Introduction
The Western legal tradition generally conceives of equity as a distinct body of law, which originated in the English Court of Chancery, designed to supplement and remedy the deficiencies of the common law. Its purpose is to deliver fairness and justice in individual cases where the strict application of legal rules would lead to an unconscionable result. The central theme of this assignment is to explore "Equity in Oriental Cultures." This essay will analyse how the Western understanding of equity has been present in oriental cultures by examining principles from the Hindu legal tradition, a system of significant historical and cultural relevance to Sri Lanka. This essay argues that principles analogous to Western equity were not absent in this tradition. By examining the overarching concept of Dharma as a source of substantive justice, and the specific practice of benami transactions as a parallel to the equitable resulting trust, it will be demonstrated that the underlying pursuit of fairness, which is the hallmark of Western equity, has deep roots in Hindu jurisprudence.
The Western Conception of Equity
To understand the parallels, it is first necessary to briefly outline the Western, specifically English, concept of equity. Equity developed historically from petitions made to the King, which were delegated to his Chancellor, often described as the ‘keeper of the King’s conscience’ (Pettit, 2012). The Court of Chancery was established to provide remedies where the common law courts were unable to do so, either due to procedural rigidities or a lack of available remedies. As noted by Hudson (2016, p. 5), equity’s role was "to soften and mollify the extremity of the law."
This jurisdiction is founded on conscience and operates on a discretionary basis, guided by a series of principles known as the maxims of equity. These include "equity will not suffer a wrong to be without a remedy," "he who seeks equity must do equity," and "he who comes to equity must come with clean hands." These maxims are not binding rules but guiding principles that reflect the moral and ethical underpinnings of equity (Martin, 2012). Key creations of equity include the trust, which separates legal and beneficial ownership of property, and remedies such as specific performance and injunctions, which provide more flexible solutions than the common law remedy of damages. At its core, Western equity represents a system of justice that prioritises substance over form and fairness over rigid legality.
The Principle of Dharma as Substantive Justice
The first instance of an equitable-like principle in Hindu culture is the concept of Dharma. Dharma is a complex and multi-faceted term in Hindu philosophy and jurisprudence, often translated as righteousness, justice, duty, or moral law. It is considered the foundational principle that upholds the social and cosmic order (Lingat, 1973). While the ancient Hindu legal texts, such as the Dharmasastras, contain detailed rules of positive law (vyavahara), these rules were always intended to be interpreted and applied within the overarching framework of Dharma.
The role of Dharma can be seen as analogous to the conscience-based jurisdiction of the early English Chancellors. Just as the Chancellor was expected to deliver justice according to conscience where the common law failed, a Hindu king or judge was duty-bound to ensure that a judgment was in accordance with Dharma, even if it meant deviating from the strict letter of a legal text. According to Kane (1968), the king’s duty (Rajadharma) was to protect his people and deliver justice, and this duty was not merely procedural but substantive. If a rigid application of a rule led to an unjust outcome (anyaya), it was considered a failure of Dharma.
This bears a strong resemblance to the equitable maxim that "equity will not permit a statute to be used as an instrument of fraud." Both systems recognise that written laws, while necessary, can be exploited or can produce harsh outcomes in unforeseen circumstances. In such situations, a higher principle—be it Dharma or equity’s conscience—is invoked to ensure that justice is done. While Dharma is a much broader religious and philosophical concept than the jurisdiction-specific English equity, its function within the legal system as a corrective to the strictness of formal law provides a clear and solid parallel to the foundational purpose of Western equity (Davis, 2010).
Benami Transactions and the Concept of Trust
A more specific and practical example of an equitable principle in the Hindu tradition is the concept of the benami transaction. A benami transaction is one where property is purchased and held in the name of one person (the benamidar), but the purchase price is paid by another (the beneficial owner). The person in whose name the property is held is merely a trustee, with the real ownership vesting in the person who provided the funds.
This arrangement is functionally identical to the English equitable concept of the 'presumed resulting trust'. In English law, where a person provides the purchase money for property that is then vested in the name of another, equity presumes that the person holding the legal title does so on a resulting trust for the one who paid the money (Dyer v Dyer (1788)). The presumption is that the provider of the funds intended to retain the beneficial interest in the property.
Long before the introduction of English common law and equity into India, the practice of benami was widely recognised and enforced by local adjudicators (Derrett, 1968). The courts in pre-colonial and early colonial India would look beyond the formal title deed to identify the 'real' owner based on who had provided the consideration. This shows a clear preference for substance over form, a core equitable principle. When the British administration introduced the principles of "justice, equity and good conscience" into the Indian legal system, they found that the concept of a resulting trust was not a foreign imposition but an idea that resonated with existing indigenous practice. The Privy Council, in Gopeekrist Gosain v Gungapersaud Gosain (1854), formally recognised the benami system, acknowledging it as a long-standing custom and applying principles that mirrored those of English equity.
The parallel is striking. Both the Hindu benami concept and the English resulting trust are mechanisms developed to recognise that the formal, legal ownership of property does not always reflect the true, substantive ownership. They serve to prevent the legal owner from unconscionably denying the interest of the person who funded the purchase. This demonstrates that a sophisticated, trust-like concept, designed to achieve a fair outcome in property dealings, was already present in an oriental culture well before the formal reception of Western equitable doctrines.
Conclusion
In conclusion, an analysis of the Hindu legal tradition, which has close cultural and historical links to Sri Lanka, reveals that concepts and principles analogous to the Western understanding of equity were indeed present. The overarching principle of Dharma served a similar function to equity’s conscience-based jurisdiction, acting as a source of substantive justice to mitigate the harshness of strict legal rules. Furthermore, the established practice of the benami transaction provides a direct parallel to the English equitable doctrine of the resulting trust, demonstrating a shared recognition of the distinction between legal and beneficial ownership to prevent unjust outcomes.
While the formal legal architecture of English equity was introduced to the Indian subcontinent and Sri Lanka during the colonial period, its core ideas of fairness, conscience, and the preference for substance over form were not entirely alien. These pre-existing cultural and legal norms suggest that the need for a mechanism to correct the potential injustices of rigid legal systems is a more universal jurisprudential theme, not one exclusive to the Western tradition. Therefore, it can be reasonably asserted that the spirit, if not the precise form, of equity has been present in oriental cultures in ways that are both significant and deeply rooted.
References
- Dyer v Dyer (1788) 2 Cox Eq Cas 92
- Gopeekrist Gosain v Gungapersaud Gosain (1854) 6 Moore's Indian Appeals 53
- Davis, Jr, D. (2010) The Spirit of Hindu Law. Cambridge University Press.
- Derrett, J. D. M. (1968) Religion, Law and the State in India. Faber & Faber.
- Hudson, A. (2016) Equity and Trusts. 9th edn. Routledge.
- Kane, P. V. (1968) History of Dharmasastra. Vol. III. 2nd edn. Bhandarkar Oriental Research Institute.
- Lingat, R. (1973) The Classical Law of India. University of California Press.
- Martin, J. E. (2012) Hanbury & Martin: Modern Equity. 19th edn. Sweet & Maxwell.
- Pettit, P. H. (2012) Equity and the Law of Trusts. 12th edn. Oxford University Press.
