Chapter-30 Absence of Authority and Interpretive process-part-1

The Absence of Previous Authority

LORD WOOLF observed in the case[1] that: “There may be no clear previous authority to support this conclusion but this is not surprising where the relatively new jurisdiction of ordering restitution is involved. What is more important than the absence of clear support in the authorities for the grant of compound interest is the absence from the existing authorities of any statement of principle preventing the natural development of a salutary equitable jurisdiction enabling compound interest to be awarded. The jurisdiction is clearly desirable if full restitutionin some cases is to be achieved. It is relevant here to repeat what is stated at the outset in the bank's case under the heading "The Position in Principle":

"1. 'Any civilised system of law is bound to provide remedies for cases of what has been called unjust enrichment or unjust benefit, that is to prevent a man from retaining the money of or some benefit
derived from another which it is against conscience that he should keep[2]'

The operation of stare decisis in constitutional cases was considered in the Second Territory Senators Case [3]. AICKIN J undertook a review of the authorities and set out some general considerations to assist in deciding whether a previous constitutional decision regarded as erroneous should be overruled. In summary, these considerations were[4]:

1. Whether the error of the prior decision had been made manifest by later cases which had not directly overruled it.
2. Whether the prior decision went with "a definite stream of authority" and did not conflict with established principle.
3. Whether the prior decision could be confined as an authority to the precise question which it decided or whether its consequences would extend beyond that question.
4. Whether the prior decision was isolated as receiving no support from other decisions and forming no part of a stream of authority.
5. Whether the prior decision concerned a fundamental provision of the Constitution or involved a question of such vital constitutional importance that its consequences were likely to be far reaching, although not immediately foreseeable in detail.

Aickin J also pointed out that as a result of the progressive abolition of appeals to the Privy Council in 1968 and 1975 the Court had become "in all respects a court of ultimate appeal". He said[5]:

"The fact that error can no longer be corrected elsewhere must change our approach to the overruling of our own decisions, at least to some extent. It remains however a serious step, not lightly to be undertaken."

Another important factor distinguishing constitutional cases from others is that the effect of constitutional decisions cannot generally be remedied by legislative amendment.[6].

The observation by Dixon J that there was "no very definite rule as to the circumstances in which [the Court] will reconsider an earlier decision" was cited by the joint judgment in John v Federal Commissioner of Taxation[7]. Four relevant considerations were set out in that case:

1. Whether the earlier decision rested upon a principle carefully worked out in a significant succession of cases.
2. Whether there was a difference between the reasons of the Justices constituting the majority in the earlier decision.
3. Whether the earlier decision had achieved a useful result or caused considerable inconvenience
4. Whether the earlier decision had been independently acted upon in a way which militated against reconsideration, as in the Second Territory Senators Case.

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[1] Westdeutsche Landesbank Girozentrale v Islington LBC [1996] UKHL 12 (22 May 1996)
URL: http://www.bailii.org/uk/cases/UKHL/1996/12.html
Cite as: [1996] 2 All ER 961, [1996] 2 WLR 802, [1996] UKHL 12, [1996] 5 Bank LR 341, [1996] AC 669 per LORD WOOLF

[2] Fibrosa Spolka Akcyjna v. Fairbairn Lawson Combe Barbour Ltd. [1943] A.C. 32, 61 (Lord Wright), approved in Woolwich Equitable Building Society v. Inland Revenue Commissioners [1993] A.C. 70, 197, 202 (H.L.).[Observing further that:” Restitution is an area of the law which is still in the process of being
evolved by the courts. In relation to restitution there are still questions remaining to be authoritatively decided. One question, which was still undecided until the decision on this appeal, is whether its legitimacy is derived from the common law or equity or both. In order to decide whether compound interest is payable in this case I do not consider it is necessary to decide which is the correct answer to that question, but I am content to assume that the cause of action is one at common law. If the principal sum is repayable as money had and received rather than under some trust or because of the existence of a fiduciary duty it is still unconscionable for the local authority to retain the benefit it made from having received payment under a contract it purported to make which was outside its powers. The fact that, until the law was clarified by the decision in this case, the local authority may reasonably not have appreciated that it should make restitution is not critical. What is critical is that the payment of compound interest is required to achieve restitution. A defendant may perfectly reasonably not regard himself as having been a trustee until the court so decides but this does not effect the remedies which the court has jurisdiction to grant. The jurisdiction of the court to grant remedies has to be judged in the light of what the court decides.”

[3] Queensland v The Commonwealth (1977) 139 CLR 585; [1977] HCA 60.

[4] [1977] HCA 60; (1977) 139 CLR 585 at 630

[5] [1977] HCA 60; (1977) 139 CLR 585 at 630

[6] There may be legislative means to offset the effects of a particular constitutional decision: see the use of referral of powers by the States in support of the Corporations Act 2001 (Cth) and associated legislation following the decision of the Court in Re Wakim; Ex parte McNally (1999) 198 CLR 511; [1999] HCA 27.

