• Ms. Jyoti sharma

Understanding 'Precedent' as a source of law.

Precedent: Definition and Meaning

Judicial precedent is an important source of law. Higher courts have a constitutional role to interpret the law and statutes. This jurisdiction has developed a system of principle which states that a case shall bind the later judges and courts. Thus, precedent refers to the set of judgements which have been decided earlier and binds the subsequent cases if there is similarity in their material facts. This principle not only save the time and labour of judges but also ensure certainty and uniformity in the application of law.

Many jurists and thinkers have given their views regarding precedent which can be studied as under:

  • In words of Gray, “Precedent covers everything said or done, which furnishes a rule for subsequent practice.”

  • According to Keeton, ‘a judicial precedent is judicial to which authority has in some measure been attached.’

  • According to Salmond, ‘in a loose sense, it includes merely reported case law which may be cited & followed by courts, in a strict sense, that case law which not only has a great binding authority but must also be followed.

  • According to Bentham precedents are ‘Judge made Law.’

  • According to Austin precedents are ‘Judiciary’s Law.’

Nature of Precedent

Precedent is purely constructive in nature. It can create law but can never abrogate the same. The process of judicial decision making may be either Inductive or Deductive.

  • Inductive- In Inductive method, reliance is placed upon the decision of judges. Judges are supposed to look into the cases that has been decided earlier and deduce the general rule and apply them, if their material facts are same and decide the case accordingly.

  • Deductive- It refers to the codification of law. It pre-supposes that legal rule applicable to a particular case is fixed. Judges are required to apply those legal rules without referring to their personal views on that particular case. They are not supposed to decide the matter on basis of previously decided cases.

Kinds of Precedent

Depending upon binding force, precedent may be either persuasive or authoritative.

  • Persuasive Precedent

The judicial decisions which has no finding force on subsequent cases is termed as persuasive precedent. It may only guide the judges in making the decisions. Persuasive precedent may come from different sources which can be stated as below:

  1. Foreign Judgement

  2. Obiter Dicta

  3. Authoritative text books and commentaries

  4. Decisions from the Courts having equivalent authority, horizontal authority e.g. High Courts

  5. A dissenting judgement

  • Authoritative Precedent

It has a binding force which judges are bound to follow. These are the decisions of superior courts and the lower courts are bound to follow them. For example, In India, all the higher courts are bound to follow the decisions of Supreme Court. Likewise, all the courts which are subordinate to Higher Courts are under obligation to follow the decisions of High courts.

Declaratory Theory of Precedents

This theory revolves around how a judge declare a law. This theory is in contradiction that judge can also make law. It clearly states that judges can only declare the law or decide the case according to pre-existing law and principle but he can never be a law-maker. When a court overrule a decision, it doesn’t propound a new law but only declare that the supposed law was never law and make correct the incorrect law that existed earlier.

Blackstone is the supporter of this theory. He observed that the function of judges are to discover in the existing law the principle that govern the facts of individual cases. Thus, they maintain and explain the existing law. Hence, they are ‘law-finder’ and not the ‘law-maker’.

In case of Willis v Baddeley, Lord Esher explained, ‘there is in fact no such thing as Judge-made law, for the Judges don’t make law, though they frequently have to apply existing law to circumstances as to which it has not previously been authoritatively laid down that such law is applicable’

Jurist James Carter also support this theory. He opined that judicial decision are ‘mere declaration of existing of law’. According to him, Precedent are merely interpretative of the existing law, they don’t create law.


  • Bentham criticised this theory saying that this theory is an orthodox view. Also, Austin calls this theory as hypocritical and childish fiction.

  • James view has been severely criticised by many thinkers. Rylands v. Flectcher has been used to give a reference. This case has evolved a new doctrine of absolute liability. In many cases, doctrine of precedent has created new law for future in number of cases. For example, overruling Golak Nath case in historic fundamental case, namely, Keshwanand Bharti v. State of Kerala, court held that parliament can alter any provision pf constitution except the basic structure of the Constitution.

Doctrine of Stare Decisis

The doctrine of ‘Stare decisis literally means ‘let the (previous) decision stand’. It is based on the principle that ‘LIKE CASES SHOULD BE TREATED ALIKE’. This doctrine has been developed a result of progress made in law-reporting. Initially there was no doctrine of stare decisis as such. It was only in 1833, in a historic judgement named as Mirehouse v Rennel when the need for recognising binding force was reiterated. Later, with the establishment of the high Court of judicature by the Acts of 1873 and 1875 the doctrine of stare decisis was firmly established & now it forms a indispensable part of our legal system.

If there are two similar individuals in similar circumstances and one of them is treated better or worse than the other, then that is the paradigm case of injustice. This means that once a decision has been reached in a case, it should be followed in similar cases as accurate statement of law.

