Question

Assume that Jack, Hal, and Sophia enter into a valid contract for the sale of the restaurant and for the covenant not to compete for five years. After three years, Jack starts selling frozen foods in violation of the covenant not to compete. Hal and Sophia sue, and the judge feels that the time restraint in the covenant not to compete was unreasonably long. Which of the following would likely be an appropriate remedy?
A. Quasi contract.
B. Rescission and restitution.
C. Reformation.
D. Specific performance.

Answer 1

Answer: C. Reformation

Explanation: A non-compete agreement or clause is a legal binding entered into by two or more parties which restricts the parties from being in competition with the other usually through the sale of similar product. However, in the context above, since the non-compete clause has been breached by Jack, and the judge feels the time constraint in the clause was unreasonably long, The reformation process will be best to remediate the situation, which refers to the change or alteration of the terms of an existing document using the judicial process and requires the conformation of the parties involved.