B Com Exam  >  B Com Questions  >  Mr. Arhan, a businessman sold the goodwill of... Start Learning for Free
Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain.
?
Most Upvoted Answer
Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan....
**Enforceability of the Agreement**

The enforceability of the agreement between Mr. Arhan and Mr. Farhan depends on whether it is legally valid and enforceable under the principles of contract law. To determine this, we need to consider the following elements:

**1. Agreement between the Parties**
There must be a valid agreement between the parties involved. In this case, Mr. Arhan and Mr. Farhan have agreed that Mr. Arhan will not practice the same trade for 3 years and will not carry on any business competing with Mr. Farhan's business. This agreement is likely to be in the form of a written contract, which is a legally recognized form of agreement.

**2. Consideration**
For a contract to be valid, there must be consideration exchanged between the parties. Consideration refers to something of value that is exchanged between the parties to make the agreement legally binding. In this case, the consideration is the sale of goodwill from Mr. Arhan to Mr. Farhan. As long as there is valid consideration, this element is satisfied.

**3. Legality of Object**
The object or purpose of the agreement must be legal. In this case, the agreement restricts Mr. Arhan from practicing the same trade and competing with Mr. Farhan's business for a certain period of time. Such non-compete clauses are generally considered legal and enforceable, provided they are reasonable in terms of duration, geographic scope, and industry.

**4. Capacity of the Parties**
To enter into a legally binding agreement, the parties must have the legal capacity to do so. This means they must be of sound mind and of legal age. Assuming that Mr. Arhan and Mr. Farhan meet these requirements, this element is satisfied.

**Enforceability**
Based on the above analysis, it can be concluded that the agreement between Mr. Arhan and Mr. Farhan is likely to be enforceable. The agreement meets the essential elements of a valid contract, including agreement, consideration, legality of object, and capacity of the parties. However, it is important to note that the enforceability of non-compete clauses may vary depending on the jurisdiction and specific circumstances of the case. Therefore, it is advisable to seek legal advice to determine the enforceability of such clauses in a particular jurisdiction.
Explore Courses for B Com exam
Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law?
Question Description
Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law?.
Solutions for Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law? in English & in Hindi are available as part of our courses for B Com. Download more important topics, notes, lectures and mock test series for B Com Exam by signing up for free.
Here you can find the meaning of Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law? defined & explained in the simplest way possible. Besides giving the explanation of Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law?, a detailed solution for Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law? has been provided alongside types of Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law? theory, EduRev gives you an ample number of questions to practice Mr. Arhan, a businessman sold the goodwill of his trade to Mr. Farhan. Both of them agreed that Mr. Arhan will not practice the same trade for 3 years and also that Mr. Arhan will not carry on any business competing in any way with the business of Mr. Farhan. Is the agreement enforceable? Explain. Related: Agreement declared void - Agreement, Business Law? tests, examples and also practice B Com tests.
Explore Courses for B Com exam
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev