Once a Precedent Is Made It Remains Binding Until Overruled

2361 words (9 pages) Essay in Contract Law

02/02/18 Contract Law Reference this

Last modified: 02/02/18 Author: Law student

Disclaimer: This work has been submitted by a student. This is not an example of the work produced by our Law Essay Writing Service. You can view samples of our professional work here.

Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of LawTeacher.

What do you think are the strengths and weaknesses of case law as a source of law? Discuss.

A Binding precedent is where each court is bound by the decision made by the court of the same level or higher than it in the same hierarchy of the court, whether or not the outcome is correct or not. This is because once a precedent is made it remain binding until it is overruled by a higher court in a later case. The system of binding precedent is known as stare decisis .

Court structure can refer diagram 1.Following the diagram below, High Court is above Syariah Court and under Court of Appeal. The Federal Court is the highest court and the final court of appeal. The court system is in the form of a hierarchy like a pyramid with the subordinate courts at the bottom of the pyramid. Different court have different jurisdictions and power .The high court handles serious criminal cases like drug trafficking ,murder and civil cases involving large sum of money. The Court of Appeal can only hear the argument about the mistakes was made in the actual trial. It has no authority to hear the trail.

Judges does not decide case arbitrarily. Judges is bound to follow certain accepted principles which known as precedent. An original precedent is situation where there is no precedent to follow and the judges decide according to justice ,equity and good conscience .When judges is setting new precedent ,they is merely making a new law. A declaratory precedent is where the judges applying an existing law.

For example, in the case Donoghue v Stevenson (1932), where a lady bought a ginger beer that contains a decomposed snail in the bottle. After drinking it she became ill, so she sought damages against the manufacture. This is the original precedent .Besides, in the case of Daniels v White (1938), a bottle of lemonade was bought, and the plaintiff felt a burning sensation on drinking it. Declaratory apply here as the compensation was available based upon Donoghue v Stevenson as the lemonade was found to contain a chemical.

A precedent may consist of ration decidendi and obiter dictum .A ration decidendi is the legal principal of the case which is binding on the lower courts. It is known as the reason for the decision. While an obiter dictum are comment made by judges that has no binding power but merely persuasive but it somehow have influence over the decision make by judges.

In this case, Mr. Justice Peter as a high court judges he cannot to be bound by the decision. He must follow the decision made in year 2009.This is because by referring to the court structure in Malaysia, the Court of Appeal is located at higher position than the High Court, thus the decision made by the Court of Appeal is a must for High Court judge to follow. The High court judge can decline to be bound by the decision made by Court of Appeal unless the precedent is cancelled or modified .As according to the doctrine of judicial precedent all of the lower courts are bound to apply the principle set by the superior’s court in earlier cases.

Answer 1(B)

Judicial precedent is an unwritten law which is a reference to that portion of Malaysian law that not enacted by the legislature. Case law also known as judicial precedent. It means the process whereby a judge made a decision according to the previous decision where the facts are sufficiently similar. There are advantages and disadvantages of case law as a source of law.


Certainty, if there is a similar case happened before; the court is bound to follow the solution as the problem has been solved before. Thus a litigant can be sure of the outcome of the case no matter which judges is to deal with the case as similar cases are treated in similar ways .So there will be no opportunity for the judges to practice biased and thus improve the fairness of the result.

Predictability ,it enable a lawyer to forecast the outcome of the client’s case .Thus it give a degree of certainty of what result the case is likely to be and this can reduce the expense of going to court .

Uniformity, everyone is treated equally as same offence will get the same punishment. This can increase fairness of the outcome and avoid judge’s biases.

Less legal cost .When there is precedent to follow the case can be resolved quickly and thus save cost. The longer the case being trial the higher the cost incurs.

Save time, judges maybe very busy in handling many cases . So if there is the precedent to follow they can save the time needed to come out with a new principle that may take long period to figure out and cases can resolve quickly.


Rigidity , the rule laid down by previous judges remain binding to the lower court even though the decision is wrong .Only a higher court can overrule a precedent .Thus sometime people may want to appeal to higher court so that the decision can be overruled but the cost incur may be enormous expensive. Thus people may reluctant to bring the appeal.

Bulk and complexity, each year there are hundreds of cases reported and no one can learn all of it. Thus it may make it difficult for an inexperienced lawyer to find the relevant precedent which should be followed and may overlook some important rule in any given case.

Confusion, it is difficult to identify whether it is ratio decidendi or obiter dictum for Example in the case of Donoghue v Stephenson. Ratio Decidendi is the legal principle of the case which is binding on the lower court. It is the reason for the case. Besides, obiter dictum is merely comment made by the judges which is not binding but is persuasive only. These are things said “by the way”, “incidental remarks” by a judges which is persuasive only.

Question 2

On the 29th October, 2010 Steven advertised in the NewFocus Paper, “ Yamaha Piano latest model, excellent condition, RM15,000 interested please call 016 1234567″.

On the 1st November 2010, Tanny after seeing the piano, offered RM10,000 to buy the piano. Steven said “ I will not sell it below RM14,000 and I will not sell it to anyone else before 7th November 2010.”

Tanny went to Australia for a few days and came back to Malaysia on the 7th of November 2010. On the 8th of November 2010, Tanny decided to post a letter accepting to buy the piano for RM14,000. Steven received this letter on the 11th of November 2010.

