CONSTRUCTION LAWLETTERS

FOR INDUSTRY PROFESSIONALS, MANAGERS, TRADES & SUPPLIERS

J. NORMAN STARK, ATTORNEY-AT-LAW

JURIS DOCTOR, B. ARCHITECTURE, B.F.A

Vol. 2001-2  February, 2001

INTERFERENCE WITH CONTRACTS -
AN ACTIONABLE TORT


Claims for tortious interference with contract may arise in current, highly competitive business relationships and transactions.  Simply defined, tortious interference is the unlawful act of one person or entity that causes damage or harm to another’s rights, interests, or business.  The aggrieved party may recover monetary damages from the wrongdoer, upon the presentation of clear evidence to support such claims. 

In one recent action, a corporate officer filed suit against the former employer and shareholders, alleging wrongful discharge and tortious interference with her contract of employment.  The trial Court found no wrongful termination and denied the claims of tortious interference.  On appeal, the Court of Appeals affirmed in part and reversed in part, remanding the case to the Trial Court for rehearing. Gray-Jones v. Jones (2000) 137 O App3d 93, 100-102. 

In interpreting and applying the law, one recent court decision held: “One who intentionally and improperly interferes with another’s prospective contractual relation (except a contract to marry) is subject to liability to the other for the pecuniary harm resulting from loss of the benefits of the relation, whether the interference consists of  “(a) inducing or otherwise causing a third person not to enter or continue a prospective relation or (b) preventing the other from acquiring or continuing the prospective relation."

The type of relations protected from interference includes: “any prospective contractual relations *** if the potential contract would be of pecuniary value to the plaintiff.”  The prospective contractual relations include “the opportunity of selling or buying land or chattels or services, and any other relations leading to potentially profitable contracts.”

Factors:  In determining whether an actor has acted improperly in intentionally interfering with a contract or prospective contract of another, consideration should be given to the following factors: (a) the nature of the actor’s conduct, (b) the actor’s motive, (c) the interests of the other with which the actor’s conduct interferes, (d) the interests sought to be advanced by the actor, (e) the social interests in protecting the freedom of action of the actor and the contractual interests of the other, (f) the proximity or remoteness of the actor’s conduct to the interference, and (g) the relations between the parties.”  Fred Siegel Co., L.P.A. v. Arter & Hadden (1999), 85 Ohio St.3d 171, 178-179, Syllabus, para. 3, citing Restatement of the Law 2d, Torts [1979] 26 Section 767.

When the interference was with a prospective contract, the plaintiff is entitled to recover lost profit expected to be made under the contract.  Additionally, Ohio law recognizes that a plaintiff may recover all damages proximately caused by an actor’s misconduct in a tortious interference action.  Gray-Jones v. Jones (2000) 137 O App3d 93, 100-102.                 

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Author:  J. NORMAN STARK is an Attorney-at-Law, a Registered Architect, (AIA, NCARB) Registered Landscape Architect, Interior Designer, Planner and Senior Appraiser (ASA), admitted to practice law before the Bar of Ohio, the US District Courts, Ohio and Illinois (Central Dist.), the US Court of Appeals, and the United States Supreme Court. He has had experience in business, Construction, Real Property, Litigation and Construction-Legal Project and Crisis Management.

 


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