diff --git a/app/models/spree/user_decorator.rb b/app/models/spree/user_decorator.rb
index 7ee42af088..9890d0ff7b 100644
--- a/app/models/spree/user_decorator.rb
+++ b/app/models/spree/user_decorator.rb
@@ -9,6 +9,8 @@ Spree.user_class.class_eval do
   attr_accessible :enterprise_ids, :enterprise_roles_attributes
   after_create :send_signup_confirmation
 
+  validate :owned_enterprises_count
+
   def build_enterprise_roles
     Enterprise.all.each do |enterprise|
       unless self.enterprise_roles.find_by_enterprise_id enterprise.id
@@ -20,4 +22,12 @@ Spree.user_class.class_eval do
   def send_signup_confirmation
     Spree::UserMailer.signup_confirmation(self).deliver
   end
+
+  private
+
+  def owned_enterprises_count
+    if owned_enterprises.size > enterprise_limit
+      errors.add(:owned_enterprises, "^The nominated user is not permitted to own own any more enterprises.")
+    end
+  end
 end
diff --git a/spec/models/spree/user_spec.rb b/spec/models/spree/user_spec.rb
index 166ae6dab5..e985d9bde8 100644
--- a/spec/models/spree/user_spec.rb
+++ b/spec/models/spree/user_spec.rb
@@ -3,17 +3,28 @@ describe Spree.user_class do
     it { should have_many(:owned_enterprises) }
 
     describe "enterprise ownership" do
-      let(:u) { create(:user) }
-      let(:e1) { create(:enterprise, owner: u) }
-      let(:e2) { create(:enterprise, owner: u) }
+      let(:u1) { create(:user) }
+      let(:u2) { create(:user) }
+      let(:e1) { create(:enterprise, owner: u1) }
+      let(:e2) { create(:enterprise, owner: u1) }
+
       it "provides access to owned enteprises" do
-        expect(u.owned_enterprises).to include e1, e2
+        expect(u1.owned_enterprises).to include e1, e2
+      end
+
+      it "enforces the limit on the number of enterprise owned" do
+        expect(u2.owned_enterprises).to eq []
+        u2.owned_enterprises << e1
+        u2.owned_enterprises << e2
+        expect {
+          u2.save!
+        }.to raise_error ActiveRecord::RecordInvalid, "Validation failed: The nominated user is not permitted to own own any more enterprises."
+
       end
     end
   end
 
   context "#create" do
-
     it "should send a signup email" do
       Spree::UserMailer.should_receive(:signup_confirmation).and_return(double(:deliver => true))
       create(:user)