Precedent is defined as

• A. A statute enacted by legislature.
• B. A principle or rule established in a prior case.
• C. A court order.
• D. A regulatory guideline.

Answer: (B)

Precedent means a principle or rule established in a prior case that guides decisions in similar situations. In common law, courts follow stare decisis, using previous rulings to decide current cases to keep outcomes consistent and predictable. The important part is the ratio decidendi—the legal reasoning that determined the outcome—which becomes binding on future cases with the same issue. A statute enacted by the legislature is new law created by lawmakers, not a prior court ruling. A court order is a directive issued in a single case. A regulatory guideline is an agency-issued instruction that may influence decisions but isn’t binding precedent in the same way. Hence, the definition matching precedent is a principle or rule established in a prior case.