Legal Blog

Interference

We have previously discussed the tort of unlawful interference with economic relations (see newsletter of December 2010). The Supreme Court of Canada has finally put all of the controversy to rest in a scholarly decision in A.I. Enterprises Ltd. v. Bram Enterprises Ltd. (2014). Rather than give you an entire analysis of the case, we will give you the bare bones rules that arise from the decision.

Need

The tort of “causing loss by unlawful means” (we even have a new name) is now available only in a three-party situation. The defendant (D) must commit an unlawful act against a third party (TP) and that act must cause, and intentionally be meant to cause, economic harm to the plaintiff (P).

Conduct is unlawful if it is actionable by TP against D or would have been actionable had TP suffered a loss because of it.

A criminal offence or a breach of statute is not, in itself, actionable. A breach of a statute or a criminal offence can be considered to be unlawful for purposes of this tort only if, under common law principles, TP would have a civil cause of action against D because of the breach. The court did not want to “tortify” criminal and regulatory law. However, criminal offences and breaches of statute are still relevant for the tort of conspiracy and its necessary criterion of “unlawful means”.

There is no requirement that the acts either cannot be or must be otherwise actionable by P against D and there are no exceptions to the scope of the liability imposed. The focus of the tort is the unlawful conduct that intentionally harms P’s economic interests. There need be no contract or formal dealings between P and TP as long as D’s conduct is unlawful and intentionally harms P’s economic interests.

Example

TP is a contractor working for D, using P as one of its workers. D does not like P and tells TP, “Fire P, your employee, or I will not continue to do business with you.” TP fires P and P sues D for causing him loss by unlawful means. Will P be successful?

The answer depends on whether TP has a cause of action against D (e.g. were D’s demands to fire P in breach of a contract?).  If TP does and if P can prove that D intentionally meant to cause economic harm to P, then P has a cause of action against D under the tort of causing loss by unlawful means. If TP has no cause of action against D, then P may have a  remedy against TP under the employment contract, but has no cause of action against D.