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Business Torts
UMKC School of Law
Abdel-Khalik, Jasmine C.

Business Torts: Abdel-Khalik: Fall 2013
INTENTIONAL INTERFERENCE
Aka: tortious interference
Restate (2d) of Torts § 766
Purpose of Cause of Action:
Protect contractual relationships
Appropriately protect and value things other than contractual relationships
                                                               i.      Expected fruits of enterprise
                                                             ii.      Fairness in marketplace
                                                           iii.      Fair dealing
p bears burden of proving all elements
Interference w/ a K
§766
Elements:
                                                               i.      (1) K between p and 3d party
                                                             ii.      (2) D’s knowledge of the K
                                                           iii.      (3) intentional interference by D inducing or causing breach of K
1.      INTENT and CAUSATION: talk about both!!!
2.      (A) Actively and Affirmatively inducing (intent by D) AND
a.       intent to cause a breach
b.      interferer intended to induce the breach
c.       “induced” ® to move & lead as by persuasion or influence, to inspire, call forth, or bring about by influence or simulation
3.       (B) But for causation
a.       use “but for” test to determine if D’s alleged actions caused a breach
                                                                                                                                       i.      they changed their behavior w/ 3d party
b.      “but for what you did I wouldn’t have breached my K”
 
4.      Proved by Circumstantial Evidence:
a.       Facts must reasonably follow
                                                                                                                                       i.      think about facts & reasonably follows that breach would occur
b.      Existence of facts cannot be speculative or guesswork
                                                                                                                                       i.      ex: came to construction site w/ certain hat
c.       Evidence submitted should have tendency to exclude every reasonable conclusion other than the one desired
 
                                                           iv.      (4) absence of justification AND
1.      absence of legal justification to take the actions p complains of
2.      Justification if D:
3.      (1) Acted w/ Proper Means  AND
a.       Improper Means ® means that are independently wrongful apart from injury caused by the interference 
                                                                                                                                       i.      Examples:
                                                                                                                                     ii.      Misrepresentation of facts
                                                                                                                                   iii.      Threats
                                                                                                                                   iv.      Violence
                                                                                                                                     v.      Defamation
                                                                                                                                   vi.      Trespass
                                                                                                                                 vii.      Restraint on trade
                                                                                                                               viii.      Any other wrongful act
                                                                                                                                   ix.      False statements tending to prejudice or injure a person’s business by suggesting person is unreliable, insolvent, or the like
b.      Does NOT have to be illegal – only wrongful
                                                                                                                                       i.      MO case required illegality to be wrongful (Community Title)
c.       NOT improper means:
                                                                                                                                       i.      To protect one’s own economic interests
                                                                                                                                     ii.      If have contractual right to deny or interfere
d.      MAKE the ARGUMENT here
 
4.      (2) Acted w/ Proper Purpose (motives)
a.       Economic Interest
                                                                                                                                       i.      Had a legitimate economic interest to protect (creates proper purpose)
                                                                                                                                     ii.      Actions protected present Economic Interest OR
1.      MUST be a present economic interest
2.      Can use economic interest UNLESS D used improper means
                                                                                                                                   iii.      D had unqualified legal rights to interfere
1.      Qualified Privilege or Interest
2.      Extends to ALL statements made bona fide in performance of a duty, or w/ a fair & reasonable purpose of protecting the interest of the person making them, or the interest of the person to whom they are made
3.      Ways to Get Qualified Purpose:
a.       (1) Independent Duty OR
                                                                                                                                                                                                               i.      (a) prove duty exists
                                                                                                                                                                                                             ii.      (b) acting in a reasonable manner and
                                                                                                                                                                                                           iii.      (c) had a proper purpose in executing the duty
b.      Then have to decide was it reasonable manner OR for proper purpose
                                                                                                                                                                                                               i.      AK thinks it’s a circular argument
5.      Negative impact alone is NOT enough to establish absence of justification
6.      p must offer substantial evidence to show absence of justification 
 
