griffith, J.A.G., 2001. The Common Law and the Political Constitution. LQR, p.42.

International Court of Justice, 1969. North Sea Continental Shelf Cases. [Online] Available at: [Accessed 18 August 2016].

Jade, 1991. R v Shrestha [1991] HCA 26; 173 CLR 48. [Online] Available at: [Accessed 18 August 2016].

Jade, 1992. Leeth v Commonwealth [1992] HCA 29; 174 CLR 455. [Online] Available at: [Accessed 18 August 2016].

Justia, 2016. Marbury v. Madison 5 U.S. 137 (1803). [Online] Available at: [Accessed 17 August 2016].

Kirby, M., 2008. Full text of Michael Kirby's speech: Equity's Australian isolationism. [Online] Available at: [Accessed 17 August 2016].

Leeming, M., 2014. Common law, equity and statute: limitations and analogies. Supreme Court Documents.

Lowe, V., 2000. The Role of Equity in International Law. Australian Year Book of International Law, pp.54-81.

Pearce, R., Stevens, J. & Barr, W., 2010. The Law of Trust and Equitable Obligations. Oxford.

Skwirk, 1907. Harvester judgement: basic wage. [Online] Available at: [Accessed 18 August 2016].

UniStudy Guides, 2011. Sue v Hill. [Online] Available at: [Accessed 18 August 2016].

Wade, J., 1979. Trusts, The Matrimonial Home and De Facto Spouses. [Online] Available at: [Accessed 18 August 2016].

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