Chapter 3 Judicial Precedent

Chapter 3  

Judicial Precedent 

Introduction  

In this chapter you will learn about : 

• Definition of judicial precedent 
• The types of statements in judgment and it effect on future cases 
• Hierarchy of Courts 
• Judicial tools 
• Advantages of judicial precedent 
• Disadvantages of judicial precedent 

3.1 What is judicial precedent ? 

1. Judicial precedent refers to the source of law where past decisions of judges create law for  future judges to follow. This source of law is also known as case-law. Most of he law of tort and contract and important crimes such as murder and common assault are a creation of judges and not Parliament. 

2. The doctrine of stare decisis (stand by what has been decided ) requires that once a decision has been made on how the law applies to particular set of facts , similar facts in later cases should be treated in the same way. 

3. The decision in an earlier case in only binding upon any later case if : 

• It contains a statement of law which forms part of the ratio decidendi of the earlier case. 
• It was decided by a superior court or court whose decisions are binding upon the court dealing with the latter case 
• It does not contain any significant difference to the latter case 

4. The effective system of precedent requires acccurate law reporting to provide access to previous judicial decisions and a clear hierrchy of courts. 

3.2 Binding and persuasive precedent 

1. The ratio decidendi of the case refers to the legal reasoning for the decision in a case and is binding on future cases. 

2. Obiter dicta refer to all parts of the judgement which do not form part of the ratio decidendi. Obiter dicta refers to things said 'by the way' which are not binding but may be persuasive on future cases. 

3. Persuasive precedents include : 

• decisions of inferior courts 
• decisions of the Judicial Committee of the Privy Council 
• statements made obiter dicta 
• decisions of the European Court of Human Rights 
• decisions from other common law jurisdictions 
• judgements of parallel courts , where these are not binding , for example the High Court 

3.3 Hierarchy of Courts 

Civil Cases [ European Court of Justice -> Supreme Court -> Court of Appeal (Civil Division) -> Divisional Courts -> High Court -> County Court -> Magistrates Court] 

Criminal Cases [ Supreme Court -> Court of Appeal (Criminal Division) -> Queens Bench Divisional Court -> Crown Court -> Magistrates Court 

3.3.1 European Court of Justice 

Decisions of the ECJ are binding on all English courts up to and including the Supreme Court for points of EU law but not for other areas . However , the ECJ is not bound by its own decisions. 

3.3.2 Supreme Court ( replaced the House of Lords in October 2009 as a result of the Constitutional Reform Act 2005 ) 

1. The most senior appeal court in English law and hears civil and criminal appeals on points of law of great public importance. 

2.  SC decisions are binding on all lower courts. 

3. HL was also self-binding until 1966 - In London Tramsways Ltd. v London County Council (1898) - HL held that certainty in the law was more important than the possibility of individual hardship being caused through having to follow a past decision. 

4. In 1966 the Lord Gardiner issued The Practice Statement ( Judicial Precedent) 1966 which allows the House of Lords to depart from previous decisions where it appears right to do so though the HL only rarely overrules on of its earlier decisions. 

5. The PS emphasised the importance of the doctrine of precedent in providing certainty in the law. However the Practice Statement recognised the dangers of rigidity. Old decisions may be unjust or out-dated. Hence the House of Lords would generally be bound but may depart if it is right to do so. Judges were warned of the dangers that flexibility could present. The retrospective effect of changes in the common law could have a major impact in commercial and financial transactions and in criminal law. 

6. The House of Lords may depart from a previous decision if it is out of date or wrong or creates uncertainty in the law but in the interest of certainty has only use the PS rarely . The Practice Statement has enabled the House of Lords to adapt English law to meet changing social conditions and has made the House of Lords like superior courts in other countries which are not bound by their own decisions. 

7. The House of Lords may depart from a previous decision if it is out of date or wrong or creates uncertainty in the law. 

8. Some examples of cases where the House of Lords has departed from its previous decisions include : 

• In Miliangos v George Frank (Textiles) Ltd (1976) the House of Lords overruled its previous decision in Re United Railways of the Havana and Regia Warehouse Ltd. (1960) and allowed damages to be paid in currencies other than sterling as the earlier decision was out-of-dated. 
• In R v R , the House of Lords overruled the previous position and recognised that a husband could be found guilty of raping his wife. The House of Lords held that the previous decisions were wrong and out of date especially in line of the changing role played by women in society. 
• In Pepper v Hart (1993) , the previous ban on the use of Hansard in statutory interpretation in Davis v Johnson was overruled. 

