Thus, continuity of a law is a major factor in equality of treatment, that is, in
ensuring that everyone is treated equally by the law. Justice requires
consistency by treating like cases alike.
Changing from one law to another reduces this sense of equality. This causes
an equality cost, which operates regardless of whether the policy is for making
or interpreting law and regardless of whether the law is common law or statute
law. Typically, though, it is a consideration more commonly raised with
changing law based on precedent (common law and the interpretation of
common law and statute law) than with altering statute law.
Legislature
Citizens expect a legislature to change old laws and make new ones.
Moreover, traditional basic rights such as freedom of movement, ownership of
property and freedom of contract are largely common law rights - statutes tend
to operate outside areas of rights. Consequently, the equality costs of a new
statute are not necessarily high although they certainly can be.
Court
While net benefit applies to any policy decision, it applies to precedent in a
special way. This is because precedent contains two rules. One is ratio
decidendi which is the rule in the case that is the precedent. The other is stare
decisis which requires a later court to follow the precedent; it therefore
preserves the rule enshrined in the ratio and the policy which this rule
implements (which may not be the policy that the makers of the rule
intended).
341
Policy justification for the ratio is based on the net benefit it
produces - no rule could do better. Policy justification for stare decisis is that
it preserves that benefit, but also avoids the four changeover costs, namely
transaction, adjustment, predictability and equality costs. With precedent,
equality looms large because there is a strong common law tradition that like
cases be treated alike so that all people are equal before the law.
Desire for equality of treatment is manifest in judicial reasoning when a
precedent lacks proper support because it is not “supported by the citation of
any reported case or authority,”
342
or it “is out of line”
343
or incompatible
344
with other authorities. In an obvious case, this happens where the court fails to
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341
For some academic attempts to articulate why courts overrule prior cases
see Harris, (1990) and Horrigan (1992).
342
Re Mason [1928] Ch 385 at 400 per Romer J
343
Scruttons v Midland Silicone [1962] 1 AC 446 at 476-477 per Lord Reid
344
Rankin v Baldi [1985] 1 NSWLR 274 at 276
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