California Jury Instruction CACI 2201 Intentional Interference With Contractual Relations—Essential Factual Elements

New September 2003; Revised June 2012, December 2013

Nakase Wade | California Business Lawyers & Corporate Lawyers

This tort is sometimes called intentional interference with performance of a contract. (See Little v. Amber Hotel Co. (2011) 202 Cal.App.4th 280, 291 [136 Cal.Rptr.3d 97].) If the validity of a contract is an issue, see the series of contracts instructions (CACI No. 300 et seq.).

•“California recognizes a cause of action against noncontracting parties who interfere with the performance of a contract. ‘It has long been held that a stranger to a contract may be liable in tort for intentionally interfering with the performance of the contract.’ ” (Redfearn v. Trader Joe’s Co. (2018) 20 Cal.App.5th 989, 997 [230 Cal.Rptr.3d 98], original italics.)

•“[C]ases have pointed out that while the tort of inducing breach of contract requires proof of a breach, the cause of action for interference with contractual relations is distinct and requires only proof of interference.” (Pacific Gas & Electric Co. v. Bear Stearns & Co. (1990) 50 Cal.3d 1118, 1129 [270 Cal.Rptr. 1, 791 P.2d 587], internal citations omitted.)

•“The elements which a plaintiff must plead to state the cause of action for intentional interference with contractual relations are (1) a valid contract between plaintiff and a third party; (2) defendant’s knowledge of this contract; (3) defendant’s intentional acts designed to induce a breach or disruption of the contractual relationship; (4) actual breach or disruption of the contractual relationship; and (5) resulting damage.” (Pacific Gas & Electric Co. v. Bear Stearns & Co. (1990) 50 Cal.3d 1118, 1126 [270 Cal.Rptr. 1, 791 P.2d 587], internal citations omitted.)

•“[A] cause of action for intentional interference with contract requires an underlying enforceable contract. Where there is no existing, enforceable contract, only a claim for interference with prospective advantage may be pleaded.” (PMC, Inc. v. Saban Entertainment, Inc. (1996) 45 Cal.App.4th 579, 601 [52 Cal.Rptr.2d 877].)

•“Because interference with an existing contract receives greater solicitude than does interference with prospective economic advantage, it is not necessary that the defendant’s conduct be wrongful apart from the interference with the contract itself.” (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 55 [77 Cal.Rptr.2d 709, 960 P.2d 513], internal citations omitted.)

•“The question is whether a plaintiff must plead and prove that the defendant engaged in wrongful acts with the specific intent of interfering with the plaintiff’s business expectancy. We conclude that specific intent is not a required element of the tort of interference with prospective economic advantage. While a plaintiff may satisfy the intent requirement by pleading specific intent, i.e., that the defendant desired to interfere with the plaintiff’s prospective economic advantage, a plaintiff may alternately plead that the defendant knew that the interference was certain or substantially certain to occur as a result of its action.” (Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1154 [131 Cal.Rptr.2d 29, 63 P.3d 937], original italics.)

•“We caution that although we find the intent requirement to be the same for the torts of intentional interference with contract and intentional interference with prospective economic advantage, these torts remain distinct.” (Korea Supply Co., supra, 29 Cal.4th at p. 1157.)

•“Plaintiff need not allege an actual or inevitable breach of contract in order to state a claim for disruption of contractual relations. We have recognized that interference with the plaintiff’s performance may give rise to a claim for interference with contractual relations if plaintiff’s performance is made more costly or more burdensome. Other cases have pointed out that while the tort of inducing breach of contract requires proof of a breach, the cause of action for interference with contractual relations is distinct and requires only proof of interference.” (Pacific Gas & Electric Co., supra, 50 Cal.3d at p. 1129, internal citations omitted.)

•“[A] contracting party cannot be held liable in tort for conspiracy to interfere with its own contract.” (Asahi Kasei Pharma Corp. v. Actelion Ltd. (2013) 222 Cal.App.4th 945, 961 [166 Cal.Rptr.3d 134], original italics.)

•“[O]ne, like [defendant] here, who is not a party to the contract or an agent of a party to the contract is a ‘stranger’ for purpose of the tort of intentional interference with contract. A nonparty to a contract that contemplates the nonparty’s performance, by that fact alone, is not immune from liability for contract interference. Liability is properly imposed if each of the elements of the tort are otherwise satisfied.” (Redfearn, supra, 20 Cal.App.5th at p. 1003.)

•“[I]nterference with an at-will contract is actionable interference with the contractual relationship, on the theory that a contract ‘at the will of the parties, respectively, does not make it one at the will of others.’ ” (Pacific Gas & Electric Co., supra, 50 Cal.3d at p. 1127, internal citations and quotations omitted.)

•“We conclude that a plaintiff seeking to state a claim for intentional interference with contract or prospective economic advantage because defendant induced another to undertake litigation, must allege that the litigation was brought without probable cause and that the litigation concluded in plaintiff’s favor.” (Pacific Gas & Electric Co., supra, 50 Cal.3d at p. 1137.)

•“[A]n actor with ‘ “a financial interest in the business of another is privileged purposely to cause him not to enter into or continue a relation with a third person in that business if the actor [¶] (a) does not employ improper means, and [¶] (b) acts to protect his interest from being prejudiced by the relation[.]” ’ ” (Asahi Kasei Pharma Corp, supra, 222 Cal.App.4th at p. 962.)