Interference with Contracts

If a contract exists between two or more parties, and a third party interferes with any other party’s fulfillment of that contract, the third party can be held liable.  Often that interference was created in the hopes of gaining an unfair advantage over another party.

Chatow Law can help litigate interference with contracts, whether your California business has been at the receiving end of that interference or you’ve been accused of interfering with a contract.  You can contact our office in Orange County now, or read on to find out more.

Elements of Tortious Interference with a Contract Case

To prove a tortious interference case exists, the plaintiff must be able to prove the following:

1. A valid contract exists between a plaintiff and another party.
2. The defendant knew the contract existed.
3. The defendant took either negligent or intentional and wrongful steps to disrupt the contractual relationship.
4. The defendant’s actions caused a breach of the contractual relationship.
5. The plaintiff sustained damages as a result of the defendant’s actions.

If the defendant owed the plaintiff a duty of care, then the plaintiff does not need to show that the defendant acted knowingly, and only needs to show that interference occurred and caused damages. If no duty of care existed, negligence will not be enough to press the claim; the plaintiff would need to show the behavior was intentional. 

Good faith offers don’t count as interference, because any business may offer its own contract or deal in the spirit of fair competition. Thus the plaintiff must be able to show the action was wrongful. Otherwise, “disappointed competitors” could make claims of interference whenever the sales process doesn’t go their way.

It is unnecessary to prove that the defendant successfully disrupted the contract, if the interference resulted in damages. The plaintiff may show that the interference made the plaintiff’s performance more costly and burdensome instead. 

If you have reason to believe a third party interfered with your contract, you must act quickly if you want to pursue litigation: Tortious interference claims have a 2-year statute of limitations in California. 

Litigating Interference with Contracts on a Contingency Basis

It is possible that we can litigate your case on a contingency basis, rather than on a pay-as-you go hourly basis.  Probably because of the interference or damages and possibly for other reasons, your money may be tied up temporarily.  We understand that, which is why we may be able to work you in such a way that you only pay a percentage of the settlement or judgment if and when we win your case and you collect your award.  You can find out more about the contingency business litigation option here.