3.3.3 Court of Appeal 

1. Hears civil and criminal appeals in separate divisions. 

2. CA is bound by decisions of the European Court of Justice. 

3. Bound by precedents of the House of Lords ( Supreme Court ) ( Cassell Co.Ltd. V Broome (1972) ). 

• In Broome v Cassell & Co . Ltd. (1971), Lord Denning refused to follow the earlier House of Lords decision in Rookes v Barnard (1964) on the circumstances in which exemplary damages could be awarded. 
• In Schorsch Meier GmbH v Henning (1975) and Miliangos v George Frank ( Textiles ) Ltd . (1976) the Court of Appeal under Lord Denning's leadership refused to follow a decision of the House of Lords in Re Havana Railways (1961) which said that damages could only be awarded in sterling . In Miliangos , the House of Lords pointed out that the Court of Appeal had no right to ignore or overrule decisions of the House of Lords. 

4. Decisions of the Court of Appeal  are binding on all lower courts. 

5. The Court of Appeal ( Civil Division) is self-binding subject to the three well accepted exceptions laid down in Young v Bristol Aeroplane Co.Ltd. (1944) 

• If a previous decision conflicts with a later House of Lords decision , the House of LOrds decision prevails. ( Family Housing Association v Jones) 
• If two previous CA decisions conflict , the court must choose between them . ( Starmark Enterprises Ltd . V CPL Enterprise Ltd. ) 
• The CA may depart from a previous decision made per incuriam ( through want of care ). ( Williams v Fawcett (1985) ) 

6. Other situations where the Court of Appeal may be able to depart from its previous decisions:  

• Where the CA decision is inconsistent with an earlier HL decision the Hl decision is binding. 
• Where the previous decision of the CA is inconsistent with the decision of the Judicial Committee of the Privy Council. ( Worcester Works Finance Ltd. v Cooden Engineering Ltd. (1972) ) 
• Where there is a change in the rule of international law . ( Trandex Trading Co. v Central Bank of Nigeria). 
• The Court of Appeal can ignore a previous decision of its own which is inconsistent with European Union law or a later decision of the European Court of Justice . ( Section 3 European Communities Act 1972 ) 
• The Court of Appeal may ignore its previous decision made prior to the Human Rights Act 1998 which is in conflict with the provisions of the European Convention of Human Rights. 

7. The Court of Appeal ( Criminal Division) in addition to using the exceptions in Young's case an depart from previous decisions if the law has been ' misapplied or misunderstood' to prevent injustice to the defendant . 

Should the Court of Appeal have the power to depart from its previous decisions ? 

1. Lord Denning wanted the CA to be able to depart from previous decisions like the HL or by adding exceptions to Young v Bristol Aeroplane . His view was that precedent unduly restricted the growth of the law. 

2. In Davis v Johnson , Lord Denning sought to overrule an earlier Court of Appeal decision on basis it was wrong . The House of Lords upheld his decisions  but strongly said that the Court of Appeal was bound by its own decisions subject to the Young exceptions. 

3. Arguments that the CA should be able to depart from its own decisions  

• The CA hears more cases than the HL and is therefore the final appeal court for many litigants. 
• Very few cases reach the HL. Even if there is an error in the law it may take years before a suitable case is appealed all the way to the House of Lords. 
• The CA would probably only use the power on rare occasions like the HL has used the PS ( Judicial Precedent ) 1966. 
• The power given to the CA to refer a decision to the HL when they disagree with the decision that they are bound to make by precedent may siphon away public funds. 

4. Arguments that the CA should not be allowed to depart from its own decisions : 

It will create more uncertainty . The system of precedent would be undermined and the law would become unpredictable. 

The CA should leave quasi-legislative development of the law permitted by the Practice Statement ( Judicial Precedent ) to the HL. 

5 . Since Denning left the bench, there has been no further challenge by the Court of Appeal. 

