## Facts

- Reynolds, a baker by trade, leased a bakery to Mitchel for a five-year term in the town/parish of St. Andrew’s Holborn.
- As part of the lease transaction, Reynolds executed a bond conditioned on his not exercising the baking trade during the five-year term within St. Andrew’s Holborn.
- The bond provided that if Reynolds baked within St. Andrew’s Holborn during the term, he would owe Mitchel £50.
- Mitchel alleged that during the lease term Reynolds carried on business as a baker within St. Andrew’s Holborn, contrary to the condition of the bond.
- Mitchel sued Reynolds in debt on the bond to recover the £50.
- Reynolds defended on the ground that the noncompetition condition was void as an unlawful restraint of trade, arguing that as a trained baker he could lawfully work in his trade.
- Mitchel demurred to Reynolds’s plea, placing before the court the legal sufficiency of the restraint-of-trade defense.

## Issues

1. Whether a bond condition restraining Reynolds from baking within St. Andrew’s Holborn for the five-year lease term is void as an unlawful restraint of trade.
2. Whether a restraint limited to a particular place and time, given in connection with a lawful transaction and supported by consideration, is enforceable.

## Decision

- The King’s Bench held the bond valid and enforceable and rejected Reynolds’s restraint-of-trade defense.
- The court treated the restraint as a limited, local restraint connected to a lawful bargain (the five-year lease) and supported by consideration.
- Judgment was for Mitchel on the demurrer.

## Legal Principles

- A general restraint on a person’s trade (for example, not to practice a trade anywhere) is ordinarily void as against public policy.
- A partial restraint limited by place and time may be valid when it is reasonable in relation to the transaction and not more restrictive than necessary for the promisee’s protection.
- The enforceability inquiry turns on the existence of a sufficient consideration and the reasonableness of the restraint, not on whether the restraint is contained in a bond or in a simple promise.
- A restraint ancillary to a lawful agreement—such as transferring or leasing a business—may be upheld where it helps secure the value of what the buyer/lessee paid for (including the benefit of the bakery business during the lease term) and does not impose an undue restriction on the promisor or the public.

## Conclusion

*Mitchel v. Reynolds* sustained a five-year, parish-limited noncompete given with a bakery lease and enforced through a £50 bond, drawing a line between generally void blanket restraints and enforceable limited restraints that rest on sufficient consideration and are reasonable in scope.


Mitchel v. Reynolds, 24 Eng. Rep. 347 (1711)