solus tie

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A form of restraint of trade sometimes incorporated into a mortgage, often for the acquisition of certain types of commercial premises, most often petrol stations and public houses (Esso Petroleum Co Ltd v Harper's Garage (Stourport) Ltd [1968] AC 269 (HL). A solus tie seeks to limit the mortgagor's choice of commercial supplier by incorporating a provision into the mortgage deed that determines the source from which the mortgagor may obtain his supplies during a predetermined period. Solus ties and other restraint of trade clauses can be found in contracts other than mortgage contracts: the principles that underpin the law's dislike of such clauses, which are held to impose an unreasonable restraint on the borrower, are of general application and do not originate from the law of mortgages.

Subjects: Law.

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