Application to the English legal system
The doctrine of binding precedent or stare decisis is basic to the English legal system, and to the legal systems that derived from it such as those of Australia, Canada, Hong Kong, Pakistan, Singapore and New Zealand. A precedent is a statement made of the law by a Judge in deciding a case. The doctrine states that within the hierarchy of the English courts a decision by a superior court will be binding on inferior courts. This means that when judges try cases they must check to see if similar cases have been tried by a court previously. If there was a precedent set by an equal or superior court, then a judge should obey that precedent. If there is a precedent set by an inferior court, a judge does not have to follow it, but may consider it. The House of Lords however does not have to obey its own precedents.
Only the statements of law are binding. This is known as the reason for the decision or ratio decidendi. All other reasons are "by the way" or obiter dictum. [1]A precedent does not bind a court if it finds there was a lack of care in the original “Per Incuriam”. For example, if a statutory provision or precedent had not been brought to the previous court's attention before its decision, the precedent would not be binding. Also, if a court finds a material difference between cases then it can choose not to be bound by the precedent. Persuasive precedents are those that have been set by courts lower in the hierarchy. They may be persuasive, but are not binding. Most importantly, precedents can be overruled by a subsequent decision by a superior court or by an Act of Parliament.[2] Those powers were promptly invoked in this case. Because the Treasury was dissatisfied with the meaning given by this Court to the estate-tax provision, the very next day after the three decisions reaffirming May v. Heiner were handed down, the Treasury appealed to Congress for relief and Congress gave relief. The true significance of today's decision in the Church case is not to be found in the Court's failure to respect stare decisis. The extent to which judges should feel in duty bound not to innovate is a perennial problem, and the pull of the past is different among different judges as it is in the same judge about different aspects of the past. We are obligated, however, to enforce what is within the power of Congress to declare. Inevitable difficulties arise when Congress has not made clear its purpose, but when that purpose is made manifest in a manner that leaves no doubt according to the ordinary meaning of English speech, this Court in disregarding it is disregarding the limits of the judicial function which we all profess to observe.
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