The statute of frauds is a legal principal that requires certain contracts to be in writing in order to enforce them. It is traditionally reserved for contracts involving important or expensive subject matter, such as the sale of land, contracts for marriage, or the sale of goods totaling more than $500. In these instances, the contract is only enforceable if the terms of the agreement are in writing and it is signed by the party against whom the agreement is being enforced. It is used as a defense in cases where one party is suing another for breach of contract regarding one of the situations the statute covers. For…
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North Carolina Business Court Weighs in on Enforceability of Non-Compete and Confidentiality Agreements Post-Merger
It is well-settled law that adequate consideration is required to create binding restrictive covenants such as non-compete agreements. Generally, such agreements are entered at the start of an employment relationship, and the new employment itself constitutes consideration. In North Carolina, continued employment following a merger of two companies does not satisfy the consideration requirement. In a recent decision, the North Carolina Business Court (“NCBC”) confronted the very issue.[1] In January 2012, AmeriGas Propane, Inc., a propane company that services over two million residential and commercial customers nationwide, merged with Shaw L.P. Gas. Ermon Coffey, an employee of Shaw, and…
