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Free Books / Society / Law / Contracts and Agency | Popular Law / | ![]() |
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Section 45. Agreements In Restraint Of Trade. Part 3 |
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This section is from the book "Popular Law Library Vol3 Contracts Agency", by Albert H. Putney. Also see: Popular Law-Dictionary.
22 17 R. I., 3.
"Is the contract unreasonable? Courts should be slow to set aside as unreasonable a restriction which has formed a part of the consideration of a contract. Yet when it is a restriction upon individual and common rights, which only oppresses one party without benefiting the other, all courts agree that it should not be enforced. In determining the reasonableness of a contract, regard must be had to the nature and circumstances of the transaction. For example, if one has sold the good-will of a mercantile enterprise, receiving pay for it upon an agreement not to engage in the same business in the same State for a certain time, such a stipulation would stand upon quite a different footing from the similar stipulation of a mere servant in an ordinary local business. In many undertakings, with modern methods of advertising and facilities for ordering by telegraph or mail, and sending goods by railroad or express, it matters little whether one was located at Providence or Boston, or some other place. In such cases a restriction embracing the State, or even a larger territory, could not be said on that account to be unreasonable, for without it the seller might immediately destroy the value of what he sold and was paid for. But it is unreasonable to ask courts to enforce a greater restriction than is needed. So it has been uniformly held that restrictions which go too far are void. As was said in the note of the Law Quarterly Review, above cited: 'Covenantees desiring the maximum of protection have no doubt a difficult task. When they fail, it is commonly because, like the dog in the fable, they grasp at too much and so lose all.' Beside the matter of protection, the hardship of the restriction upon the party and the public should also be considered."
 
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