GOOD-WILL

In purchasing or selling a store, a good rule for estimating the value of the "fixtures" and "good-will" is to allow one-half to two-thirds of their original cost for fixtures, and to take the net profits of the previous year or six months as the value of the good-will. There should be a written agreement that the seller shall not enter into the same business within a certain limit of distance, or for a certain period.

It has been held that, by common law, when the territory so prescribed is reasonably limited in extent, its prohibition may be for life; when the time is limited to, say, five or ten years, the prohibition may be absolute for that period. Protection for five years in the city of location should be sufficient for an exclusively retail business.