Interference-with-Business-RelationshipsFrequently in business transactions, a business dispute will arise when other businesses or individuals whom are not involved in the business contract causes a breach of contract. In these situations, the injured party potentially has various claims against these other parties. These claims include: intentional interference with contractual relations, intentional interference with business relationships and tortious interference with economic relationship.

Third-party Intentional Interference Claims

In regards to any commercial litigation, intentional interference with a contract is a typical example of a third-party interference claim. Usually, for businesses, it could be the competition or even potential competitors who are committing this tort. Intentional interference with contract arises when a person intentionally damages the plaintiff’s contractual or some other business relationships. Intentional interference with contract may also occur when a third-party tortfeasor persuades a party to breach the contract with the plaintiff, or where he intentionally disrupts the ability of one party to satisfy his obligations under the contract, thus, injuring the plaintiff. In order for there to be an interference with contract claim, there needs to be a valid contract that is already in existence.

In an action for intentional interference with contract, a plaintiff must allege:

  • The existence of a valid and enforceable contract;
  • Defendant’s awareness of the contractual obligation;
  • Defendant’s intentional and unjustified inducement of a breach;
  • Subsequent breach caused by defendant’s unlawful conduct; and
  • Damages.
Claims based on an interference with business relationships may arise when a third-party prevents the plaintiff from maintaining or establishing a business relationship, or even by disrupting a business relationship.
Intentional interference with business relationships and prospective business relationships are additional examples of various potential third-party interference claims. These claims may arise when a third-party prevents a plaintiff from maintaining and/or establishing his business relationship or by disrupting a business relationship. Since this claim is a tort, the conduct must be intentional and the plaintiff must prove he was damaged by the conduct of the third-party tortfeasor (i.e. he either lost the business relationship or was unable to proceed in the business relationship because of the defendant’s intentional interference).

The elements of the tort of interference with prospective business advantage are:

  • Plaintiff’s reasonable expectation of entering a valid business relationship;
  • The defendant’s knowledge of the plaintiff’s expectancy;
  • Purposeful or intentional interference by the defendant that prevents the plaintiff’s legitimate expectancy from ripening into a valid business relationship; and
  • Damages to the plaintiff resulting from such interference.
A cause of action for intentional interference with a business expectancy (prospective business relationship) does not need to be based on an enforceable contract that is interfered with; instead, it is the interference with the relationship that creates the actionable tort.