The nature of judicial precedent
In examining the development of our law reference was made to the role played by the judges in its evolution, the common law and equity being the product of judicial reasoning in that they have both evolved through the system of case law whereby law is made for the purpose of the decision of the specific case before the court. It is natural that if a similar dispute should arise again then the previous decisions should be used as a precedent and in this way the law becomes more certain and more uniform in its application. This practice of referring to previous decisions and arguing by analogy to them of the present case in order to arrive at a judgment is known as the application of judicial precedent.
Binding and persuasive precedent
Judicial precedents have played and continue to play an important role in the administration of Justice under the English legal system. But they do more that this, for not only are they regarded as authoritative pronouncements of law, but certain precedents are regarded as binding upon courts which are subsequently called upon to try similar issues. Such precedents are not merely persuasive authorities which may be followed if the appear to be correct; they are precedents which must be followed.
Ratio decidendi and obiter dicta
For a judicial decision to be binding on subsequent courts, the decision must be ratio decidendi. The ratio decidendi of a case is the reason for the actual decision or the principles underlying the decision, and if the judge made a clear statement of the reason for his decision, or laid down a legal principle, it would not be difficult to extract the ratio decidendi, but this is not often the case. Many matters would have to be taken into consideration before it can said with certainty what the true reason may have been, such as the circumstances and the facts in the case, the arguments of counsel on both sides and the state of the law at the time when the decision was given. In addition, a judge may give several reasons for his decision and the court may be composed of several judges and each judge may give a different reason for the court’s judgment. A true ratio decidendi is a product of material facts.
The ratio decidendi must not be confused with obiter dicta. Such expression of opinion or illustrations emanating from the Bench during the course of the judgment have no binding force , as does ratio decidendi; they are simply statements “ by the way” but they do possess some authority which is entitled to respect varying with the reputation of the particular judge.
Significance in the operation of the binding system of judicial precedent is the hierarchical structure of the court system, for whether a court is bound to follow a previous decision depends to a very large extend on which court gave the previous decision. Generally, if the decision was of a superior court then the lower court must follow it but superior court is not bound by the previous decisions of the inferior court. The hierarchy of the courts as regards the operation of precedent is as follows:
House of Lords
With the exception of decisions made ‘per incuriam’, ie, where an important case or statute has not been brought to the attention of the House when the previous decision was made, the House of Lords was bound by its own former decisions. However, in 1966, the Lord Chancellor issued a statement that in future the House of Lord would not regard itself as bound by its own decisions.
Note. All decisions of the House of Lords are absolutely binding on all other courts.
The Court of Appeal
This court is bound by its own pervious decisions, as well as those of the House of Lords: The Court however is not bound by its own previous decisions
a) where it considers that a decision was made ‘ per incuriam’, ie, in error b) where there are two...