THE

THE THEORY OF JUDICIAL PRECEDENTS.

HE importance of judicial precedents has always been a distinguishing characteristic of English law. The great body of the common or unwritten law is almost entirely the product of decided cases, accumulated in an immense series of reports extending backwards with scarcely a break to the reign of Edward I at the close of the thirteenth century. Orthodox legal theory indeed long professed to regard the common law as customary law, and the reported precedents as merely evidence of the customs and of the law derived therefrom. But this was never much better than an admitted fiction. In practice, if not in theory, the common law of England has been manufactured by the decisions of English judges. Neither Roman law, however, nor any of those modern systems which are founded upon it, allows any such place or authority to precedent. They allow to it no further or other influence than that which is possessed by any other expression of expert legal opinion. A book of reports and a text-book are on the same level. They are both evidences of the law; they are both instruments for the persuasion of judges; but neither of them is anything more 1. English law, on the other hand, draws a sharp distinction between them. A judicial precedent speaks in England with a voice of authority; it is not merely evidence of the law but a source of it; and the courts are bound to follow the law that is so established.

It seems clear that we must attribute this feature of English law to the peculiarly powerful and authoritative position which has been at all times occupied by English judges. From the earliest times the judges of the king's courts have been a small and compact body of legal experts. They have worked together in harmony, imposing their own views of law and justice upon the whole realm, and establishing thereby a single homogeneous system of common law. Of this system they were the creators and authoritative interpreters. They did their work with little interference either from local custom or from legislation. The centralization and concentration of the administration of justice in the royal courts gave to the royal judges a power and prestige which would have been unattainable on any other system. The authority of precedents

1 [This is so. But in point of fact the importance of reported decisions has been on the increase in both France and Germany for some time.-ED.]

was great in England because of the power, the skill, and the professional reputation of the judges who made them. In England the bench has always given law to the bar; in Rome it was the other way about, for in Rome there was no corporate body of professional judges capable of doing the work that has been done for centuries in England by the royal courts.

Declaratory and creative precedents.-In proceeding to consider the various kinds of precedents and the methods of their operation, we have in the first place to distinguish between those decisions which are creative of the law and those which are merely declaratory of it. A declaratory precedent is one which is merely the application of an already existing rule of law. A creative precedent is one which creates and applies a new rule. In the former case the rule is applied because it is already law; in the latter case it is law for the future because it is now applied. In any well developed system such as that of modern England, declaratory precedents are far more numerous than those of the other class; for on most points the law is already settled, and judicial decisions are therefore commonly mere declarations of pre-existing principles. Creative precedents, however, though fewer in number, are greater in importance. For they alone develop the law; the others leave it as it was, and their only use is to serve as good evidence of it for the future. Unless required for this purpose, a merely declaratory decision is not perpetuated as an authority in the Law Reports. When the law is already sufficiently well evidenced, as when it is embodied in a statute or set forth with fullness and clearness in some comparatively modern case, the reporting of declaratory decisions is merely a needless addition to the great bulk of our case law.

It must be understood, however, that a declaratory precedent is just as truly a source of law as is one belonging to the other class. The legal authority of each is exactly the same. Speaking generally, the authority and legal validity of a precedent do not depend on whether it is, or is not, an accurate statement of previously existing law. Whether it is or is not, it may establish as law for the future that which it now declares and applies as law. The distinction between the two kinds turns solely on their relation to the law of the past, and not at all on their relation to that of the future. A declaratory precedent, like a declaratory statute, is a source of law, though it is not a source of new law. Here, elsewhere, the mere fact that two sources overlap, and that the same legal principle is established by both of them, does not deprive either of them of its true nature as a legal source. Each remains an independent and self-sufficient basis of the rule.

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I have already referred to the old theory that the common law is customary, not case law. This theory may be expressed by saying that according to it all precedents are declaratory merely, and that their creative operation is not recognized by the law of England. Thus Hale says in his History of the Common Law:

'It is true the decisions of courts of justice, though by virtue of the laws of this realm they do bind as a law between the parties thereto, as to the particular case in question, till reversed by error or attaint, yet they do not make a law properly so called: for that only the king and parliament can do; yet they have a great weight and authority in expounding, declaring and publishing what the law of this kingdom is; especially when such decisions hold a consonancy and congruity with resolutions and decisions of former times 1.'

Hale, however, is evidently troubled in mind as to the true position of precedent, and as to the sufficiency of the declaratory theory thus set forth by him, for elsewhere he tells us inconsistently that there are three sources of English law, namely, (1) custom, (2) the authority of parliament, and (3) the judicial decisions of courts of justice consonant to one another in the series and succession of time 2.'

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In the Court of Chancery this declaratory theory never prevailed, nor indeed could it, having regard to the known history of the system of equity administered by that court. There could be no pretence that the principles of equity were founded either in custom or legislation. It was a perfectly obvious fact that they had their origin in judicial decisions. The judgments of each Chancellor made the law for himself and his successors.

