Question 1

Why were the contracts enforced by the court in the case of: Yango Pastoral Company Pty Ltd v First Chicago Australia Ltd [1978] HCA 42?

Accepted Answer

A) The prohibition was in the public interest. 
B) The prohibition related to the operation of the business rather than formation of the contract. 
C) The plaintiffs were responsible for the breach. 
D) The illegal behaviour was only incidental to performance of the contract. 
A) The prohibition was in the public interest. 
B) The prohibition related to the operation of the business rather than formation of the contract. 
C) The plaintiffs were responsible for the breach. 
D) The illegal behaviour was only incidental to performance of the contract.

Question 2

The decision in Attwood v Lamont [1920] 3 KB 571 was based on the fact that:

Accepted Answer

A) the restraint of trade clause was an unreasonable exercise of the employer's superior bargaining power. 
B) the restraint of trade clause was a reasonable protection of the employer's proprietary interest. 
C) the restraint of trade clause was imposed merely to restrict competition. 
D) arms length bargaining with legal advice on both sides meant there was no inequality of bargaining power. 
A) the restraint of trade clause was an unreasonable exercise of the employer's superior bargaining power. 
B) the restraint of trade clause was a reasonable protection of the employer's proprietary interest. 
C) the restraint of trade clause was imposed merely to restrict competition. 
D) arms length bargaining with legal advice on both sides meant there was no inequality of bargaining power.

Question 3

An employer can enforce a restraint of trade clause in a contract of employment with an employee,provided it is not an attempt to limit competition.

Accepted Answer

A) True 
 B)False

Question 4

Explain why the courts are generally reluctant to enforce restraint clauses in contracts of employment.

Accepted Answer

A restraint clause in a contract of empl

Question 5

In St John Shipping Corporation v Joseph Rank Ltd [1957] 1 QB 267,the court deemed the contract enforceable because:

Accepted Answer

A) the prohibition was in the public interest. 
B) the plaintiffs were responsible for the breach. 
C) the prohibition related to the operation of the business rather than formation of the contract. 
D) the illegal behaviour was only incidental to performance of the contract. 
A) the prohibition was in the public interest. 
B) the plaintiffs were responsible for the breach. 
C) the prohibition related to the operation of the business rather than formation of the contract. 
D) the illegal behaviour was only incidental to performance of the contract.

Question 6

A lawful contract may be rendered illegal if it is performed in a prescribed manner.

Accepted Answer

A) True 
 B)False

Question 7

The courts adopt a different approach depending upon the circumstances in which a restraint may be imposed.Discuss.

Accepted Answer

The courts do indeed adopt a different a

Question 8

A restraint of trade contract will be void if:

Accepted Answer

A) the time for which the restraint is to apply is too long. 
B) the geographical extent of the restraint is too wide. 
C) the restraint does not apply to a proprietary interest of the person applying the restraint. 
D) any of the above. 
A) the time for which the restraint is to apply is too long. 
B) the geographical extent of the restraint is too wide. 
C) the restraint does not apply to a proprietary interest of the person applying the restraint. 
D) any of the above.

Question 9

The intention of a statute will determine whether a contract is illegal and unenforceable.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following is NOT a factor to consider in determining the validity of a restraint of trade clause?

Accepted Answer

A) The type of business involved. 
B) The geographic extent of the restraint. 
C) The relative bargaining powers of the parties. 
D) The amount of consideration paid. 
A) The type of business involved. 
B) The geographic extent of the restraint. 
C) The relative bargaining powers of the parties. 
D) The amount of consideration paid.

Question 11

At common law,a restraint of trade clause will be enforced if it is reasonable in the circumstances.If you were drafting legislation intended to enact this common law principle,how would you define the term 'reasonable'?

Accepted Answer

In drafting legislation to enact the com

Question 12

Which of the following cases is authority for the principle that a restraint of trade clause will be valid if it is reasonable?

Accepted Answer

A) Anderson Ltd v Daniel [1924] 1 KB 138. 
B) Nordenfelt v Maxim Nordenfelt Guns and Ammunition Company Ltd [1894] AC 535. 
C) Forster & Sons Ltd v Suggett (1918)35 TLR 87. 
D) Public Service Employees Credit Union Cooperative Ltd v Campion (1984)56 ACTR 39. 
A) Anderson Ltd v Daniel [1924] 1 KB 138. 
B) Nordenfelt v Maxim Nordenfelt Guns and Ammunition Company Ltd [1894] AC 535. 
C) Forster & Sons Ltd v Suggett (1918)35 TLR 87. 
D) Public Service Employees Credit Union Cooperative Ltd v Campion (1984)56 ACTR 39.

Exam 12: Is the Contract Legal

Why were the contracts enforced by the court in the case of: Yango Pastoral Company Pty Ltd v First Chicago Australia Ltd [1978] HCA 42?

The decision in Attwood v Lamont [1920] 3 KB 571 was based on the fact that:

An employer can enforce a restraint of trade clause in a contract of employment with an employee,provided it is not an attempt to limit competition.

Explain why the courts are generally reluctant to enforce restraint clauses in contracts of employment.

In St John Shipping Corporation v Joseph Rank Ltd [1957] 1 QB 267,the court deemed the contract enforceable because:

A lawful contract may be rendered illegal if it is performed in a prescribed manner.

The courts adopt a different approach depending upon the circumstances in which a restraint may be imposed.Discuss.

A restraint of trade contract will be void if:

The intention of a statute will determine whether a contract is illegal and unenforceable.

Which of the following is NOT a factor to consider in determining the validity of a restraint of trade clause?

At common law,a restraint of trade clause will be enforced if it is reasonable in the circumstances.If you were drafting legislation intended to enact this common law principle,how would you define the term 'reasonable'?

Which of the following cases is authority for the principle that a restraint of trade clause will be valid if it is reasonable?

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