A Provision That Restricts the Seller from Competing with the Buyer

question 149

Multiple Choice

A provision that restricts the seller from competing with the buyer in a contract for the sale of a business is

• A) always enforceable because the parties to a contract have the freedom to contract as they see fit.
• B) always unenforceable because any attempt to restrict competition is an illegal restraint of trade.
• C) fatal to the whole contract (i.e., it causes the whole contract to fail).
• D) enforceable if it is reasonable between the parties, which means that it must be limited in time (e.g., one year) but need not be limited in area.
• E) enforceable if it is reasonable between the parties and not contrary to public policy.

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Definitions:

Sexual Partners

Individuals with whom one engages in sexual activity within a consensual agreement or relationship.

Fixation

A persistent focus on an earlier psychosexual stage due to unresolved conflicts; in psychoanalysis, this can lead to personality traits and behaviors associated with that stage.

Genital Stage

The final stage in Freud's psychosexual development, starting in puberty, where sexual maturation is complete and sexual interests become concentrated on the genitals.

Fixation

In psychoanalytic theory, an obsessive focus or attachment to a developmental stage, idea, or aspect of life that may hinder psychological development.