(1) Where the nature of the injury itself cannot be adequately repaired with money damages

(2) The contract is for or purchase is of unique or scarce goods (land)

(3) Where equity is necessary to prevent multiplicity of legal proceedings

(4) Where money would be an adequate remedy but damages are too speculative

(5) Money would be an entirely adequate remedy, but the D is insolvent

1. P must establish a claim for liability (tort cause of action, breach of contract)

2. P must demonstrate no adequate remedy at law; in other words, P must show irreparable injury or irreparable harm

3. The equitable decree that is sought must be enforceable – must be specific and definite and capable of compliance - feasibility of enforcement

4.

- Detrimental reliance on misleading or inconsistent behavior

Equitable estoppel has three elements:

1. The moving party (P) by words or conduct causes the D to believe a fact or a certain state of affairs exists  

2. The D relies on the facts that comes from the P’s words, conduct or silence

3. The D was prejudiced as a result of this reliance

- The court orders the D to affirmatively act

- Geant an order to a person or entity to affirmatively do a particular act

- Subject to higher scrutiny and requires a showing of fact and law clearly favoring the moving party, b/c it is harder for a court to supervise

- The court orders the D to refrain from acting

- Typically not stayed during the pendency of an appeal

- Used in emergency situations when the injunction must issue before any hearing and lasts only a few days, generally long enough for the parties to seek a preliminary injunction

- One purpose of temporary injunctive relief is to maintain the status quo during litigation or arbitration in order to avoid irreparable injury to the P during litigation

- In exigent circumstances, may be granted ex parte

- Bond required

- There are four criteria for determining whether preliminary relief should be granted

1. The P is likely to succeed on the merits of the underlying claim

2. P will suffer irreparable injury if the temporary relief is not issued

3. - Issued after the P has prevailed on the merits on the substantive claim, and has shown and is able to demonstrate a need for continuing protection of the court

- A permanent injunction is a final judgment

- A court order that disaffirms the contract and puts the parties in the position they were in prior to the formation of the contract

- Generally, the court will simultaneously order restitution to restore the parties to the position they were in prior to the contract

- Can either affirm the contract and get damages/specific performance, or disaffirm the contract and get rescission/restitution

- Innocent Misrepresentation - material and relid upon, then ok

- Fraudulent Misrepresentation - optional with tort damages

- Mutual Mistake - rescission ok

- Unilateral Mistake - rescission unlikely

- Innocent Misrepresentation: no recovery at law for money damages

a. Two Elements

i. The misrepresentation was material to the contract

ii.  The P reasonably relied on that innocent misrepresentation

- Fraudulent Misrepresentation: the D knowingly makes a false statement that is relied upon to the P’s detriment

a. Constitutes an actionable tort where money damages are appropriate but the P may choose to either rescind the contract or seek money damages alternatively

Mutual Mistake: 4 elements

1. Both parties are mistaken as to a fact underlying the contract

2. The mistaken fact goes to a material part of the contract

3. The mistake has a material effect on the bargain

4. Party seeking rescission did not assume the risk for the mistake

Unilateral Mistake: 3 elements

1. Mistake is about a basic assumption of the underlying contract

2. The P who is the mistaken party will suffer extreme hardship by enforcement of the contract and the D is not prejudiced

3. Other party knew of claimant’s mistake and proceeded anyway

- Court redrafts agreement to meet the original intent of the parties

Available in two instances:

1. Fraud in the Inducement: If one party induces the other to execute the contract by fraudulently misrepresenting its contents, the reformation may be granted to reflect the understanding of the innocent party

2. Mistake in the Execution: If either party claims to have made a mistake in entering into the contract, there will be no reformation b/c there was no meeting of the minds; granted if mistake mutual; granted to reflect unknowing party's understanding if unilateral

1.  Statute of Frauds: if a written agreement fails to comply with these requirements, it cannot be reformed; exception is a part performance

2. Parol Evidence Rule: not a valid defense to reformation b/c the court has to attempt to learn the original intent of the parties

3.  Protection of Rights of Third Parties: Revision or reformation is generally only available if it can be done without prejudice to bona fide purchaser

- The focus is on the defendant’s gains rather than the plaintiff’s losses

- Puts the parties in their rightful positions and prevents a D from being unjustly enriched at the expense of the P

