Judicial Obligation, Precedent, and the Common Law

In a dispute between two parties, the court must first establish what happened. The facts are usually determined by the trial judge. Although in some countries jury may be used, in Malaysia, it was abolished in the 1980s. Once the facts are determined, the judge will then make the application of law to the facts to determine which party would succeed. The doctrine of judicial precedent is important because it is the ratio decidendi of a previously decided similar case, decided by a higher court to the current facts that will decide the solution of the case.

1 JUDICIAL PRECEDENT The weight or authority of rules of law derived from cases may vary. These relative weights are determined by the doctrine of precedent. Nearly all legal systems (including civil law systems) have some form of a doctrine of precedent, though its provisions may vary. Even a legal system which explicitly prohibits the citation of earlier cases in court could be said to have a doctrine of precedent in that it has a rule which regulates the use of precedents. 6. 1. 1Stare Decisis.

Countries which derive their legal systems from the English common law are said to employ the doctrine of stare decisis. They are regarded by many as having a strict rule of precedent, although there is a substantial body of opinion that, in fact, the rule is not applied as strictly as the theory indicates. The general rules of the doctrine of precedent in common law systems can be summarised as shown in the following Figure 6.

1: Figure 6. 1: The general rules of doctrine of precedent The general rules of doctrine of precedent will be further elaborated as follows. (a)Each Court is Bound by Decisions of Courts Higher in its Hierarchy (b)A Decision of a Court in a Different Hierarchy may be of Considerable Weight but Will Not be Binding In the case of Director General of Inland Revenue v Kulim Rubber Plantations [1987] 1 MLJ 214, the judge in this case referred to the decisions of the courts in Australia, England and New Zealand and stated: (i)Only the ratio decidendi (the judge’s decision on the material facts) of a case is binding See the case of Carlill v Carbolic Smokeball Co (discussed under ratio decidendi).

(c)Any Relevant Decisions, Although not Binding, may be Considered and Followed The rule in the English case of Young v Bristol Aeroplane Co Ltd was followed by the Federal Court. The practice of following this rule can be traced back to the Court of Appeal case of Hendry v De Cruz (1949) 15 MLJ Supp 25. In this case the court was faced with the question as to whether it was bound to follow the previous decision in Butter Madden v Krishnasamy (unreported). To answer the question the court stated: [pic]

The question whether the Court of Appeal in England should be bound to follow its own decisions remained in doubt until 1944 and was then settled by the case of Young v Bristol Aeroplane Company Limited: (d) Precedents are not Necessarily Abrogated by Lapse of Time The present Federal Court is the successor of the Supreme Court and as such bound by decisions of the latter. The courts at the top of the hierarchy normally treat decisions of lower, but still superior, courts within the hierarchy as highly persuasive. Decisions of superior courts within a different hierarchy, while not binding, may also be considered highly persuasive.

For example the Federal Court in the case of Malaysia National Insurance v Lim Tiok [1997] 2 MLJ 165 adopted the criteria laid down by the House of Lords in Food Corporation of India v Antclizo Shipping Corporation [1988] 2 All ER 513. In addition, the doctrine means that appellate courts are either bound by their own decisions or will depart from them only with reluctance. For example in the case of Koperasi Rakyat v Harta Empat [2000] 2 AMR 2311 in this case, the defendant a co-operative society appealed to the Federal Court against a decision of the Court of Appeal in that a charge created was void and unenforceable.

This charge was in contravention of s 133 CA 1965 (Act 125). In deciding the case, the Court of Appeal disregarded the decision of the Federal Court in Co-operative Central Bank v Feyen Development [1995] 3 MLJ 313 (Feyen no 1). The plaintiff, a private housing development company in the instant appeal tried to invite the Federal Court to review its previous decisions in Feyen no 1 and overrule it. The attempt was rejected by the learned judge Gopal Sri Ram JCA and he stated:

When judges say that they are adhering to the principle of stare decisis they are merely saying that they are applying the doctrine of precedent; that is there is a previous decision on a similar issue which the court must apply to the case before it. To talk of adhering to previous decisions is, however, to oversimplify what judges must actually do. They may encounter a number of problems when endeavouring to apply the principle of stare decisis. 2 WHY ARE PRECEDENTS USEFUL Precedents are used in areas other than the legal system.

