INTRODUCTION
The doctrine of binding precedent means the process whereby judges follow previously decided cases where the facts are of sufficient similarity. The doctrine of judicial precedent involves an application of the principle of stare decisis i.e., to stand by the decided. In practice, this means that inferior courts are bound to apply the legal principles set down by superior courts in earlier cases. This provides consistency and predictability in the law.
RATIO DECIDENDI AND OBITER DICTUM
The decision or judgement of a judge may fall into two parts: the ratio decidendi (reason for the decision) and obiter dictum (something said by the way).
RATIO DECIDENDI - The ratio decidendi of a case is the principle of law on which a decision is based. When a judge delivers judgement in a case he outlines the facts which he finds have been proved on the evidence. Then he applies the law to those facts and arrives at a decision, for which he gives the reason (ratio decidendi).
OBITER DICTUM - The judge may go on to speculate about what his decision would or might have been if the facts of the case had been different. This is an obiter dictum.
The binding part of a judicial decision is the ratio decidendi. An obiter dictum is not binding in later cases because it was not strictly relevant to the matter in issue in the original case. However, an obiter dictum may be of persuasive (as opposed to binding) authority in later cases.
A difficulty arises in that, although the judge will give reasons for his decision, he will not always say what the ratio decidendi is, and it is then up to a later judge to "elicit" the ratio of the case. There may, however, be disagreement over what the ratio is and there may be more than one ratio.
THE COURT HIERARCHY
THE EUROPEAN COURT OF JUSTICE
Under s3(1) of the European Communities Act 1972, decisions of the ECJ are binding, in matters of Community law, on all courts up to and including the