Public Policy

Question 1

is that principle of the law which holds that no subject can lawfully do that which has a tendency to be injurious to the public or against the public good.

Answer 1

Public Policy

Question 2

presents the principles under which the freedom of contract or private dealings are restricted by law for the good of the community.

Answer 2

Public Policy

Question 3

“An agreement that has a tendency ‘to be against the public good, or to be injurious to the public’ violates

Answer 3

Public Policy

Question 4

A covenant not to compete is invalid unless it protects some legitimate interest beyond the employer’s desire to protect itself from competition

Answer 4

Restrictive Covenant

Question 5

To prevent competitive use, for a time, of information or relationships which pertain peculiarly to the employer and which the employee acquired in the course of the employment.

Answer 5

Restrictive Covenant

Question 6

The restraint is greater than necessary to protect the employer’s legitimate interest or
That interest is outweighed by the hardship to the employee and the likely injury to the public.

Answer 6

Restriction Unreasonable

Question 7

A __________ cannot be greater (have a greater scope) than necessary to protect the employer’s legitimate interests.

Answer 7

restriction

Question 8

activity,
duration,
geographical area

Answer 8

Scope of Restrictive Covenant

Question 9

A promise is unenforceable on grounds of _______ _______ if it is unreasonably in restraint of trade.

Answer 9

public policy

Question 10

A promise is in _________ __ ______ if its performance would limit competition in any business or restrict the promisor in the exercise of a gainful occupation.

Answer 10

restraint of trade

Question 11

A promise to refrain from competition that imposes a restraint that is _____________ to an otherwise valid transaction or relationship is unreasonably in restraint of trade.

Answer 11

not ancillary

Question 12

Agreements not to compete in general

Courts tend not to enforce unless:

Answer 12

The seller has unique talents, knowledge, or abilities
The area the limitation will cover is reasonable (geographic limitation)
The time period of restraint is reasonable (temporal limitation).

Question 13

A promise to refrain from competition that imposes a restraint that is ancillary to an otherwise valid transaction or relationship is unreasonably in restraint of trade if

Answer 13

the restraint is greater than is needed to protect the promisee’s legitimate interest, or
the promisee’s need is outweighed by the hardship to the promisor and the likely injury to the public.

Question 14

Promises imposing restraints that are ancillary to a valid transaction or relationship include the following:

Answer 14

a promise by the seller of a business not to compete with the buyer in such a way as to injure the value of the business sold;
a promise by an employee or other agent not to compete with his employer or other principal;
a promise by a partner not to compete with the partnership.