What Is a Stipulated Judgment?

By Erika Waters
A judge's gavel in front of a book and the scales of justice.

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Trials can be long and very expensive, which is why parties often choose to settle lawsuits before going to trial. A stipulated judgment is an agreement between parties to a lawsuit that spells out the terms of their settlement. It becomes a court order once signed by a judge, which makes it easier to enforce than an out-of-court agreement.

Parts of a Stipulated Judgment

Every court will have different requirements for the contents and format of a stipulated judgment. But certain basic components will be present in every stipulated judgment. The document will include a statement of the dispute between the parties, a description of the terms of the settlement agreement, the consequences if either party fails to comply and the signatures of all the parties to the settlement agreement as well as their lawyers.

Family Law

Stipulated judgments are often used in settling family law cases such as divorces. In a divorce case, the parties will draft a marital settlement agreement to be filed with the court and approved as a stipulated judgment. It usually will include the parties' agreements on how to divide their marital property, payment of spousal support, and, if applicable, payment of child support and custody arrangements.

Civil Lawsuits

Stipulated judgments can also be used to settle civil lawsuits. For example, if a person is sued by a bank for failure to make loan or credit card payments, the bank may be willing to settle the case by stipulated judgment. The settlement may allow the defendant to make a lump sum payment that is less than the total amount he owes the bank. In such a case, the stipulated judgment will state the terms for making settlement payments and the consequences if the defendant fails to make those payments.

Default on a Stipulated Judgment

If one of the parties does not comply with the terms of the settlement agreement, then he may be in default and the other party may ask the court to vacate the stipulated judgment. The parties' settlement agreement may include certain consequences for failure to comply with its terms. If the stipulated judgment is vacated, the plaintiff may be able to proceed against the defendant for the full amount of damages sought in the lawsuit.

About the Author

Erika Waters is a business lawyer licensed to practice in California. She has experience working with nonprofits including Teach for America, as well as entrepreneurs and startups. Waters has contributed to several blogs, including the Business & Media Institute and other online publications and has worked as an editor for an academic publication.

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