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Ash
Ash, Solicitor
Category: Law
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Experience:  Solicitor with 5+ years experience
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I joined an art franchise, Parsley Pie Art Club 3 years ago

Resolved Question:

I joined an art franchise, Parsley Pie Art Club 3 years ago but have been paying out more than half I earn each month as a license fee to the owner. Having come to the end of the minimum term, I would like to go it alone with a new name and focus. The owner was initially supportive but has since come back at me with clause 19 of the license agreement (below) -
19. RESTRICTIONS
19.1 In order to protect the Confidential Information, trade secrets and business connections of the Licensor, the Licensee covenants with the Licensor that they shall not:
(a) during the Term, or for 18 months after termination or expiry of this agreement, be involved as agent, consultant, director, owner, partner or shareholder with any business concern which is (or intends to be) in competition with any Restricted Business in the Territory; or (b) at any time after termination of this agreement, represent himself as connected, in any way, with the Licensor.
19.2 The restrictions imposed on the Licensee by this clause 19 apply to them acting:
(a) directly or indirectly; and (b) on their own behalf or on behalf of, or in conjunction with, any firm, company or person.
19.3 Each of the restrictions in this clause 19 is intended to be separate and severable. If any of the restrictions are held to be void, but would be valid if part of their wording were deleted, such restriction shall apply with such deletion as may be necessary to make it valid or effective.
I don't know whether she can stop me from continuing to teach. I'm not in her territory and can't see myself as much of a threat as I operate on a very small scale. My current students are keen to stay with me. I would be grateful of any advice you can give.
Submitted: 12 months ago.
Category: Law
Expert:  Ash replied 12 months ago.
Hello my name is ***** ***** I will help you with this.Have they just said you cant do anything whatsoever?Alex
Customer: replied 12 months ago.
She has given me these options -
~ carry on with Parsley Pie, at a slightly lower monthly license fee~ start a completely different type of business from scratch that is totally unlike Parsley Pie~ open my own business that is similar in nature to Parsley Pie/“go it alone” after the end of July 2016, BUT outside your allotted/defined territory~ open your own business that is similar in nature to Parsley Pie/“go it alone” inside my allotted territory, but I would be restricted to do so for 18 months after the termination of the agreement (so 18 months after the end of July 2016)
Expert:  Ash replied 12 months ago.
Well they cant stop you teaching, that would be unreasonable and unfair. As such if they wanted to stop you teaching they would need to seek an injunction.The Court would then be able to assess the terms and whether or not they are fair and in breach of the Unfair Contract Terms Act 1977.The Court is likely to conclude that these are too restrictive. They can't stop you teaching all together, otherwise if anyone left a school they wouldnt be able to work anywhere else!So the terms are unfair, you wont be able to contact the existing customers etc, but you will be able to teach elsewhere.Can I clarify anything for you about this today please?Alex
Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience: Solicitor with 5+ years experience
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Customer: replied 12 months ago.
No, that is very helpful and all for now. Many thanks.
Expert:  Ash replied 12 months ago.
Good luck. Alex

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