[7] [1989] HCA 5; (1989) 166 CLR 417 at 438-439; [1989] HCA 5.

Chapter-29 Stare Decisis- Application to US legal system -Part-2

Application to the U.S. legal system

When the Court implies that the doctrine called Stare decisis rests solely on 'important policy considerations * * * in favor of continuity and predictability in the law,' it does not tell the whole story. Such considerations are present and, in a field as delicate as labor relations, extremely important. 'Stare decisis is usually the wise policy, because in most matters it is more important that the applicable rule of law be settled than that it be settled right.[1]'

In the ordinary case, considerations of certainty and the equal treatment of similarly situated litigants will provide a strong incentive to adhere to precedent.

In the United States Supreme Court, the principle of stare decisis is most flexible in constitutional cases:

Stare decisis is usually the wise policy, because in most matters it is more important that the applicable rule of law be settled than that it be settled right.... But in cases involving the Federal Constitution, where correction through legislative action is practically impossible, this Court has often overruled its earlier decisions.... This is strikingly true of cases under the due process clause[2].

For example, in the years 1946–1992, the U.S. Supreme Court reversed itself in about 130 cases.^[6][3] The U.S. Supreme Court has further explained as follows:

[W]hen convinced of former error, this Court has never felt constrained to follow precedent. In constitutional questions, where correction depends upon amendment, and not upon legislative action, this Court throughout its history has freely exercised its power to reexamine the basis of its constitutional decisions[4]

Stare decisis is not an "inexorable command[5]," but the doctrine is "of fundamental importance to the rule of law,"[6] Even in constitutional cases, in which stare decisis concerns are less pronounced, we will not overrule a precedent absent a "special justification.[7]" We do not agree that the doctrine of stare decisis bars a re-examination of Sinclair in the circumstances of this case. We fully recognize that important policy considerations militate in favor of continuity and predictability in the law. Nevertheless, as Mr. Justice Frankfurter wrote for the Court, '(S)tare decisis is a principle of policy and not a mechanical formula of adherence to the latest decision, however recent and questionable, when such adherence involves collision with a prior doctrine more embracing in its scope, intrinsically sounder, and verified by experience.[8]' It is precisely because Sinclair stands as a significant departure from our otherwise consistent emphasis upon the congressional policy to promote the peaceful settlement of labor disputes through arbitration [9]and our efforts to accommodate and harmonize this policy with those underlying the anti-injunction provisions of the Norris-LaGuardia Act [10]that we believe Sinclair should be reconsidered. Furthermore, in light of developments subsequent to Sinclair, in particular our decision in Avco Corp. v. Aero Lodge [11] it has become clear that the Sinclair decision does not further but rather frustrates realization of an important goal of our national labor policy. Nor can we agree that conclusive weight should be accorded to the failure of Congress to respond to Sinclair on the theory that congressional silence should be interpreted as acceptance of the decision. The Court has cautioned that '(i)t is at best treacherous to find in congressional silence alone the adoption of a controlling rule of law.' Girouard v. United States[12], Therefore, in the absence of any persuasive circumstances evidencing a clear design that congressional inaction be taken as acceptance of Sinclair, the mere silence of Congress is not a sufficient reason for refusing to reconsider the decision[13].

“When Sinclair Refining Co. v. Atkinson[14], was decided in 1962, I subscribed to the opinion of the Court. Before six years had passed I had reached the conclusion that the Sinclair holding should be reconsidered, and said so in Avco Corp. v. Aero Lodge[15]. Today I join the Court in concluding 'that Sinclair was erroneously decided and that subsequent events have undermined its continuing validity * * *.[16]”

When the Court implies that the doctrine called Stare decisis rests solely on 'important policy considerations * * * in favor of continuity and predictability in the law,' it does not tell the whole story. Such considerations are present and, in a field as delicate as labor relations, extremely important.[17]

'Stare decisis is usually the wise policy, because in most matters it is more important that the applicable rule of law be settled than that it be settled right. In the ordinary case, considerations of certainty and the equal treatment of similarly situated litigants will provide a strong incentive to adhere to precedent.

