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Interference With Contracts Cases Summarized

This page within Virginia Tort Case Law is a compilation of cases reported by the Virginia Supreme Court and summarized by Brien Roche dealing with the topic of Interference With Contracts and the related topic of intentional torts.  For more information on contracts see the pages on Wikipedia.

Interference With Contracts-Cases

2011 Lewis-Gale Medical Center, LLC v. Alldredge, 282 Va. 141, 710 S.E.2d 716.
Hospital employee described an emergency room physician as an “organizational terrorist.” Physician emergency room practice group subsequently terminated her. These types of comments by hospital employee did not rise to the level of “improper methods” and therefore no jury issue presented.

2011 Dunn, McCormack & MacPherson v. Connolly, 281 Va. 553, 708 S.E.2d 867.
When a contract is terminable at will, the plaintiff must not only prove tortious interference but must allege and prove an intentional interference that caused the termination of the contract and also that the defendant employed improper methods. The interference is improper if it is illegal, independently tortious, or violates established standard of trade or profession. Conduct that is merely motivated by spite or ill will or malice does not suffice.

2009 DurretteBradshaw, P.C. v. MRC Consulting, L.C., 277 Va. 140, 670 S.E.2d 704.
Plaintiff sued law firm alleging tortious interference with contractual relationship where the alleged contract that was directly interfered with was one that the plaintiff was not a party to but that interference then allegedly caused damage to the plaintiff under a separate contract. The complaint did not allege that defendant intended to affect the plaintiff’s contract or that it acted for the purpose interfering with that contract. As such, the claim was demurrable and the demurrer should have been sustained. Judgment in favor of the plaintiff was reversed.

2003 Williams v. Dominion Tech. Partners, 265 Va. 280, 576 S.E.2d 752.
Interference with contracts.Former employer sued former employee for breach of fiduciary duty, breach of contract, tortious interference with business relationship, and business conspiracy alleging that employee had improperly elected to work as an at-will employee at power tool facility where plaintiff had placed him. Under the common law, an employee, including an employee at-will, owes a fiduciary duty of loyalty to his employer during the course of the employment. Within that general duty of loyalty is the specific duty that the employee not compete with his employer during his employment. The employee does, however, have a right to make arrangements during his employment to compete with his employer after resigning his post but this right is not absolute and must be balanced with the importance of the integrity and fairness attaching to the relationship between employer and employee. In order to sustain claim for statutory business conspiracy, plaintiff must prove by clear and convincing evidence that defendants acted with legal malice, i.e., intentionally, purposefully, and without lawful justification and that such actions injured the plaintiff’s business. In this case, employee simply arranged with employment brokerage firm to become its employee effective upon resignation from the employment agency. Specific duties that employee owes to employer are not to misappropriate trade secrets, not to misuse confidential information, not to solicit clients or other employees prior to termination of employment. This list is not exhaustive. In this particular instance, the employee’s actions did not rob his employer of any objective or tangible business opportunity or expectancy since the employee simply took advantage of an opportunity to obtain full-time employment in another capacity. In this case, since the conduct alleged was the same as to all of the different theories of recovery, the judgment in favor of the plaintiff is reversed and final judgment is entered in favor of the employee.

2001 Rappahannock Pistol & Rifle Club, Inc. v. Bennett, 262 Va. 5, 546 S.E.2d 440.
Gun club sought to buy property for rifle range. Nearby neighbor placed back-up contract on property for higher price with neighbor eventually going to settlement on contract. Gun club sues for intentional interference with contracts. Elements of claim are: (1) existence of valid contractual arrangement or business expectancy; (2) knowledge of the relationship or expectancy on part of the interfering party; (3) intentional interference inducing or causing breach or termination; and (4) resulting damage. Instruction to jury contained only those elements and no other elements and as such, that became the law of the case. Therefore, there was no need for plaintiff to prove that defendants used improper methods to induce seller to breach its contract with the club. In this case, it is irrelevant as to what purchaser did to induce the club to abandon its plans to purchase. The club in this case had to prove not only the existence of the back-up contract but also that its existence caused seller’s refusal to close on contract with club. In this case, there was no evidence as to that latter subject.

2000 Lockheed Info. Mgmt. Sys. Co. v. Maximus, Inc., 259 Va. 92, 524 S.E.2d 420.
Affirmative defense of justification or privilege applies in claim for intentional interference with contracts.

1998 Smith v. Litten, 256 Va. 573, 507 S.E.2d 77.
Interference with contracts.Defendant terminated plaintiff because at 79 years of age he was just too old. Plaintiff entitled to compensatory award along with punitive award. When plaintiff pleads and proves intentional tort under common law of Virginia jury may award punitive damages. Presentation of evidence as to defendant’s net worth was proper.

1997 Maximus, Inc. v. Lockheed Information Mgt. Systems, 254 Va. 408, 493 S.E.2d 375.
Interference with contracts.No requirement that plaintiff show malice in regards to this type of claim. To prove that defendant used improper means or methods to interfere with business expectancy, plaintiff must show that interference was intentional and improper under circumstances, not that improper methods used were inherently illegal or tortious.

1997 Perk v. Vector Resources Group, 253 Va. 310, 485 S.E.2d 140.
Attorney sued former client and client’s new law firm alleging interference with existing relationship. Contract in question was terminable at will therefore plaintiff had to prove improper methods consisting of conduct that is either illegal or independently tortious. In this case allegedly illegal or tortious conduct occurred after the termination of contract and therefore cannot serve as basis for interference with contracts.

