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Unformatted text preview: e to recognise the title of a party guilty of an illegality the estate lie, where it falls,"19 and appears to be the source of the equitable maxim "H
who comes to equity must come with clean hands".20 These are examples where policy
can be clearly seen, but the principles examined in this chapter are not so starkly unmasked. The exercise of policies of predictability, efficiency, and accuracy in case l
judgments have not always been straightforward. Courts do not always openly acknowledge the influence of public policy in the common
law decision process.21 The use of public policy in the courts provides a basis for criticism that the settlement of cases uses extra-legal criteria, criteria which may have roots in the communal conscience of the society in which courts reside. The participatory
decision model employed in the early Germanic courts mentioned in Chapter Two used
this communal conscience in dealing with crimes and civil wrongs. Whether the use of an intuitive community sense of justice by modern judges can still be defended is open to
argument, but the recognition that judges approach some cases with preconceived notions
based in individual notions of social beliefs, policies, and mores seems beyond dispute. Thus, it is inevitable that in any research on the recovery of opportunity cost in litig
that public policy issues will arise. This chapter examines how public policy 18 Holman v Johnson (1775) 1 C o w p 341 at 343; Mclnnes, M . 1997, "Advancement, Illegality and
Restitution"; 1997 A P L J L E X I S 3.
Muckleston v Brown (1801) 6 V es 52 at 69.
LCI. Australia Operations Pty. Ltd. v Trade Practices Commission (1992) 38 F.C.R 248; 110 A.L.R.
4 7; F.A.I. Insurances Pty. Ltd. v Pioneer Concrete Services Ltd. (1987) 15 N.S.W.L.R. 552 at 555-7 per
Young J. Also see Sterling Winthrop Pty. Ltd. v Boots Company (Australia) Pty. Ltd.  33 I.P.R. 3
per Tamberlin J. w h o linked the maxim to public interest considerations in trade practices violations under
Leask v Commonwealth (1996) 187 C.L.R. 5 79 per Toohey J. at 1013. Vermeesch, R. B., and Lindgren,
K. E., 2001, Business Law ofAustralia, Sydney, Butterworths, p. 52. 275 considerations have hindered judicial acceptance o f e conomic principles a nd divides
consideration of public policy principles into three categories which have woven threads of overt influence into curial reflection on inflation, discount rates, and interest rates
of which are seminally important when considering the opportunity costs of a sum of
money owed by a defendant to a plaintiff. This is especially so if the sum is comprised of
compensation for long-term future expected losses. The principles of efficiency, accuracy, and predictability, the subject of this chapter, have been especially influentia
in court decisions. The principle of efficiency, whereby the courts are expected to deliver judgment in a
cost-effective and expedient manner, has received increased attention from legal writers
in the 20 century attempting to equate the 'common good' with social wealth, using
individual wealth as a proxy, arguing that the common law tacitly or openly uses
efficiency as a guideline to generate rules of law. Opponents have argued that justice is
not congruent in all circumstances with efficiency, and that other values must enter in to
the common law judgments. Epstein argues caution against the excessive use of policy,
defined in terms of changes in either the social behaviour or technological patterns of
communities23 where courts exercise jurisdiction, as justification for the alteration of
legal rules. He takes the position that good rules can be maintained and bad rules
abandoned through other means, but to over-rely on social changes as justification for altering previously workable legal rules is to assault the static notion of the common law,
value innovation over stability and increase uncertainty. Certainty, though, has not been
historically a mark of early cases, for even competent judges found it difficult to 22 Epstein, R. A., 1980, "The Static Conception of the C ommon Law", The Journal of Legal Studies vol.
IX, no. 2, March 1980, pp. 253-275.
Epstein 1980, p. 254. 276 promulgate certainty in decision making due to a lack of swift and accurate
communication and the lack of accurate case reports. Early Court Reports The court reports prior to the 19th century were incomplete, constituting little more than
case summaries. The lack of clarity and completeness in early reports not only hinders
historical research, but it also hindered coherency in the English common law generally.
Without the ability to ascertain the logical processes upon which early courts derived
rules, it becomes difficult to organise and substantiate a systematic view of the early
doctrines of the common law. In Hadley v Baxendale (1854), the court chose to pronounce a "rule of the common law" which it did not fully justify, or at least the case reports of the decision do not contain sufficient information to fully establish the cou
justifications. Some discussion...
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