It must not be forgotten,' says Sir George Jessel, 'that the rules of courts of equity are not, like the rules of the common law, supposed to have been established from time immemorial. It is perfectly well known that they have been established from time to time-altered, improved, and refined from time to time. In many cases we know the names of the Chancellors who invented them. No doubt they were invented for the purpose of securing the better administration of justice, but still they were invented 3.

But both at law and in equity this declaratory theory must be totally rejected if we are to attain to any sound analysis and explanation of the true operation of judicial decisions. We must admit openly that precedents make law as well as declare it. We must admit further that this effect is not merely accidental and indirect, the result of judicial error in the interpretation and autho

1 Hale's History of the Common Law, p. 89 (ed. of 1820).
2 Ibid. p. 88.

3 In re Hallett, 13 Ch. D. at p. 710.

ritative declaration of the law. Doubtless judges have many times altered the law while endeavouring in good faith to declare it. But we must recognize a distinct law-creating power vested in them and openly and lawfully exercised. While it is quite true that the duty of the courts is in general jus dicere and not jus dare, nevertheless they do in fact and in law possess both these functions. Creative precedents are the outcome of the intentional exercise by the courts of their privilege of developing the law at the same time that they administer it.

Authoritative and persuasive precedents. - Decisions are further divisible into two classes, which may be distinguished as authoritative and persuasive. These two differ in respect of the kind of influence which they exercise upon the future course of the administration of justice. An authoritative precedent is one which judges must follow whether they approve of it or not. It is binding upon them and excludes their judicial discretion for the future. A persuasive precedent is one which the judges are under no obligation to follow, but which they will take into consideration, and to which they will attach such weight as it seems to them to deserve. It depends for its influence upon its own merits, not upon any legal claim which it has to recognition. In other words, authoritative precedents are legal sources of law, while persuasive precedents are merely historical. That is to say, the former establish law in pursuance of a definite rule of law which confers upon them that effect. The latter, if they succeed in establishing law at all, do so indirectly, through serving as the historical ground of some later authoritative precedent. In themselves they possess no legal authority.

The authoritative precedents recognized by English law are the decisions of the superior courts of justice in England. The chief classes of persuasive precedents are the following:

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(1) Foreign decisions, and notably those of American courts1. (2) The decisions of superior courts in other portions of the British Empire, for example, the Irish courts. Decisions of the Irish courts, though entitled to the highest respect, are not binding on English judges 2.'

(3) The decisions of the Privy Council when sitting as the final Court of Appeal from the colonies. In Leask v. Scott it is said. 3 by the Court of Appeal, speaking of such a decision in the Privy Council: We are not bound by its authority, but we need hardly say that we should treat any decision of that tribunal with the greatest respect, and rejoice if we could agree with it.'

1 Castro v. R., 6 App. Cas. 249.

2 In re Parsons, 45 Ch. D. 62.

32 Q. B. D. 376, at p. 380.

(4) Judicial dicta, that is to say, decisions which go beyond the occasion, and lay down a rule wider than is necessary for the purpose in hand. We shall see later on that the authoritative influence of precedents does not extend to such obiter dicta, but they are not equally destitute of persuasive efficacy 1.

Absolutely and conditionally authoritative precedents.—Authoritative precedents are of two kinds, for their authority is either absolute or conditional. In the former case the decision is absolutely binding and must be followed without question, howsoever unreasonable or erroneous it may be considered to be. It has a legal claim to implicit and unquestioning obedience. Where, on the other hand, a precedent possesses merely conditional authority, the courts possess a certain limited power of disregarding it. In all ordinary cases it is binding, but there is one special case in which its authority may be lawfully denied. A precedent belonging to this class may be overruled or dissented from, when it is not merely wrong, but so clearly and seriously wrong that its reversal is demanded by the interests of the sound administration of justice. Where this is not so, the precedent must be followed, even though the court which follows it is persuaded that it is erroneous or unreasonable. The full significance of this rule will require further consideration shortly. In the meantime it is necessary to state what classes of decisions are recognized by English law as absolutely, and what as merely conditionally, authoritative. Absolute authority is attributed to the following kinds :—

(1) Every court is absolutely bound by the decisions of all courts superior to itself. A court of first instance cannot question a decision of the Court of Appeal, nor can the Court of Appeal refuse to follow the judgments of the House of Lords.

(2) The House of Lords is absolutely bound by its own decisions. 'A decision of this House once given upon a point of law is conclusive upon this House afterwards, and it is impossible to raise that question again as if it was res integra and could be re-argued, and so the House be asked to reverse its own decisions 2.'

(3) The Court of Appeal is, it would seem, absolutely bound by its own decisions and by those of older courts of co-ordinate authority, for example, the Court of Exchequer Chamber 3.

In all other cases save these three, it would seem that the authority of precedents is merely conditional. That is to say, in

Persuasive efficacy, similar in kind though much less in degree, is attributed by our courts to the civil law and to the opinions of the commentators upon it; also to English and American text-books of the better sort.

2 London Street Tramways Company v. London County Council [1898] A. C. 375, at p. 379. Pledge v. Carr [1895] 1 Ch. 51; Lavy v. London County Council [1895] 2 Q. B. at p. 581, per Lindley L.J.