In Philip Jeyasingh vs The Joint Registrar of Cooperative Societies, 1992 Madras HC, general principle on which doctrine of stare decisis is based, were laid down by the Supreme Authority.

  1. Each court is absolutely bound by the decisions of the court above it.

  2. The decision of one high court is not binding on any other High Court and it has only a persuasive value.

  3. A Single Judge is bound by the decision of a Division Bench & Division Bench is bound by the decision of a Full Bench.

  4. The decision of a Full Bench is binding on the court including a subsequent Full Bench until it is overruled by a higher Court or a larger Bench & A decision of a Full Bench can be reconsidered only by a larger Bench specially constituted by the Chief Justice for deciding the question.

But doctrine of stare decisis is not absolute. In case of Maktul v. Manbhari, it was held that if the correctness of a decision has been challenged time and again, the rule of stare decisis need not be applied. Application of law and statute should be done according to the social interests. In case of Supreme Court Advocates on Records Association v. Union of India, Supreme Court emphasised that if it is necessary in public interest or for any other valid reason, the previous decision should be revised. This doctrine can’t be blindly followed. Judges should keep into mind about changing circumstances otherwise it would stultify the growth of law (Bachan Singh v. State of Punjab).

Stare decisis can be follow vertically as well as horizontally. To reinforce the law-making superiority of the higher courts, all courts are bound by decisions of the courts above them in the court hierarchy. This is known as vertical stare decisis. For maintaining consistency in law, the higher courts are also usually bound by their earlier decisions. This is known as horizontal stare decisis. The decision of a case is not binding as a whole. So, it become important to understand what actually constitute the binding factor in a decision. It has following two important parts:

  • Ratio decidendi

It literally means ‘Reason of the decision’. It is a statement of law upon which the decision is based. It is a general rule that the ratio of a decision must apply upon subsequent cases provided that their material facts are same. The lower court shall have the authority to decides the ratio of precedent and material facts of present case. According to Rupert & Cross, ratio decidendi is the legal rule and associated reasoning to a case which has been treated by judges as an important step to reach final decision and the authority of a decision as a precedent lies in its Ratio Decidendi, not in res judicata. Res judicata is the final verdict of the court of a particular case. Unlike ratio, res judicata has no binding authority in subsequent cases. A case may have more than one ratio because of lengthy discussion and or because different judges reached their decision in different way.

In Union of India v. Maniklal Banerjee it was upheld that only ratio decidendi is binding and has precedent value. But ratio vary from case to case. The ratio of a earlier decided case can only be applied on case in hand when their material facts are same. Some English case law may be cited here for this purpose.

In Bridges v. Hawkeshworth a customer found some money on the floor of a shop. The court applied the rule of ‘finder-keepers’ and awarded possession of money to him rather than shop-keeper. The ratio decidendi of this case is that finder of a good is the keeper i.e. has right of possession over it. But however, in case of South Staffordshire Water Company v. Sharman, when defendant found a ring in a pool owned and occupied by the plaintiff, the court refused to apply ‘finders-keepers’ principle on the ground that it was not a public place where defendant found that ring unlike Bridges’ case, but a private place which was not open to public. Hence, ratio vary from case to case and should be applied only when the material facts are same. Same reasoning can’t be applied to everywhere.

The Donoghue v. Stevenson may seem like a small case, but it went on to establish many important legal precedents and principles that courts still follow to this day – including negligence as a tort, and the concept of a duty of care. It exploded the doctrine of privity of contract and held that manufacturer is liable to the consumer for his negligence in the manufacturing of the goods which is of such nature that it is incapable of intermediate inspection by retailer.

  • Obiter dicta

The other statements that are peripheral to the outcome of the case are called obiter dicta, again a Latin term which means ‘SAID IN PASSING.’ They are ‘not binding’ and termed as mere casual expression of the court which carry no weight. After analysing following observations, we can make an attempt to finds what constitute obiter:

  1. when the discussion or reasoning of the judge is much wider than that which is necessary to decide the case,

  2. when judge suggests about the decision that he would have delivered if the facts of the case in hand would have been different,

  3. when judge explains what his decisions would have been in the case, if he had not been bound by a judicial precedent,

  4. the dissenting opinion.

In Union of India v. Dhanwanti Devi, the Supreme Court held that It is not everything said by a Judge while giving judgment that constitutes a precedent. It is the reasoning or statement of law. So, it become important to isolate obiter dicta from ratio decidendi.

Here the case of S.R. Bommai v. Union of India can be taken as a reference, where it was held that Secularism is a basic structure of our Constitution. Justice Sawant and Kuldeep Singh observed that social pluralism is one of the basic structure while Justice Ramaswamy observed that socialism, social justice and fraternity are included in basic structure of the Constitution. The observation of the learned Judges are obiter dicta. The ratio of the case is that Secularism is a part of Basic structure of the Constitution.

