Arbitration Tolling Agreement
Arbitration Tolling Agreement – What You Need to Know
When it comes to resolving disputes, arbitration is often the preferred method because it is quicker and less costly than going to court. In an arbitration proceeding, the parties to the dispute agree to submit their dispute to a neutral third party (an arbitrator) who will make a binding decision. However, there are times when one or both parties may want to delay the arbitration process. That`s where an arbitration tolling agreement comes in.
What is an Arbitration Tolling Agreement?
An arbitration tolling agreement is an agreement between the parties to an arbitration that extends the time for one or both parties to bring a claim. In other words, it „tolls“ the statute of limitations or deadline for filing a claim, giving parties more time to negotiate a settlement or prepare for the arbitration hearing.
Why Would Parties Enter into an Arbitration Tolling Agreement?
There are several reasons why parties may enter into an arbitration tolling agreement:
1. Negotiating a Settlement – By tolling the arbitration, parties have more time to negotiate a settlement and avoid the costs and risks associated with a full arbitration hearing.
2. Conducting Additional Investigations – Parties may need more time to conduct additional investigations to support their claims or defenses.
3. Obtaining Legal Counsel – One party may need more time to obtain legal counsel to represent them in the arbitration proceeding.
4. Unforeseen Circumstances – Parties may agree to toll the arbitration if unforeseen circumstances arise, such as the death or illness of a party or witness.
What Should be Included in an Arbitration Tolling Agreement?
An arbitration tolling agreement should include the following information:
1. The names of the parties to the agreement
2. The date the agreement is made
3. The effective date of the tolling period
4. The length of the tolling period
5. Any conditions or limitations on the tolling period
6. The consequences of violating the agreement
7. Signatures of all parties to the agreement
An arbitration tolling agreement can be a useful tool for parties to an arbitration who need more time to negotiate a settlement, conduct additional investigations, or obtain legal counsel. However, it is essential to ensure that the agreement is properly drafted and includes all necessary information. If you are considering entering into an arbitration tolling agreement, it is recommended that you consult with an experienced attorney who can assist you in drafting a valid agreement that protects your interests.