In common law countries equity is based on a judiciary assessment of fairness. It is what is often what is considered fair and right under natural law. It is used when the laws themselves do not address an issue or are inadequate in some way. Examples of equity decisions include imposing a lien, correcting a property line or ordering someone to do something to prevent damage.
Common law in England can be traced back to the Norman conquest. The laws, such as they were then, did not address every concern. At first, a subject (of the king) had to petition the king to ask to be heard in his court. One of the first instances of this was in 1070 when Lanfranc, the Archbishop of Canterbury had a case against Odo, Earl of Kent, the king's brother. The archbishop petitioned that lands taken by Odo be restored. Rules of equity began when it became apparent that the common law courts could not solve all legal problems. The king set up courts of chancery (equity). By the 1800s the equity courts were becoming obsolete. In 1875 Parliament did away with the chancery courts altogether.
States in New England followed the English tradition of maintaining separate courts for law and equity. Others, however, combined their courts with both types of jurisdiction. This is what Congress did with respect to the US federal courts. United States bankruptcy courts are the one example of US federal courts which operate as courts of equity.
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