Key Takeaways

  • Contract stipulations are specific provisions that establish terms, conditions, or obligations within a legal agreement.
  • Stipulations are legally enforceable once agreed upon by all parties.
  • They can govern areas such as payment, scope of work, confidentiality, indemnification, and more.
  • Freelancers and contractors should scrutinize stipulations to avoid scope creep and legal liability.
  • Stipulations are also frequently used in litigation and settlement agreements to streamline proceedings.

Contract stipulation refers to a demand for something to be included in an agreement.

To stipulate is to demand that an item should be added to a contract. You can stipulate that specific conditions should be part of a deal or agreement. Whenever you draft a legal contract, you can stipulate a condition that the other party must satisfy to complete the agreement. In that sense, a stipulation may serve as a form of restriction on the contract.

What Is an Example Of A Stipulation?

For example, if you operate a restaurant and offer a coupon, you can stipulate that patrons must order a specific amount of home delivery to qualify for the coupon.

About the Contract

A contract does not need to be elaborate. A simple email agreement that shows the work you are doing, the delivery date, and the price will suffice; however, a contract must have three elements which include:

  • An offer.
  • Acceptance of the offer.
  • Consideration, i.e., exchange of value.

Legal Significance of Contract Stipulations

Stipulations are not mere formalities—they carry legal weight. Once both parties consent to a stipulation, it becomes as binding as any other contractual clause. Courts treat them as enforceable commitments, particularly when they appear in legal pleadings or settlement agreements. For example, in Waterworks Restoration Baltimore, LLC v. Shine Home Improvements, the court emphasized that stipulations voluntarily agreed to by parties were legally binding and could not be unilaterally withdrawn.

Stipulations are often used to narrow issues for trial, simplify complex cases, or settle disputes efficiently. In litigation, they may cover facts, procedures, or admissibility of evidence, and when properly entered into the record, are difficult to revoke without consent or cause.

Contract Stipulations All Freelancers Should Know About

It's not advisable to sign every contract that comes your way. Rather, go through the details, negotiate if you need to, and try as much as possible to understand what you are getting yourself into. An unsigned contract is not binding on both parties. Don't start work until the other party signs the agreement.

Common Types of Contract Stipulations

Stipulations in contracts may take various forms, each serving distinct purposes. Common types include:

  • Performance stipulations: Define expectations for service quality, delivery timelines, or technical standards.
  • Compliance stipulations: Require adherence to specific laws, policies, or industry regulations.
  • Financial stipulations: Include terms related to payment schedules, penalties for late payment, or reimbursement conditions.
  • Termination stipulations: Outline conditions under which the contract may be terminated early.
  • Force majeure clauses: Relieve parties from liability when extraordinary events prevent contract fulfillment.

Each stipulation should be reviewed in context to understand the implications it may have on liability, performance, or legal obligations.

Scope

Scope creep is a common problem among freelancers. For example, a client contracts you to write a 1000-word article with three posts, but suddenly increases the scope of the job by two more articles and three interviews. The important point is to ensure that your contract covers the scope of the new assignments. This might require renegotiating payment, shifting deadlines, or rejecting the new work. While this does not mean that you can't chip in some extra work for loyal clients, it sends the message that clients should not expect extra work.

Research and Transcripts

In some contracts, the freelancer needs to submit copies of research and interview transcripts along with the completed article or post. If you are unable to remove this clause, ensure that the client pays for the actual transcript and the extra work you will have to do, and the content you won't be able to use for other projects.

Confidentiality Clauses

Publishers and brands put confidentiality clauses in contracts to prevent you from sharing confidential information about your dealings with the client. Publishers want to maintain a degree of exclusivity when the post goes live. They want their audience to start talking about the post once it's live, but the novelty effect would be lost if some people already know about it.

Indemnification Clauses

An indemnification clause in a contract makes you legally responsible for any expenses, damages, and losses related to your work. Whenever you sign an indemnification clause, be careful about taking assignments that may involve engaging in illegal activities such as using copyright images without acknowledgment. The owner of such images may pursue you and the publisher for copyright infringement.

Exclusivity and Non-compete Clauses

Some publishers put an exclusivity clause in their contract to restrict the writer from covering specific topics for a certain amount of time. If the bulk of your work comes from this topic, it's advisable to leave the relationship. A non-compete clause may prevent you from working for the publisher's direct competitors. If that clause will prevent you from working with old clients, it's better to renegotiate the terms of the agreement.

Rights

This clause means that at no point will you own any of the work you created on behalf of the client. This condition must be in writing, and both parties must agree to it before the commencement of work.

Payment

There are three types of payment including:

  • Pay on submission: You are paid immediately after you submit the work.
  • Pay on acceptance: You receive payment after the client accepts the work.
  • Pay on publication: You get paid when the article goes live.

Stipulations in Litigation and Settlements

Outside of business contracts, stipulations are frequently used in litigation and court proceedings. Parties may agree to stipulate to certain facts, such as the authenticity of documents or the occurrence of events, to reduce trial time and focus on contested issues.

In settlements, stipulations are used to outline the agreed terms for dismissing a case, including payment amounts, confidentiality, or non-disparagement clauses. These stipulations are often incorporated into consent judgments or settlement agreements and are enforceable as court orders.

Litigants should understand that stipulating in court is a strategic decision. Once a stipulation is accepted by the judge, it is binding and cannot be retracted without legal cause or consent of the other party.

Enforceability and Challenges to Stipulations

While contract stipulations are generally enforceable, their validity depends on factors like mutual consent, clarity, and legality. A stipulation that contradicts public policy or violates statutory law may be rendered void. Courts often assess whether the stipulation was entered into knowingly and voluntarily.

Challenges may arise in cases of ambiguity, duress, or fraud. For example, if a party can demonstrate that a stipulation was misleading or signed under pressure, the court might modify or nullify the provision. Well-drafted stipulations should be specific, balanced, and supported by consideration to stand up to legal scrutiny.

Frequently Asked Questions

  1. What are contract stipulations?
    Contract stipulations are specific conditions or terms written into a contract that define duties, obligations, or rights of the involved parties.
  2. Are contract stipulations legally binding?
    Yes, once agreed upon by all parties, stipulations are legally enforceable and treated with the same authority as any other part of a contract.
  3. Can a contract stipulation be changed or removed?
    Only if all parties consent to the change. In court, a stipulation may also be amended or set aside under specific legal grounds, such as fraud or duress.
  4. How do stipulations differ from standard contract clauses?
    While all stipulations are clauses, not all clauses are stipulations. Stipulations often imply a specific obligation or requirement that must be strictly followed to uphold the agreement.
  5. What should freelancers watch out for in contract stipulations?
    Freelancers should be alert to scope, rights transfer, indemnity, exclusivity, and payment stipulations to avoid losing control of their work or taking on unnecessary legal risk.

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