Obiter dictum
Obiter dictum (more usually used in the plural, obiter dicta) is Latin for a word said "by the way", that is, a remark in a judgment that is "said in passing". It is a concept derived from English common law, whereby a judgment comprises only two elements: ratio decidendi and obiter dicta. For the purposes of judicial precedent, ratio decidendi is binding, whereas obiter dicta are persuasive only.
Significance of obiter dicta
A judicial statement can be ratio decidendi only if it refers to the crucial facts and law of the case. Statements that are not crucial, or which refer to hypothetical facts or to unrelated law issues, are obiter dicta. Obiter dicta (often simply dicta, or obiter) are remarks or observations made by a judge that, although included in the body of the court's opinion, do not form a necessary part of the court's decision. In a court opinion, obiter dicta include, but are not limited to, words "introduced by way of illustration, or analogy or argument". Unlike ratio decidendi, obiter dicta are not the subject of the judicial decision, even if they happen to be correct statements of law. The so-called Wambaugh's Inversion Test provides that to determine whether a judicial statement is ratio or obiter, you should invert the argument, that is to say, ask whether the decision would have been different, had the statement been omitted. If so, the statement is crucial and is ratio; whereas if it is not crucial, it is obiter.
