This blog post is a part of a series I will be posting that are part of what I am learning in my Commerce degree. This particular post if from the unit called ‘Business and the Law’.
Australia is deeply tied to England and its legal system. Therefore, the Australian legal system in many ways mirrors that of the English system.
Australia has, however, taken some ideas from the system of the United States. Particularly, this is the separation of powers that is written into the Constitution. We therefore have three arms of government – the legislative, the judiciary and the executive. The legislative is made up of the two houses of parliament, and their primary function is to make laws. The executive is made up of the government and the government departments that administer the law, and the judiciary is made up of the system of courts that both ensure the laws are followed, and check the constitutionality of the laws that are written by parliament.
However, the courts also have a very important function that comes from the English legal tradition. The courts make laws in the form of case law or common law. This is one of the most important roles that the courts have.
In this system, when a judge makes a decision, that decision becomes binding on all of the courts that sit below it in the hierarchy. This, in effect, makes a law. These laws that the courts make are not necessarily laws like forbidding insider trading, but relate more to how we determine if someone has broken a statute law, or how we determine if a contract exists between people.
These issues are far too complex to write down, and too nuanced for every case to fit into a certain prescribed set of requirements. Therefore, the laws that the courts come up with are a more fluid set of laws that outline general principles, guidelines and tests that can be made. It is then the job of the judges to ensure that their decisions are made in line with the relevant precedent that they are bound to.