Legal Question in Business Law in New Jersey
We are a NJ based Pilates studio.
We had an independent contractor who performed a service for a period of time. She had signed a contract in the beginnign of her relationship with us which included a non-compete clause for 10 miles and 12 months following the termination. Contract was terminated 5 months ago and she opened a Pilates studio 3.3 miles from us.
Can we sue her in Small Claims Court for breach of contract asking for $3000 (max in NJ), and then obtain an injunction against her for the remaining 7 months?
Specific language of the contract:
a. �I will not take up a new position teaching Yoga or Pilates within a 10 mile radius of the primary location of Premier Pilates and Yoga during the course of the contract and for at least 12 months after my contract with Premier Pilates & Yoga ends. Breaking this particular clause of the contract will incur a penalty of $3000, collection of which will absolutely be sought through the legal system.�
2 Answers from Attorneys
Hi there,
You can obtain injunctions in small claims court, but that phrasing might be interpreted as a "liquidated damages clause". In that case your sole remedy would be limited to the damages stated in the contract, and injunctive relief would be out of the question. It also doesn't state she can't own a studio, only teaching (seems like a non-issue, but actually harder to prove in court). I could point out a number of other issues with that clause that might affect enforcement. It's just poorly worded, I'm afraid. You really should have an attorney review your contracts prior to relying upon them.
If you would like to discuss your matter further over a free and confidential phone consult, please contact me at your convenience.
Regards,
Michael J. Duffy
Duffy Law, LLC
1-888-414-5773
www.mduffylaw.com
Please note: The information provided here is for general informational purposes only and should not be construed as legal advice or legal opinion on specific facts or circumstances.
It would have been preferrable if you had a lawyer review the contract before making the arrangement. The term that is in the contract should never have used the word "penalty" and should have included injunctive relief as being available. As is, you have probably limited yourself to the $3000 and will not be able to get injunctive relief.
To answer your original question, the Small Claims court cannot award injunctive relief except that which is incidental to the money relief that is within its scope. If your primary goal is an injunction, as it should be for a case like this, you need to sue in Superior Court proper.
See also: http://info.corbettlaw.net/lawguru.htm
Related Questions & Answers
-
If a Business name is available with the State, and someone is using this name for... Asked 2/15/12, 12:32 pm in United States New Jersey Business Law
Looking for something else?
10,200 active attorneys ready to answer your legal questions today.
Featured Attorneys
Earn additional revenue and grow your business.
