Interference with a Business Contract A contract is a legally enforceable agreement between two or more parties made between mutually agreed terms and conditions. The meeting of minds is essential to form a contract. The principle of “consensus ad idem” is important to constitute any contract. Meaning thereby the terms should be agreed on the same thing in the same sense. In case of unlawful interference, it should be unlawful or illegal in the eyes of the law. If such interference is lawful or unintentional, or accidental, it would not come under tortious or unlawful interference. To constitute unlawful interference, the contract formed between the parties should be valid. It should comply with all the requisites provide in Contract Law. If the defendant uses any forceful or coercive means to interfere with a business contract, it will result in unlawful interference.
Interference with Business Relations This concept is similar to the interference with business contracts, and the only difference is that it is associated with the relations outside the actual contract. The contracts formed outside the formal contract are mostly based on the history between the parties, oral agreement, or stipulation of the futures contract. The inchoate rights also have a major role to play in it. These are the rights where parties do not have rights at present but are expected to have in the future. Business relationship interference is not so prevalent when compared to contractual interference. It is a much more complicated task to present in a court of law. The burden of proof lies on the plaintiff to prove the existence of the actual business agreement.
Proof of Interference in a Business Relationship
The burden of proof lies on the plaintiff to prove that the plaintiff has intentionally caused loss to them using unlawful or coercive means or any other fraudulent means. It includes inducing a customer using coercive means to break their contract with their competitor, making false promises about a competitor to deter a business, making threats to a company to stop the delivery to a competitor, and many more. The plaintiff needs to show the following facts while claiming tortious interference:
The existence of a valid contract is necessary. The plaintiff must prove that there is a contract between the plaintiff and a third party.
It is important to prove that the defendant was aware of the formed valid contract.
There was an intentional interference on the part of the defendant, which resulted in the breach of such a contract.
The defendant’s conduct was not proper and was unlawful.
The plaintiff suffered a monetary loss because of such a breach of contract.
It is not rightly said that every competitive activity is tortious. The most significant point to be noted in considering the conduct that was unlawful is that the interference was improper. Some of the factors considered that declare conduct to be improper are the defendant’s motive, the defendant’s nature of the conduct, proximity of remoteness, and the relationship between the plaintiff and defendant.
Defenses to Unlawful Interference
Some of the common defenses available too unlawful are as follows:
The defendant did not interfere unknowingly. That is to say that they were unaware of the contract between the plaintiff and a third party.
There was no contract existed at the time the defendant alleged improper conduct.
The breach of contract took place even when there was no interference on the part of the defendant.
The valid contract was not in existence.
The defendant’s actions were legally justified. The interference needs to be unlawful or unjustified in the eyes of the law.
There are many defenses available to the defendant. The principle behind the defenses is that the loss was caused to the plaintiff unintentionally. Another thing is the loss occurred mistakenly by the defendant, or the contract was no established between the parties.
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