‘I do not believe that the principle of stare decisis forecloses all reconsiderations of earlier decisions. In the area of constitutional law, for example, where the only alternative to action by this Court is the laborious process of constitutional amendment and where the ultimate responsibility rests with this Court, I believe reconsideration is always proper.[18] Even on statutory questions the appearance of new facts or changes in circumstances might warrant re-examination of past decisions in exceptional cases under exceptional circumstances. In the present situation there are no such circumstances. Congress has taken no action inconsistent with our decision in Sinclair[19]. And, although bills have been introduced,[20] Congress has declined the invitation to act

‘Other members of the Court have drawn the distinction between constitutional and statutory matters, and indicated that the correction of this Court's errors in statutory interpretation is best left to Congress. For example, Mr. Justice Douglas noted in dissent in Swift & Co. v. Wickham[21] : 'An error in interpreting a federal statute may be easily remedied. If this Court has failed to perceive the intention of Congress, or has interpreted a statute in such a matter as to thwart the legislative purpose, Congress may change it. The lessons of experience are not learned by judges alone.[22] No doubt stare decisis is not 'a universal, inexorable command[23]' 'We recognize that stare decisis embodies an important social policy. It represents an element of continuity in law, and is rooted in the psychologic need to satisfy reasonable expectations.[24]' And one of the most recent reliances on stare decisis for decision was expressed with such firmness as to manifest allegiance to principle, not utilization of an ad hoc argument.[25] We are not dealing here with a ruling which cramps the power of Government; we are not dealing with a constitutional adjudication which time and experience have proved a parochial instead of a spacious view of the Constitution and which thus calls for self-correction by the Court without waiting for the leadenfooted process of constitutional amendment. We are dealing with an exercise of this Court's duty to construe what Congress has enacted with ample powers on its part quickly and completely to correct misconstruction.

‘The policy of stare decisis is at its most powerful in statutory interpretation (which Congress is always free to supersede with new legislation)[26], and §5 presents no exception to the rule that when statutory language is construed it should stay construed. But it is another thing entirely to ignore error in extending discredited reasoning to previously unspoiled statutory provisions.[27]’

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[1] Burnet v. Coronado Oil & Gas Co., [1969] USSC 129; 285 U.S. 393, 406, 52 S.Ct. 443, 447, 76 L.Ed. 815 (1932) per JUSTICE BRANDEIS, dissenting

[2] Burnet v. Coronado Oil & Gas Co., 285 U.S. 393, 406–407, 410 (1932) (BRANDEIS J dissenting)

[3] Congressional Research Service,Supreme Court Decisions Overruled by Subsequent Decision (1992) [source of this write up is , wikipedia]

[4] Smith v. Allwright, 321 U.S. 649, 665 (1944)

[5] Burnet v. Coronado Oil & Gas Co., [1969] USSC 129; 285 U. S. 393, 405 (1932) (BRANDEIS, J., dissenting)

[6] Welch v. Texas Dept. of Highways and Public Transp., [1987] USSC 147; 483 U. S. 468, 494 (1987).

[7] Arizona v. Rumsey, 467 U. S. 203, 212 (1984)

[8] Helvering v. Hallock, [1940] USSC 19; 309 U.S. 106, 119[1940] USSC 19; , 60 S.Ct. 444, 451[1940] USSC 19; , 84 L.Ed. 604 (1940). See Swift & Co. v. Wickham, 382 U.S. 111, 116, 86 S.Ct. 258, 261, 15 L.Ed.2d 194 (1965).

[9]See, e.g., United Steelworkers of America v. American Mfg. Co., [1960] USSC 107; 363 U.S. 564, 80 S.Ct. 1343, 4 L.Ed.2d 1403 (1960); United Steelworkers of America v. Warrior & Gulf Nav. Co., [1960] USSC 109; 363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960); United Steelworkers of America v. Enterprise Wheel & Car Corp., [1960] USSC 108; 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960); Textile Workers Union of America v. Lincoln Mills, [1802] USSC 5; 353 U.S. 448, 77 S.Ct. 912, 1 L.Ed.2d 972 (1957).

[10] See, e.g., Brotherhood of Railroad Trainmen v. Chicago River & Ind. R. Co., [1957] USSC 37; 353 U.S. 30, 77 S.Ct. 635, 1 L.Ed.2d 622 (1957); Textile Workers Union v. Lincoln Mills, supra; cf. Graham v. Brotherhood of Locomotive Firemen, [1949] USSC 114; 338 U.S. 232, 70 S.Ct. 14, 94 L.Ed. 22 (1949). See also United States v. Hutcheson, 312 U.S. 219, 61 S.Ct. 463, 85 L.Ed. 788 (1941)

[11] Avco Corp. v. Aero Lodge 735[1968] USSC 85; , 390 U.S. 557, 88 S.Ct. 1235, 20 L.Ed.2d 126 (1968)

[12] Girouard v. United States, [1946] USSC 76; 328 U.S. 61, 69, 66 S.Ct. 826, 830, 90 L.Ed. 1084 (1946)

[13] Boys Markets, Inc v Retail Clerks [1970] USSC 125; 398 U.S. 235; 90 S.Ct. 1583; 26 L.Ed.2d 199;No. 768 (1 June 1970)

