What Are The Elements Of Interference With Contract In Manhattan?

In New York State, the elements of the tort of interference with contract are “[1] the existence of [a] valid contract with a third party, [2] defendant’s knowledge of that contract, [3] defendant’s intentional and improper procuring of a breach, and [4] damages.”  White Plains Coat & Apron Co. v. Cintas Corp., 8 N.Y.3d 422, 426, 867 N.E.2d 381, 835 N.Y.S.2d 530 (N.Y. 2007); accord Rose v. Different Twist Pretzel, Inc., 123 A.D.3d 897, 898, 999 N.Y.S.2d 438 (N.Y. App. Div. 2nd Dep’t 2014).

Some courts in Manhattan further hold that lack of justification is an element that the plaintiff must plead and prove.  See, e.g., Oddo Asset Mgmt. v. Barclay’s Bank PLC, 19 N.Y.3d 584, 594, 973 N.E.2d 735, 950 N.Y.S.2d 325 (N.Y. 2012); Miller v. Theodore-Tassy, 92 A.D.3d 650, 938 N.Y.S.2d 172, 173-174 (N.Y. App. Div. 2nd Dep’t 2012).

Additionally, plaintiff must show that the defendant’s actions were the “proximate cause“ of the third party’s breach.  See State Street Bank v. Inversiones Errazuriz, 374 F. 3d 158, 171-172 (2nd Cir. 2004) (citation and emphasis omitted).

Where these elements have been satisfied, plaintiff may recover even though ” ‘the defendant was engaged in lawful behavior.’ ”  Wandering Dago Inc. v. State Office of Gen. Svcs., 992 F. Supp. 2d 102, 131 (N.D.N.Y. 2014)

In an action for interference with contract, plaintiff may recover “the full pecuniary loss of the benefits” that would have flowed from the contract that was interfered with.  Guard-Life Corp. v. S. Parker Hardware Mfg. Corp., 50 N.Y.2d 183, 428 N.Y.S.2d 628, 636, 406 N.E.2d 445 (N.Y. 1980); accord International Minerals & Resources, Inc. v. Pappas, 761 F. Supp. 1068, 1079 (S.D.N.Y. 1991).

In other words, the monies recoverable in an interference with contract action include not only compensatory damages, but also consequential damages.  See Guard-Life Corp., 428 N.Y.S.2d at 636 & n.6 (“In an action against the third party for tortious interference, . . . the elements of damages, including consequential damages, would be those recognized under the more liberal rules applicable to tort actions”); International Minerals & Resources, Inc., 761 F. Supp. at 1079 (same).

If your company wants to bring, or needs a lawyer to defend it in, business litigation and you are located in the borough of Manhattan area, call Litigation Lawyer David S. Rich at (347) 941-0760.