5.9 LEADING CASES
5.901 In General.
A. Dunlap Cottman Transmission Systems, LLC. 114 In this case, a franchisee filed suit against the franchisor's competitor and franchisor's principal for, inter alia, tortious interference with contract and tortious interference with business expectancy. On appeal, the Fourth Circuit certified two questions concerning tortious interference to the Virginia Supreme Court. The Virginia Supreme Court addressed each question in turn, holding first that "both tortious interference with contract and tortious interference with business expectancy qualify as an unlawful act for purposes of a business conspiracy claim under Code §§ 18.2-499 and -500." The court also held that "the five-year statute of limitations in Code § 8.01-243(B) applies to causes of action for tortious interference with contract and tortious interference with business expectancy."
B. Preferred System Solutions, Inc. v. GP Consulting, LLC. 115 In this case, a government contractor sued its subcontractor following the subcontractor's termination of contract with the government contractor. The government contractor alleged, inter alia, that the subcontractor had tortiously interfered with its contracts. On appeal, the Virginia Supreme Court affirmed the circuit court's refusal to award damages on the tortious interference claim. The court reasoned that "[e]ven assuming that PSS established the other elements of its tortious interference claim, it failed to prove that GP used improper methods or means to interfere with PSS's business or contract expectancy with DLA. The only act that PSS points to as evidence of an improper method or means on the part of GP is its breach of the non-compete clause. While improper methods or means need not be 'inherently illegal or tortious,' we hold that the breach of a noncompete clause is not in itself an improper method or means." 116
5.902 Real Estate Brokers and Agents.
A. T.G. Slater & Son, Inc. v. Donald P. & Patricia A. Brennan LLC. 117 In this case, a real estate broker stated a claim under Virginia law against a purchaser for tortious interference with contract. The broker
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alleged the existence of a "valid contractual relationship" between the broker who was acting as the purchaser's agent and the defendant purchaser, that the purchaser "was aware of the existence of the contractual relationship," that the purchaser "intentionally interfered" with that relationship "for the purpose of avoiding the payment of [broker's] reasonable commission," and that as a result of the interference the "[broker] suffered a loss in the form of lost commissions."
B. Century-21 v. Elder. 118 In this case, a builder failed to make a prima facie case of intentional interference by an agent with performance of the builder's contract with homebuyers. The buyers requested the agent to give them information on the prices of houses in the area of the builder's house, requested the agent to show them additional houses, and proceeded to sign the offer to purchase another house after the agent told them of her understanding of their liability under their contract with the builder. The builder's evidence was insufficient to show that the agent intended to interfere with the contract or induced or caused the buyers to breach the contract with the builder.
C. In re Williamson. 119 In this case, the plaintiff's purchase of the home of Chapter 13 debtors was contingent on court approval of the contract. During the time between the execution of the contract and the court hearing to approve it, the property remained on the market and was subject to higher or better offers than the plaintiff's. The plaintiff brought an action against a competing bidder and real estate agents, asserting that the competing bidder tortiously interfered with her business relationship with the debtor by submitting a competing bid that forced the plaintiff to pay more for the house than she would have otherwise. The court dismissed the plaintiff's claim, holding that the higher price was not a result of interference by the defendants but rather the process of exposing the property to the market.
5.903 Financial Services Providers.
A. Commerce Funding Corp. v. Worldwide Security Services Corp. 120 In this case, a district court concluded that attempts by the first lender to enforce its rights to collect accounts receivable were not done with the intent to interfere with the asset purchaser's factoring agreement with a second lender. The trial court's conclusion was not clearly erroneous, where
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the first lender's evidence was that it was not aware of the factoring agreement and believed it had the right to pursue its remedies under an earlier security agreement.
B. Douty v. Irwin Mortgage Corp. 121 In this case, allegations by a former mortgage loan officer that other loan officers, acting on behalf of the company, interfered with prospective business contracts in the construction industry by providing false and misleading information regarding her employment and termination from the company, stated a claim under Virginia law for tortious interference with prospective business opportunities.
C. Peterson v. Cooley. 122 In this case, endorsers of two commercial promissory notes did not enter into a contractual relationship with the payee bank that was sufficient to support a claim for tortious interference with a contract under Virginia law. Although they had orally agreed, the endorsers failed to execute a written settlement agreement sent by the bank, so a later sale of the notes by the bank to another creditor was upheld.
D. Charles E. Brauer Co. v. NationsBank of Virginia, N.A. 123 In this case, the court found that a bank's refusal to release its security interest following the debtor's default to allow the sale of its collateral to prospective purchasers, while perhaps arbitrary, was not wrongful. This exercise of its contractual rights by the bank would not support a tortious interference claim on the theory that the bank had wrongfully interfered with the debtor's contractual relations.
E. Meadow Ltd. Partnership v. Heritage Savings & Loan Ass'n. 124 In this case, the court found a savings and loan did not improperly interfere with a sales contract because the agreement to purchase the property was conditioned on the approval of the savings and loan because the property owner's note was in default and had been accelerated. Even if the savings and loan had full knowledge of an agreement whereby a third party would purchase the property, it was not relevant since the bank held the priority lien and had the freedom to approve or disapprove an offer.
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5.904 Architects. In Chaves v. Johnson, 125 the court found that the defendant's letter, which described an architect as inexperienced and as charging the city council excessive fees, could not be justified against a claim of tortious interference with contract rights on the basis of financial self-interest, freedom of speech, or the right of a taxpayer to complain of public expenditures. The letter had resulted in the city council's breach of its original contract with the plaintiff and a later award of the same job to the defendant.
5.905 Contractors. In Masco Contractor Services East, Inc. v. Beals, 126 an insulation contractor's counterclaim failed to allege the existence of a valid contractual relationship, business relationship, or business expectancy to support its claims for tortious interference with contractual relations and tortious interference with prospective economic advantage under Virginia law. The contractor's allegation that the opposing contractor generally coerced suppliers and consumers only referred to its own general expectancy to remain in business.
5.906 Distributors. In Bay Tobacco, LLC v. Bell Quality Tobacco Products, LLC, 127 the court held that a cigarette distributor failed to properly plead its claim of tortious interference with contracts against a competitor. The court noted that the plaintiff had failed to allege which of its customer contracts a competitor interfered with by making an allegedly defamatory statement about the distributor, that...
