# non compete contract



## ERICS LAWN CARE (Oct 19, 2009)

does anyone have an example of a non-compete contract for a potential sub contractor for plowing?


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## Matson Snow (Oct 3, 2009)

SIMA.....Has some sub-contractor agreements..Might want to look into joining SIMA..They have alot to offer


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## grandview (Oct 9, 2005)

Of course you need to join SIMA, I'll even let you use me as a referral and you can get a discount to for joining.(Grandview)


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## Matson Snow (Oct 3, 2009)

LOL.....I have not been on plowsite that long..BUT i know if you talk about SIMA...Grandview is right around the corner...


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## grandview (Oct 9, 2005)

Matson Snow;847618 said:


> LOL.....I have not been on plowsite that long..BUT i know if you talk about SIMA...Grandview is right around the corner...


I have not seen you signing up yet!:waving:


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## Matson Snow (Oct 3, 2009)

Already a member..


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## Luther (Oct 31, 2007)

_::::mmnmmmnmm.......beer!.......::::::_


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## ERICS LAWN CARE (Oct 19, 2009)

she or he might have a search engine looking for the key word??


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## bsuds (Sep 11, 2008)

Non compete contracts seldom work and rarely hold up in court. They are very easy to wiggle around. All they will do is make someone think twice about taking your business. In a capitalistic society everybody has the right to build their own business. Non competes try to take that away from people, but usually fail. The best solution would be to get another truck and driver and don't sub your work out anymore.


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## Bajak (Nov 12, 2008)

bsuds;853537 said:


> Non compete contracts seldom work and rarely hold up in court.


Not so sure about that. Maybe true in this industry but I do know of a machine shop that sold to another and had a non compete for 5 years. The seller started up a year later under a new name, the buyer knew about it and let him away with it for a couple of years. With one year left to go the seller was served, went to court and the buyer was awarded 3.5 mill.


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## bsuds (Sep 11, 2008)

I said rarely hold up in court. Which implies that sometimes they do, which is where your example comes in to play. Like I said, they are most often used to prevent you from starting your business. But no one has the right to tell you you can't go into business. Either way if it makes you sleep better at night. Have him sign it, but don't think it is the end all and be all of noncompetitive enforcement documents.


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## grandview (Oct 9, 2005)

Most non compete contracts are for professionals who develop intellectual things . Mostly like scientist who may work on a project for years at the company expense then jump ship after it was developed and try and sell it on their own. As for plowing I would never sign it.


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## Grampa Plow (Sep 1, 2008)

I bought a tanning salon/beauty salon and had the previous owner (seller) sign a non-compete clause. It was limited to 4 years and 25 miles. It was enforceable and we collected without any problem. HOWEVER, if you try to prevent someone from performing their livelyhood unresonably, you will loose. Talk to a lawyer abou how the judges have ruled in your area and be prepared to spend some $$ (a couple of hundred $$). Remember, a judge will not take a persons means of support away from them if they have only worked for you for a short period of time and used their equipment to do it.

Hope that helps!


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## show-n-go (Feb 5, 2009)

As a sub i wouldn't sign that. I work for a few company's every year. Of course i don't run around trying to steal there accounts either. If that what your worried about find a different sub.


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## BigLou80 (Feb 25, 2008)

Bajak;853615 said:


> Not so sure about that. Maybe true in this industry but I do know of a machine shop that sold to another and had a non compete for 5 years. The seller started up a year later under a new name, the buyer knew about it and let him away with it for a couple of years. With one year left to go the seller was served, went to court and the buyer was awarded 3.5 mill.
> 
> View attachment 61560


I was going to ask how they got around mitigation of damages, but I see your in canada so maybe its different there


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## Silentroo (Jun 19, 2006)

BSDUS

You are giving wrong advise. 

Any contract you sign is enforceable. May or may not be legal, however the courts can decied how to view the agreement. 

Second point, It can cost you 10's of thousands of dollars to prove your point. 

A non compete that is well written by a good attorney is great protections and should be a yearly agreement. As long as the employer is reasonable in their expectations it is great protections. 

I as a business also have rights, I should have the right to expect that an employee or sub is not bidding on my current work. or working for a competitor at the same time, and dose not take current customers with them when they leave.


