where the question of the best way in which to exercise the discretion is
revealed.
Resolving the Issue
Introduction
The key to understanding how an issue of discretion is resolved is to
appreciate a simple fact about the exercise of a discretion that was
propounded above. Rationally, the only proper basis for this decision is for
the court to take the course of action that brings about the most just outcome.
In the example, the Director of Pensions should exercise the discretion in
favour of an unemployed applicant for a pension when it is more just if they
do so than if they do not do so.
Net Benefit
In a legal context, a chosen course of action should be labelled the most just if
it is the best course of action taking all relevant considerations into account.
What constitutes the best course of action can be explained by reference to
the concept of net benefit. At the basis of net benefit is a simple proposition:
every action potentially causes positive and negative effects, that is, it causes
benefits and costs. In principle the benefits of a decision can be summed, as
can the costs. Then total costs can be subtracted from total benefits to yield a
net benefit. Net benefit, most conveniently, is a single measure of the worth or
value of a course of action.
In the light of this further analysis, the decision making rule can be
reformulated. A decision to exercise the discretion one way or another should
be made on the basis of choosing the action that yields the highest net benefit.
This is so because the action that yields the highest net benefit also constitutes
the most just course of action available. In the example, the Director would
grant the pension when the net benefit of granting a pension would be greater
than the net benefit of not granting it.
In the light of this analysis, there is clearly a better way to understand the issue
of the discretion than just stating the alternative action that the discretion
authorises (will they or won’t they?). Instead it is better to conceive it in terms
of net benefit. Will the greater net benefit ensue from exercising the discretion
in one way or another? To illustrate from the unemployment example, in a
particular case the issue would be stated in the following way: would the
greater net benefit ensue from granting an unemployment pension to the person
in question or not granting it?
Criteria
Net benefit has to be measured in some way. For the exercise of a
discretionary power, net benefit is measured by reference to the criteria that are
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