Precedents can be conveniently divided into three classes, according to the nature of their binding force.
(a) Authoritative or absolutely binding
In these cases precedents are legal sources of law, and must be followed without question. Absolute authority is accorded to the decisions of the House of Lords, the highest English court.
However, in 1966, by a formal Practice Statement, the House of Lords judges announced that in future they would not regard themselves as necessarily bound by their own decisions. The Practice Statement said:
"Their Lordships regard the use of precedent as an indispensable foundation upon which to decide what is the law and its application to individual cases. It provides at least some degree of certainty upon which individuals can rely in the conduct of their affairs, as well as a basis for orderly development of legal rules. Their Lordships, nevertheless, recognise that too rigid adherence to precedent may lead to injustice in a particular case and also unduly restrict the proper development of the law. They propose, therefore, to depart from a previous decision when it appears right to do so."
In fact, there have not been many occasions since 1966 when the House of Lords has departed from a previous decision. One major example is Herrington v. British Railways Board (1972) where the court departed from an earlier decision: Addie v. Dumbreck (1929) concerned with the duty of care owed to a child trespasser. Every court is absolutely bound by the decision of all courts superior to itself in rank. The Court of Appeal is bound by its own previous decisions, but the High Court and the lower courts are not bound by their own decisions.
At the lower end of the court hierarchy, the Crown Courts, Magistrates' Courts and County Courts do not create precedents.
(b) Conditionally binding
While a lower court cannot question the decisions of a court of superior authority, it is not bound to accept the judgment of a court of equal status. Generally speaking, however, conditional precedents will be followed by courts of equal status, unless they are clearly undesirable. Consequently, in course of time, conditional precedents acquire almost absolute authority and, being followed by subsequent decisions, ultimately become binding.
(c) Persuasive
Persuasive precedents are those that do not intrinsically establish the law, but may be followed by courts because they are considered truly to state the law. There is no obligation to follow them. Examples of such precedents are:
The decisions of inferior courts on superior courts
The decisions of the Judicial Committee of the Privy Council in appeals from the
Commonwealth or any English court
The decisions of other courts of the Commonwealth
Foreign judgments
Statements of law by British judges, which go beyond the case in point – these
are called obiter dicta (remarks by the way).
The ratio decidendi, or the principle on which the decision of a judge is based, must not be confused with the opinions expressed by him or her either to explain or illustrate the law. Judges express the reasons for the formation of their decisions and this process of reasoning is a vital part of the precedent. Their obiter dicta, however, have no binding force but have persuasive opinion only, the value of which depends upon the reputation of the judge in question. Obiter dicta pronounced by judges in the House of Lords, for example, carry great persuasive authority.
(d) Declaratory and original precedents
A further distinction is often referred to – declaratory precedents, which merely declare the existing law and original precedents, which, by applying a new rule, create or make new law. The old theory was that all precedents are declarations of customary law but, as we have seen, the common law is not, by any means, customary only. Moreover, as regards the principles of equity, these were not to be found in either custom or statute, but had their source entirely in judicial decisions, the various Chancellors making new law in their judgments.
Strictly speaking, there is no fundamental contradiction between the "declaratory" and the "original" theory of precedents. Precedents both declare the law and make it. Every legal decision is a step forward in the development of the law. Even when judges profess openly that they are merely declaring the law by applying an
their decisions are adding to the existing rule and, therefore, are developing the law as they administer it. Therefore, precedents are declaratory as being evidence of old law, but are original as sources of new law.
(e) Extending and "distinguishing" precedents
We must note another factor which makes for flexibility under the doctrine of precedent (and sometimes, perhaps, for uncertainty and the possibility of confusion). Judges have some latitude to modify the effects of even authoritative or absolutely binding precedents by "extending" the effect of a decision of which they approve, and by restrictively "distinguishing" precedents of which they disapprove.
As an example of the latter we may consider the case of Priestley v. Fowler (1837) which laid down the rule that a master should not be liable for injuries suffered by his servants in the course of their employment if the injury was caused through the fault of a fellow-servant. This doctrine of common employment as it came to be called, was from the outset unpopular with lawyers and it became increasingly disliked. The judges were bound by the decision, but they restricted its effect by confining its application as far as possible. (The doctrine was modified by statute in 1880 and finally abolished by the Law Reform (Personal Injuries) Act 1948.)
A precedent is said to be "distinguished" when the court sitting to decide a later case finds that the facts of the case before it are sufficiently different from those of the original precedent to make the precedent inapplicable. Since the facts of no two cases can be exactly alike, you will see that the power given by this device is a considerable one.
Conversely, when a precedent is regarded by lawyers as being desirable and beneficial in its effect, judges may be persuaded to enlarge its application as far as possible by extending the principle concerned to cases where the facts are not strictly similar.