[14] Sinclair Refining Co. v. Atkinson, [1962] USSC 109; 370 U.S. 195, 82 S.Ct. 1328, 8 L.Ed.2d 440,

[15] Avco Corp. v. Aero Lodge 735[1968] USSC 85; , 390 U.S. 557, 562[1968] USSC 85; , 88 S.Ct. 1235, 1238[1968] USSC 85; , 20 L.Ed.2d 126 (concurring opinion)

[16] Boys Markets [supra] per JUSTICE STEWART ,he also quoted JUSTICE FRANKFERTER :” An aphorism of Mr. Justice Frankfurter provides me refuge: 'Wisdom too often never comes, and so one ought not to reject it merely because it comes late.' Henslee v. Union Planters Bank, [1949] USSC 4; 335 U.S. 595, 600[1949] USSC 4; , 69 S.Ct. 290, 293, 93 L.Ed. 259 (dissenting opinion).

[17] Burnet v. Coronado Oil & Gas Co., [1969] USSC 129; 285 U.S. 393, 406, 52 S.Ct. 443, 447, 76 L.Ed. 815 (1932) per JUSTICE BRANDEIS

[18] . See James v. United States, [1961] USSC 84; 366 U.S. 213, 233—234[1961] USSC 84; , 81 S.Ct. 1052, 1062—1063[1961] USSC 84; , 6 L.Ed.2d 246 (1961) per separate opinion of Black, J.

[19] Girouard v. United States, [1946] USSC 76; 328 U.S. 61, 70, 66 S.Ct. 826, 830, 90 L.Ed. 1084 (1946).

[20] cf. Helvering v. Hallock, [1940] USSC 19; 309 U.S. 106, 119—120[1940] USSC 19; , 60 S.Ct. 444, 451—452[1940] USSC 19; , 84 L.Ed. 604 (1940),

[21]Swift & Co. v. Wickham, 382 U.S. 111, 133—134, 86 S.Ct. 258, 271, 15 L.Ed.2d 194 (1965)

[22] See also United Gas Improvement Co. v. Continental Oil Co., [1965] USSC 119; 381 U.S. 392, 406, 85 S.Ct. 1517, 1525, 14 L.Ed.2d 466 (1965) (Douglas, J., dissenting). Apparently, however, some members of the Court are willing to give greater weight to state decisis in constitutional than in statutory matters. See, e.g., Orozco v. Texas, [1969] USSC 62; 394 U.S. 324, 327—328[1969] USSC 62; , 89 S.Ct. 1095, 1097—1098[1969] USSC 62; , 22 L.Ed.2d 311 (1969) (Harlan, J., concurring)

[23] State of Washington v. Dawson & Co., [1924] USSC 54; 264 U.S. 219, 238[1924] USSC 54; , 44 S.Ct. 302, 309[1924] USSC 54; , 68 L.Ed. 646.' Per BRANDEIS J [dissenting]

[24] 309 U.S. at page 119, 60 S.Ct. at page 451[1940] USSC 19; , 84 L.Ed. 604, 125 A.L.R. 1368

[25] See Screws v. United States, [1945] USSC 89; 325 U.S. 91, 112, 113[1945] USSC 89; , 65 S.Ct. 1031, 1040[1945] USSC 89; , 89 L.Ed. 1495, 162 A.L.R. 1330. 'But beyond that is the problem of stare decisis. The construction given § 20 [now 18 U.S.C.A. § 242] in the Classic case [United States v. Classic, 313 U.S. 299, 61 S.Ct. 1031, 85 L.Ed. 1368] formulated a rule of law which has become the basis of federal enforcement in this important field. The rule adopted in that case was formulated after mature consideration. It should be good for more than one day only. We do not have here a situation comparable to Mahnich v. Southern S. S. Co., [1944] USSC 24; 321 U.S. 96, 64 S.Ct. 455, 88 L.Ed. 561, where we overruled a decision demonstrated to be a sport in the law and inconsistent with what preceded and what followed. The Classic case was not the product of hasty action or inadvertence. It was not out of line with the cases which preceded. It was designed to fashion the governing rule of law in this important field. We are not dealing with constitutional interpretations which throughout the history of the Court have wisely remained flexible and subject to frequent re-examination. The meaning which the Classic case gave to the phrase 'under color of any law' involved only a construction of the statute. Hence if it states a rule undesirable in its consequences, Congress can change it. We add only to the instability and uncertainty of the law if we revise the meaning of § 20 to meet the exigencies of each case coming before us.'

[26] see Hilton v. South Carolina Public Railways Comm'n, [1991] USSC 155; 502 U.S. 197, 202 (1991),

[27]See: Reno v Bossier Parish School Bd [2000] USSC 12; 528 U.S. 320; 120 S.Ct. 866; 145 L.Ed.2d 845 (24 January 2000)

[2000] USSC 12; 528 U.S. 320