Stare Decisis

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Definition of 'Stare Decisis'

Stare decisis is a legal principle that means "to stand by things decided." It is the doctrine that courts should follow precedents established in previous cases. This principle helps to ensure that the law is applied consistently and that people are treated fairly.

There are a few exceptions to the principle of stare decisis. For example, courts may depart from precedent if the original case was decided incorrectly, or if the law has changed since the original case was decided. Courts may also depart from precedent if it would be unjust or unfair to apply the original case to the new case.

The principle of stare decisis is important because it helps to promote stability and predictability in the law. It also helps to ensure that people are treated fairly and consistently. However, the principle of stare decisis is not absolute. Courts may depart from precedent in certain cases.

In the financial world, the principle of stare decisis is also important. It helps to ensure that financial transactions are conducted in a fair and consistent manner. For example, if a court has ruled that a certain type of financial transaction is legal, then other courts will generally follow that ruling. This helps to provide certainty and predictability in the financial world.

However, the principle of stare decisis is not always followed in the financial world. For example, in 2008, the U.S. Supreme Court ruled that the government could not prevent banks from selling mortgages that they had originated. This ruling overturned a previous Supreme Court ruling that had allowed the government to prevent banks from selling mortgages. The 2008 ruling was controversial, and it led to a number of changes in the financial world.

The principle of stare decisis is an important one, but it is not absolute. Courts may depart from precedent in certain cases. This is especially true in the financial world, where new and complex financial products are constantly being created.

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