A toll agreement is a “pause” agreement in which the parties agree that the limitation period will last for an agreed period. This type of agreement is legal and enforceable in Maryland. Milton Co. v. Council of Unit Owners of Bentley Place Condo., 121 md App. 100, 117-18, 708 A.2d 1047 (1998). With a toll agreement, the parties to the dispute have room for manoeuvre to find a solution that avoids the costs and burdens of litigation. More than two decades ago, a deputy attorney general gave a speech saying that a similar practice, then common in the radio industry, could be contrary to the HSR Act if it were implemented as part of a merger contract.8 Indeed, the DOJ seemed to recognize the novelty of its position by accepting a sanction well below the ceiling available under the law. A lawyer can contribute to the conclusion of a toll agreement by making reasonable efforts to identify and preserve evidence. Such efforts can lay the foundation for good faith to refute an accusation of spoliation. In addition, if the other party has significant evidence, the toll agreement may contain a specific provision to identify and secure such evidence. Before COVID-19, many companies were not looking to be involved in legal action.
In addition to the cost of litigation, there is a misappropriation of the company`s human resources to meet with lawyers, participate in statements, find answers, and take on other tedious responsibilities. While COVID-19 some businesses are closed by executive order, while others have switched to remote work. Efforts to stop operations have been the elimination of non-essential expenses, staff layoffs and the closure of underperforming initiatives. Time and money resources are limited and these resources can be better used to keep the business running. This article is the first in a series on the issues affecting businesses during the economic uncertainty of COVID-19. In this article, I will discuss how toll agreements in Maryland can be used as an instrument to preserve commercial resources and protect their interests through the dispute resolution process. Whether your company is suing a dispute or defending against you, if the statute of limitations expires quickly, a toll agreement is probably the right tool to allow your business to settle deadlines that are effective and set by the courts. This presupposes that the parties to the dispute work in good faith to find a solution. If this is not the case, the dispute may require the urgency of legal action. While a toll agreement does not have to be a complex document, there are significant repercussions if it is not properly formulated.
Therefore, toll contracts should not be concluded without the assistance of a lawyer. In addition to many questions, the lawyer who established the toll agreement can review important aspects of the dispute in order to preserve claims, defenses, physical evidence, and testimony. Since this is a private agreement between the parties, unless the agreement is ambiguous, a court will not look beyond the agreement document to determine which claims the parties intend to preserve. Broad language in the toll agreement could preserve unrelated or even unknown rights. Too narrow a language may limit the remedies available for litigation. Consultation with a lawyer is necessary to correctly define the scope of the dispute to be settled. Toll agreements are a common feature of the energy sector. . . .