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## Grampa Plow (Sep 1, 2008)

Do I hear an echo??


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## QuadPlower (Jan 4, 2007)

As a sub, I would never sign one.

As an employer I have my workers sign one. I share information with them that has won me bids. Price is one item. If they leave on poor terms, I don't want them going to the next company and telling them my price for a job. That makes it too easy to take bids away from me.

The non-compete is for one year in my county. After that, the prices change anyway.


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## Mackman (Nov 3, 2009)

QuadPlower;863925 said:


> As a sub, I would never sign one.
> 
> As an employer I have my workers sign one. * I share information with them that has won me bids.* Price is one item. If they leave on poor terms, I don't want them going to the next company and telling them my price for a job. That makes it too easy to take bids away from me.
> 
> The non-compete is for one year in my county. After that, the prices change anyway.


That is your fault right there. I work for an excavating business and they will never tell anyone how much they get paid or what the bid to get a job. Or what they pay for anything. It is none of your workers business. So if you tell them and they run their mouths you did it to your self.


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## Grampa Plow (Sep 1, 2008)

Correct...why tell anyone? Makes no sense!!


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## ERICS LAWN CARE (Oct 19, 2009)

right--there is a guy that worked for one of our competitors that told us how long it took to do the job or maybe how much he got for it. So we know that he knew too much and now he has his own plowing business (out of his home) and lawn care too; but one of the first jobs he picked up for plowing was that apt complex we'll see if he can handle it.


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## ERICS LAWN CARE (Oct 19, 2009)

loose lips sink ships


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## Bajak (Nov 12, 2008)

Mackman;863950 said:


> That is your fault right there. I work for an excavating business and they will never tell anyone how much they get paid or what the bid to get a job. Or what they pay for anything. It is none of your workers business. So if you tell them and they run their mouths you did it to your self.


That is very true. The whole time I worked for other companies the guys on site never new how much the company was billing out, not even the supervisors. Supers only knew the hourly cost for labor and machines. Other than that, the quote process was and is a closely guarded secret that only the higher ups in the office knew. Estimators get paid quite well to keep their mouth shut.


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## bsuds (Sep 11, 2008)

Silentroo

No, I am not giving bad advise. All I am saying is a non compete in not the end all be all as far as contracts go. An agreement is only as good as the person writing it. Look at our constitution for example and how lawyers have eroded our rights away. If they can do that to the most supreme contract. Than a non compete will be no problem..


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## Silentroo (Jun 19, 2006)

Bsuds, 

Your advices is wrong. If an agreement is reasonable and well written it will hold up 100% of the time. If it is over reaching certain provisions can be blue penciled down. However it will not end the whole agreement. I have a non compete that has been challenged 5 time over 10 years. All 5 times the lawyer for the other side had your attitude as did the contractor. In each cases they lost paying the fine and my attorneys costs. It is bad legal advice to tell anyone that a non compete will be "no problem. "

Look at it this way If my non compete covers the following 

Lots you personally plow for me. (you know what I am paying you so you have privileged info) You will lose 100% of the time. 
Lets say I say current customers. You will lose 100% of the time
Lets say I say current employees. You will lose 100% of the time. 
Lets say I say 1 season. You will lose 100% of the time.

Lets say I say work in the snow industry I will lose.
Lets say I say potential customers I will lose 
Lets say I say 4 years I might win you might win. 

Funny thing about your advice as well. It will cost you 30-100k to fight it. Ready for that. Of course your lawyer will tell you he can make it go away. He is rubbing his hands together. 

A non compete is a contract that should ALWAYS be reviewed by an Attorney, as all contracts should be . 

We took ours to 4 lawyers asked two to review for us, and asked two to review stating we wanted to hire a guy with this agreement. 

All 4 lawyers agreed it was air tight. One wanted it to give to a client. 


Yes, I can not stop you from earning a living. However I can stop you from taking my customers. 

By the way the constitution is not a contract.


