Legal Question in Real Estate Law in Massachusetts
I am looking to start my own brokerage in the Allston area of Boston, but I signed this form below. Before I entered the firm, my brokerage did not compete in the Allston area. Do I have any ground to challenge the non-compete, arguing that the work that I put in resulted in the firm's growth in the area I want to open my firm in and I should have the right to conduct business?
1.
Noncompetition.
1 . 1 Contractor represents and warrants that, as of the date hereof he is not a
party to any agreement or arrangement that would require him to conduct activities in the Field
for another party that would prevent him from carrying out his obligations to the Company under
this Agreement. During the Consultation Period, Contractor shall immediately disclose to the
Company the occurrence of either of the activities described in the preceding sentence. If
Contractor fails to notify the Company of such activities within thirty (30) days of the occurrence
thereof, the Company shall have the right to terminate this Agreement.
1 . 1 Contractor understands the confidential nature of the information and
materials he will acquire or develop in performing his services under this Agreement. Contractor
acknowledges that if such information or materials were revealed to competitors of the Company,
then such disclosure could cause damage to the Company and agrees that Contractor shall not
disclose, during the Consultation Period and thereafter, any Proprietary Information to
competitors of the Company.
1 . 1 Contractor agrees that during the term of this Agreement and thereafter for
a period of two (2) years, Contractor shall not, directly or indirectly, (i) solicit, divert, or take
away, or attempt to divert or take away, the business or patronage of any actual or prospective
clients, customers, or accounts of the Company, or (ii) recruit, solicit, or hire any employee or
Contractor of the Company, or induce or attempt to induce any employee or Contractor of the
Company, to discontinue his or her relationship with the Company.
1.2
Contractor agrees that during the Consultation Period and for a period
of two (2) years after termination of this Agreement for any reason, I shall not, without the
Company�s prior written consent, which shall not be unreasonably withheld, become involved,
as a principal, director, agent, officer, employee, consultant, partner, or holder of more than 5%
of the outstanding capital stock of any business enterprise that conducts in Allston or Brighton,
Massachusetts activities in the area of real estate rentals or sales or activities that are competitive
with the Company.
1.
Notices. All notices required or permitted under this Agreement shall be in
writing delivered by a recognized national overnight courier, personal delivery, or facsimile
transmission and shall be deemed effective upon receipt. The parties shall designate their
addresses and facsimile numbers.
1.
Entire Agreement. This Agreement, including all schedules and exhibits attached
hereto, constitutes the entire agreement between the parties and supersedes all prior agreements
and understandings, whether written or oral, relating to the subject matter of this Agreement.
1.
Amendment. This Agreement may be amended or modified only by a written
instrument executed by both the Company and Contractor.
1.
Governing Law. This Agreement shall be construed, interpreted and enforced in
accordance with the laws of the Commonwealth of Massachusetts.
Successors and Assigns. This Agreement shall be binding upon, and inure to the
1.
benefit of, both parties and their respective successors and assigns, including any corporation
with which, or into which, the Company may be merged or which may succeed to its assets or
business, provided, however, that the obligations of Contractor are personal and shall not be
assigned by him.
2 Answers from Attorneys
You should probably take your contract to an attorney for advice. The agreement largely speaks for itself. For strategies about how to handle, i.e. comply with or breach the non-compete clauses in your contract, you need advice concerning your specific situation. On its face, your plan would seem to violate your contract. The non-compete clause itself seems entirely reasonable in scope. Whatever you do, be careful not to solicit your current employer's client base, and do not take away with you any customer lists, etc., as this could give rise to further civil liability.
While I agree with Mr. Vauhn-Martel that you should consult with an attorney - indeed, I would consider that basically mandatory in your situation - I am not sure your plan violates the contract. Though I do believe that you will need to discuss your plan with your company to obtain permission to start the business.
No one likes unpleasant surprises. Consult with an attorney who can help you craft a strategy for dealing with your company. [email protected]