This essay outlines the way in which courts use the system of precedent in deciding cases. Different methods of law-making will be identified, and the authority of judges to make laws will be described. It will state the operation of doctrine of precedent, including binding and persuasive precedent, as well as ratio decidendi and obiter dicta. Explained also, is the problems encountered with the doctrine of precedent and the methods available to overcome precedent. Case law is made by the judges in the courts either when a new case is before them or when the judge interprets a statute.
The courts are limited in their power to make law, however, through the court hierarchy and the doctrine of precedent. Judge-made laws are recorded decisions of judges that have been written down and collected over time. There are two main areas of judge-made laws. The first area is Common law, which is judge-made law in areas where no legislation applies, whilst the other area is Judicial Interpretation, which is judge made law relating to the interpretation of the words used in legislation. A precedent is the decision of a court that is used as an authority for reaching the same decision in a later case. The rule that similar cases should be decided in a similar way isn t the center of our idea of justice.
If people are to be treated equally before the law, then legal principles or past decisions must be followed and applied to later cases. There are strict rules that guide judges in making and applying precedents. Firstly if courts are to be consistent in the application of precedents, judges must know what earlier decisions are precedents. In other words, these decisions need to be recorded.
Only major cases are ever recorded. Recorded cases, which contain some new development, are published in a permanent form known as law reports. Law reports record the judgment in a case. This is a formal statement by th judge which gives the facts of the case, the decision between the parties and the reasons given by the judge for the decision reached. This will often include a lengthy discussion of other sources of information or other cases, which support the reason for the decision, which is known as the ratio decidendi, which will be discussed in more detail further on in the essay. The doctrine of precedent is a set of principles governing the way in which courts must deal with cases they are deciding.
The doctrine is also known as the doctrine of Stare Dec isis. Let the decision stand. The next paragraph explains the operation of doctrine of precedent. The doctrine of judicial precedent is at the heart of the common law system of rights and duties, developed through decisions of the courts. The doctrine of precedent is important because it allows for a system of appeals, where by someone who is dissatisfied with a decision can appeal to a higher court. When a decision is reached, the reason for the decision stands and is part of the law that is binding on, or guides the courts in later cases.
Consistency and predictability is promoted by the system of following previous cases because it means that all cases are decided in a similar manner. The doctrine of precedent requires that like cases be decided alike. If a case before the court has facts and raises issues similar to those of a previously decided case, then the present case will be decided in the same way as the earlier one. In this way, the earlier case, referred to as a precedent will have provided a legal basis on which the later case and subsequent cases could be decided.
Generally, lower courts are bound to follow the decisions of courts higher than them in the same hierarchy. The closely connected principle of the doctrine of precedent is defined as the policy of courts to stand by precedent and not to disturb a settled point. Binding precedent is a precedent that must be followed. A precedent will be considered to be binding when the facts in the previous case are similar to the case being considered by the judge, or the precedent was set by a higher court in the same court system. If a judge fails to apply a binding precedent, that failure will provide the ground for an appeal. Only the ratio decidendi of a case is binding.
Obiter dicta are never binding. Decisions from other hierarchies or from a court lower in the same hierarchy can act as persuasive precedent. This is influential on other courts but not binding. In such a case, a court may be persuaded by the decision but it is not bound to follow it. In every court case the presiding judge is required to present to the court a statement that outlines his or her judgment and the legal reasoning behind that judgment.
Within this judgment are two categories of statements of legal principle which must be considered. These are ratio decidendi, or reason for deciding; and obiter dictum, something said by the way. Often it is difficult to distinguish between the ratio and dicta within a judgment, which creates problems for a judge attempting to follow that principle. The ratio decidendi, the reason for deciding, is the ground or grounds upon which a case was decided. The ratio is a proposition of law that may make a particular case a precedent for the future. The ratio of a case is deducted from an analysis of the facts of the case and the written judgments of the judges.
A later court will apply the ratio, or rule, when they use the earlier case as a precedent. It is sometimes quite difficult to work out what is the ratio of a case. Where a number of judges have heard a case, they might have reached the same conclusion but for very different reasons, or it might be difficult to work out what facts each of the judges saw as important to his or her decision. For example in Donoghue v Stevenson  AC 562, the judges of the House of Lords were not unanimous as to the issue of whether a manufacturer would be responsible for the damage caused to a consumer through the careless production of a product, in this case a bottle of ginger beer. The majority of their Lordships held that the manufacturer was liable for negligent / careless production that caused damage to a consumer (she became ill) where the consumer used the product in the manner intended by the manufacturer (she drank it).