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## bsuds (Sep 11, 2008)

Like the old saying says, the only sure thing is death and taxes. There is nothing that holds up 100% of the time. and for you to give that advice is irresponsible. A simple agreement "reasonable and well written" holding up 100% of the time, talk about bad advise and a bold assumption. And to my original point, your contract can not keep someone from earning a living, all customers have a choice. If someone can provide higher quality service at a competitive price then a customer should be able to do business with them. What if your service is inferior compared to the person who is servicing them? 

Your arguments
"Lots you personally plow for me.(you know what I am paying you so you have privileged info) You will lose 100% of the time."

Why would you allow a sub to have "privileged information" and let them know what you charge? Your subs don't need to know what you charge to get in a truck and drop a plow. Sound like a bad judgment call. Nothing is 100%

-"Lets say I say current customers. You will lose 100% of the time"


So now this simple agreement is so powerful it has taken freedom of choice away form a customer? So an unhappy customer can not seek out the past sub, who successfully serviced their business if you provide unsatisfactory service. Nothing is 100%

-"Lets say I say 1 season. You will lose 100% of the time."

So you fall flat on your face because you can not keep up with a major storm and your client leaves you. The customer does'nt have the right to find the sub who serviced them last year? Nothing is 100%

Cheers to thinking your simple contract is 100%:laughing:

PS - The constitution is the supreme contract guaranteeing We The Peoples rights. Your rights are enforceable only because of this contract.


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## Silentroo (Jun 19, 2006)

Bsuds,

First you are incorrect the US constitution is not a contract. 

Second 50 states in the US union prove you wrong. 

In all 50 states a well written and not overly broad non compete agreement that is properly executed will hold in court 100% of the time. There are cretin things that must be in there and certain things that can not It has been decided in the US Supreme Court and in each of the 50 State supreme courts. So understand for it not to hold you have to overturn the State Supreme court or the US Supreme court. So maybe I should have said 99.99999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999%
of the time. However if you have the time and money to fight it to one of those courts more power to you and your lawyer will love you. However you will lose several times getting there. 

All the examples you site would not be reason to set aside a legal agreement between me and a sub. And in all three cases I would be entitled to the damages outlined in the contract as long as it is not overly broad and the damages are reasonable. 

The agreement has no bearing on the customers ability to do business with any business, It simply states that if My sub takes the business from me there are damages that I am entitled to.

The agreement has no bearing on the subs ability to earn a living, as long as it is properly written, not overly broad, and properly executed. 

But as always check with you lawyer. It's what they get paid for.


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## Luther (Oct 31, 2007)

Silentroo;866906 said:


> Look at it this way If my non compete covers the following
> 
> Lets say I say work in the snow industry I will lose.


How then did you win 5 out of 5 challenges without the court knowing this fact?



Silentroo;867678 said:


> The agreement has no bearing on the customers ability to do business with any business, It simply states that if My sub takes the business from me there are damages that I am entitled to.


How were you able to prove that you incurred damages? What damages did you actually suffer?


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## Silentroo (Jun 19, 2006)

TCLA.

My non compete does not say that. I was using it as an example of the two extremes. My non compete lists properties I want protection on and generally only the specific properties the sub is working on.

How to prove damages? 

In a well written agreement they are defined. 

In all 5 cases the damages were different. The 'Damages' I suffered we the breach of the contract and the specific section of the agreement. I do not have to show loss of income, customers, or reputation. I just have to prove the sub violated the agreement. 

How to prove. There is generally a signed contract in the office of either the property owner or the contractor that proves the breach of the contract. So if the address is listed on the non compete and the address is listed on the contract you have an issues. 

The courts have ruled that the loss of a business relationship is damage.


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## Luther (Oct 31, 2007)

Silentroo;867766 said:


> TCLA.
> 
> My non compete does not say that. I was using it as an example of the two extremes. My non compete lists properties I want protection on and generally only the specific properties the sub is working on.
> 
> ...


Interesting. Seems to me a very weak leg to stand on....you did not suffer any damages yet you were able to win the cases?

Did you in fact collect monies, or are there judgments "out there" that are most likely noncollectable?


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## QuadPlower (Jan 4, 2007)

Bajak;866112 said:


> That is very true. The whole time I worked for other companies the guys on site never new how much the company was billing out, not even the supervisors. Supers only knew the hourly cost for labor and machines. Other than that, the quote process was and is a closely guarded secret that only the higher ups in the office knew. Estimators get paid quite well to keep their mouth shut.


