Interference With Economic Relations: A Comparative Analysis Of American And Anglo-Canadian Approaches

Nothing leads to more confusion in common law than the scope of the tort of intentional interference with economic relations.

In the United States, Canada, and the United Kingdom, courts have struggled with when and how to hold a defendant liable for deliberately engaging in conduct that causes harm to the plaintiff's economic interests. At the core of the debate, as with most economic torts, is the courts' reluctance to use tortious liability as a way to stifle legitimate competition and overall commercial activity.

Despite this common concern, the United States, on the one hand, and Canada and the United Kingdom, on the other hand, have adopted different approaches to when the tort will be applied.

In the United States, most courts have imposed liability where the defendant employs "improper means" to interfere with the plaintiff's contractual or prospective economic relationship. By contrast, the United Kingdom and Canada have narrowed the scope of the tort considerably, basing liability on the defendant's "unlawful act" against a third party; in these jurisdictions, the "unlawful means" tort is narrowly circumscribed and subject to exceptions.

This article provides a brief summary of how the tort of intentional interference operates generally in the United States, Canada, and the United Kingdom. The author concludes that while the breadth of the American approach has been criticized as leading to commercial uncertainty, the Anglo-Canadian jurisprudence has unnecessarily narrowed the tort so as to render it virtually inapplicable to most commercial dealings.

The Tort of Intentional Interference

Like many other economic torts, the tort of intentional interference with economic relations at common law is "in a mess." H. Carty, "Intentional Violation of Economic Interests: The Limits of Common Law Liability," 104 Law Q. Rev. 250, 278 (1998) (cited in A.I. Enters. Ltd. v. Bram Enters. Ltd. [2014] 1 S.C.R. 177, para. 28 (Can.)).

At Canadian common law, for example, even the name of the tort was at one time debatable, with varying monikers such as "unlawful interference with economic relations," "interference with a trade or business by unlawful means," and "intentional interference with economic relations" being employed. Ultimately, the Supreme Court of Canada resolved this issue by naming it the "unlawful means" tort. A.I. Enterprises [2014] 1 S.C.R. 177, para. 2.

In the United States, the tort may differ depending on the level of the defendant's intention in causing economic harm and whether the defendant sought to affect a contractual or prospective economic relationship. See Gary C. Crapster & Jessica C. Smith, "Interference with Contractual and Economic Relationships," in Business Torts Litigation 55 (Am. Bar Ass'n, 2d ed. 2005), for a discussion of the distinction in most states between interference with contractual relationships and interference with prospective economic relationships.

These nuances aside, however, the basis of the tort remains the intention to cause economic harm by way of unlawful or improper means. That is, the victim of the unlawful or improper act has the right to sue the defendant for the defendant's deliberate interference with the victim's economic relations.

Despite the relative clarity surrounding the elements of the tort across most common-law jurisdictions, the scope of the tort varies significantly from one...