Tolling Agreements: Defined

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August 21, 2019
Author: Ben Halverson
Organization: Lorman Education Service

After a personal liability accident, the clock starts ticking. In most states, victims have a limited period of time before they must file a claim or begin legal action against the person who caused their injuries. Once this pre-set time, referred to as the statute of limitations, runs out, the victim no longer has the legal right to make a claim against the person who caused their injuries. In some cases, however, the existing statute of limitations might not offer enough time for the victim to collect evidence, take care of their injuries, or take care of other processes related to the claim. In this case, a tolling agreement can help.

What is a Tolling Agreement?

A tolling agreement stops the ticking clock after an accident. It acts as a legal placeholder: a statement that the victim intends to file a claim, but that they need more time before doing so. A tolling agreement lets the courts and the defendant know that legal action is coming, but that the plaintiff is not quite prepared to file and needs more time beyond the statute of limitations for a special reason or concern. 

When Can a Tolling Agreement Be Filed?

The statute of limitations on many personal injury claims and crimes is designed to protect individuals who have gone on with their lives long after the initial event from having it come back to haunt them many years down the road. A tolling agreement may be filed for any number of reasons, including:

Underage or juvenile status. If one of the parties involved is underage, but will be of age within a reasonable period of time, one party may choose to file a tolling agreement, holding action until the juvenile reaches the age of 18. 

Bankruptcy. Bankruptcy may prevent the injured party from seeking the damages they deserve from an accident or breached contract. Waiting until the bankrupt individual reaches solvency can aid both parties in the pursuit of justice. 

Insanity. Insanity can make it very difficult to file a claim or collect evidence. As a result, if one party claims insanity, the case may wait until counseling is received or until a full evaluation of the insane individual can be done. 

Natural disaster. Natural disaster can slow the progression of many cases. By filing a tolling agreement, both parties can recover from that natural disaster before proceeding with the claim. 

Any time there are unforeseen circumstances impacting a claim or interfering with the statute of limitations, a tolling agreement can aid one or both parties. Consulting with a lawyer can help more effectively determine exactly what type of agreement is possible. 

What Should You Do if Presented with a Tolling Agreement?

Did you cause an accident, either on the road or in your home? If the victim presents you with a tolling agreement, you can assume future legal action is coming. When you sign the tolling agreement, you agree to give the victim time to collect necessary information. In some cases, this may act in your favor: you may, for example, discover that you are liable for fewer medical bills than originally anticipated. If you're sent a tolling agreement, make sure you:

Avoid admitting fault. Unless this is what was agreed to in a good-faith agreement prior to the tolling agreement, try to avoid admitting fault. Do not sign an agreement that locks in fault before it has been fully established. 

Make sure the tolling agreement does not resurrect claims already past the statute of limitations. You also do not want to sign an agreement with unlimited freedom to resurrect past claims. 

Contact your insurance company. If a homeowner's or vehicle insurance company will provide coverage for the accident, make sure you let them know that a claim is coming to help avoid voiding your coverage. 

Do you need to know more about tolling agreements? Contact us today to learn more about how we can help.

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