What if it is the Estimator that gets fired and leaves to work for another local company? You are assuming that you, the owner, are the only one that does estimates for a company.

I didn't say I tell the guy running the lawn mower or the snow plow how much I'm making on a job. But there are certian core people in my company that I share info with and if they left, I wouldn't want them telling others what I told them.


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## Luther (Oct 31, 2007)

QuadPlower;867796 said:


> But there are certian core people in my company that I share info with and if they left, I wouldn't want them telling others what I told them.


Unless you're talking about how you cook your books, or personal issues, why so bitter.....and why the paranoia?

With all due respect Quad, your not manufacturing pharmaceuticals. There are no real "trade secrets" in this industry, and it is not brain surgery.

It's all about experience, creative financing, organization, communication, systems, execution, efficiencies, quality control, relationships and the art of negotiation. Oh.....and hard work.

Price is the clients pain.........there are many ways to overcome this.

This is not rocket science. Your world should not collapse, nor should such a focus be on an exiting employee. Everyone is expendable......


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## Bajak (Nov 12, 2008)

One company I worked for had their estimator quit. He took a job as a supervisor with another company for 2 years. Did he share information with this other competing company? I don't know. He then bought a small contracting company and has grown it from 8 employees to about 30 employees now. I'm sure with out a non compete contract he wouldn't have waited or worked in a different capacity for 2 years. He is in the same city, same market and bids the same jobs. When he bought that company he had the seller sign a non compete contract and the seller moved out of the area and started up again in a different market. Under the contract the seller could not do the same type business within a certain area. 

A rather large home builder, here in Ontario, had their own excavating division. They started it mainly for their own work but it did eventually grow to servicing about 10 or 12 other home builders. The division manager quit or was fired, I'm not sure which. Within a month of that he had taken all the work from the 10 or 12 other builders as his own by lowballing. I'm sure this rather large home builder would have wished there was a non competition agreement in place. There is nothing they can do about it now.

In my view, one must be very selective about what information is shared and with whom. If your operation needs key people that will have access to proprietary information and key contacts, they should be well compensated and I would think it prudent to have a non competition contract in place.


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## QuadPlower (Jan 4, 2007)

TCLA;868022 said:


> Unless you're talking about how you cook your books, or personal issues, why so bitter.....and why the paranoia?
> 
> With all due respect Quad, your not manufacturing pharmaceuticals. There are no real "trade secrets" in this industry, and it is not brain surgery.
> 
> ...


How did you get that I was bitter or cooking my books from what I said? I'm very happy with my employees. I've been doing this long enough to know what to share and what not to share. No its not rocket science and everyone is expendable.

But like mentioned above, a guy quits/fired, starts his own business, goes to competition and figures he can do it for $99 because he knows that his last company is doing it for $100. Competition figures he is cheaper and the same guy doing the work so they hire him.

You can pay good, you can treat them good. but in the end, sometimes you hire jerks and when they leave some times it is necessary to prevent people from using information gained from you to hurt you.


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## Luther (Oct 31, 2007)

QuadPlower;868207 said:


> How did you get that I was bitter or cooking my books from what I said? I'm very happy with my employees. I've been doing this long enough to know what to share and what not to share. No its not rocket science and everyone is expendable.
> 
> But like mentioned above, a guy quits/fired, starts his own business, goes to competition and figures he can do it for $99 because he knows that his last company is doing it for $100. Competition figures he is cheaper and the same guy doing the work so they hire him.
> 
> You can pay good, you can treat them good. but in the end, sometimes you hire jerks and when they leave some times it is necessary to prevent people from using information gained from you to hurt you.


I read too much emotion in your post....my bad. Not accusing you of anything. The lowball thing we all deal with anyway, doesn't really matter who the competition is.

And yes, you are right. It's a real burn when one you've invested and confided in turns like that. It is hurtful.


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## QuadPlower (Jan 4, 2007)

I'm an emotional guy :crying:

It must be this mid 40 temp in mid November that is causing it. Is it ever going to snow?


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