This responsibility or duty of care existed even though the consumer had not directly purchased the product from the producer. Other members of the House of Lords required there to be a contractual relationship before the manufacturer was liable. The ratio of this case has been taken from the majority view. Even though the case dealt specifically with the production and consumption of a bottle of ginger beer, the ratio or principle of the case that emerges from the decision has a broader significance. The ratio of the case could be stated as follows. A manufacturer has a duty of care to ensure that what they produce will be safe to consume.
Therefore, the ratio is the main legal point that has to be decided. A helpful formula was suggested for the ratio decidendi. Suppose that in a certain case, facts A, B and C exist, and suppose that the court finds that facts B and C are material and fact A immaterial, and then reaches conclusion X (e. g. judgment for the plaintiff, or judgment for the defendant). Then the doctrine of precedent enables us to say that in any future case in which facts B and C exist, or in which facts A and B and C exist, the conclusion must be X.
if in a future case A, B, C and D exist, and the fact D is held to be material, the first case will not be a direct authority, though it may be of value as an analogy. Obiter dictum, a thing said by the way, is a statement made by a judge of principles of law which relate to hypothetical facts, rather than to the particular facts of the case being determined. Often, a judge raises relevant comparisons or examples in obiter remarks. An example of the difference between ratio and obiter is seen in Cohen v Sellar  1 KB 536. in that case, the plaintiff and defendant were engaged to be married but the engagement had come to an end. Both parties claimed to be entitled to the diamond engagement ring given by the defendant, Mr.
Sellar, to the plaintiff, Miss Cohen. The judge held that the plaintiff, Miss Cohen, was entitled to keep the ring, because the defendant, Mr Seller, had breached his promise to marry her. This was the ratio of the case. The judge remarked that in cases where the woman has refused to carry out her promise to marry, or an engagement is broken off by mutual consent, the woman is bound to return the engagement ring to the man. These statements by the judge were obiter. There are many problems involved with interpreting past decisions.
The doctrine of precedent is essentially quite simple, although it may be difficult to trace established principles developed by courts in earlier cases. Judges and lawyers often encounter many problems in following and applying precedents. There are a number of reasons for this. It is Difficult to find the ratio decidendi. A judges final judgment is usually quite lengthy, containing many comments and remarks about the facts of the case, reference to other cases, statements about what the judge considers might be or should be, as well as the reasons for the final decision. It may be difficult to determine what is obiter and what is the ratio of a case.
Some cases consist of multiple ratios. Most cases involving a new precedent will be heard in a court before a number of judges, maybe three, five or seven judges. While the judges may agree on the final outcome of the case, each judge may have different reasons for that decision or legal opinion. This makes it very difficult to decide which is the fundamental principle of the case. In some instances, one or more judges may dissent from the final decision.
It becomes increasingly difficult to extract the ratio in situations where judges dissent or disagree with the final decisions. In some instances, a case may have more than one ratio, making it necessary to give priority to the more authoritative and fundamental ratio of the case. No two cases are exactly the same. There may be a number of factual and legal similarities. Each case has its own peculiarities that distinguish it from earlier cases. Consequently, it may be difficult to apply principles established in one case to a new set of circumstances or facts.
The volume of law and cases creates a difficulty in locating the case that will be most applicable to the one before the court. Over time, there may be a number of cases involving a particular area of law, and finding the most appropriate case may be difficult. A judge or lawyer may have failed to trace all the relevant case law, or a particularly significant case, where the facts in question are crucial. In some courts, precedents may conflict. Where a judge is faced with conflicting authorities, a decision will have to be made about which authority to follow. Factors that may influence this decision may be the status of the court, status of the judge, the number of judges presiding over the previous cases, and whether subsequent courts have followed that decision.
Many judges are reluctant to depart from long-established precedents, even when the outcome of the case before them would result in an injustice. There may be problems with taking account of all parties. Any decisions will need to be reasoned one that considers the parties before the court, any relevant past precedents, that the decision will stand up to any criticism, and the effect of the final outcome. In criminal cases, the ultimate effect of the decision may involve punishment or setting the person free. Another problem may be listening and comprehending all submissions. While it is assumed that judges by their appointment are capable of this, it must be remembered that the legal issues that confront courts have become increasingly complex, raising difficult questions of law, and may involve technical matters pertinent to a specialist area.
