Illinois Decision Reaffirms Importance Of Tolling Provisions In Restrictive Covenants

A trial court in Chicago recently held that because a restrictive covenant did not contain a provision extending the restricted period during any time of breach, there was no basis to re-write the contract to extend the restricted period. The court also declined to extend the restricted period on any equitable basis.  The lengthy decision is attached in two parts here and here. 

This decision illustrates the importance of including a “tolling” provision in a restrictive covenant. See, e.g., Prairie Eye Center v. Butler, 329 Ill.App.3d 293, 304-305 (Ill. App. 2002) (enforcing a contractual provision extending the period of noncompetition for “a period of time equal to that period beginning when such violation commenced and ending when the activities constituting such violation shall have terminated.”) Otherwise, by the time a party learns of a violation of a restrictive covenant and rushes in to court to seek injunctive relief, much of the restricted period may have already expired.