1997 Commercial Business Systems v. Halifax Corp., 253 Va. 292, 484 S.E.2d 892.
Elements of interference with contracts are as follows: (1) existence of business relationship or expectancy with probability of future economic benefit to plaintiff; (2) defendant’s knowledge of relationship or expectancy; (3) reasonable certainty that absent defendant’s intentional misconduct, plaintiff would have continued in relationship or realized expectancy; and (4) damage to plaintiff. Proof of existence of first and third elements of this tort must meet objective test. Mere proof of plaintiff’s belief or hope is insufficient. Proof must establish probability of future economic benefit to plaintiff.

1996 Charles E. Brauer Co. v. NationsBank, 251 Va. 28, 466 S.E.2d 382.
Failure to act in good faith under Uniform Commercial Code does not amount to independent tort. Breach of this duty only gives rise to breach of contract action.

1994 Hilb, Rogal & Hamilton Co. v. DePew, 247 Va. 240, 440 S.E.2d 918.
Employees post-termination conduct was not in violation of his fiduciary duty. Employees duty to his employer not to compete arises out of that relationship; upon termination of relationship employee may compete with his employer. Elements of intentional interference with contracts are as stated in Duggin. Breach of fiduciary relationship is evidence of improper method as called for in Duggin.

1993 Peace v. Conway, 246 Va. 278, 435 S.E.2d 133.
There was no covenant not to compete between employer and his former employees. These former employees did not use improper methods in soliciting business of customers they have known through their former employment. As such there is no basis for claim for interference with contracts. These employees relied solely upon their memories when they contacted former customers. Unless otherwise agreed, after termination of agency, agent has no duty not to compete but does have duty not to use or disclose to third persons, on his own account or on account of others in competition with principal, written list of names or other similar confidential matters given to him. Agent is entitled to use general information concerning method of business of his former employer and names of customers retained in his memory if not acquired in violation of his duty. If employer wishes to restrict employee in this regard, then he may require signing of covenant not to compete. In this case, this was not done, and as such there is no basis for claim.

1990 Century-21 v. Elder, 239 Va. 637, 391 S.E.2d 296.
Blanks signed contract with Elder to purchase Elder’s house. Blanks had previously retained Dowdy to act as real estate agent to assist Blanks in finding house. After Blanks signed contract with Elder, Dowdy explained other comparable prices in area to Blanks and prepared contract for other home Blanks was interested in. Insufficient evidence presented to show Dowdy guilty of interference with contracts.

1989 Elliott v. Shore Stop, Inc., 238 Va. 237, 384 S.E.2d 752.
Employee ordered to take polygraph. Employee alleged employer and polygraph examiner conspired to rig exam so as to terminate plaintiff. This may constitute tortious interference with contracts of employment.

1988 Philip Morris, Inc. v. Emerson, 235 Va. 380, 368 S.E.2d 268.
Escape of highly toxic chemical caused adjoining property owner to shut down business. No property damage. No claim recognized for negligent interference with contracts.

1987 Duggin v. Adams, 234 Va. 221, 360 S.E.2d 832.
Intentional interference with contracts is tort. Elements for such claim where contract is not terminable at will: (1) existence of valid contractual relationship or business expectancy; (2) knowledge of relationship or expectancy on part of interferor; (3) intentional interference, inducing or causing breach or termination; and (4) resulting damage to party whose relationship or expectancy has been disrupted. When contract is terminable at will, plaintiff in order to make out case must allege and prove not only intentional interference that caused termination of contract but also that defendant employed improper methods. Improper methods are those means that are illegal or independently tortious such as violations of statutes, regulations, or recognized common-law rules. Improper methods may include violence, threats or intimidation, bribery, unfounded litigation, fraud, misrepresentation or deceit, defamation, duress, undue influence, misuse of inside or confidential information or breach of fiduciary relationship.

1986 Wright v. Castles, 232 Va. 218, 349 S.E.2d 125.
To prove interference with contracts claim plaintiff must show that defendant intentionally and improperly interfered with contractual relations by causing third party not to enter into prospective contract with him.
1985 Chaves v. Johnson, 230 Va. 112, 335 S.E.2d 97.
Elements of prima facie cause of tortious interference with contracts: existence of a valid contractual relationship or business expectancy; knowledge of such by defendant; intentional interference inducing or causing breach or termination; resulting damage. Affirmative defense is justification or privilege such as legitimate business competition, financial interest, responsibility for welfare of another, directing business policy, and giving requested advice. Conduct is tortious if third party is induced to breach existing contract which is not terminable at will.

>1985 Bowman v. State Bank of Keysville, 229 Va. 534, 331 S.E.2d 797.
To prove interference with contracts claims plaintiff must establish there was conspiracy to procure breach of contract and that breach of contract was pursuant to conspiracy. There must be two persons to comprise conspiracy. Corporation cannot conspire with itself. Plaintiff argued that bank official conspired with other bank officials to terminate plaintiff’s employment contract. There were insufficient facts alleged to conclude two parties to conspiracy. Virginia recognizes exception to employment-at-will doctrine where employee discharged in violation of established public policy.

1973 Berlage-Bernstein Bldrs., Inc. v. Lear, 213 Va. 566, 193 S.E.2d 786.
When seller loses his sale on account of wrongful conduct of stranger, he is entitled to fruits of his bargain and consequential expenses incurred. Plaintiff lost sale because defendant wrongfully filed lis pendens; against property. Damages include difference in price and carrying charges.

1956 Worrie v. Boze, 198 Va. 533, 95 S.E.2d 192.
In reference to covenant not to compete, plaintiff has cause of action to enforce covenant in equity and cause of action for damages for conspiring to breach contract. Action in tort will lie against those who conspire to induce breach of contract. Such cause of action also lies against party to contract.

1953 United Constr. Workers v. Laburnum, 194 Va. 872, 75 S.E.2d 694.
Union allegedly threatened retribution unless employer recognized union. Common-law tort or action under National Labor Relations Act is maintainable.

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Interference With Contracts Cases Summarized

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