Decision making bodies of all kinds may be faced with problems involving conflicting principles on which a determination must be made. In reaching a solution they will take into account previous decisions in relation to similar problems and they will be aware of the example they are setting for the future. The usefulness of employing existing legal rules and categories in order to resolve disputes which come before courts is explained by Professor Lon Fuller. 3 PROBLEMS WITH THE DOCTRINE OF PRECIDENT Although the doctrine of stare decisis is useful, it has disadvantages.

Some judicial decisions are unavoidably ‘unjust’. That may be because the case law the judge is applying seems unjust. Yet, if the terms of the law are clear, there is no way for a judge who conforms to the doctrine of precedent, particularly one in a lower court, to avoid applying it. A contrary argument is that the legislature has the duty to remedy such an injustice by enacting remedial legislation. On the other hand, most cases coming to appellate courts for decision allow judges considerable scope for avoiding precedents which would result in injustice or an otherwise inappropriate decision.

Some appellate courts are more adventurous than others more responsive to suggestions from academics, as well as practicing lawyers and, in some circumstances, are probably more prepared to accept that judicial creativity is desirable. The composition of the appeal court bench is all important in producing such an attitude. 4 THE IMPORTANT ELEMENTS (RATIO DECIDENDI AND OBITER DICTA) 6. 4. 1Ratio Decidendi Another aspect of the doctrine of precedent affecting the weight to be accorded a rule pronounced in a case is the distinction between those that are binding and those that are not.

Some of the legal rules articulated are binding, others are more or less persuasive, and some may be of very little significance. Only the ratio decidendi (literally ‘reason for deciding’) in a case can be binding. It may take a variety of forms and there is no way of predicting with certainty the form which will be accepted by a later court. Among the reasons for this difficulty are the following: • the ratio (or rations if there is more than one) may be difficult to identify; • it may be possible to state the ratio at a higher or lower level of generality; • there may be no majority in favour of a particular ratio; and • it may be difficult to distinguish the ratio from the obiter dicta in the case.

(a)Identifying the Ratio In many other cases the relevant legal principles have long been determined, so that once the facts have been established the application of the principles is straightforward whereby, the principle that one way to create a contract is by agreement with consideration and the intention to create legal relations is one such well-established rule. Neither of these sorts of case will set a precedent to be followed in later cases (the one, because it relates only to a set of facts and not to law, the other because the law is well settled).

Neither, therefore, has a ratio which will be employed in later cases. It is in cases in which the facts do raise a legal issue that the judge’s decision becomes a ratio having a precedent value. For example, have a look at the case Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256. In that case, it was established that the company had advertised a product known as a ‘smoke ball’ which was supposed to prevent those who used it from catching influenza. It promised compensation of ? 100 to anyone who used one correctly. The advertisement went on to explain that the company had deposited ?

1000 with the Alliance Bank (on Regent Street in London) as a sign of its sincerity on that matter. Any proper claimant could get their payment for that sum. Relying on the advertisement, Mrs. Carlill bought the smokeball and used as directed but yet caught the flu. She sought her ‘reward’ (as the company described it in the advertisement). When the company refused to pay she then sued, alleging a breach of contract. The transaction had to be analysed by the court to see whether it conformed to existing principles of contract law and whether, therefore, the company’s promise could be enforced.

