Definition

• A stipulated settlement is an agreement between parties in a criminal proceeding, civil action or any other type of litigation. The purpose of the stipulated settlement is to agree upon and settle the case before it ever reaches the courtroom. A stipulated settlement does away with the need to prove uncontested facts, which saves time and money for all involved.
  
  

Process

• The process of agreeing to a stipulated settlement begins when one party approaches the other with a proposal to settle the legal matter out of court. The proposal is usually handled by the attorneys, and a contract or written agreement is drafted by the parties, which includes all of the agreed-upon stipulations from each side. Both parties sign the agreement, and it is reviewed and signed by the judge, making it a legally binding contract.
  
  

Is the Settlement Mandatory?

• The stipulated settlement can go back and forth between parties before they reach a final agreement. Both parties must agree to the stipulation of settlement for it to be approved by the judge. If one party does not think the agreement is fair or believes that he cannot fulfill his end of the deal, he may deny the settlement. The case would then proceed to a trial before a judge.
  
  

Common Uses

• Stipulated settlements are commonly used in child custody, child support and divorce cases. In these cases, many people want to settle the case outside of court to avoid drawn-out battles and expensive fees. Debt collectors often reach stipulated settlements with debtors, agreeing to take only a portion of the debt owed to be able to settle the debt out of court.