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Elements of Tortious Interference with Contract and Tortious Interference With Prospective Business Relations Explained

The Second Department, over a dissent, determined that the counterclaims alleging tortious interference with contract and tortious interference with prospective business relations were properly dismissed. The counterclaims alleged that the plaintiffs-attorneys, who represented defendant, Landmark, improperly sought payment of attorney’s fees for a negotiated stipulation of settlement directly from the party with whom Landmark settled, rather than from Landmark. In dismissing the counterclaims, the court explained the required elements of each:

A necessary element of [tortious interference with contract] is the intentional and improper procurement of a breach and damages … . Here, Landmark failed to adequately plead facts that would establish that the plaintiffs, in communicating with the third party to secure their attorney’s fees, intentionally procured that party’s breach of the stipulation of settlement… . …

A claim for tortious interference with prospective business relations does not require a breach of an existing contract, but the party asserting the claim must meet a “more culpable conduct” standard … . This standard is met where the interference with prospective business relations was accomplished by wrongful means or where the offending party acted for the sole purpose of harming the other party … . ” Wrongful means’ include physical violence, fraud or misrepresentation, civil suits and criminal prosecutions, and some degrees of economic pressure” … . As a general rule, the offending party’s conduct must amount to a crime or an independent tort, as conduct that is neither criminal nor tortious will generally be “lawful” and thus insufficiently “culpable” to create liability for interference with prospective business relations … . The mere violation of an attorney disciplinary rule will only create liability if actual damages are incurred as a result of the violating conduct  … . In addition, where the offending party’s actions are motivated by economic self-interest, they cannot be characterized as solely malicious … . Law Offs. of Ira H. Leibowitz v Landmark Ventures, Inc., 2015 NY Slip Op 06575, 2nd Dept 8-19-15

 

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