- May be an alternative to compensatory damages

Types:

1. Quasi Contract

2. Constructive Trust

3. Equitable Lien

4. Subrogation

- A charge or encumbrance imposed by law or equity against specific property that makes the properly stand as security for the debts owed by the D

- A judicial restitutionary remedy to keep the D from being unjustly enriched

- An equitable lien is similar to a constructive trust; however, the holder of an equitable lien cannot recover specific property, as can the beneficiary of a constructive trust

- A constructive trust gives complete title to the claimant, but an equitable lien only creates a security interest in the property

- A judicially created form of specific restitution whereby property that was wrongfully acquired by the D is ordered returned to the P

- Designed to prevent unjust enrichment by conveyance of title from the D to the P

- Cut off by a bona fide purchaser

Requirements:

1. Confidential or fiduciary duty between P & D, breached by the D

2. As a result of breach, D holds legal title to specific property that rightfully belongs to the claimant

3. The retention of the property by the D results in unjust enrichment

- A situation that is a means of avoiding unjust enrichment whereby a promise is implied in law based on an equitable or moral duty

Requirements:

Plaintiff conferred a benefit upon defendant, who realized the benefit, and retention by defendant of the benefit under the circumstances is unjust

Benefit: Any advantage

Unjust: when retention of benefit unfair

- An equitable doctrine applied when one party (subrogee) discharges an obligation for which another (subrogor) is primarily liable and that the latter ought to pay

- A payor who satisfies an obligor's obligation is then entitled to every remedy she has against the obligor, to the extent of reimbursing what was expended

- If the proceeds exceed what the payor spent on the plaintiff's behalf, the plaintiff is entitled to the excess

- A court order directing the D to comply with a contractual agreement – enforcing the contract

Requirements:

1. Definite and Certain Contract

2. Mutuality of Performance

a. Contract at issue is enforceable (valid)

b. All conditions precedent to performance have been satisfied

c. The contractual terms at issue are sufficiently certain that they can be enforced by a court

d. The D is actually able to perform

e. It would be fair and equitable to specifically enforce the contract

If the plaintiff seeks equitable relief by way of specific performance, plaintiff must establish that money damages would be inadequate to restore him to the position he would have been in had the breaching party been performed

1. Land Sale Contracts: the breach of an agreement to transfer real property cannot adequately be compensated by money damages; IL follows the Equitable Conversion Doctrine

2. Sale of Goods or Chattels: specially manufactured or not readily available on open market

3. Sale of Closely held Corporate stock: no readily ascertainable market price or stock represents voting control

4. Non-Compete Agreements: reasonableness includes scope of activities restricted, geographic and duration restrictions; generally enforced except service contracts

1. Employment Contracts - the court may affect the same result indirectly by enjoining him from working elsewhere

2. Construction Contracts - not feasible to enforce

3. Partnership Agreements - including marriage

4. Franchise Agreements - business ventures too personal

- Equitable relief will be barred if

1. The moving party has waited an unreasonable length of time in asserting its claim; and

2. The non-moving party has suffered prejudice as a result of the unreasonable delay

- Only a defense to equitable remedies

- Voluntary and intentional relinquishment of a known right; can be express or inferred by conduct

- Focus is on P's conduct rather than D's induced conduct

- Unlike equitable estoppel, no reliance is required by the D in waiver

- Where equitable relief would pose an undue hardship or unreasonable burden on D, D may either use this as a complete defense or ask that legal remedies be granted rather than equitable remedies

1. Where a plaintiff has made out a case for equitable relief, but undue harm would result to the defendant by granting the equitable remedy, the equity court may deny equitable relief and leave the plaintiff to his remedy at law, if available

2. In injunction cases, undue hardship is considered in balancing of the equities where it is an extreme hardship on the D

Equity follows the maxims that:

a. He who comes into equity must come with clean hands

            b. No one can take advantage of his own wrong doing

            c. Between those equally in the wrong, the law will not interpose

- The inequitable conduct must have a close connection to the matter in controversy

1. Civil

a. Compensatory: goal of compensating the P for losses caused by the D’s disobedience with the court’s order

b. Coercive: ensure compliance with the court order and is conditional; lifted once compliance is achieved

2. Criminal: a crime and is considered an assault to the dignity of the authority of the court

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