Larry has the largest pizza business in the city. He learns that Henry is thinking of opening a competing pizza and pasta delivery business. Larry gives Henry $25,000 to not open his proposed business in the same city. Which statement is correct? A) The contract is voidable at Larry's option.

B) The contract is void for lack of consideration.

C) The contract is illegal and void.

D) The contract is enforceable.

Question

Business

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4 September, 21:39

Larry has the largest pizza business in the city. He learns that Henry is thinking of opening a competing pizza and pasta delivery business. Larry gives Henry $25,000 to not open his proposed business in the same city. Which statement is correct? A) The contract is voidable at Larry's option.

B) The contract is void for lack of consideration.

C) The contract is illegal and void.

D) The contract is enforceable.

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Answers (2)

Know the Answer?

Maren Leblanc · Answer 1

C) The contract is illegal and void.

Explanation:

Larry giving Henry $25,000 to not open his proposed business in the same city without any contractual agreement, written and signed by both parties makes the contract illegal and void.

Shawn · Answer 2

C) The contract is illegal and void.

Explanation:

Non-competing contracts are only valid for employees or contractors, and they must last a reasonable amount of time. In this case, Henry apparently is not one of Larry's employees or former employee, so there is no legal way in which a non-competing contract could be enforced. Henry should take the $25,000 and use them in his new pizza business.

This is an attempt to monopolize the pizza restaurant industry in the city which is illegal specially considering that Larry has the largest pizza business in town.