Legal Question in Business Law in United Kingdom

restraint of trade

Hi, i was wondering if anyone could tell me to what extent can a buyer of a italian restaurant go to restrain the freedom of trade of the seller, if nothing was included on this issue in the contract?

There are no other italian restaurants in the suburb and the buyer only wishes can not set up a business in competition within 5km for the next 12 months.


Asked on 5/10/02, 10:22 am

1 Answer from Attorneys
Jim Dodge The Dodge Law Firm

Re: restraint of trade

Generally, restraints on trade are unenforceable. One of the major exceptions deals with contracts to sell existing businesses. You can create an enforceable covenant not to compete in a contract to sell a going business that specifies a particular area and duration within which the seller will not compete. However, you cannot add it on to a contract that has already been executed, unless the other party agrees to it (and it will most likely require the payment of additional consideration to be enforceable).

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Answered on 5/10/02, 10:48 pm


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