3.3.4 Other Courts 

The High Court ( Divisional Court ) - In criminal cases the Divisional Court is bound by the HL and the CA and their own previous decisions , but may depart from their own previous decisions to prevent injustice . In civil cases , the Divisional Court is bound by the decisions of the HL , the CA and their own decisions . Like the CA ( Civil Division ) , the Divisional Court is self-binding subject to Young v Bristol Aeroplane. 

1. High Court - Puisne judges are bound by decisions of the HL , CA and Divisional Courts , but not by their own decisions though they will usually follow them 

2. Inferior courts - The Crown Courts , county courts and magistrates courts. Bound by decisions of the higher courts , but is not self-binding (merely persuasive). 

3. European Court of Human Rights ( based in Strasbourg ) - hears cases alleging that there has been a breach of the European Convention of Human Rights. Does not have to follow its previous decisions but English Courts must take into account ( not binding ) past decisions of the European Court of Human Rights . - S.2 HRA 1998. 

3.4 Implications of the Decision in R v James 

1. In R v James the CA ( Criminal Division ) held that the Privy Council decision on provocation as a partial defence to murder in R v Holle y effectively overruled the earlier decision of the HL in R v Smith  (2001) . This was because all nine of the Lords of Appeal in Ordinary sitting in Holley agreed in the course of their judgments that the result reached by the majority clarified definitively English law on the issue in question and since the majority in Holley constituted half the Appellate Committee of the House of Lords , the result of any appeal on the issue to the House of Lords was a foregone conclusion. 

2. It cannot be denied that the decisions in Holley and James fundamentally after the previous understanding of the way in which the doctrine of precedent operates within the English legal system and affords the judges on the HL a second way of altering their previous decisions in addition to the PS 1966. However, the decision in James is limited to the specific circumstances and does not alter the general rule that the Court of Appeal should follow decisions of the House of Lords. 

3.5 How is flexibility achieved? 

How is the law to develop and change to cater for changed circumstances and changing social needs if cases are always to be decided according to ageless precedent ? There are certain judicial tools available to ensure that the law continues to develop. 

1. Since ratios are determined retrospectively , judges do have flexibility in applying the precedent system . It is open to later judges to avoid precedents by declaring them to be no more than obiter statements. 

2. Distinguishing occurs where a judge holds that the ratio of a previous case would not find application in the case before the court because the material facts are different . In Merritt v Merritt (1971) the court distinguished Balfour v Balfour (1919). In Balfour v Balfour it was held that a wife could not claim against her husband for breach of contract as there was no intention to create legal relations. However in Merritt v Merritt the wife was successful as the facts were different as here although the parties were husband and wife , the agreement was made after they had separated and the agreement was in writing . Hence it was not just a domestic arrangement but a legally binding contract. 

3. Overruling -  Overruling occurs where a judge believes that the ratio decidendi in a previous case is no longer good law and therefore does not follow it . A higher court may overrule a decision made in an earlier case by a lower court . For example , the House of Lords overruling a decision of the Court of Appeal - overruling also occurs when the House of Lords uses its powers under the Practice Statement to overrule a past decision of its own . Overruling does not extend to affect the parties in the authorities overruled. 

4. Reversing - This occurs where a court higher in the hierarchy overturns the decision of a lower court on appeal in the same case. For example the Court of Appeal may disagree with the legal ruling of the High Court and reverse the High Court's decision. This has the obvious impact of affecting the parties in the case. 

5. Disapproving - occurs where the judge believes that the previous decision was wrongly decided but will not overrule it . It may be proved to be persuasive in other cases so that the law perceived as flawed is not perpetuated. Anns v Merton London Borough Council (1978) was widely disapproved by a number of later cases before being overruled by Murphy v Brentwood. 

6. Original precedents - If the point of law in a case has never been decided before , then whatever the judge decides will form a new (original) precedent for future cases to follow. The system of precedent allows 'original precedents' to be created to deal with difficult new legal dilemmas - ReA, Airedale NHS. 

7. The possibility of a later court extending or modifying the effective ambit of a precedent - Judges have a tendency continuously to extend existing precedents to fit new situations. An established principle in a precedent could be adapted to particular circumstances - for example , the rule in Hedley Byrne v Heller was developed out of Donoghue v Stevenson. 

8. Section 2 Human Rights Act 1998 requires the UK courts to take into account judgements, decisions and opinions of the European Court of Human Rights. The HRA 1998 gives the CA latitude to effectively overrule decisions of the HL which were decided before the HRA came into effect and in conflict with ECHR. 

