Contract Glossary
Tolling Agreement
Definition
A tolling agreement pauses the statute of limitations clock on a potential legal claim. Instead of rushing to file a lawsuit before time runs out, both parties agree to freeze the deadline so they can negotiate a resolution.
In Practice
A software company discovers their vendor delivered a defective product 18 months ago. The statute of limitations is 4 years. Rather than spending $50,000 on litigation, they propose a 6-month tolling agreement to negotiate a fix, replacement, or refund.
Example Clause
The Parties agree that from the Effective Date through the Tolling Expiration Date, the running of any applicable statute of limitations shall be suspended and tolled. Upon expiration, the limitation period shall resume with the same time remaining as existed on the Effective Date.
Common in these contract types
Related articles
5 Clauses Every Service Agreement Needs
The five non-negotiable clauses in any service agreement — scope, payment, liability, termination, and dispute resolution. Skip one and you are exposed.
How to Write a Service Agreement That Protects Both Parties
Write a service agreement that protects both parties. Covers scope, payment, liability caps, SLAs, and termination clauses.
Free Service Agreement Template — Scope, Payment & Liability
Free service agreement template for consultants and agencies. Covers scope, payment terms, SLAs, liability, and termination clauses.
Frequently asked questions about tolling agreement
Both sides benefit. The potential plaintiff gets more time to evaluate and negotiate. The potential defendant avoids premature litigation costs. It signals good faith.
Create a contract with proper tolling agreement clauses
Generate a professional contract in minutes with all the essential clauses — no legal expertise needed.
Create your contractThis content is for informational purposes only and does not constitute legal advice. For contracts with significant financial or legal implications, review by a qualified attorney is recommended.