Gott v Toogood

In *Gott v Toogood*, heard before Judge Jarrett, the dispute concerned the interpretation of a clause within a contract for the sale of a business. The vendor, Mr. Toogood, sought to enforce a restraint of trade clause against the purchaser, Mr. Gott, who had subsequently commenced a competing business. Mr. Gott argued that the restraint was unreasonable and therefore void.

The central legal issue before the court was whether the restraint of trade clause, as drafted, was reasonably necessary to protect the legitimate interests of the vendor and whether its scope, in terms of geographical area and duration, was proportionate to that objective. The court was required to consider the principles of contract law relating to restraints of trade and the public interest in freedom of commerce.

Judge Jarrett reasoned that for a restraint of trade clause to be enforceable, it must go no further than is reasonably necessary to protect the vendor's proprietary interests, such as goodwill. The court found that the clause in question was overly broad in its geographical reach and duration, extending beyond what was required to safeguard the goodwill of the business sold. Consequently, the restraint was deemed unreasonable and void as against public policy.