intentional interference with contractual relations

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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 updated in June of 2023 by the Wex Definitions Team]