ratio decidendi

The legal reasons of judge in reaching a finding in a case brought before the court. The ratio decidendi is binding on lower courts and stands in contrast to obiter dicta. The ratio decidendi is a fundamental part of establishing precedents that bind lower courts in the hierarchy, which serve to make the application of the more predictable, which in turn reduces the likelihood of litigation of the issues of law in the future.

Setting out the reasons for a judgment or order is a fundamental part of the administration of justice and determination of parties' legal rights in litigation. Firstly, the reasons underlying the decision reached allows the disaffected party to properly exercise their right of appeal in the event that the decision is wrong, by any of:

1. an error of law,
2. an error in a finding of fact, or 
3. error in the exercise of a discretion.

Furthermore, reasons allow the parties and the public at large to know why one party has won, and the other lost.

A trial judge is not required to address all of the arguments raised during the course of the trial, but that are required to make clear the legal principles upon which they reached their conclusions, so that the final decision is properly justified at law.  Accordingly, the giving of reasons is essential to ensure that the rule of law has been applied in the litigation.

Usage: The finding that a contractual term may be implied into contracts to divest the copyright owner of copyright in certain circumstances formed part of the ratio decidendi of the decision.

Related Words: obiter dicta; precedent; stare decisis; rule of law.