Lindley L. J. stated that there was ‘a string of authorities’ confirming that advertisements offering rewards for performance of a condition are correctly characterized as ‘offers’ in the technical legal sense. Two legal issues remained to be decided as no previous decision had dealt with a similar set of facts. The two issues were: 1. whether there had been the necessary acceptance of the company’s offer; and 2. whether there had been consideration for its promise. Lindley L. J. ‘s decision on each issue was as indicated in Figure 3. 2. Figure 6. 2: Lindley L. J. ‘s decision

Each of the decisions above is a ratio of the case and is, therefore, an authoritative statement of that principle of law for application in later, similar, cases. All three Lord Justices of Appeal gave judgements in favour of Mrs. Carlill although slightly different reasoning, arguments and examples was given by them. (b) Level of Generality The way in which the rule of law is stated by the judge may not, however, be the rule accepted as the ratio by later courts. For any principle of law from one case to be applicable in later cases which are not identical, it will almost certainly have to be stated at a level of greater generality.

The rations from Carlill’s case, given above, were stated at the lowest level of generality. They can be restated at a higher level of generality in the following manner: •in cases of unilateral offer, the offeree’s performance of the condition constitutes acceptance of the offer; and •in cases of unilateral offer, performance of the condition is good consideration for the offeror’s promise. The restatement of these rules at a higher level of generality allows each of them to encompass a wider range of cases and so to have greater value as a precedent.

This sort of restatement is necessary in order for the doctrine of precedent to be useful. If the statements are taken as the authoritative principles of Carlill’s case then it will not be necessary for judges in later, similar, cases to work out the correct decision from first principles. Had the rations remained fixed at the lowest level of generality, forever confined to the particular facts of the case, they would have value only if a later dispute arose on almost identical facts.

There does eventually come a point, with all principles of law, where they can no longer be raised to a higher level of generality while at the same time, remaining acceptable to society in general and to the courts in particular. An illustration of such an extreme would be some of the possibilities envisaged by Professor Fuller. Over the years the courts will have to deal with cases which are on the very edge of the scope of the principle and to decide whether or not the rule is applicable.

Gradually, in this way, the parameters within which the rule is to operate will become set and there will no longer be a need for people to resort to litigation to determine the effect of that particular principle although it may always be challenged. (c) Ratio of Appellate Decisions As a ratio decidendi is a proposition with which a majority of the court has agreed, it may be necessary to determine, by a head count, what the majority thought were the relevant principles of law applicable to the case.

However, even when each judge comes to the same conclusion it may be as the result of following different arguments and applying different rules. Alternatively, it might treat propositions contained in individual judgments as having persuasive, but not binding force. (d)Obiter Dictum A judge will often find it necessary or convenient to state principle of law which relate to hypothetical events rather than to the specific facts of the case. Such statements sometimes serve to illustrate or clarify the principle which is actually applied in the case (the ratio) but they are not themselves rations.

The distinction between ratio and obiter, therefore, can be stated thus; pronouncements of legal principle necessary for the judge’ decision on the established facts of the case are the ratio or rations decidendi of the case, whereas pronouncements of legal principle which are not strictly relevant to the issue or issues will be obiter dicta only. It must be appreciated, however, that not every statement of a rule of law by a judge is necessarily ratio or obiter. Frequently, during the course of the judgment the judge will restate and discuss rations from existing cases.

It is simply a recitation of the development of the relevant legal principles where it is a foundation for the judge’ reasoning, but those statements are neither ratio nor obiter in the case before the court. Sometimes it is very hard to distinguish between statements which are ratio or obiter and those which are restatements of principles in earlier, slightly different cases. In the case of Carlill v Carbolic Smokeball, Bowen LJ gave the legal answer to a set of facts which were not in issue in the case. They are thus obiter dicta. The learned judge did this to assist him to clarify the answer to Carlill’s case.

The words of this judge could be used by a council (if ever such facts were in issue in a court case) as persuasive precedent. On 1973, Carlill’s case was applied in Peck v Lateu but was distinguished in AM Satterwaite & Co v NZ Shipping Co (1972). 5 THE RULES OF PRECEDENT 6. 5. 1Judicial Decision Making The real focus of attention of contemporary lawyers should be upon the extent of legal creativity, its proper occasions and the techniques that may be used to achieve and justify it. When a dispute between two or more parties comes before it, a court must first attempt to establish what happened.

