Precedent means a judgment or decision of a court of law cited as an authority for deciding a similar set of facts. It contains cases which serve as an authority for the legal principle embodied in its decision. A precedent which creates and applies a new rule is called an original precedent. Declaratory precedent does not create a new rule that merely apply on existing rule of law.
On the basis of the enforceability precedents can be further divided into two parts:
(a) Authoritative precedent
(b) Persuasive precedent. An authoritative precedent is binding while the persuasive precedent is not binding and is worth of consideration only.