Demita Inc

Demita Inc. runs a bakery in La Ronge, Saskatchewan, that sells bread, rolls, cakes, and pastries. Demita bought the bakery from King's Bakery Inc. In the sale agreement, Demita agreed not to sell bakery products outside La Ronge. Business is good and Demita wants to expand. Demita is not interested in competing with King's which now sells its products exclusively in Regina, Saskatchewan. It wants to sell in other markets. Demita wants to know if there is any way that she can successfully challenge the restriction on selling outside La Ronge as a restraint on trade?

A) Probably not. Restraints of trade are dealt with exclusively as criminal matters by the Commissioner of Competition under the Competition Act.
B) Probably. The requirement constitutes a deprivation of property contrary to the Canadian Charter of Rights and Freedoms.
C) Probably. The requirement is not linked to any valid public purpose but only the private benefit of King's.
D) Probably. The requirement is a regulatory offence.
E) Probably. Restraints on trade are permissible, but they are scrutinized by the courts to ensure that they do not unduly restrict competition. Here restricting Demita to selling bakery products in La Ronge is more restrictive than necessary to protect the commercial interests of King's.