Judicial precedent is source of law
Judicial precedent is the source of law where past decisions create law for judges to refer back to for guidance in future cases. Precedent is based upon the principle of stare decisis et non quieta movere, more commonly referred to as ‘stare decisis', meaning to “stand by decided matters”. A binding precedent is where previous decisions must be followed. This can sometimes lead to unjust decisions, which I will address when talking about the advantages and disadvantages of binding precedent. First I will address how the process of judicial precedent works, including the hierarchical structure of the courts, moving on to the advantages and disadvantages of using the doctrine.
A binding precedent is created when the facts of a latter case are sufficiently similar to the facts of a previous case. The doctrine of precedent is often referred to as being a rigid doctrine. Within the court hierarchy, every court is bound to previous decisions made by courts higher than them. At the very top of the court hierarchy is the European Court of Justice, followed by the House of Lords, which is considered to be the supreme court as many laws do not concern European Union law. Decisions made by the House of Lords become binding on all other courts within the hierarchy. Below the House of Lords is the Court of Appeal, which has two divisions, Civil division and Criminal division. Both divisions are bound to decisions made by the House of Lords and the European Court of Justice. Additionally, they are bound to their own decisions, with the exception that the Criminal division is more flexible where a case involves a person's liberty. The Divisional Courts along with the High Court are also bound to decisions made by the House of Lords and the European Court of Justice, with the addition to the Court of Appeal, and the Divisional Courts in the case of the High Court.
Between 1898 and 1966, the House of Lords were bound to their own previous decisions, making the law consistent due to rulings made in London Street Tramways v London County Council . In 1966, the Lord Chancellor issued a Practice Statement, stating, “the rigid adherence to precedent may lead to injustice in a particular case and also unduly restrict the proper development of the law”. It also stated that the House of Lords would be able to “depart from a previous decision when it appears right to do so” (supra n.2). The House of Lords attempt to follow the majority of past decisions. Exceptions include where unjust decisions result from following past decisions. When deciding cases, there is a test of subjective recklessness that is relied upon. This is where certain aspects of particular cases are taken into account. For example, in the case of R v Caldwell , the defendant got sacked from a hotel that he worked at; and one night got drunk and set fire to the hotel, with the intention to cause damage to the property. However, there were also guests sleeping in the hotel. He was therefore charged with not only arson, but also with intent to endanger human life. Lord Diplock decided to remove the objective test, as being drunk was not seen as a defence for recklessness. In R v G  the objective test was put back in as it was decided that the defendants should be judged with consideration to their age and understanding. Two boys, one aged eleven and the other twelve, camped in a yeard behind a shop with permission from their parents. They set fire to some newspapers, thinking that the fire would go out itself. However, the fire spread to nearby bins and finally to the shop. Over £1 million of damage was caused. The boys were unaware of the damage that they had caused as they had left before the fire spread. As they did not intend the damage it was decided that their infancy should be taken into account. In their defence, reckless behaviour is where the defendant is aware of the risk, and seeing as the boys did not intend the damage, the objective test was put back in.
These cases show that the House of Lords are prepared to depart from past decisions when it is desirable to do so. Similarly, in Elliot v C , a 14 year old girl who had learning difficulties, was playing with matches and set a neighbours shed on fire. The case was acquitted on the basis that she was unaware of the damage caused. However, an appeal by the prosecution was allowed, based on the Caldwell test that being unaware of the damage caused is irrelevant. This case is in between R v Caldwell (supra n.4) and R v G (supra n.5), as it is decided on the basis of the Caldwell test, but has similar facts to the latter case. This could cause problems for future cases, making it difficult for judges to decide which case is best suited to follow.
The Practice Statement marked an important change to the doctrine of precedent. The first major use was in Herrington v British Railway Board , however it wasn't until the 1980's and 1990's that the House of Lords showed more willingness to use the Practice Statement. In Pepper v Hart , a young child was burned on an electric railway. The playground where the child was playing was separated from the railway by a fence that was damaged. The stationmaster knew that the children often trespassed onto the railway, but did nothing about it. The previous case of Addie v Dumbreck  held that the occupier of land had no duty of care for the trespassers; it was in fact the duty of the parents. However, this case was overruled in the case of Pepper v Hart (supra n.8) as the House of Lords held that the judges could refer to Hansard in interpreting the case. They came to the conclusion that the case “involved the law on the duty of care owed to a child trespasser”, and found that the stationmaster did not do anything to ensure the safety of the child trespassers, even though he was aware of the risk.
The Court of Appeal, being below the House of Lords in the court hierarchy, is bound to any decisions made by the House of Lords. However, the Court of Appeal tried to challenge this authority in Broome v Cassell  and also in the latter case of Miliangos v George Frank (Textiles) Ltd . However, the House of Lords rejected both attempts. This suggests that the Court of Appeal along with many other courts lower in the hierarchy do not exercise any power in relation to the doctrine of precedent.
