BU206 Business Law

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BU206 Business Law

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BU206 Business Law

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Course Code: BU206
University: Herzing University

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Country: United States


Kakavas v Crown Melbourne Ltd [2013] HCA 25 and the doctrine of precedent.
In June 2013, the High Court held that a casino does not owe special duty to its patrons in cases where they have a gambling problem.
The Court, in a joint judgement, upheld the decision of the primary judge stating “[i]n the absence of a relevant legislative provision, there is no general duty upon a casino to protect gamblers from themselves.”
Does the Northern Territory Supreme Court have to follow this decision? What would be required for this decision to be overruled? In your answer, explain how the Australian courts employ the doctrine of precedent in reaching their decisions. Refer particularly to the role of decisions of the High Court in the development of the law in Australia.


Kakavas V Crown Melbourne Limited (Acn 006 973 262) & Ors [2013] Hca 25- Judicial Interpretation
This case related mainly to the obligation on part of a casino to protect the interests of its patrons. As contended by the casino owners, there is no such obligation on part of casinos to protect the interests of its patrons. The case revolves around the provisions of Gaming Control Act 1993, specifically the provisions of Section 79A of the act (Komárek 2013). This section prescribes that a licensee must not breach the Code of Conduct that has been ratified by the Minister. Such a breach would be deemed to be an offence under the provisions of the Gaming Control Act 1993 (Vines 2013). Legislative procedures are amended and scrutinized so that accurate provisions of law can be formulated so that the rights of all parties in a particular scenario are well represented however in the present scenario of Australia’s legal framework such a duty of care is not provided for. This means that there is no obligation on casinos to protect the interests of its patrons. But it is a well settled position of law that all individuals owe a duty of care towards one another in case of foreseeable harm that could arise and maybe foreseen by a man of ordinary prudence (Callander and Clark 2017). Thus there was a gap in the legal duty as far as casinos and the interests of their patrons are concerned. In instances of gambling the patrons stand to earn money in the event of a victory but are also subject to losses in case of a failure to win the wager. This effect is considered to be an absolute economic loss and thus the same dictates that the courts cannot infer the same to be breach of duty of care. Additionally, it may be stated that in such instances the parties whose interests have been hampered would have no recourse and thus they would not be able to avail any remedy (Lupu and Fowler 2013). The courts would not ideally provide for any pecuniary liabilities for such an infringement of interests and thus it would not be inclined to introduce a new class of individuals that could make such a claim. The decision in this case however, delivered by High Court of Australia, was such that it would have to be followed by the Northern Territory Supreme Court based on the binding precedential value of the same (Groppi and Ponthoreau 2013). This is known as the doctrine of precedent which was elaborated on in this case. The following paragraphs will elaborate on the judicial interpretation of this doctrine as it was presented in this case.
The plaintiff in this scenario Mr. Kakavas, contended that he was not in a mental state to adequately assess his own interests while gambling with the organization. He further contended that the situation was such that the organization “Crown” would be able to asses that his actions were not in his best interests and thus they had an obligation to prohibit him from acting against his own interests. In the same way it can be decided that the parties to the dispute were the Casino and Mr. Kakavas (Saunders and Stone 2014). The judgment delivered by the High Court of Australia was purely based on the factual representation of the issue and the decision solely pertained to that. In order successfully challenge the decision of the High Court of Australia the doctrine of precedent needs to be considered to extent where numerous positions of law have been amended and have created rights that should ideally have legal remedies (Boyle 2015). These positions of law are formulated by the overruling of a judicial precedent which defined the position of law in that matter in the past. Thus for the Northern Territory Supreme Court to not follow the directions of the High Court of Australia the precedent would have to be overruled by a competent authority.
From its very inception, the concepts of appeals and revisions have been provided to amend positions of law which do not meet the adequate standards in the interests of justice. It can further be stated that the High Court of Australia itself has been proactive in overruling cases that do not meet the accepted standards of society at the prevailing time. This however means that such an option to follow or dissent from a judicial precedent was clearly discretionary (Wang 2018). It is particularly difficult to overrule constitutional precedents as the courts are conferred their powers through the constitution and thus the same needs to be interpreted in the same light.
It thus may be inferred here that the doctrine of precedent as it applies within the jurisdiction of the Australian Commonwealth is in the hands of courts deciding matters even if the precedent discusses powers of the court being conferred on them (Hutchinson 2015). It is based on the legal maxim ejus dem generis which dictates that cases with similar facts and issues must be decided in a similar way. This doctrine brings about uniformity in judicial precedents and also ensures that precedents of such value are not disregarded in the next instance (Callander and Clark 2017). Such disregard would bring about an ambiguous and discretionary situation where the position of law in a particular matter would depend on the interpretation of a particular judge. This nullifies the purpose of carriage of justice as uniformity is essential for observing equality before the law. In judging the evidentiary value of various precedents the case of Imbree v McNeilly [2008] HCA 40 must be considered (Ben-Yishai 2015). This case clarified that a cab driver would have to observe a duty of care towards his passengers. In this case the precedent Cook v Cook [1986] HCA 73 was discussed and dissented from (Bant 2015). Thus in doing so the court ideally rejected the evidentiary value of the precedent in which the court ruled in a different way. Resultantly, the position of law relating to the issue was changed and the previous position of law on the same issue was amended. This meant that the court was bound to consider the precedential value of such a case but was not bound to follow the previous position of law in the matter.
