Sources of law: parliament and courts (SACE Stage 2 Legal Studies)
“Identify and explain the two main sources of law in Australia: statute law made by parliament and common law made by courts.”
Australian law has two main sources. Statute law (legislation) is made by elected parliaments, such as the Commonwealth Parliament and the South Australian Parliament. Common law (case law) is made by judges when they decide cases and set precedents. Where the two conflict, valid statute law prevails over common law.
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What this dot point is asking
You need to identify the two main sources of law, explain how each is made, and show how they relate to one another in Australia's legal system.
Statute law (legislation)
Statute law is law made by parliament. A proposed law is called a bill; once it passes both houses and receives royal assent from the Governor (state) or Governor-General (Commonwealth), it becomes an Act of Parliament.
Australia is a federation, so legislation is made at three levels:
- Commonwealth (federal) Parliament legislates on matters listed in the Australian Constitution, such as defence, immigration and taxation.
- State and territory parliaments, such as the Parliament of South Australia, legislate on matters not given exclusively to the Commonwealth, including most criminal law, health and education.
- Local councils make by-laws under power delegated by state parliament.
Parliament is the supreme law-making body within its area of power. Statute law can override common law, and parliament can pass new legislation to change a court-made rule it disagrees with. Courts cannot override a valid statute.
Common law (case law)
Common law is law developed by judges through their decisions in individual cases. When a superior court decides a case, the legal reasoning behind the decision (the ratio decidendi) can bind lower courts in later, similar cases. This is the doctrine of precedent.
Common law fills gaps where no statute applies and develops principles over time. A well-known Australian example is the High Court's decision in Mabo v Queensland (No 2) (1992), which recognised native title at common law for the first time. Parliament then responded by enacting the Native Title Act 1993 (Cth), illustrating how the two sources interact.
Law made by courts through judicial decisions, also called case law or judge-made law. It is built on the doctrine of precedent, where the reasoning in earlier cases guides later decisions.
How the two sources interact
Statute and common law work together rather than in isolation.
- Courts interpret statutes. Words in an Act can be unclear, so judges apply rules of statutory interpretation to decide what parliament meant. These interpretations then guide how the Act is applied in future.
- Statute prevails over common law. If a valid Act conflicts with a common law rule, the Act applies. Parliament can abolish or modify common law principles by legislating.
- Common law fills gaps. Where no legislation covers a situation, judges rely on existing precedent and legal principle.
Do not write that courts and parliament are equal in law-making power. Within its constitutional area of power, parliament is supreme: it can override court-made law, but courts cannot override a valid statute. Courts can interpret and apply legislation, not strike it down for being unpopular.
The English origins
Australian law derives historically from English law. After European settlement, English common law and statutes were "received" into the Australian colonies. Over time Australia developed its own statutes and its own line of precedent, and since the Australia Acts 1986 the British Parliament can no longer legislate for Australia and appeals to the Privy Council in London have ended. The High Court of Australia is now the final court of appeal.
When asked to evaluate sources of law, link them to law reform: parliament can make broad, prospective changes quickly, while courts can only develop law when a relevant case is brought before them and must wait for the right facts. Use both strengths and weaknesses of each source.
Other sources to recognise
Beyond the two main sources, you should be able to mention:
- The Constitution, the highest source of law in Australia, which limits and distributes law-making power.
- Delegated (subordinate) legislation, such as regulations and by-laws, made under authority granted by an Act.
- International law, which is not automatically part of Australian law but can influence legislation and judicial reasoning once incorporated by statute.
Understanding these sources lays the foundation for the rest of the course, because law-making, constitutional limits and the operation of courts all build on the distinction between parliament-made and court-made law.
A SACE extended response rewards a balanced, evaluative argument with a judgement.
Step 1: State a contention
Argue that the two sources are complementary but parliament is dominant and more flexible.
Step 2: Evaluate parliament
Show its capacity to make broad, prospective and democratic law quickly, and the rule that statute prevails.
Step 3: Evaluate the courts
Show how precedent develops principle and fills gaps, using Mabo, but only when a case arises.
Step 4: Weigh the strengths and weaknesses
Assess which source better serves certainty, flexibility and democratic legitimacy.
Step 5: Reach a judgement
Conclude that parliament is the superior source within its power while courts provide essential development.
Exam-style questions
Questions in the style of SACE Board exam questions on this dot point, each with a worked answer. They are written by ExamExplained unless tagged "Past paper"; the year shows the paper a question is modelled on.
SACE 2022-style15 marksEvaluate the relative strengths and weaknesses of parliament and the courts as sources of law.Show worked answer →
An extended-response question wants a sustained, evaluative argument with a judgement, not a description of each source.
Contention. Argue that parliament and courts have complementary strengths, but parliament is the dominant and more flexible source.
Parliament's strengths. It can make broad, prospective law quickly and democratically, and statute prevails over common law.
Parliament's weaknesses. It depends on political will and may not act on detailed or unpopular issues.
Courts' strengths. They develop principle through precedent and fill gaps where no statute applies, as in Mabo.
Courts' weaknesses. They can only act when a relevant case arises, must wait for the right facts, and are bound by precedent and statute.
Judgement. Conclude that parliament is the superior source within its power, while courts provide essential development and gap-filling.
Markers reward balanced analysis of both sources and a reasoned judgement.
2019 SACE Stage 2-style1 markOutline what is meant by the phrase 'sovereignty of the legislature'.Show worked answer →
Sovereignty of the legislature (parliamentary sovereignty or supremacy) means that parliament is the supreme law-making body. It can make or unmake any law on any subject within its constitutional power, and its statute law prevails over the common law made by courts.
Because parliament is sovereign, it can override or abrogate a court decision by passing legislation, which is why statute is treated as the superior source of law. Courts must apply valid Acts of parliament even where they would have decided the matter differently.
2019 SACE Stage 2-style1 markIdentify one method that parliament uses to supervise case law.Show worked answer →
One method is abrogation: parliament passes legislation that overrides or cancels a common law rule established by the courts, replacing it with statute.
A second acceptable method is codification: parliament collects and restates existing common law principles in a single statute, confirming or clarifying the law made by courts. Either answer shows that parliament, as the supreme law-maker, can confirm, change or reverse the law that judges develop through precedent.
Practise this
Sources & how we know this
- Stage 2 Legal Studies subject outline (2025 onwards) — SACE Board
- Stage 2 Legal Studies: external assessment — SACE Board