A Tolling Agreement is a document signed between the claimant and the respondent who mutually agree to suspend or toll the statute of limitations for a definite time. The term Statute of Limitations refers to the time limit in which a party can bring a claim or file a lawsuit; this time limit will vary from claim to claim.
This Tolling Agreement (hereinafter referred to as the "Agreement") made and entered into this [Document.CreatedDate] by and between:
Name: [Claimant.FirstName] [Claimant.LastName] [Claimant.Company] (hereinafter referred to as "Claimant"), and
Name: [Respondent.FirstName] [Respondent.LastName] [Respondent.Company] (hereinafter referred to as "Respondent")
Claimant and Respondent are hereinafter referred to as “Parties” collectively in this Agreement.
Claimant has filed an Action against Respondent in the Court of (court name) on the date of (mm/dd/yyyy) being Case Number (case number).
Respondent denies that it committed any of the acts alleged in the Complaint and intends to fully defend against the claims asserted in the Complaint.
The relevant claim is (describe the relevant claim; for example, a breach of contract claim).
Both Parties agree that, given the above-cited proceedings, they want to toll (or suspend) the running of any statute of limitations or any other deadlines or procedures which might otherwise apply to the relevant claim so that the Parties may engage in good faith settlement negotiations.
A tolling period is a specified time within which an individual’s legal action is postponed. Tolling periods are often 30 or 60 days, but the optimal tolling time will depend on the particular circumstances of the case and is best decided after a discussion between the claimant and the respondent.
Claimant and the Respondent agree that the applicable statute(s) of limitations for any Claims that have arisen or may arise between them are hereby tolled and suspended from the date of this Agreement until (insert number, eg: 30, 60, 90) days or until (mm/dd/yyyy).
The Agreement will not be construed to damage, harm, or prejudice any party's legal rights or remedies, as expressly reserved.
Both the Parties represent and warrant that they have the legal power and authority to enter into this agreement.
Both Parties have had the opportunity to assess and review this agreement with the legal counsel of their choice prior to execution and agree to be bound by its provisions.
Execution of this Agreement shall not be construed as an admission of any wrongdoing or liability by any Party concerning any Claim.
Parties agree to not initiate any litigation or any other proceeding concerning any Claim between the date this Agreement is in effect and the end of the tolling period.
In the future, anything mentioned in this Agreement shall not waive the rights or remedies to which the Parties are, or will be, entitled under the law.
If in the event any term or provision stated in this Agreement is found to be void or unenforceable by a court of law or any other tribunal of competent jurisdiction, then that term or provision shall be severed from this Agreement.
Either Party can terminate this Agreement at any time for any reason, subject to a written notice to the other Party. Subsequently, the Agreement will be automatically terminated on the day the tolling period comes to an end.
From the effective date of this Agreement, the Parties agree to not indemnify, defend, hold harmless and release the other Party, and the other Party’s representatives from and against any claims, losses, liabilities, actions, demands, damages, judgments, settlements, costs, and expenses, in addition to reasonable attorneys' fees.
This Agreement may not be altered, except in writing, and signed by both Parties.
No agency, partnership, or joint venture is implied or created by this Agreement.
Any notice required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given when delivered by hand, sent via email, or posted to the registered mail to the party to whom it is addressed.
The failure of any Party to this Agreement to enforce any provision of this Agreement at any time shall not be construed as a waiver of any such provision or of the right to thereafter enforce the same.
This Agreement shall be governed by and construed under the laws of the State of [Respondent.State] .
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A tolling agreement is a legally binding agreement between the claimant and the respondent to suspend, pause, postpone or delay the statute of limitations for a specific period on a claim or a legal matter. It provides the parties additional time to investigate the facts and circumstances of the case further, save litigation costs, or negotiate a settlement.
A tolling agreement means an extrajudicial contract between the partakers that tolls the statute of restrictions for counterclaims for a precise period. For example, if the parties are in the middle of a negotiation and find that they require additional time to arrive at a settlement, a tolling agreement can be served to pause the statute of limitations so that negotiations can continue without fretting about a looming deadline.
Likewise, if a party needs more time to prepare for trial, a tolling agreement can provide that supplemental time.
A tolling agreement in manufacturing is a binding document between a manufacturer and a customer.
In it, the customer supplies the raw materials or semi-finished goods, and the manufacturer agrees to provide the manufacturing services to produce a finished product; the customer owns both the raw materials and the finished product.
Furthermore, it comprises provisions regarding quality control, delivery, payment, and other pertinent information as required.
A tolling agreement can last for an indefinite period, as mutually agreed by the parties. However, most tolling agreements are valid for 90 days or 3 months.
Both the claimant and the respondent can benefit from preparing a tolling agreement. By agreeing to toll the statute of limitations, both parties get more time to negotiate the settlement or to prepare for trial. In turn, this can help to prevent a rushed settlement that may not be fair to either party or a trial that is not as well prepared as it could be.
A tolling agreement works by pausing, delaying, or postponing the statute of limitations. This means that the period in which a party can bring a claim or file a lawsuit is shelved or put on hold. The tolling agreement defines the duration of the tolling period too. Subsequently, when the tolling period ends, the statute of limitations resumes too.
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