What Is Tolling Agreement Meaningmarekbilek.cz - 30.4.2023
When it comes to legal terms, understanding their meaning is crucial in making sound decisions. One legal term that has gained attention is tolling agreement. In this article, we will explore what a tolling agreement means and its significance.
A tolling agreement is a contract between two parties that pauses the statute of limitations for a legal claim. It is an agreement that extends the time frame for filing a lawsuit or claim past the original deadline, without losing any legal rights.
For instance, let`s assume that a company has been dealing with a faulty product for a while, but they only discovered it recently. They may want to pursue legal action against the manufacturer or supplier, but the statute of limitations for such claims has already run out. In such a case, a tolling agreement could be established to extend the deadline for filing the lawsuit beyond the original deadline.
The agreement can be created by any two parties who prefer to pause the time frame for legal claims. It could be between the defendant and plaintiff, two companies, or even between a company and an individual.
A tolling agreement is commonly used in industries like construction, insurance, and energy. In construction, tolling agreements are used to pause time frames for building contracts due to weather or other unforeseen circumstances. In insurance, tolling agreements are used to pause the deadlines for filing a claim, especially when the insurance company is still investigating the claim.
The significance of tolling agreements is that they help parties to avoid the negative consequences of the statute of limitations without losing any legal rights. Once a tolling agreement has been established, the affected party can then take time to investigate and gather sufficient evidence to pursue a legal claim.
In conclusion, a tolling agreement is a legal contract that pauses the statute of limitations. It enables parties to extend time frames for legal claims beyond the original deadline without losing any legal rights. Although tolling agreements are most common in industries like construction, insurance, and energy, they can be established by any two parties. Understanding the meaning of a tolling agreement is important for anyone who wants to make informed decisions on legal matters.