Discuss the above issues and explain if Tanny’s letter of acceptance is valid.


On the 29th October 2010, Steven advertised in the NewFocus Paper, “Yamaha Piano latest model, excellent condition, RM 15000, if anyone interested please call 016 1234567″.

Courts held that advertisements in newspaper are invitation to treat. Invitation to treat is not an offer. An invitation to treat means inviting the public to make an offer. Besides that, an invitation to treat does not have any promise exist. Like the case, Pharmaceutical Society of Great Britain v Boots Cash Chemists [1] . Certain drugs containing poisons could only be sold under the supervision of a pharmacist. The plaintiff claimed that this rule had been broken by Boots who had put supplies these drugs in the open shelves in a self-service shop.

However Boots argued that there was no sale until a customer brought the goods he had selected to the cashier and offered to buy them. The Courts stated it doesn’t make an offense. Those display goods is an invitation to treat, not an offer to sell. Customers make an offer to purchase and there is acceptance when the cashier accepts the money. In the case above, Steven is inviting others to make an offer to him. So it is an invitation to treat.

On the 1st November 2010, Tanny after seeing the piano, offered RM 10,000 to buy the piano. Steven said “I will not sell it below RM 14,000 and I will not sell it to anyone else before 7th November 2010″.

Offer is the 1st essential elements of a valid contract. Offer is defined in S2(a) Contracts Acts, 1950 as “ when one person signifies to another his willingness to do or abstain from doing anything with a view to obtaining the assent of that other to the act or abstinence he is said to make a proposal” [2] . Offer must be clear, definite, certain, precise and complete. There are 2 types of offer, bilateral offer and unilateral offer.

Example of the case which is Carlill v Carbolic Smoke Ball co [3] . Carbolic Smoke Ball Company advertised that they would offer 1000 pounds for anyone who still suffered influenza after using a certain remedy for a fixed period. Plaintiff duly used it but nevertheless, contracted influenza. She then sued for the 100 pounds. Court of Appeal held that the Plaintiff was entitled to the 100 pounds as she had accepted the offer made to the world.

Well in this case, Tanny made an offer to buy the piano with the price RM 10,000. Steven will not sell it below RM 14,000 and will not sell to anyone else before 7th November 2010. Revocation of acceptance may be revoked at any time before communication of acceptance is complete. Case example which is Byrne & co v Van Tienhoven [4] . A posted a letter of offer to B on 1st of October. B received the letter on 11 of October. Well, he accepted and posted back on the same day. While A had posted a letter which he revoked the offer on 8th of October and sold the tin plates to third party. But B received the letter on 20th October.

B sued A for breach of contract. The revocation sent by A is not to be considered. The withdrawal is no effect. Steven rejected Tanny’s offer indirectly but he is making a statement and counter offer to her. A counter offer operates as a rejection of the original offer. Such as the case, Hyde v Wrench [5] . Wrench as the defendant offered to sell his estate to Hyde for 1200 pounds. After that, Wrench made a final offer which is 1000 pounds for the estate. But Hyde wanted to purchase for 950 pounds, Wrench said he would consider and will give him the answer.

Later on, Wrench rejected the offer but then Hyde said that he accepted the offer of 1000 pounds. Wrench did not want to complete any sale and Hyde sued for specific performance. A counter offer is usually taken to reject earlier offer. It was held that there was no contract exists. The offer to buy at 950 pounds rejected the offer to sell at 1000 pounds. It was not allowable to revive the offer by acceptance.

Anyway, there is a bilateral agreement which the offer made to a particular person or group of people. We know the identity of the offeree here. Like the case of Powell v. Lee [6] . Powell applied for the position of headmaster. One of the school board members told him that he was successful. In the end the board changed his mind and appointed another person to hold this position. An offer can only be accepted by the particular party or the party has been addressed to. In this case, promise is there. Steven will not sell it to anyone else, he is making an offer to Tanny with discount of RM 1,000.

Tanny went to Australia for a few days and came back to Malaysia on the 7th of November 2010. On the 8th of November 2010, Tanny decided to post a letter accepting to buy the piano for RM 14,000. Steven received this letter on the 11th of November 2010.

Tanny posted the letter after the offer has expired. Postal rule does not apply here. According to the postal rule, acceptance by post is deemed to take effect when the letter which is correctly addressed and stamped, is actually placed in the post box. Acceptance is said to be completed as soon as it is posted, as the case Adam v Lindsell [7] . Lindsell offers to sell wool to Adam, he required to reply ‘in course of post’. Unfortunately the letter of acceptance was misdirected and cannot reach to Lindsell on the date stated which is 7th September 2010.

Lindsell decided to sell to third party on 8th September 2010. He received the letter by post on 9th September 2010. However Lindsell sold the wool to another party. Adam sued Lindsell for breach of contract. Anyway, the court held that the offer had been accepted as soon as the letter had been posted. Therefore, the contract is exist although the letter had not been received. So the acceptance is valid. Postal rule is for acceptance only not for offer.

So after the date of 7th November 2010, public can make an offer to Steven. It means that Tanny’s letter of acceptance is not valid. Her letter just merely an offer. Steven can just reject or accept the offer.

Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.

Related Services

View all

DMCA / Removal Request

If you are the original writer of this essay and no longer wish to have the essay published on the UK Essays website then please:

Current Offers