Declaratory Judgment Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Declaratory Judgment, written in plain English, along with examples of how it is used.

What is Declaratory Judgment?

n. A court judgment that doesn’t order anything to be done or award damages but determines the parties’ rights. Declaratory judgments are allowed to nip controversies in the bud, but border on advisory opinions which are prohibited. For example: An employer may request the court to rule whether a new tax is applicable to the business prior to paying it or a contract’s party may seek the interpretation of a contract in order to determine the parties’ rights.

History and Meaning of Declaratory Judgment

Declaratory judgment is a legal term that refers to a court decision that renders a statement of the legal rights of parties without necessarily awarding damages or ordering any action. Declaratory judgments originated in England in the 19th century and were later adopted in the United States legal system. The purpose of declaratory judgments is to resolve legal disputes and uncertainties before a dispute escalates to a point that it requires damages, specific performance, or other remedies.

A declaratory judgment does not enforce anything, but it clarifies a legal issue that may have been in dispute. Declaratory judgments can be issued in various cases, including disputes relating to contracts, intellectual property, real estate, labor law, and constitutional law.

Examples of Declaratory Judgment

  1. A company may seek a declaratory judgment from the court to confirm whether its use of a particular trademark infringes on anyone's intellectual property rights before starting to use the trademark.
  2. In a divorce case, one party may request a declaratory judgment to establish the validity of a prenuptial agreement before challenging it later on.
  3. In a trade dispute, a party may request a declaratory judgment to determine the interpretation of a contract or an agreement in order to avoid future disagreements.

Legal Terms Similar to Declaratory Judgment

  1. Injunction: An order issued by the court prohibiting an individual or entity from continuing with a specific action.
  2. Summary judgment: A legal decision issued by the court based on a written motion and without a trial, typically when there are no material facts in dispute.
  3. Res judicata: A legal principle that precludes a matter that has been adjudged by a competent court from being raised again in the future.