3.6 Advantages of precedent 

1. Provides for a degree of certainty and predictability since like cases are treated alike. This enables people to plan ahead. The House of Lords Practice Statement points out how important certainty is . 

2. Saves time and money as cases do not have to be reargued if there is a precedent and lawyers  can advise clients on the likely outcome based on previous cases. 

3. There is a degree of flexibility as the House of Lords Practice Statement and other methods of avoiding precedent for example distinguishing enable the law to develop and adapt , thus keeping up with modern times. 

4. Has enabled whole areas of law like contract and tort to develop with little statutory intervention. 

5. The system allows 'original precedents ' to be created to deal with difficult new legal dilemmas - ReA , Airedale NHS v Bland. 

• Airedale NHS Trust v Bland - on the facts the court held that the life support machine could be switched off when a person was in a persistent vegetative state. 
• ReA - on the facts the court held that the Siamese twins could be separated by an operation when the hospital recommended this despite the parent's objections. 

6. It has an advantage over legislation as it responds to factual situations that have occurrred. Hence the law can be applied in a practical and thorough manner. 

3.7 Disadvantages of precedent 

1. The system is rigid as bad judicial decisions may be perpetuated for a long time until they come before a court high enough to have the power to overrule them . Change in the law will only take place if parties have the courage , the persistence and the money to appeal their case. 

2. There are a large number of decided cases and more are added all the time. Judgements are often long and unclear , and so finding the ratio is not an easy task. 

3. The use of distinguishing to avoid past decisions can lead to ' hair-splitting and illogical distinctions' so that some areas of the law have become very complex. 

4. Retrospective effect - unlike legislation , considered unfair to the losing party in the case who  could not have known what the law was before they had acted. 

5. Judges like Lord Denning suggest that the restrictions imposed by the precedent system can cause injustice. 

6. Promotes laziness as a judge only has to refer to previous decisions he does not have to fully consider the matter personally. 

7. Undemocratic - unlike the legislator the judge is not answerable to the people. 

3.8 Precedent and acts of parliament 

If an Act of Parliament is passed which contains a provision which contradicts a previously decided case that decision will cease to have effect and the Act of Parliament will be the law on that point. 

Learning Outcome 

By now you should know that : 

• The doctrine of stare decisis determines the certainty in the law via the chain novel of cases 
• Only the ratio decidendi in a judgment is binding in future cases 
• Decisions of the higher courts are binding on the lower courts in the hierarchy of courts 
• There are several judicial tools within the hierarchy of courts i.e. Court of Appeal and Supreme Court 
• There are also external judicial tools available to judges of other courts 
• Precedent provides the certainty much required but there are disadvantages due to the rigidity of the doctrine 

Self - Assessment 

1. What is the principle promulgated in London Tramsways Ltd v London County Council ? 

2. Define the term ration decidendi. 

3. Give examples of persuasive  precedents. 

4. Draw a diagram of the hierarchy of courts from the highest to the lowest within for civil cases. 

5. Give examples of cases that applied the exception introduced by the Practice Statement 1966. 

6. List 5 judicial tools available to all courts. 

7. State the three exceptions laid down by Young v Bristol Aeroplane Co.Ltd. 

8. State 3 advantages of the doctrine of judicial precedent. 

9. Which judge supports the notion that Court of Appeal should be able to depart from its own decisions like the Supreme Court ? 

10. List 5 disadvantages of precedent. 

Further Reading 

Jacqueline Martin , The English Legal System , 6th Edition , pgs. 22-41. 

Appendix A - Application of the exception in the practise statement today 

R v G & R [2003] 1 Cr App R 343 

Two boys aged 11 and 12 were convicted of arson , the judge having ruled that recklessness was based on a risk obvious to a reasonable person rather than to a typical 12-year-old. The Court of Appeal dismissed the boys' appeal . The decision in R v Caldwell has been much criticised , they said , but it was made by the House of Lords and is thus an authority binding on the Court of Appeal . (The decision was subsequently reversed by the House of Lords , who departed from their own previous decision in Caldwell.) 

