When two parties enter into a business contract, it's with the assumption that neither will breach its terms. What if a third party interferes with the arrangement, though, and ultimately disrupts it? Known as tortious interference, such conflicts are fairly common in highly competitive business climates. If you ever find yourself dealing with a breach prompted by a third party, here is what you should know. 

What Constitutes Tortious Interference?

Tortious interference is a civil offense that occurs when a third party interjects into an existing or anticipated arrangement, causing financial harm to one of the parties. If a competitor impacted one of your business contracts, you’ll have to prove four elements in order to win the case. 

First, you’ll have to prove your company had an existing business relationship with the other party, even if it was not yet in writing. Then, you’ll have to show how the offending party knows (or should’ve known) of this relationship. Third, you’ll have to prove the defendant intentionally and wrongfully interfered with the arrangement. Finally, you must demonstrate how said interference harmed the business relationship and, subsequently, caused actual damages. 

What Kinds of Damages Are Recoverable?

In a successful tortious interference claim, the plaintiff may be entitled to compensation for all monies lost as a result of the defendant’s wrongdoing. For example, if the contract was breached two months into a 12-month commitment, the plaintiff might be able to recover the funds they would’ve been entitled to over the subsequent 10 months. 

Depending on the circumstances, a punitive award may also be warranted. If the defendant’s conduct constituted wanton and willful negligence, for example, the judge may award punitive damages on top of the standard compensatory damages. 

If one or more of your business contracts have been threatened by third parties, contact PoindexterHill, P.C. Located in Waynesboro, VA, this firm has been counseling business owners since 1976. Their knowledgeable attorneys are equipped to set up limited liability companies, draft operating agreements, and resolve employment disputes. To discuss your business contracts with a member of their team, call (540) 943-1118. Visit them online to browse their practice areas.