In case of R v. Franklin, distinction can be observed between ratio and obiter. Ratio in this case was that, i) if a person while committing a wrong or as a consequence of the wrong causes death of a person, he can’t be held guilty for manslaughter only because of the reason that a death has been caused due to his act, ii) a person who causes death of another person due to his negligence shall be guilty of manslaughter. The obiter in this case was the observation of Justice Field where he expressed that even if prosecution succeeds in proving that the alleged tort of negligence was committed by the accused, he shall not be guilty of manslaughter until juries finds him guilty for his offence.

Difference between Ratio Decidendi and Obiter Dicta:

  1. The ratio decidendi has binding authority whereas obiter has no such binding authority. It is a by-product of the original judgment. They are only remarks and opinions of the judge.

  2. Ratio has been treated as a necessary step to reach to the conclusion or result of the case in hand while dictum is a rule of law stand by a judge which was neither expressly nor impliedly treated by him as a necessary step in reaching his conclusion. “9. …It is not everything said by a Judge while giving judgment that constitutes a precedent. The only thing in a Judge's decision binding a party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolatefrom it the ratio decidendi

  3. The rules of law based on “material facts” is Ratio Decidendi whereas rules of law based on “hypothetical facts” are mere Dicta.

  4. Obiter dicta are unrealistic and contrary to current practice while Ratio is a statement of law based on facts.

  5. If the result is the same, giving no effect on the decision, then it is “obiter dictum”. If it effects the decision of the case, it will surely be a ratio of the case.

Difference between Stare Decisis and Res Judicata:

  1. Res judicata applies to the decision of dispute. Stare decisis operates as a ruling of law involved in a case.

  2. Res judicata only binds party to case and their successors while stare decisis binds everyone, who come to court.

  3. Res judicata applies to all courts while stare decisis operates only with regards to higher courts.

  4. Res judicata takes effect only after lapse of time-period of appeal. Stare decisis operates immediately and at once.

What can the subordinate court do with the precedent?

As a general principle, all the lower courts are bound to follow the decisions of higher courts. sometimes due to change in social, cultural or economic circumstances, the court in a later case may feel that the earlier decision needs amendment or sometimes it may realise that the earlier decision has not laid down the law correctly or it may feel that the earlier decision could not fairly decide the case in hand. To deal with any of such circumstances, the courts have developed some methods. However, such methods are used rarely and with caution. As any departure from an established principle of law may have wider implications.

  • Apply, Follow/Distinguish:

The ratio of a case is to be applied in a subsequent case if material cases are same. But if court may find that the material facts are different. So, the court must use a different reasoning to decide the case. But this new reasoning is also subject to review, approve or disapprove.

Follow or Depart: The Supreme Court and High Courts normally follow their own decisions. But any of these court can depart from them, if it wishes to change its approach to law in an area.

  • Approve, disapprove/ Overrule:

Overruling means action of a superior Court in upsetting the ratio laid down by a lower Court in some other case. When a case is overruled, its ratio is no longer authoritative. By overruling, Superior Court sets new correct precedent. It may be express or implied.

Prospective overruling - An overruling which takes effect for the future only is called prospective-overruling. In case of people v. Graves, the Supreme Court of United States has expressly given constitutional recognition to the doctrine of prospective-overruling which denies retrospective effect to the overruled decisions. It was decided after taking into consideration what grave dangers can be arisen from giving retrospective effect to decisions which overrule previous one. In US Sunbust case, it was observed that the case before court is determined under old principles but caution is given that future cases will be decided according to new principles. In an English case law, Hedley Byrne v. Heller, which operates prospectively, laid down that there would no liability for the negligent misstatement made by a person who are entrusted with financial dealings such as auditors.

In India, the Supreme Court adopted the doctrine of prospective overruling in case of Golak Nath v. Union of India, wherein it overruled its earlier decisions in Sankari Prasad Case and Sajjan Singh Case by which first and seventh Constitution Amendments were held valid. In Golak Nath case, court held the validity of first, fourth and seventh Constitutional Amendment till this case. The Supreme Court restricted the effect of Golak Nath decision to future cases only by employing the doctrine of prospective-overruling. In Narayanan Nair v. State of Kerla, the court explained the rationale behind the doctrine of prospective overruling. It was emphasised that it is a necessary tool in system of law to protect the interest of the litigant public.

  • Affirm, Reverse or Quash

In an appeal, the higher court could affirm or confirm the decision of a lower court (or part of it) in Present case and thus, dismiss the appeal. Otherwise it may allow the appeal and reverse the decision of the lower court. If it is a criminal case the sentence may be quashed.