Appendix B - Judicial tools 

Distinguishing 

(In addition to Balfour v Balfour and Merritt v Merritt , Stilk v Myrick and Hartley v Ponsonby you can use the following ) 

Rylands v Fletcher (1866) LR 1 Ex Ch 265 , Ex Ch ; (1868) LR 3 HL 330 House of Lords 

Water escaped from the defendants' reservoir , through some old mine shafts that had not been adequately sealed , and flooded the plaintiff's working mines. Blackburn J said the true rule of law was that the person who for his own purposes brings on his land and collects and keeps there anything likely to do mischief if it escapes , must keep it at his peril , and if he does not do so he is prima facie answerable for all the damage which is the natural consequence of the escape. Upholding this judgment in the House of Lords , Lord Cairns LC said the defendants might lawfully have used their land for any purpose for which it might in the ordinary course of the enjoyment of land be used , and if in the natural use of the land there had been any accumulation of water , which by the operation of the laws of nature had passed off into the land occupied by the plaintiff, the plaintiff could not have complained. On the other hand , if the defendants not stopping at the natural use of their land had desired to use it for any non-natural purpose , and if in consequence of their doing so the water came to escape and pass off into the plaintiff's land , then that which the defendants were doing they were doing at their own peril. 

Rickards v Lothian [1913] AC 263 

PC (Australia) A sink in D's upper flat had been locked and water turned on by an intruder , causing damage in P's flat below . Lord Moulton , giving their Lordships' judgment , said a defendant is not liable under the rule in Rylands v Fletcher for damage caused by the wrongful acts of third persons. He also took up Lord Cairns' emphasis on non-natural use , and said it is not every use to which land is put that brings into play the rule in Rylands v Fletcher. It must be some special use bringing with it increased danger to others , and must not merely be the ordinary use of the land or such a use as is proper for the general benefit of the community. 

Appendix C - Difficulties with judicial tools - Uncertainty 

Lewis v Averay [1971] 3 All ER 907 Court of Appeal 

A Bristol postgraduate student P advertised a car for sale , and a man X came to see it . X said he would like to buy it and introduced himself as Richard Green ( a well-known actor) , showing a studio pass as evidence of his identity. P agreed to accept a cheque and let X take the car away. X disappeared , the cheque bounced , and P sought to recover the car from D , who had bought it in good faith . The Court of Appeal rejected P's claim , following Phillips v Brooks and distinguishing and doubting Ingram v Little. 

Shogun Finance v Hudson [2004] 1 All ER 215 

HL A rogue bought a car on hire purchase from a dealer , producing a driving licence (probably stolen) that showed a false name . The finance company CC carried out the normal credit checks against the name on the licence , and subsequently approved the loan .The rogue sold the car to an innocent purchaser D and subsequently defaulted on the loan. (Note : the Hire Purchase Act 1964 provides that a person who buys in good faith from a "hire purchaser", believing him to be an outright owner, acquires a good title.) In split decisions , the Court of Appeal and the House of Lords decided that CC was entitled to repossess the car : they clearly intended to hire the car only to the person named on the licence , and the rogue had not acquired any title that could be transmitted to the purchaser D . As Lord Denning MR pointed out in Lewis v Averay , frauds of this sort almost always result in a conflict between two quite innocent parties , and there will always be hard cases . Sedley LJ ( dissenting in Shogun v Hudson ) said the law is still unclear : this is evidently true , and it is wrong that the courts should resort to very technical distinctions to decide essentially similar cases in different ways. The law should be clear one way or the other , and that cannot happen unless the doctrine of stare decisis is properly applied. 

Actavis UK v Merck and Colus [2008] 

The UK Court of Appeal has decided that a "second medical use" claim can be patentable even if the sole distinguishing feature of the claim over the prior patent is a new dosing regimen or new dosage form. The Court's decision is a surprise , as an earlier decision of the same court found a lack of patentability for a claim to a different dosing regimen. However , the Court of Appeal found reasons to distinguish the facts of the case at hand from those of the earlier case Bristol-Myers Squibb v Baker Norton [1999] RPC 253. Surprisingly , the Court also commented that , even if the facts could not be distinguished , they were entitled to overturn the earlier decision . Although this goes against the usual rule of the Court of Appeal being bound by its own decisions , the Court decided that a limited exception applied to the facts of the case at hand , which exception allowed it to ignore the reasoning of the earlier decision.