OCR A2 Contract Law Special Studies Paper - Restraint of Trade - 34 Marker (4)

This is for the 2013 paper only

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  • Created by: Majid
  • Created on: 02-01-13 17:48

Restraint of Trade - 34 Marker (4)

Vendors of a business:

As source 1, lines 21-23 states, the courts have recognised the doctrine of ROT fall in the area of vendors of a business. Here a seller promises not to carry out any business which will compete with the buyer.

The leading case in this area is "Goldsoll v Goldman". In this case a vendor of imitation jewellery was told he couldn't for 2 years deal with real or imatation jewellery in the UK or abroad. It was held to be unreasonable in parts, however as precise language was used the courts were able to sever "deal with real jewellery and abroad", making the clause reasonable. A further case in this area is "British Reinforced Concrete v Schelff". In this case Schelff only sold 1 type of road reinforcement but was told not to work in any type of road reinforcement business. It was held to be unreasonable as the clause was too wide and schelff only dealt with 1 type of road reinforcement. In the later case of "Allied Dunbar v Frank Weisinger", a business was sold for a sum, which included £386,000 consideration. This was held to be reasonable as the sum of consideration could have covered his salary for 2 years.

AO2: "G v G" represents the judges being prepared to sever and interpret the clauses as it "should" be read, as the barganing strengths are somewhat equal.

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