The Equity of Exoneration and Figments of the Trustee’s Imagination

The equity of exoneration is an age-old doctrine, originally available to married women, who without recognised legal status, were accorded an equity in circumstances where they charged their own interest in an asset, usually the family home, for the purposes of promoting a business or venture conducted and owned by their husband and where their husband later became bankrupt. This article examines the equity in its current form and the ways that it is typically used today. Whether there is a need for such an equity in most circumstances is a moot point, given the considerable advancement of the legal status of women, and the development of the conduct and financing of business since the 17th century. Recent decisions, nonetheless, support the continued operation of the equity.

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