Non-Solicitation Agreements in Montana: Statutory Rules
Montana's Statutory Framework
Montana addresses restrictive covenants through Montana Code Annotated Section 28-2-703 through 28-2-705. These statutes generally render void any contract that restrains someone from exercising a lawful profession, trade, or business, with specific exceptions. Non-solicitation clauses must fit within these exceptions to be enforceable.
When Non-Solicitation Clauses Are Permitted
Montana law allows restrictive covenants, including non-solicitation clauses, in limited circumstances:
- Sale of a business: A seller may agree not to solicit the business's customers within a specified area and time
- Dissolution of a partnership: Partners may agree to non-solicitation as part of the dissolution
- Employment context: Non-solicitation clauses in employment agreements are enforceable if they are reasonable, but Montana courts apply heightened scrutiny given the statutory disfavor of trade restraints
Reasonableness Factors
When a non-solicitation clause falls within a recognized exception, Montana courts evaluate:
- Legitimate employer interest: Customer relationships, trade secrets, or confidential information
- Reasonable duration: Montana courts favor shorter time periods, with one to two years being the typical range
- Narrowly tailored scope: The restriction must target only customers the employee directly served
- Not oppressive: The clause cannot prevent the employee from earning a living in their chosen field
Red Flags
- A non-solicitation clause that does not fit within one of the statutory exceptions
- Restrictions covering customers beyond those you personally serviced
- Duration exceeding two years
- Language that effectively constitutes a general restraint on trade
- No clear consideration supporting the agreement
Montana's Disfavor of Restraints
Because Montana's statutes reflect a general policy against restraints on trade, courts are predisposed to interpret ambiguities against enforcement. Employers bear the burden of demonstrating that a non-solicitation clause fits within a statutory exception and is reasonable.
When to Consult a Lawyer
Consider contacting a Montana attorney if you are being asked to sign a non-solicitation agreement as part of employment and want to understand your rights, if you are buying or selling a business and need to evaluate restrictive covenant terms, or if a former employer is asserting a non-solicitation violation.
This article is for informational purposes only and does not constitute legal advice. Consult a licensed attorney for guidance specific to your situation.