The Court of Appeal is also bound to its own decisions as decided in Young v Bristol Aeroplane Company Ltd , along with three exceptions. These include the right to choose between prior conflicting decisions, to refuse to follow a decision that is inconsistent with the House of Lords decisions and to refuse to follow a decision that is made per incurium (in error). The Court of Appeal attempted to challenge this authority in Davis v Johnson , and Lord Denning suggested that the Court of Appeal should have similar powers as the House of Lords. However, this approach would result in the House of Lords becoming useless as the Court of Appeal is usually first to deal with cases, and would affectively break the court hierarchy.
Although the doctrine of precedent is considered to be a fetter upon the English Legal system, there are also ways of avoiding the strict applications of precedent. Three ways in which precedent may be avoided include distinguishing, overruling and reversing. Distinguishing is where a judge is able to draw differences between the case he is deciding and a past case that he would usually have to follow, showing that there are not enough sufficiently similar facts between the cases to bind them. Therefore he would not be bound to a past decision. This was shown in the differences between Balfour v Balfour  and Merrit v Merrit . Although both cases involve husband and wife, in Balfour v Balfour (supra n.15) it was merely a domestic arrangement meaning there was no legal intention. However, in Merrit v Merrit (supra n.16), the agreement was made after they had split up, making the agreement legally binding.
Overruling is where the court later decides that the decision in a previous case is wrong. The House of Lords exercising the power of the Practice Statement, to overrule its own decisions, can demonstrate this. The House of Lords overruled a past decision made in Davis v Johnson (supra n.14) in Pepper v Hart (supra n.8), whereby the House of Lords ruled that Hansard could be referred to in order to understand the actual meaning of certain words within an Act of Parliament.
Finally, reversing is where a court overturns a decision made by a court lower than itself in the court hierarchy. For example, the Court of Appeal could reverse a decision made by the High Court.
As the question addresses, the doctrine of precedent can be seen as a restraint on the development of law due to its strict application. However, judicial precedent does have its advantages. The main advantage of using precedent is that it provides certainty in the law. As cases with sufficiently similar material facts are bound by past decisions, it provides an idea of how the case will be decided. Another advantage is that it provides consistent decisions within the law, which also ensures fairness. Consistency also provides that people are reassured in the law, as they do not feel that they are being treated unfairly.
However, precedents could become ‘out of date', for example in R v R , the laws changed in the respect that a man could now be guilty for raping his wife, whereas before he couldn't. This can be referred to as being persuasive precedent, which is not binding on the courts. A judge has the right to consider a persuasive precedent and be persuaded to follow it if he believes that it provides the correct principle. The introduction of the Practice Statement ensured that flexibility was restored in the development of the law. The ability to overrule past decisions means that there is room for law to develop at the same rate as society changes. Precedent also provides a time saving element, which in the long run also saves money. Being bound to past decisions, courts avoid long periods of litigation. As cases with sufficiently similar facts would have already been decided, it saves the process of deciding the legal ruling, which can often take a long time.
However, the rigid approach of the doctrine is often criticised for inflexibility. As courts lower down in the court hierarchy are bound to decisions made by courts higher than them, any bad or unjust decisions made would have a knock on affect, as they are bound to follow them. In defence of this, the House of Lords are able to depart from past decisions in order to amend unjust decisions made by means of the Practice Statement. However, few cases actually reach the House of Lords, meaning that it down to the other courts to decide cases. Although precedent is seen as being consistent, it also brings complexity to the law. Seeing as there are millions of cases decided by court, it is often difficult to find relevant past cases. Application of a wrong past decision could lead to an unjust decision being made in a latter case. The law also becomes complex as previously discussed, when cases are distinguished and a new precedent is formed. This is demonstrated in the cases of R v Caldwell (supra n.4) and R v G (supra n.5), which later made the decision in Elliot v C (supra n.6) complex.
Overall, the doctrine of judicial precedent brings equally both advantages and disadvantages to the English Legal System. Despite being referred to as being a fetter upon the courts, the rigid application of precedent is upheld in order to provide consistency. As decided by the House of Lords in London Street Tramways v London County Council (supra n.2), as the Lords held that certainty in the law was more important than the possibility that unjust decisions would be made as a result of following past decisions. The so called ‘fetters' the doctrine of precedent puts on the English Legal System, can be seen as something that is simply only in existence in the minds of lawyers, as it is in the hands of such professionals to decide whether consistency is more important that allowing the law to develop. There are opportunities for avoiding the rigidity of judicial precedent, proving that the doctrine does display some margin of flexibility.