West Midland Baptist (Trust) Assn v Birmingham

The Jolly Contrarian Law Reports Our own, snippy, in-house court reporting service. →Go uptown Editorial Board of the JCLR: Managing Editor: Lord Justice Cocklecarrot M.R. · General Editor: Sir Jerrold Baxter-Morley, K.C. · Principle witness: Mrs. Pinterman Common law | Litigation | Contract | Tort | Click ᐅ to expand: Case notes Tell me more Sign up for our newsletter — or just get in touch: for ½ a weekly 🍺 you get to consult JC. Ask about it here.

On the question of whether, a court having suddenly realised that it had been wrong about the common law for decades, could agree to uphold its new correct understanding of the same prospectively only. A question thrown into sharp relief by the Lehman insolvency, and in particular Re Spectrum Plus.

No, as it turned out. The traditional approach was stated crisply by Lord Reid in West Midland Baptist (Trust) Assn v Birmingham [1970] AC 874, 898-899, a case concerning compulsory acquisition:

“We cannot say that the law was one thing yesterday but is to be something different tomorrow. If we decide that [the existing rule] is wrong we must decide that it always has been wrong, and that would mean that in many completed transactions owners have received too little compensation. But that often happens when an existing decision is reversed.”

Later on, Lord Nicholls said:

“Whatever its faults the retrospective application of court rulings is straightforward. Prospective overruling creates problems of discrimination. Born out of a laudable wish to mitigate the seeming unfairness of a retrospective change in the law, prospective overruling can beget unfairness of its own.

“This is most marked in criminal cases, where ‘pure’ prospective overruling would leave a successful defendant languishing in prison.”

While the court didn’t rule out the idea of prospective overruling —“‘Never say never’ is a wise judicial precept, in the interests of all citizens of the country” — this present case was “miles away from the exceptional category in which alone prospective overruling would be legitimate”.

Goedel’s undecidability applied to the common law

This question — should a “newly decided” thread of common law apply to human affairs pre-dating its development which were specifically constructed in contemplation of common law principles which, the new authority has adjudged to be wrong? — articulates the same paradox by which Kurt Gödel buggered up David Hilbert’s aspiration to describe a complete and consistent set of all mathematic axioms.

How so? Well, bear in mind the starting presumption of common law jurisprudence is that it is not judge-made, but judge discovered — an objet trouvée inverted, signed and exhibited as is. Judges are merely expert scupltors, revealing the platonic details of the law as Michelangelo did when carving David from a marble block. Like David, the law was always there, encased in that block of — what? Semantic confusion? White noise? — it just took a craftsperson of sufficient skill and enlightenment to reveal it.

Bear in mind another, apparently consistent presumption: the common law’s fundamental value is certainty. Merchants need to know, moment to moment, that the legal foundations underpinning their commercial arrangements are not liable to shift. Hence, while statutes are transparently the creature of men and women and will not, without grave justification, be applied retrospectively, the common law suffers no such legislative fickleness: it is unchanging, for all times and for all men and all women.

But judges, however excellent, are human. It is not beyond their powers to make a bish of things. So, what to do? And what if that very epistemological foundation falls apart on closer inspection. Could it be, after all, that the law is a social construction? That a fellow in a horsehair wig just made it up? Should we look under our foundation to see if we can find any turtles?

Here is the paradox. Since newly decided cases overturn old ones, and the law does apply retrospectively, then by the jurisprudence of the law, the old law was never the law, even when everyone agreed it was. But the device by which one discovers the old law isn't the law and the new law is the law is, itself, a fallible case. But here the jurisprudential principle “revealed” by West Midland Baptist (Trust) Association Inc v Birmingham Corporation is that the common law, as laid down by a decided case, may not be the common law after all. If it may not be it, it cannot be it: at best it is its shadow, flickering on the grotto wall, illuminated by Plato’s candle.

If it is right, being itself laid down by a decided case, it must by its own lights, be wrong. This is not the law. It is a fallible judge’s impression of the law. It is as susceptible of falsehood as the judgment which it overturns. Only if it is wrong can we have any certainty that it is right.

So if you organised your affairs in reliance on what you, and everyone else, including the judiciary, at the time earnestly believed to be a tributary of the golden stream, but which a later revelation of the law shows to have been a bucket of piss, well that’s tough. But you therefore you can’t rely on the later revelation of the law either, because it too might turn out to be wrong.

Which means perhaps you can rely on the old precedent, as it might turn out not to have been a bucket of piss after all. But as long as this new ruling isn’t considered to be a bucket piss, you can’t. O tempora! O mores! O paradox!

See also

Re Spectrum Plus