Special stipulations: Overview, definition, and example
What are special stipulations?
Special stipulations refer to specific, customized conditions or provisions included in a contract or agreement that go beyond the general terms and address unique or particular needs of the parties involved. These stipulations may modify or supplement the standard clauses of a contract and are often tailored to reflect the unique circumstances of the agreement, such as the specific requirements of a project, a business arrangement, or a legal situation.
Special stipulations can cover a wide range of issues, such as payment schedules, delivery terms, confidentiality requirements, penalties for non-performance, or other conditions that are particular to the agreement. They are designed to address the specific needs and concerns of the parties and ensure that all relevant aspects of the agreement are covered in detail.
Why are special stipulations important?
Special stipulations are important because they allow parties to adapt standard contract templates to fit their specific needs, ensuring that all relevant conditions are addressed. They offer flexibility within the confines of the legal framework of the contract, making the agreement more suitable and tailored to the specific project, transaction, or relationship.
For example, in construction contracts, special stipulations may address specific project timelines, quality control standards, or risk allocation. In business partnerships, they may specify additional financial terms or specific rights and responsibilities of the partners. Special stipulations can help prevent misunderstandings or disputes by making the expectations of each party clearer.
Understanding special stipulations through an example
Imagine a company, ABC Corp., enters into a contract with a supplier, XYZ Supplies, to deliver custom-made machinery. The contract contains general terms regarding payment, delivery schedules, and warranties, but there are certain unique needs based on the specifications of the machinery. These unique needs are addressed in the special stipulations section of the contract, which might include provisions like:
- Custom Delivery Terms: The machinery must be delivered by a specific date to meet production deadlines. A penalty is specified if the delivery is late.
- Inspection and Acceptance: The machinery must undergo a detailed inspection by ABC Corp.’s engineers before being accepted, with specific criteria for passing the inspection.
- Intellectual Property: Special stipulations regarding the ownership of any intellectual property related to the design of the machinery, including licensing rights for ABC Corp. to use the designs for future projects.
- Confidentiality Agreement: A confidentiality provision requiring XYZ Supplies to keep all technical information related to the machinery confidential for a set period after the contract is completed.
These special stipulations help ensure that the contract meets the specific needs of ABC Corp. and XYZ Supplies, preventing potential conflicts by clearly outlining the expectations and responsibilities.
In another example, a freelance graphic designer, Jane, enters into a contract with a client, ACME Corp., to design a logo. While the contract includes standard terms, the special stipulations section includes:
- Revisions: The client is entitled to two rounds of revisions, with any additional revisions incurring extra charges.
- Copyright Ownership: Jane agrees to transfer copyright ownership of the logo to ACME Corp. upon full payment.
- Deadline: The final logo must be delivered within 30 days of signing the contract, with penalties for delays beyond the deadline.
These stipulations provide clear guidelines on how the work will be done and what happens if the terms are not met.
An example of a special stipulations clause
Here’s how a special stipulations clause might look in a contract:
*“Special Stipulations:
Delivery of the custom machinery must occur no later than 60 days from the signing of this Agreement. If the machinery is delivered late, a penalty of 5% of the total purchase price will be assessed for each week of delay.
The machinery must pass inspection by ABC Corp.’s engineers before acceptance. Any failure to meet the agreed-upon specifications will result in the supplier correcting the issues at no additional cost to ABC Corp.
All technical designs and plans provided by XYZ Supplies shall remain the intellectual property of the supplier, but ABC Corp. shall have an exclusive, royalty-free license to use the designs for future projects related to this machinery.”*
Conclusion
Special stipulations are customized provisions in contracts that address the specific needs, preferences, or circumstances of the parties involved. They ensure that contracts are tailored to the unique aspects of a transaction or project, covering areas that go beyond general terms. By including special stipulations, parties can clarify expectations, manage risks, and avoid potential disputes. Whether in business, construction, or personal agreements, these stipulations help ensure that all relevant details are captured and addressed in a legally binding manner.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.