Tolling Agreements: Meaning & Benefits (2026)

What Is a Tolling Agreement?

A tolling agreement is a contract between a plaintiff and a defendant to pause the statute of limitations. These arrangements are most often seen in personal injury cases, such as:

• Slip and fall or trip and fall cases
• Truck and auto accidents
• Medical malpractice claims
• Construction accidents
• Bicyclist or pedestrian injuries

Litigants with another type of lawsuit, such as a contract dispute, a premises liability lawsuit, or other civil matters, may also use tolling agreements in their cases. To understand why the involved parties might sign a tolling agreement, you must first understand how statutes of limitations work.

What Are Statutes of Limitations?

A statute of limitation is any law that states how long an individual has to file a legal claim in court. These laws are state- and claim-specific and can range from two to four or more years in length. They function similarly to a “countdown clock,” indicating to those considering filing a legal claim how long they have left to do so.

For example, one state’s personal injury statute of limitations might give injured parties three years to file a claim, while another’s might only give them two years to do the same.

The statute of limitations usually begins when a crash, breach, or other legal injury occurs. Once it starts, very few events can “toll,” or pause, the countdown. An injured party can lose their right to file a lawsuit and seek compensation if they don’t act before the countdown expires.

Elements of a Tolling Agreement

The key element of any tolling agreement is the willingness of both parties to suspend the applicable statute of limitations temporarily. The parties must agree not only to suspend it but also on how long it should be paused. Neither party can unilaterally decide to pause or stop the statute of limitations.

A tolling agreement typically doesn’t contain an admission of liability by either party. It also rarely contains promises or agreements beyond pausing the statute of limitations. For example, a tolling agreement doesn’t guarantee that the parties will reach a car accident settlement.

Drafting and Key Provisions of a Tolling Agreement

When creating a tolling agreement, the parties should use clear, precise language. Any ambiguities could lead to litigation over the scope of the agreement itself.

An experienced personal injury lawyer can create a tolling agreement specifically tailored to your case. But generally speaking, a tolling agreement should include the following:

A Clear Definition of Scope

Specificity is critical in any tolling agreement. Your agreement should clearly state the legal claims or disputes it applies to and the parties involved.

Options for Termination

A tolling agreement is a contract between the parties, and it hinges on their continued agreement. The agreement should outline how either party may terminate it. For instance, one party may be allowed to cancel the tolling agreement with 30 days’ notice.

Impact of Dismissal

In lawsuits involving several parties, dismissal of any one party from the lawsuit has the potential to change the agreement. Any tolling agreement should clearly detail what happens if one party is dismissed.

Possibility of Extension

A tolling agreement should clearly state how long the tolling period will last. However, depending on the circumstances of the case, the parties may want to extend it further. Any tolling agreement should specify when and how the parties should meet to discuss its extension.

No Admission of Liability

Any tolling agreement should contain a clear statement that signing the agreement does not constitute an admission of liability by any involved party.

How Long Can a Tolling Agreement Last?

It’s up to the two parties involved to decide how long the tolling agreement will last. In some cases, they may specify that the agreement will last for a specific duration of time. In others, they may decide on an indefinite tolling agreement.

Indefinite agreements can sometimes be difficult to maintain. The two parties must regularly renegotiate the agreement to make sure it stays in effect.

When Should You Use a Tolling Agreement?

There are many different circumstances where you and your lawyer may decide that a tolling agreement is the best option for your case.

You Need More Information

If the statute of limitations is approaching but you don’t have what you need to file a lawsuit, a tolling agreement may be an option. For instance, if you have major injuries after a head-on car collision, a tolling agreement may allow time for your injuries to heal.

When you have a better idea of the total impact of the injuries on your life, your attorney will be better equipped to seek a fair settlement.

You Want More Time to Negotiate

Negotiation can save you from the stresses of litigation, but it often takes longer than many realize. A tolling agreement can give both sides ample time to negotiate.

You Think You May Want to Sue in the Future

If you think you may want to pursue legal action eventually, a tolling agreement can extend the statute of limitations.