In some trials the relevant facts are determined by the presiding magistrate or judge. In cases where a jury is used, though, the jury is responsible for making the decisions on the facts, while the judge decides the law. Once the facts have been established, it falls to the judge to apply the law to them in order to determine which party should succeed. According to the the President of the New South Wales Court of Appeal, Kirby J, the learned judge put it clearly when he said: Judges do have to make choices but some of them have more scope in that endeavour than others.

In considering this point, a distinction should be made between judges at first instance (that is, judges in inferior courts, or single judges in superior courts), and those in appellate courts. While a judge in an inferior court, ought to be aware of the contemporary values of society and what the average person would consider to be the appropriate decision in that context, generally speaking, judges of first instance are obliged to follow ‘binding authority’ in the form of decisions of a higher court in the same hierarchy on a similar issue.

If, despite a faithful adherence to the doctrine of precedent, the judge’s decision is considered by one or both of the parties to be ‘wrong’ in law, an appeal can be brought against it to a higher court. If the appeal court decides that the existing rule, which was applied in the lower court, is indeed wrong then it can change that rule either totally or in part. The decisions of ultimate courts of appeal, however, cannot be changed by a higher court. Such superior courts normally consider themselves free to overrule their earlier decisions in the appropriate circumstances. The notes above have raised several questions.

They include in Figure 6. 3. Figure 6. 3: Questions raised in overrule earlier decision The questions will be further explained as follows. (a)Is It Possible for the Facts of an Incident to be Objectively Determined? A philosopher would probably answer that question in the negative while the reasonable lay person might well say ‘Yes’. Fortunately, in many cases, the question does not need to be argued for the parties may agree on a statement of fact leaving only the legal issue(s) raised for determination by the court. In other cases the jury, or the judge if no jury is empanelled, will decide the facts.

It is the characterisation of the facts, in terms of the level of generality at which they are stated, that can always be disputed and that leads to argument about the articulation of the ratio which is based on them. An example of that process is Professor Julius Stone’s demonstration of how the facts in Donoghue v Stevenson [1932] AC 562 could be characterised at several different levels of generality leading to different rations decidendi of that case. (b) How Does a First Instance Judge Decide What is the Legal Rule Binding the Court Given the Established Facts of the Case?

As has already been explained, under the doctrine of stare decisis, if a superior court in the same hierarchy has previously made a decision on the question of law raised by the same or similar facts, the first instance judge is bound to follow the earlier decision. However, there several techniques in avoiding precedents that would otherwise be binding. If the judge decides not to follow such a precedent: • he or she must expressly distinguish it (that is, explain how the earlier case is different from the current one and therefore not applicable); or • the later decision will be deemed to have been made in ignorance of the earlier one.

Such a case is said to be decided per incuriam (literally ‘through want of care’) and incapable itself, of constituting a binding authority for later cases. Decisions are said to be per incuriam where they are given ‘in ignorance or forgetfulness’ of: • a inconsistent legislative provision; or • a case which is binding on the court which made the decision: Morelle Ltd Wakeling [1955] 2 QB 379 at 406. (c)If the First Instance Judge Decides there is no Relevant Authority, What Rule Should He or She Apply? If, however, no earlier decision exists on, or analogous to, the matter before the court, how does the judge find the appropriate rule?

At one time, legal theorists used to subscribe to what was called the ‘declaratory theory of law’. Under that theory, judges did not make law even if the issue before them had never been dealt with before. Rather, by looking at existing common law and statute law principles, they were said to have extracted a rule that was held always to have existed but which had remained unused, waiting to be declared at the appropriate moment. By the end of the eighteenth century, however, philosophers such as Bentham and Austin had exposed that theory as a fiction and had asserted that in some cases judges did make law when making their decisions.

More recently, Lord Reid, a Law Lord, has described the declaratory theory as a ‘fairy tale’. He said this: Now it seems that most, if not all, judges, other lawyers and thinkers accept that judges do make law. Indeed, many people would agree that, in the appropriate circumstances, it is essential that they do so. (d)What Factors are Taken into Account by Appellate Courts in their Decision-Making? Everything stated above in relation to courts of first instance applies, with some qualification, to appellate courts.

