intentional interference with contractual relations

Intentional interference with contractual relations is a cause of action under tort law, upon which a defendant may be liable for damages from interference with the plaintiff’s contractual relations with a third party . Mere breach of contract is not a tort, but tortious actions independent of the contract that result in a breach can be sued on as a tort, meaning a contracting party cannot be held liable for intentional interference with contractual relations.

The elements of intentional interference with contractual relations differ by state, but common elements include

The existence of a valid contract between the plaintiff and a third party;
The defendant having knowledge of the contract;
The defendant intentionally and unjustifiably inducing the third party to breach the contract;
The occurrence of the breach resulting from the defendant’s conduct; and
Damages.

For example, California’s jury instructions on intentional interference with contractual relations require:

That there was a contract between the plaintiff and the third party;
That the defendant knew of the contract;
That the defendant’s conduct prevented performance or made performance more expensive or difficult;
That the defendant intended to disrupt the performance of this contract or knew that disruption of performance was certain or substantially certain to occur;
That the plaintiff was harmed; and
That defendant’s conduct was a substantial factor in causing the plaintiff’s harm.

Both individuals and entities like corporations can be held liable for intentional interference with contractual relations. Importantly, the requirements that a breach actually occur and that the breach results in damages mean that unsuccessful attempts to interfere with contractual relations will not be sufficient to support a cause of action.

[Last reviewed in June of 2023 by the Wex Definitions Team ]

Keywords

tortious interference

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