Chapter 2Law makingof the common law by the royal justices out of English
customary law. But it was not until the 19th century that
the general principle of judicial consistency in decision-
making developed into a more rigid system of binding
precedents. The necessary conditions for such a system
did not exist until the standard of law reporting was
improved by the creation of the Council of Law Report-
ing in 1865 and a hierarchy of courts was established
by the Judicature Acts 1873–75 and the Appellate
Jurisdiction Act 1876.
Precedent in action
Whenever a judge decides a case, he or she makes a
speech, which may last a few minutes in a simple matter
but may run to many pages in the Law Reports in a com-
plicated case before the House of Lords. Every judgment
contains the following elements:
1 The judge records his or her findings as to the relevant
facts of the case, established from evidence presented
in court.
2 The judge discusses the law which relates to the facts
as found; this may involve an examination of the
provisions of an Act of Parliament and/or previous
judicial decisions.
3 He explains the reasons for his decision; i.e. the rule
of law on which his decision is based. This is known
as the ratio decidendiof a case. It is this part of the
judgment which forms a precedent for future similar
cases. Other comments by the judge which do not
form part of the reasoning necessary to make the
decision are referred to as obiter dicta(things said by
the way); they do not have binding force.
4 The judge concludes his speech by announcing the
decision between the parties, e.g. ‘I give judgment for
the claimant for the amount claimed’, or ‘I would dis-
miss this appeal’.
Precedents may be either binding or persuasive. A
binding precedent is one which a court must follow,
while a persuasive precedent is one to which respect is
paid but is not binding. Whether a court is bound by a
particular precedent depends on its position in the hier-
archy of courts relative to the court which established
the precedent. The general rule is that the decisions of
superior courts are binding on lower courts. The reader
should refer to Chapter 3 for an outline of the struc-
ture of the civil and criminal courts before considering
the position of the principal courts which follows.
European Court of Justice
Since joining the EC in 1973, all English courts have been
bound by the decisions of the European Court of Justice in
matters of European law. The European Court tends to
follow its own decisions but is not strictly bound to do so.House of Lords
As the highest court of appeal in respect of our domestic
law, the decisions of the House of Lords are binding on
all other English courts. The House of Lords used to be
bound by its own previous decisions (London Street
TramwaysvLondon County Council(1898)). In 1966,
however, the Lord Chancellor announced by way of
a Practice Statement that the House would no longer
regard itself absolutely bound by its own precedents. An
example of the use of this freedom is MiliangosvGeorge
Frank (Textiles) Ltd(1976), in which the House over-
ruled its own decision in Re United Railways of Havana
& Regla Warehouses Ltd(1960) by holding that an
English court may award damages in a foreign currency.
It should be noted that the freedom to depart from pre-
vious precedents has not been exercised very often.Court of Appeal
The Civil Division of the Court of Appeal is bound by
the decisions of the House of Lords and its own previous
decisions (YoungvBristol Aeroplane Co(1944)). There
are three exceptions to this general rule:1 the Court of Appeal must decide which of two con-
flicting decisions of its own it will follow;
2 the court must not follow one of its own decisions
which is inconsistent with a later decision of the
House of Lords;
3 the court is not bound to follow one of its own
decisions which was givenper incuriam, i.e. where the
court has overlooked a relevant statute or case.Court of Appeal decisions are binding on lower civil
courts, such as the High Court and county court. The
Criminal Division of the Court of Appeal is bound by
House of Lords’ decisions and normally by its own
decisions but, since it deals with questions of individual
liberty, there appears to be greater freedom to depart
from its own precedents. In a recent criminal case con-
cerning provocation (RvJames(2006)), the Court of
Appeal had to decide whether to follow a decision of the
House of Lords (RvSmith (Morgan James)(2000)) or a
later decision of the Privy Council (Attorney-General23