Okay, if an agent works for an office and the broker required him to sign a no competition cause, stating that he will not "practice real estate within a 20 mile radius of the agency's office", does that mean that he will simply not work for an office within 20 miles, or does it also mean, that even if the license is hanging in another office over 20 miles away that he can not list or sell a property within the 20 miles?

Suppose a customer comes in to that office and wants a property on the end of the county where the original office is located?

I UNDERSTAND that those answering this are not lawyers - I'm just looking to see if this is a normal type contract and what does it really mean in typical situations. Also, is the contract legal if it was not drawn up by a lawyer? What if the broker typed it up himself and printed it?

In the past when I have seen this it has meant that the agent cannot work for an office located within 20 miles of the office that they have a covenant not to compete with. Meaning your license must live 20 miles away from the old office, but you can do business wherever.

However I suppose it would depend on the intention of the Broker who drew up the covenant.

Depending on your state laws that "NO Compete" agreement may not be worth that paper it is written. Those agreements were originally meant to protect proprietary information but there are few true secrets in real estate.

Even a no compete clause cannot prevent someone from earning a living. They can prevent you from taking "company" information, like client lists or ad copy or things that belong to the company. But if you earn your living as an auto mechanic, for instance, they cannot prevent you from earning a living. And the Constitution gives you the right to live and work anywhere you choose, so I don't see it as an issue.
Usually non compete clauses in employment contracts are designed to prevent someone from learning a very specific business and then starting a competing business next door. Real estate is pretty generic, so any brokerage would have a difficult time enforcing it.
I know of an instance here in Pennsylvania where a big regional brokerage tried to enforce such a clause, spent a ton of money on attorneys and was denied their ability to enforce it. They ended up paying the defendants legal fees as a penalty.

Thanks for the info. I do know that an agency down the road managed to force an agent to surrender her commission when she left that office and worked for another one...when she sold the house the broker ended up giving all of the commission to the first agency. I do not know any of the details - I am sure that the agent and her new broker went to the local board before surrendering it...so evidently, it can be enforceable.

But that might also be because the first agency had a lot of money to take it to court and the other agency didn't want to fight it.

Perky,

Good advice above. Let us know what your Board says...

Perky, it doesn't sound like it had anything to do with a non-compete clause, but with an office policy, when an agent leaves a company which might have generated that commission like a referral.

A "No-Compete" clause is nothing more than a scare tactic that will not hold up in court. I had signed one for an old sales job that stated I could not work for any company in the industry but I did. I later contacted a lawyer and sued my prior employer over all their harrassing calls and threats, they counter sued over the "No-Compete". I won and the judge threw out their claim.

I'm not a lawyer but in my opinion for a non-compete clause in a contract to be enforcable I think it would need to be a lot more specific than what has been discussed here. Not just a distance but what that distance applies to (new office location, agent's residence, properties to be listed, etc.) and a reasonable time limit for it to expire.

Sure a contract can be legal if drafted by a non lawyer.

Unless the law in your own jurisdiction says otherwise.

Generally if the contract is silent on important terms, the court would insert whatever is *usual and customary* in your area.

IOW it's all about local rules, regs, customs, etc.

I would recommend checking w/your local board as well as state association to find out what the broker can and cannot do.

Mr. foreclosure is right. Most non compete lawsuits lacking specificities are thrown out of court.

Paul Oaks is right on about the agreements were originally meant to protect proprietary information. Copyrights, trademarks, patents, specific trade secrets or formulas.

I disagree with the others about real estate being generic and that there are no secrets left. If the expression of your office policy and your business operation is a clone to the former broker it's easy to prove in court.

Ideas in general won't hold up in court but copyrights, trademarks, or patents of those ideas can cost far into the future.

Thank you everyone. The language appears to be excluding nearby offices only, and not mentioning geographic areas - so that's cool. Thanks so much for your help and comments.