Benefits of Tolling Agreements in Civil Cases

The primary advantage of tolling the statute of limitations is that it gives the parties additional time to pursue an out-of-court settlement. Some of the main benefits for plaintiffs and defendants include:

• Extra time to litigate gives plaintiffs leverage when negotiating with defendants
• There’s no rush to file a lawsuit, so it’s easier for both sides to come to an agreement
• Avoiding a lawsuit saves both sides money
• Defendants have more time to develop a defense strategy
• Defendants don’t have to immediately come up with litigation fees

In many situations, tolling agreements can be helpful for both sides of a civil case.

Why Plaintiffs Favor Tolling Agreements

Many civil plaintiffs benefit from the certainty and speedy resolution that settlements afford. Resolving a civil injury claim through the judicial process can take months, and there are no guarantees that the plaintiff will succeed at trial. A judge or jury could award less damages than the plaintiff sought or deny the plaintiff’s claim altogether.

With a settlement agreement, the plaintiff is guaranteed to receive whatever compensation they and the other party agree to according to a mutually agreeable time frame. It’s common for plaintiffs to receive compensation through a settlement much faster than they would by going through the court system.

How Defendants Benefit From Tolling Agreements

You might think that defendants accused of wrongdoing have nothing to gain from giving the injured plaintiff more time to bring a claim. After all, once the statute of limitations expires, the plaintiff is rarely given more time to pursue their case — the defendant can often dismiss the plaintiff’s claim without paying them a single dollar in compensation.

However, when the plaintiff has a valid claim against the defendant, the latter stands to save time and money by settling the claim before it goes to court. Injury victims might settle for less than they would seek in court. Even if they don’t, defendants often save money on legal fees by settling rather than contesting a case in court.

If the plaintiff believes they’re close to exceeding the statute of limitations, they may file a claim simply to preserve their rights. By agreeing to toll the statute of limitations, a defendant can encourage a plaintiff to continue settlement negotiations, potentially saving themselves a considerable amount of money.

Tolling Agreements vs. Litigation: Cost Comparison

Litigation is almost always more expensive than any other form of dispute resolution. Both plaintiffs and defendants may be concerned about cost. Plaintiffs may have to pay upfront legal fees, but if the court rules in the plaintiff’s favor, the defendant may be ordered to pay substantial damages.

This means that most of the time, it’s in the best interests of both parties to decide on a settlement. This way, the plaintiff can recover compensation, and neither party has to worry about significant legal fees.

Does a Tolling Agreement Guarantee a Settlement?

Tolling agreements can be particularly useful in civil cases. They give both sides time to think, negotiate, and work toward a solution that doesn’t involve litigation. However, while tolling agreements increase your likelihood of reaching a settlement, they do not guarantee one.

For example, imagine you have been seriously hurt by a drunk driver, and the other driver was injured as well. If the statute of limitations to file a car accident lawsuit is approaching and you both are still dealing with medical problems, a tolling agreement may give you more time to settle.

It’s still possible that your lawyer and the defendant’s lawyer won’t be able to agree on a fair personal injury settlement for you, though. In this case, you might end up filing a lawsuit despite your prior tolling agreement.

Risks and Drawbacks of Tolling Agreements

Tolling agreements are often beneficial to both parties in a lawsuit. However, they aren’t without drawbacks. If one party decides to file a counterclaim against the other and that claim is postponed by the tolling agreement, litigation could become far more drawn out than anticipated.

Tolling agreements may also conflict with scheduling orders set by the court. When this happens, the parties may be able to ask the court for an extension. Courts are often willing to adjust scheduling orders when the involved parties have a mutual agreement. However, if the parties don’t ask the court for an extension, it may lead to legal issues down the line.

Get Matched With a Qualified Attorney

Before entering into a tolling agreement, it’s important to consider the potential benefits and drawbacks. An experienced lawyer can explain both to help you make an informed decision. It’s also advisable to have your tolling agreement drafted by a knowledgeable attorney.

If you have questions about tolling agreements or your rights more generally, ConsumerShield can help. Complete our online form, and we’ll connect you with a qualified attorney in your area who can answer your questions and provide you with trustworthy legal representation.