We must approach this question in consideration of the fact that the American Realist movement never purported to formulate a complete theory of law which could stand alone to tell us what law is. Instead, the basis was that official conduct in dispute settlement in all kinds of dispute was the focal point for the analysis of the law's impact, facilitating the ability to make legal predictions based on expected official action. I think that to measure the impact of this type of thinking on jurisprudential thought, we need to keep in mind how it seeks to differ from other theory.
There are quotations that encompass Realism's ideals very well. Oliver Wendell Holmes, the intellectual inspiration for the realist movement, who was a Justice of the Supreme Court from 1902, is often cited as saying the prophecies of what the courts will do in fact, are what I mean by the law.' Later members of the movement such as Llewellyn describe that, what officials do about disputes . is the law itself.' The obvious theme amongst American Realists was rule scepticism, which provides that statutes and other legal materials were simply sources' for judges to lay down rules in the courts, but that the sources were not rules themselves. Judicial decision making was the law'. Thus in the future, different rules could be selected from the mass available to support decisions arrived at for reasons which had nothing to do with rules, for example equity or moral subjectivity. At its very extreme, this rule scepticism exhibited itself as fact scepticism, as propounded by Judge Jerome Frank (1889-1957). He felt that even in consideration of a particular easy-to-interpret' rule, a judge or in particular a jury can always find the facts it pleases so that a rule will give the decision it wants. Therefore, the law only comes into existence when particular facts have been decided on, and before that no law on that subject is in existence. The two main emerging factors are that rules by their nature cannot control decisions by courts and that the overriding function of the law is the settlement of disputes. Standing alone, there seems to be some practical credit in what the Realists say. The realist focus can certainly help us understand why judges can be allowed to exhibit discretion in a democratic system (although apparently undemocratically). Whilst the judges satisfy themselves and the public simultaneously that the law' (statute) is actually dictating what is happening, to the extreme realist, the father figure of pre-determined law is simply a justificatory cushion, and the practical issue is that the judges themselves are declaring/creating law incrementally on each new set of facts.
The problem is that this leaves us at a loss. The idea of law as solely a father figure as discussed is naïve and scornful of pretty much any other jurisprudential reasoning. Even the natural law theory compounds a mode of direction for judges to apply principles, so it is insufficient to say, as Frank necessarily did, that a judge has no obligation to defer to some legal reference in adjudication. However we must recognise that few realists would support this fact scepticism, and I will proceed in this essay by considering realism as moderate American Realism, that rules are not always determining decisions, or more appropriately, that rules are not the operatively determinate factor in decisions. This is the general stance taken by Llewelyn for instance.
There are many criticisms that can be duly levelled against American Realist thought. The fact that judicial prejudice is almost a pre-requisite for adjudication in Realist thought is the reason why Realists are in fact sceptical about rules. However this leads us to believe that there is no place in law for precedent, a rule of recognition (of the sovereign) or law reform. There is no point changing what is said...