equity
Pluralequities (some meanings)
- 1Fairness, impartiality, or justice as judged by the principles of natural law or natural right.
The judge was widely praised for the equity of her rulings.
Critics questioned the equity of a tax that fell hardest on the poor.
Similarfairness, impartiality, justice, evenhandedness
Oppositeinequity
Note
The fairness here is pictured as a level measure: Latin aequitās meant uniformity as well as impartiality and fairness, so every party is weighed by one standard. The word takes of and attaches to a decision (the equity of a ruling, of a tax) as when Nashe in 1599 declines to dispute "the equity of their iudgementes." Its opposites are inequity and iniquity.
- 2The value of a piece of property once any liens or other encumbrances on it are subtracted.
After ten years of payments, they had built up substantial equity in their home.
The couple borrowed against the equity in their rental property to pay for the renovation.
Note
This is the sense homeowners live with: the mortgage is the lien, and equity is the share of the house that is theirs. It takes in (equity in a home, in a rental property) and grows as the loan is paid down. People build up equity, borrow against it, and say they have a lot of it.
- 3Ownership in a business, especially when thought of in terms of its net monetary value.
The founders gave up a third of their equity to attract outside investors.
A pension fund took a 40 percent equity stake in the airline.
Note
Finance sets this ownership against debt: lenders are owed money, while owners hold the equity. Private equity, as The Economist used it in 2013, names firms that buy whole companies and often pile debt onto their balance sheets. Founders give up equity to attract investors, and an investor takes an equity stake; in the plural, equities usually means shares.
- 4The ownership interest in a company, worked out by subtracting its liabilities from its assets.
The balance sheet showed shareholders' equity of $2 million at year end.
Two years of heavy losses left the retailer with negative equity.
Note
The accountant's version is a figure on the balance sheet, where assets equal liabilities plus equity. A corporation labels it shareholders' or stockholders' equity, and heavy losses can drive it below zero. Because it rests on values recorded in the accounts, it can sit far from what the company's shares sell for.
- 5The body of law that grew up in the English Court of Chancery, a court with discretion beyond statute, and that is now administered alongside British common law.
Second-year students take a full course on equity and trusts.
The barrister focused on equity, advising mainly on trusts and family property.
Note
Here equity is a subject rather than a quality: students take courses in equity and trusts, and barristers build practices on it. Though administered beside the common law, it keeps its own vocabulary, so a right born of it is equitable (equitable title, an equitable claim) where its counterpart is legal title.
- 6The power of a court with discretion beyond statute to decide cases and grant relief outside, though not against, the legal code, as when the code does not apply or is not enough.
The judge, sitting in equity, ordered the seller to hand over the land rather than merely pay damages.
A court of equity can step in when the statute gives an injured party no remedy.
Note
Lawyers speak of a court of equity, or of a court of law sitting in equity when it reaches past the code to give relief. The power grew up in the Court of Chancery of late medieval England, and its touchstone is conscience: "A Court of equity interposes only according to conscience," Edward Sugden, Lord St Leonards, said in 1851. Macaulay calls it a refined science demanding long application.
- 7Equality; the state of being equal.
The charity campaigns for equity of access to good schools for every child.
Union members demanded equity between the pay of men and women doing the same job.
Oppositeinequality
Note
Using equity as a plain synonym for equality is nonstandard, and careful writers keep the two apart: the fairness meaning allows unequal shares when fairness calls for them. The blur shows up in political language (Ben Bradley raised "equity of opportunity" for low-income families in Parliament in 2020) where equal and fair sit close enough to swap.
- 8An equitable claim: a right that a party gains from the nature of a transaction itself and can exercise if circumstances or conditions change.
Once the loan was repaid, the borrower exercised her equity of redemption and recovered full title to the farm.
The court held that the buyer's equity bound the seller's heirs, since he had paid the full price before the seller died.
Note
A right that belongs to one party, so it can be held and counted: a buyer has an equity, a borrower an equity of redemption, the right to regain legal title once a mortgage's conditions are met. James Kent's Commentaries on American Law (1826) discusses the wife's equity, which attached only to property her husband could not acquire without a court of equity's help.
- 9The share of the pot that a poker player can expect to win from a hand.
With two cards to come, her flush draw had about 35 percent equity against his pair.
Folding a hand with that much equity would have been a costly mistake.
Note
A probability turned into money: a player's chance of winning the hand, applied to what is already in the pot. It changes with every card dealt, so players quote it as a percentage against a particular hand and speak of a hand with good or poor equity. Folding a hand with real equity gives up a share of a pot the player had a claim to.
Practice
Can you tell the meanings of equity apart? Answer 3 quick questions from this page, or write your own sentence and AI will check it.
Origin
From Middle English equitee (also equytee), from Old French equité, from Latin aequitās ('uniformity; impartiality; fairness').