Virginia business litigation: Interfering in other companies’ contracts

Virginia companies spend a great deal of time and expense in developing business relationships and contracts. In fact, the impact of these relationships and contracts often determine whether a company will thrive or languish in obscurity. Because of their importance, Virginia law generally prohibits third parties from intentionally interfering in the contractual dealings or relationships of two other businesses.

Consequently, if a third party does interfere with a contract or business relationship between two other Virginia businesses, the third party may find themselves involved in a Virginia business litigation dispute.

Virginia tortious interference law

Virginia law recognizes a cause of action known as tortious interference with an existing or prospective contract, which is often utilized by Virginia businesses when a third party interferes with their contracts.

In order to state a claim for tortious interference with an existing or prospective contract under Virginia law, a business must be able to show:

  • The existence of a valid contractual relationship or business expectancy
  • Knowledge of this relationship, or expectancy, by the third party interferer
  • Intentional interference by the interferer causing or inducing a breach or termination of the contractual relationship or expectancy
  • Damage to the party whose relationship was disrupted

As the elements indicate, it is not necessary for there to be a contract already executed for a claim for tortious interference to exist. For instance, if a business can prove with "reasonable certainty" that a contract was expected to come into existence in the future, a cause of action may be possible.

In addition to interference with contracts, Virginia law also recognizes a tortious interference with business relations. Although the elements of these causes of action are similar, there are some differences - most notably that a breach is not required for tortious interference with business relations since a contract of any type is not required.

Damages for Virginia tortious interference

For both tortious interference of contract and business relations, compensatory and punitive damages may be available. Compensatory damages are generally calculated as the present value of the profits lost due to the third party's actions. And while a business need not prove the exact amount of lost profits, they must be able to provide enough proof so that a jury can "make an intelligent and reasonable estimate of the amount."

If you are a business owner in Virginia and you believe a third party is interfering with your business's contracts or relationships, it is important to speak with an experienced business litigation attorney to ensure your rights are protected.