Factors undermining the Doctrine of Precedent

  1. Ignorance of Statute: a precedent will not be binding if it has been rendered in ignorance of any statute.

  2. Inconsistency with earlier decision of a higher court: A precedent will not be binding if the decision which a court passes, is inconsistent with the decision of a higher court. In case of Young v. Bristol Aeroplane Co. Ltd., it was held that a court is bound to follow its previous decisions. It shall also bound to follow the decisions of courts of co-ordinate jurisdiction. However, court is bound to refuse a decision of its own, if it finds that there is inconsistency between its earlier decisions.

  3. Inconsistency with earlier decision of a same rank court: A court is not bound by its earlier decisions which are conflicting with each other. The earlier decisions are not binding. The conflict may arise because of inadvertence, ignorance and forgetfulness in not citing earlier decisions. In such circumstances, earlier decision shall not be binding.

  4. Precedent sub-silentio: A point which is involved in a case but has not taken into consideration and not argued by the counsels is termed as sub-silentio. In this case, the court may decide in favour of one party but if that point was raised and argued, the decision might be in favour of another party. Such a case will fail in standing as a precedent. In case of Gerard v. worth of Paris, an employer who was discharged by defendant company obtained damages for his wrongful dismissal against the company. He applied for a garnishee order on a bank account of company which was in the name of liquidator. The only point argued was priority of claimant’s debt and court granted the same. But the question whether a garnishee order could be properly made on account standing in the name of liquidator was remained unadjudicated. Thus, when this point was raised in subsequent case, court held itself not bound by previous decision as the point was sub-silentio in the previous case.

  5. Abrogated decisions: A decision ceases to be binding if a statute or statutory rule inconsistent with it is subsequently enacted, overruled, abrogated or reversed by a higher court. when a decision is irrational, it may be abrogated by a subsequent enactment of a higher decision.

  6. Dissenting judgements: Dissenting judgements are the opinions of one or more judges who give disagreements with the decisions of a majority opinion in a legal case. It does not refer to the decision of the case but may be termed as minority opinion in a particular judgement. When some cases come to judges, they decide it according to their own experiences and there is always an scope or possibility that a dissenting note of a particular judge may become a ratio in a case in future due to overruling of the case wherein such dissent was recorded.


  1. It provides very useful and important guidelines for judges to decide the case in hand.

  2. Precedent ensure certainty in legal system. When a case is decided people come to know what will be the probable decision if material facts of a case are similar to that decided earlier.

  3. Precedent saves a lot of time and labour of judges.

  4. Precedents bring flexibility to law. Judges in giving their decisions are influenced by social, economic and many other values of their age. They mould and shape the law according to the changed conditions and thus bring flexibility to law.

  5. Precedents are more practical which is based on real-facts of a case law unlike the statutory rule which is based on any theory or imagination.

  6. It gives a sense of uniformity in justice. As all similar cases are treated same, people tend to trust more in judicial process and a sense of fair justice appears to public when similar cases are decided in same way.

  7. Judicial precedent is detailed. It proves to be a very important source of law as there exist a wealth of cases.


  1. The judicial precedents are wealth of cases. Thus, it become slightly difficult to find out a particular case from such voluminous legal literature. Case-law is gold in mine, while statute is a coin ready for immediate use.

  2. The conflicting decisions of higher courts sometimes, put the lower courts in a dilemma as to what it should follow. It has been called as a ‘complete fog of authorities.’

  3. Jurists have referred precedents as an incomplete law because judges give their decision on the basis of the point which has been put up before them. Sometime, very important point remains untouched and unargued. So, these judge-made law can’t be said perfect and complete. Case should be decided on basis of facts and evidences rather than case law and precedents.

  4. Development of a new precedent upon the parties. It is only after the parties have gone to court and the court decides the matter, that principle of law evolved.

  5. There is not any test to determine the validity of law made by case-law. should it depend on the number of decisions in which the precedent in question has been followed or should it depend on the reputation of judge who decides the precedent? There being uncertainty on this point, the reasonableness and validity of law made by judicial precedent always remains a debatable issue.

  6. one of the greatest demerits of precedent is that development of law is depend upon chance. Sometimes important may remain unadjudicated.

  7. It tends to overlook the principle of natural justice that law must be known before bringing it in practice.


The doctrine of precedent is a unique feature of common law system which treats the judge as the creator, interpreter and modifier of laws. Since social conditions keeps on changing with changes in society, law must keep pace with the changing. The courts have to follow the decisions of their superior courts. It not only saves time and labour but also bring certainty and uniformity in legal system.

If the courts don’t follow the precedents and judges start deciding cases afresh according to their reasoning every time, the law will become uncertain. Thus, the courts should give due respect and follow the decisions of higher courts.

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