An equitable interest is right in equity subject to satisfaction by an equitable remedy should the equitable interest suffer a harm. This concept only exists in the common law.
Equity
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Main article: Equity (law)
Equity is a concept of rights distinct from legal rights. In equity, a judge determines what is fair and just and makes a decision as opposed to deciding what is legal.
An example of an equitable interest may be found in a trust. In a trust, the trustee has a legal interest in the trust. However, the beneficiaries to the trust has an equitable interest in the trust. The trustee has the power of attorney, or legal rights over the trust. Meanwhile the beneficiaries, the holder of the equitable interest has an equitable right in the trust. If the trustee fails to perform his or her duties, then the beneficiary may sue the trustee in equity to perform his or her duties. Such a situation includes the trustee failing to disburse cash from the trust's property, corpus, to the beneficiary. Likewise a trustee may embezzle the trust's property and, although the trustee has a legal interest in the trust, the beneficiary has an equitable interest in the trust and so may sue for the trustee to return the trust's property or reimburse the trust for the value of the property embezzled.
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