                                                             v.      (5) damages
1.      “but for” test
 
                                                         vi.      Relationship of parties under § 766
1.      Requires breach, failure to perform, or termination of K
2.      D talked to 3d and 3d ≠ complete K had w/ p
Ex: Kerr Construction v. Khazin & Waugh – MODOT project – K1 between p’s & city required p to allow MoDOT to inspect work and K2 between city & MoDOT required inspector for city to get funding ® MoDOT inspector came to p’s site and told them he ≠ like work and started cursing but ≠ said he was inspector but p asked him to leave & inspector almost hit p’s EE – returned w/ boss wearing p’s competitors hat – p allowed boss to stay but ≠ inspector so he was mad and hit p’s president in nose w/ his coffee cup – told p they would have project shut down
                                                               i.      Inspector and boss met w/ city and said p’s had threatened them & p’s president kept cursing them ® after meeting city shut down project and ≠ compensate p’s
                                                             ii.      #3 ® D’s intended to interfere b/c kept saying they would shut the project down and city wouldn’t have shut down w/o conversation w/ D’s
                                                           iii.      #4 ® D’s claimed qualified privilege when reported p’s to city b/c had duty to report any concerns of quality of project
1.      met duty requirement of qualified privilege
2.      D’s, however, forfeited privilege when lied to City which led to problems between p’s and city
                                                           iv.      #5 ® met b/c but for D’s actions there wouldn’t be issues w/ K1 and damages b/c p was not compensated for work already performed
 
 
If Interfere w/ P and Breach or NO breach of K:
                                       i.      §766A
1.      must have K but ≠ breach required
                                     ii.      Applies when ≠ breach and p is one interfered with
 

itizens b/c would interfere w/ the K
b.      Should contact original barber and see if he needs help
2.      No one year K w/ barber and have set time for haircut each month and citizen can cancel w/ one day notice
 
Interference w/ a Business Expectancy
Generally:
                                                               i.      §766B
                                                             ii.      MO ≠ require a K
1.      replace K requirement w/ business expectancy
                                                           iii.      MUST have reasonable expectancy of a commercial relationship
1.      enough to have probable future buz relationship from which there is a reasonable expectancy of financial benefits
                                                           iv.      Harder and higher standard from interference w/ K b/c gaining customers is what competition is about so ≠ want to put too large a hand on capitalism
 
Elements:
                                                               i.      (1) valid business expectancy
1.      must establish a probable future business expectancy
2.      expectancy claimed must be reasonable under the circumstances
a.       can be shown through course of similar dealings
                                                                                                                                       i.      if change way of doing business then ≠ claim buz expectancy based on “way things have always been done”
                                                                                                                                     ii.      ex: Slone v. Purina
                                                             ii.      (2) D’s knowledge of the relationship between p and 3d party
                                                           iii.      (3) intentional interference by D inducing or causing interference w/ relationship
1.      (A) Actively and Affirmatively inducing (intent by D)
a.       intent to cause interference w/ relationship
b.      “induced” ® to move & lead as by persuasion or influence, to inspire, call forth, or bring about by influence or simulation
                                                                                                                                       i.      to active and affirmative steps to cause interference w/ relationship 
2.      (B) But for causation
a.       D’s conduct must cause business expectancy ≠ to be realized
b.      p’s business expectancy would have been realized in absence of D’s interference
                                                                                                                                       i.      harder/higher standard before it’s a valid claim
1.      that’s what competition is about
3.      Proved by Circumstantial Evidence:
a.       Facts must reasonably follow
                                                                                                                                       i.      think about facts & reasonably follows that breach would occur
b.      Existence of facts cannot be speculative or guesswork
                                                                                                                                       i.      ex: came to construction site w/ certain hat
c.       Evidence submitted should have tendency to exclude every reasonable conclusion other than the one desired
                                                           iv.      (4) absence of justification AND
1.      absence of legal justification to take the actions p complains of
a.       improper means and improper motive