Under the doctrine of stare decisis, the Courts of Appeal and the High Court are bound by decisions of the Federal Court. Federal Court, itself, although not strictly bound by its own previous decisions, is reluctant to depart from them without cogent reasons. As Sir Anthony Mason CJ has said: [pic] [pic] In some decisions, judges openly admit that they have reached their decisions on the basis of principle and policy in preference to the doctrine of precedent. In other cases, a judge will say that he or she is adhering to the doctrine of precedent but in fact, if the decision is analysed, it can be seen that the reasoning has been heavily influenced by principle and policy.

Such an outcome is achieved by the clever use of techniques of interpretation and distinguishing in avoiding precedents. These three influences which are principle, policy and legal authority will need further attention. The following are the matters that are needed to be considered. (i)Deciding cases according to principle A case in which the court paid close attention to social developments, while, at the same time, using principle by which to reach a decision, is Gillick v West Norfolk AHA [1986] AC 112.

In this case the issue was whether a doctor could lawfully prescribe contraception for a girl under sixteen without the consent of her parents. (ii) Deciding cases according to policy An excellent example of the decision being reached on policy grounds is an Australian case of Mabo v Queensland (No 2) (1992) 175 CLR 1 Bernnan J said (at 42): (iii) Deciding cases according to legal authority However, even a straightforward application of the doctrine by judges who are determined not to be influenced by principle or policy may result in two or more of them coming to different decisions on the same set of facts.

That is because of the difficulties in interpretation both of the facts and of the legal authority. Choices are always there to be made. And even supposing that wide agreement can be reached on what constitutes the ratio decidendi of a theoretically binding decision, a court may, nevertheless, be able to avoid the precedent in some way. 6. 5. 2How to Avoid Precedents It is not uncommon where; there are occasions where a judge is convinced that the rule in an earlier decision should not be applied to the case before the court even though prima facie, the precedent is binding or highly persuasive.

In these circumstances, the judge should expressly avoid the precedent and explain why it is not being followed. If a precedent which is prima facie binding is simply ignored, the decision may be considered to be per incuriam. There are many ways of arguing that a precedent should not be followed given the flexibility of language and the complexities inherent in the concept of ratio decidendi. Some of the most common methods used to avoid precedent are to hold that are indicated in Figure 6. 4. Figure 6. 4: The common methods used to avoid precedent These methods are further explained below.

(a)Precedent was Wrongly Decided This argument can generally be used only in superior courts, as a lower court would normally regard itself as bound to follow the decision of a court above it in the hierarchy, even if the lower court was of the opinion that the precedent was incorrect in law. In relation to such decisions it is given in ignorance or forgetfulness of binding authority. For example in the case of MNI v Lim Tiok [1997].

2 MLJ, the contention was whether the Supreme Court’s decision in Tan Chik bin Ibrahim v Safety Line and General Insurance [1987] 1 MLJ 217 should be reviewed to determine whether it should be overruled because it was wrongly decided. The Federal Court reviewed Tan Chik’s case and decided it was wrongly decided and should not be followed. (b) Changed Social Conditions Precedents may retain their authority no matter how old they are. Nevertheless, it is well recognised that the law gradually adapts itself to changing social conditions and that very ancient precedents are often inapplicable to modern circumstances. For this reason they are cited with comparative infrequency.

For example a court may have to decide whether there was such a crime as rape in marriage. For over two hundred years, the common law rule had been that by reason of marriage, there was an irrevocable consent to sexual intercourse on the part of a spouse. A husband, therefore, could never be found guilty of raping his wife. The principle, which had been authoritatively expounded in 1736 in an Australian case, had apparently been accepted by another Australian case in 1933. (c) Statement of Law is too Wide

It is often possible to argue that the statement of a rule of law in an earlier case should be construed narrowly and confined to the particular facts of that case. (d) Statement is Obiter Dictum Statements made by judges are often clearly obiter dictum. The statement may be preceded by words such as, ‘although a consideration of this question is not necessary for the decision in this case’; or it may be arguable that the statement is not strictly necessary to the conclusion arrived at by the judge. This area of uncertainty may be exploited to avoid an earlier precedent.