The judicial system and its framework is based on the hierarchy of courts and this hierarchy thus in effect dictates that lower courts would be bound by the decision of higher courts (Groppi and Ponthoreau 2013). This in effect states that a particular position of law that is settled by a high court cannot be overruled by a lower court and this lower court would be bound to give effect to this position of law. Thus in cases of lower courts, this power to overrule judicial precedents does not arise if the judgment was given by a superior court. In considering a lower court’s authority to act in a particular way that goes against a precedent it is worth mentioning that the courts would take into account a certain degree of reasonableness when applying such a precedent. This was laid down in the case of Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22 (Kozel 2017). This case also laid down two different categorizations for this degree of reasonableness. The first category here brings into consideration the concept of Ratio decidendi. This concept embodies the idea of a legal reason given for the judgment. This reason would be a primary factor in how the judgment in passed and in favor of which party. The second category brings into question the idea of obiter dicta. This refers to the courts right to dissent from a previous decision or position of law. This also constitutes a part of all judgments and thus the legal position reiterated by superior court could also de differed from or overruled. Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22 however is a widely criticized case for the way in which the concepts of precedential value has been misrepresented (Bigwood 2013). In the same way it can be stated that such a decision would also reduce the scope of judge-made laws in ways that cannot be determined by such a case. This would also mean that such a decision would limit the scope of judicial authority in case of overruling precedents.
This must also be considered that in such a case the precedential value of a particular judgment would supersede the interests of justice and the same cannot be condoned. Endorsement of such a stand would have chaotic effects on the framework of legal systems and would thus take away the various ways in which an act can be undertaken. Thus, the rights of the parties in case of such a position of law would be completely dependent on the legal stand of previous decisions. The case Kakavas V Crown Melbourne Limited (Acn 006 973 262) & Ors [2013] Hca 25 is specifically significant as it discusses a legal debate that ranges from the very source of law to the power of the judiciary to interpret the same (Lamond 2014). This case thus effectively contributed to the development of legal stands within the Australian Commonwealth along with elaborating on the issue of duty of care (Groppi and Ponthoreau 2013). This case also mandated that a particular act that has been condoned in the past would not be condoned in light of the present day unless it is essential in the interests of justice.
The case of Kakavas V Crown Melbourne Limited (Acn 006 973 262) & Ors [2013] Hca 25 is particularly important as it elaborates on a lower court authority to dissent from a precedent delivered by superior court while also curbing the powers of the lower courts to act arbitrarily and in a discretionary manner by prescribing the importance of a Ratio decidendi. A Ratio decidendi cannot be dissented from unless rule of law and due process warrants the same (Saunders and Stone 2014). This thus means that courts would be bound by the rule of law no matter the circumstance and this would ensure that acts of widespread discretion are curbed at their very inception (Lupu and Fowler 2013). This would also mean that the lowers courts would be bound by precedents unless such a precedent is against the rule of law and due process of law.
Reference list
Bant, E., 2015. Statute and common law: Interaction and influence in light of the principle of coherence. UNSWLJ, 38, p.367.
Ben-Yishai, A., 2015. Common Precedents: The Presentness of the Past in Victorian Law and Fiction. Oxford University Press.
Bigwood, R., 2013. Kakavas v. Crown Melbourne LTD; Still Curbing Unconscionability: Kakavas in the High Court of Australia. Melb. UL Rev., 37, p.463.
Boyle, L., 2015. An Australian august corpus: Why there is only one common law in Australia. Bond L. Rev., 27, p.27.
Callander, S. and Clark, T.S., 2017. Precedent and doctrine in a complicated world. American Political Science Review, 111(1), pp.184-203.
Groppi, T. and Ponthoreau, M.C. eds., 2013. The use of foreign precedents by constitutional judges. Bloomsbury Publishing.
Hutchinson, T., 2015. The doctrinal method: Incorporating interdisciplinary methods in reforming the law. Erasmus L. Rev., 8, p.130.
Komárek, J., 2013. Reasoning with previous decisions: beyond the doctrine of precedent. The American Journal of Comparative Law, 61(1), pp.149-172.
Kozel, R.J., 2017. Settled Versus Right: A Theory of Precedent. Cambridge University Press.
Lamond, G., 2014. Legal Sources, the Rule of Recognition, and Customary Law. The American Journal of Jurisprudence, 59(1), pp.25-48.
Lupu, Y. and Fowler, J.H., 2013. Strategic citations to precedent on the us supreme court. The Journal of Legal Studies, 42(1), pp.151-186.
Saunders, C. and Stone, A., 2014. Reference to foreign precedents by the Australian high court: a matter of method.
Vines, P., 2013. Law and Justice in Australia: Foundations of the legal system. Oxford University Press.
Wang, V.B., 2018. Abolishing Australia’s Judicially Enacted SUI GENERIS Doctrine of Extended Joint Enterprise. Concordia L. Rev., 3, p.67

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