Judicial precedent is a common law system by which a precedent serves as an authority, principle, or rule established in litigation formerly decided. This becomes a binding or persuasive precedent for lower courts or tribunals to follow in deciding future cases with similar facts or issues. The precedent appears in various forms. They are precedent in action that refers to the judge’s speech in a judgment of the European Court of Justice (ECJ) since all the English courts are bound by the ECJ concerning European law with effect from 1973.
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The Supreme Court‘s ruling can be a precedent (formerly House of Lords) as this is the highest domestic court of appeal serving as the judicial authority which the House of Lords enjoyed formerly. Court of appeal’s decisions are mandatory on the High Court and their decisions must not contradict the Supreme Court’s precedents. Divisional Courts that are bound by the decisions of the Supreme Court, Court of Appeal, and High Court which is bound by the decisions of Supreme Court, the Court of Appeal, and Divisional Court and not by another High court judge (Lewis, n.d.).
It would be clear therefore judiciary’s function is not to simply apply the laws but to interpret them and establish binding precedents. It is because there are difficulties in drafting out legislation and there are chances of unintended meanings and ambiguities creeping in the statutes. In many cases, the Parliament’s intent will be very clear in which case it will facilitate the Court’s interpretation in an unambiguous manner.
Courts are enabled to overrule their own previous decisions through judicial interpretation. In Anderton v Ryan (1985), the House of Lords had interpreted the Criminal Attempts Act 1981 in such a manner making the Act itself ineffective. However, the House of Lords giving credence to academic criticisms of the decision, admitted its errors and overruled its own decision in Anderton v Ryan (1985) while deciding in R v Shivpuri (1986) just after one year.
In this, Lord Bridge observed that in cases of ambiguous nature, the strict judicial precedent can be departed as mentioned in the Practice Statement (Judicial Precedent) 1966 1 WLR 1234 in spite of the requirement of certainty in Criminal Law. The Lord has justified his departure pointing out the provisions in the practice statement that in case of a serious error found in a House of Lord’s decision which distorted the law, it should be corrected at the earliest. Thus, the operation of judicial precedent in the English Legal System could make the House of Lords overruled its own previous decision (Slapper & Kelly, 2011).
The judge-made law is inferior and can be always overruled by the legislature and as such precedents should not be regarded as usurping of its powers by the judiciary. The judicial precedents remain law for the time being until they are overruled and they are subject to the rule of stare decisis. The precedent’s one meaning is what has been above. Another meaning is that it can refer to the decided case itself as a precedent to be relied on in the future.
The precedent actually involves the application of the principle of stare decisis which enjoins upon the court to go by the cases already decided. The principle of stare is rather self- imposed by the judiciary and there are no legislative provisions in respect of judicial precedent. However, there are two exceptions. The first one is that the courts must follow decisions on EU law pronounced by the European Court as per the European Communities Act 1972.
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The second exception is that the s 2(1) of the Human Rights Act 1998 requires that the courts and tribunals must take into account of any applicable judgments, decisions, declarations, and opinions of the European Court of Human Rights, the European Commission, and the Committee of Ministers of the Council of Europe while ruling on the questions related to European Convention of Human Rights and giving effect to them in the United Kingdom.
This is however not to mean that the English Courts and Tribunals are bound by those decisions. For example, in R (RJM) v Secretary of State for Work and Pensions  3 WLR 1023, HL, it was held by the House of Lords that where any of their decision conflicts with a subsequent decision of the European Court of Human Rights, the English Courts below the House of Lords are governed by the principle of stare decisis to follow the decision of the House of Lords alone. However, appeals can be made before the House of Lords now the Supreme Court so that the conflict can be resolved.
In R v Horncastle  2 WLR 47, SC, it was held that in rare cases, the Supreme Court can decline to follow the decision of the European Court if it militates against the particular aspects of domestic process. This will result in the two courts engaging in dialogues where the European Court may offer to reconsider its decision. Horncastle involved the conviction of the defendant under the Criminal Justice Act 2003 based on the statement of a witness in absentia which does not amount to a fair trial guaranteed under Article 6 of the ECHR. The Supreme Court conviction was not in violation of said Article 6.
There are two aspects to a precedent. They are ratio decidendi and obiter dictum. The ratio decidendi is the mandatory part of a judicial decision including the one based on a precedent. On the other hand, obiter dictum represents passing remarks made by the judge during the course of hearings or in a judgment which need not be binding. But it has a persuasive force. Sometimes such opinions of the House of Lords sounding as obiter may turn out to be a part of ratio decidendi and hence will have the force of a precedent. Since the binding part of ratio decidendi is the principle of law, such cases are not binding on questions of fact (Ingman, 2011).
Thus, by virtue of the principle of judicial precedent, judges are not considered to make or change a law which is always the same. According to this logic, the overruling of an earlier decision does not represent a change of law. The actual position is that the true nature of law is discovered or disclosed. Thus, judicial precedent is governed also by the principles of judicial interpretation which goes deep into the legislative intent before passing the laws.
The meanings of the words appearing in the statutes of the Parliament are interpretable by the judges in accordance with Statutory rules and Common law rules. Their interpretation and the resultant ratio decidendi become precedents for the future compliance of the courts and tribunals below.
Anderton v Ryan  UKHL 5.
Criminal Justice Act 2003, 2003 c. 44. Web.
Ingman, T. 2011, The English Legal Process. Oxford: Oxford University Press.
Lewis, S. n.d., Using cases to illustrate, explain how and why the courts make use of the doctrine of judicial precedent and statutory interpretation to resolve points of law. Web.
R (RJM) v Secretary of State for Work and Pensions  3 WLR 1023.
Slapper, G., & Kelly, D. 2011, The Englsih Legal Syatem. Oxon: Taylor & Francis.