Robert agreed to buy Charlie\'s business for $500,000, including the building, f

Question

Robert agreed to buy Charlie's business for $500,000, including the building, fixtures, supplies and inventory. As part of the agreement, Charlie agreed not to compete with Robert in the local community for a period of three years. At the same time, Robert knew that a former manager at Charlie's place, Pat, had retired, but might want to re-enter the market as a competitor to Robert now that he's bought Charlie's place. To prevent that re-entry by Pat, Robert agreed to pay Pat $50,000 to not compete with him for a period of three years. Robert reasoned that three years would give him a chance to establish his own reputation in the community, and he could thereafter withstand any challenge by Charlie or Pat reentering the local market.

Are these actions taken by Robert enforceable contracts?

Answer        

The contracts with both Charlie and Pat are enforceable. The contract with Charlie is enforceable, but the contract with Pat is not. C. The contract with Charlie is unenforceable , but the contract with Pat is enforceable. D. The contracts with both Charlie and Pat are unenforceable.

Explanation / Answer

Because charlie sold his business and inreturn the law allows robert to enforce the above, but pat didnt have any stake in the business and hence he cant be enforced

The contract with Charlie is enforceable, but the contract with Pat is not.

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