Tolling Agreement Template

A Tolling Agreement is a contract between parties involved in a legal dispute that suspends or "tolls" the running of the statute of limitations for a specified period. This gives parties additional time to negotiate a settlement, complete investigations, or otherwise resolve their dispute without the pressure of an imminent statute of limitations deadline.

Tolling agreements are commonly used in business disputes, employment claims, personal injury cases, and contract disputes where parties want to pursue settlement negotiations in good faith without the threat of an immediate lawsuit. Both sides benefit: the potential plaintiff preserves their right to sue if negotiations fail, and the potential defendant avoids the cost and uncertainty of litigation while settlement discussions continue.

This template includes identification of the claim or dispute, specification of the statute of limitations being tolled, the tolling period duration, extension and termination provisions, confidentiality of negotiations, agreement not to sue during tolling period, and what happens if settlement is not reached.

Important: A tolling agreement must be carefully drafted and executed before the statute of limitations expires. Once the deadline has passed, the claim is time-barred and cannot be revived.