Many cases may take days, weeks or months to be determined. When a precedent is binding, a lower court must follow that decision. However, the application of the doctrine of precedent is not as rigid as it appears. It is possible for the decisions established in the higher courts to be overcome, should the facts of the case justify it. There are several methods available to overcome precedent. These methods are: overruling, reversing, disapproving, and distinguishing.
When a decision is binding on a lower court that decision must be followed. However, the case can be appealed to a higher court and, where the facts or circumstances have changed; the precedent is out of date or irrelevant for instance, the higher court can overrule the decision. This then creates a new precedent. Reversing involves the same case, firstly heard in the lower court, and then heard on appeal in a higher court.
The original decision is overturned, or reversed, setting aside the first legal principles in favour of the new principles. Disapproving is merely expressing an unfavourable opinion of a legal principle in an attempt to question the authority of that principle. This method is particularly useful when a court of lower or equal standing cannot overrule or distinguish the accepted principle. Hopefully, the parties will appeal to the case to a higher court with the authority to overrule the existing authority. Distinguishing involves looking at the facts of the case and finding material differences between them. Consequently courts lower in the hierarchy, of equal standing or higher in the hierarchy can overcome an established legal principle.
The judge must outline where the facts are different and explain why it would not be just to apply the existing legal principles to those facts. Rylands v Fletcher  LR 3 HL 330 is an example of a case that subsequent courts have sought to avoid by distinguishing. In Rylands v Fletcher the defendant had constructed a reservoir on his land from which water escaped, causing the plaintiff s mine to flood. The House of Lords held the defendant liable in damages, on the ground that persons who accumulate things on their land which are likely to do mischief if they escape, must be strictly liable if an escape occurs. The fact that the defendant was personally free from blame was held to be irrelevant. In Rylands v Fetcher the House of Lords established a new principle of tortious liability, which was perceived to operate harshly.
Much later, the High Court abolished this Rule in Rylands v Fletcher in the Australian context for this very reason. Fifty years after Rylands case, in Rickards v Lothian  AC 263 the plaintiff sought compensation on the basis of the rule in Rylands v Fletcher. In Rickards v Lothian an overflow from a water basin on the defendant s premises caused extensive damage to the plaintiff s premises on the floor below. The Privy Council agreed with the plaintiff that the defendant had accumulated something on his land that was likely to do damage if it escaped; that water had escaped and it had caused damage to the plaintiff s property.
However, the court also found that an unknown third party had stopped-up the defendant s basin and turned on the tap. This wrongful intervention by a third party, which had not occurred in Rylands v Fletcher, was a material fact upon which the precedent could not be distinguished. The defendant was held not liable for the escape of the water. In Australia, there is still a need to maintain the use of the doctrine because it provides a level of cohesion and consistency in the law and society. Many pundits believe that some of the recent decisions handed down by the High Court have departed from the Doctrine of Precedent, this could not be further from the case. The court has always departed from precedent, in 1913 the High Court concluded that it could depart from the precedent, and should such a proper case arise, they would do so.
When the High Court overrules binding precedents, this does not suggest a decrease in the use of precedent as a principle. Some believe the doctrine of precedent brings inflexibility and limits the court s ability to adopt rapid changes in society. Such advantages are overridden by guarantees of impartiality and the provision of certainty and stability. Precedent also underpins the role and public expectations of judges as to their impartiality and strict adherence to the law. There are strong arguments against the unrestrained power of the high court to function in its creative capacity, as an extreme of this would jeopardize the use of the Doctrine of Precedent. Unlike parliament, courts do not have advisory committees nor are they accountable for their decisions.
However, in the end it is up to parliament to decide, through a system of checks and balances inherent in the Australian system of government and law. If parliament is dissatisfied with a decision of the high court it can merely overrule its decision as long as it does not impeach upon the provisions contained within the constitution. With the dynamic nature of the High Court as Australia s highest court has come the need for a change in the precedential stature of many of its past decisions from strictly binding to persuasive. The courts adherence to and use of the doctrine of precedent as a fundamental principle of common law has not decreased.
The doctrine has encompassed both binding and persuasive decisions despite the emphasis upon those which are authoritative. A system based on precedent will be rational, will be adaptive to varied and changing circumstances, will take into account all the varieties of human experience, will be highly practical and will be composed by the finest minds of many generations, tuned to a fine balance and learned in the art of detecting legal issues and resolving legal problems. As the Court enters the next century, so too will the foundations upon which Australia became a nation and with it, the beliefs of an entire melting pot of people as diverse as the universe itself. 332.