(e) Distinguishing an Earlier Case on its Facts When this method of avoiding precedents is used, it is argued that the facts of an earlier case are so different from the ones under consideration that the conclusion of law arrived at in the earlier case is not applicable. This technique can be illustrated by the following example: In Thornton v Shoe Lane Parking Ltd [1971] 2 QB 163, the English Court of Appeal had to decide whether the plaintiff was bound by a clause in a notice affixed to a pillar in a car park, which purported to exempt the car park company from liability for injury to customers.

It was argued that the case was the same as a series of older, so called ‘ticket’ cases, in which booking clerks working for railway or steamship companies issued tickets to customers. Under the old cases, the issue of the ticket was regarded as an offer by the company. When a customer took a ticket and kept it without objection the offer was deemed to have been accepted. The customers were then bound by the conditions printed on the tickets. The theory on which the cases were based was that customers could hand the tickets back if they did not like the conditions printed on them and thus refuse to enter into a contract.

In the Thornton case, however, the court distinguished those earlier cases on their facts. 6 PRINCIPLES OF JUDICIAL PRECEDENT In considering the doctrine of precedent, the general principles in Figure 6. 5 should be borne in mind: Figure 6. 5: The general principle in Doctrine of Precedent Some of the examples given to illustrate the various techniques could just as easily be used with one or more of the other techniques. The appropriateness of a particular case as an example depends on an individual’s interpretation of that case.

Suggestions made may help readers to think about legal decisions, even relatively old ones, both critically and inquiringly. Discussion should be focused on the limits and justifications of the practice. Judges in the superior courts need to keep in mind that they are not elected, as the legislators in parliament are, and that they do not have the resources available to law reform commissions or parliamentary committees. As long as they recognize those limitations, however, the creative role that they have increasingly been undertaking would seem to be a necessary one.

If courts were to go too far, either by usurping parliament’s function in a major way or by making a law with unforeseen but far reaching bad consequences, it is always open to the parliament to change it. Such a process of law creation, however, would be inefficient and would also be damaging to the reputation of the courts. The task of the current generation of judges, academic lawyers and legal practitioners is to help discover that boundary. When faced with a case, Judges will have to make an informed decision. However, some judges have more choices than the others.

A first instance judge is obliged to follow the binding authority of a higher court’s decision in the same hierarchy of a similar issue. However, there are in appropriate circumstances whereby the lower court judge may depart from the binding authority. ———————– LEARNING OUTCOMES Judicial Precedent ( Topic 6 Give the meaning of ratio decidendi and obiter dicta. Is there any distinction between these two elements? By the end of this topic, you should be able to: 1. Explain and analyse the doctrine of precedent;

2. Identify and explain the ratio decidendi in a case; and 3. Identify and describe the obiter dicta in a case. Exercise 6. 1 Self-Check 6. 2 Do you think that the decisions on the question of law by a judge in inferior courts are binding to other courts? Why? SUMMARY What do you understand about judicial precedent? Does every law system have this form of doctrine of precedent? Self-Check 6. 1 Self Check Activity 6. 1 In Young v Bristol Aeroplane Co. Ltd, it was shown that relevant decision or rule can be followed and considered although it was not binding. Identify what are other rules of doctrine of precedent in common law system?

Activity 6. 2 What is the major difference between obiter dictum and ratio decidendi? Give supporting cases to your explanation. Activity 6. 3 It is stated that changed social condition is one method to avoid precedent. Given an example a crime rape in marriage where two hundred years ago, common law gave a precedent that a husband could never be found guilty of raping his wife. However, social condition and value have changed and this principle is no longer acceptable. By referring to any law books, find any principles that are unacceptable in today’s society condition.