financial difficulties. The fear of such financial difficulties may lead the seller to refrain
from re-investing the money, and that would hamper further economic activities in society.These two factors mean that earlier judicial decisions can have a strong influence on
future judicial decisions and therefore, indirectly, also on the content of the law.
However, because judges are not bound by precedents, judicial decisions do not
create new law. Case law is therefore not a source of validity in the civil law
tradition but merely a source of origin. Case law is law because it is broadly
accepted as such; it is not institutional law.
Indirect Authority Because precedents are not binding in the civil law tradition,
judicial decisions cannot be motivated by reference to case law. What happens,
therefore, is that judicial decisions are motivated by reference to statutory law and
that case law is used to argue why the rules that are based on legislation have the
scope that is necessary to base the actual decision on. The authority of case law is
consequently indirect in the civil law tradition.
For instance, it may have been decided that an involuntary French kiss counts as a form of
rape. The person who forced this French kiss upon his victim can be condemned for
violating the statutory prohibition on rape, and the case law is then used to argue why he
raped his victim in the sense of the law.2.5.2 Common Law Tradition
The two above-mentioned reasons why precedents should be followed also apply in
the common law tradition, and perhaps because of them the rule ofstare decisiswas
adopted. Courts in the common law tradition are legally bound by their earlier
decisions and by decisions of higher courts. This means that case law in the
common law tradition is not only a source of origin for the law but also a source
of validity. A rule may be a valid legal rule for the reason that it was adopted in an
earlier court decision.
Ratio Decidendi In the common law tradition, judges are not bound by every
element of an earlier court decision but only by itsratio decidendi. Thisratio
decidendiconsists of the decisive grounds that made the court take the decision.
Apart from these decisive reasons, the court may have mentioned other reasons that
are relevant but did not determine the court’s decision. These other reasons are
calledobiter dicta(things that were also said), and courts are not bound by these
obiter dicta.
It is not always easy to distinguish in an old case between theratio decidendiand theobiter
dicta. This lack of clarity can be used by a court to interpret the precedent in a particular
way. As a consequence the court has the leeway to adapt the law to what it deems is
reasonable.Distinguishing The binding nature of precedent only applies to future cases that
aresimilarto the already decided case. In this connection, “similar” means identical
2 Sources of Law 33