Interference with Contract in Colorado

Interference with the performance of a contract (also called interference with contractual relations) is an actionable case in Colorado business litigation. The general elements of an interference with contract claim are as follows:

  1. the plaintiff had a contract with another party;
  2. the defendant knew or should have known of such contract’s existence;
  3. the defendant intentionally and improperly induced the other party to the contract not to perform the contract with the plaintiff; and
  4. the defendant’s actions caused the plaintiff to incur damages bu way of the induced breach.

Lutfi v. Brighton Cmty. Hosp. Ass’n, 40 P.3d 51, 58 (Colo. App. 2001).

In Colorado, a second related action is recognized as interference with business relationships. The first, outlined above, deals with interference with existing contractual relationships. The second and distinct claim is interference with a prospective contract or a prospective business advantage.

I have brought and successfully defended tortious interference claims in Colorado and have found that some of the most critical aspects of these claims involve the knowledge of the defendant of the contract’s existence and that the defendant’s conduct be truly improper. Merely negotiating with one of the contracting parties or entering into a contract with a party that cannot perform two contracts (such as the sale of real estate) is generally not enough. Factors for consideration of whether the conduct in question rises to the necessary level include the interest the defendant is seeking to advance, motive, proximity of conduct to the interference, nature of the conduct, and the relationship between the parties.