PJC Business 2024

T ORTIOUS I NTERFERENCE

PJC 106.4

PJC 106.4

Contracts Terminable at Will or on Notice (Comment)

The supreme court has recognized that contracts terminable at will or on notice may be protected from tortious interference. See Sterner v. Marathon Oil Co. , 767 S.W.2d 686, 689 (Tex. 1989) (terminable-at-will employment contract with no regard for whether the contract was oral or written); Juliette Fowler Homes, Inc. v. Welch Associ ates, Inc. , 793 S.W.2d 660, 666 (Tex. 1990) (terminable-on-notice fundraising con tract), superseded on other grounds by statute as recognized in Coinmach Corp. v. Aspenwood Apartment Corp. , 417 S.W.3d 909, 922 (Tex. 2013). In 2017, the supreme court repeated Sterner ’s holding that until terminated, an at will employment contract “is valid and subsisting, and third parties are not free to tor tiously interfere with it.” Exxon Mobil Corp. v. Rincones , 520 S.W.3d 572, 591 (Tex. 2017) (quoting Sterner , 767 S.W.2d at 689). But see Safeshred, Inc. v. Martinez , 365 S.W.3d 655, 660 (Tex. 2012) (not addressing Sterner or its progeny, but holding that the Sabine Pilot plaintiff’s damages are rooted in tort, not contract: “[T]o say that Sabine Pilot created an implied contractual provision would presume, in the first place, that there is a contract between at-will employees and their employers in which to place an implied provision. We have never recognized such a proposition.”). As in a claim of interference with other forms of existing contracts, justification may be a defense (see PJC 106.2) when the existing contract is terminable at will or on notice. In Sterner , the supreme court affirmed that Marathon Oil may have tortiously interfered with Sterner’s at-will employment by inducing his employer—a contractor working for Marathon—to fire Sterner. Whether its interference was tortious depended on the outcome, on remand, of an evidentiary review of Marathon’s affirma tive defense: specifically, a review of whether “the jury’s failure to find that Marathon acted with legal justification or excuse [was] against the great weight and preponder ance of the evidence.” Sterner , 767 S.W.2d at 691. But in a later case, the supreme court held that “[o]rdinarily, merely inducing a contract obligor to do what it has a right to do is not actionable interference.” ACS Investors, Inc. v. McLaughlin , 943 S.W.2d 426, 430 (Tex. 1997). The ACS court made clear that the affirmative defense of justification was not at issue. ACS Investors, Inc. , 943 S.W.2d at 431. These holdings— Sterner ’s that inducing a party to an at-will contract to terminate may be tortious interference, depending on the success of an affirmative defense of justification, and ACS ’s that it ordinarily is not tortious interference regardless of justi fication—may appear to be “at odds.” Lazer Spot, Inc. v. Hiring Partners, Inc. , 387 S.W.3d 40, 51 (Tex. App.—Texarkana 2012, pet. denied). Discussions of Sterner in post- ACS cases generally recognize that ACS narrowed Sterner , such that merely inducing a party to exit an at-will contract cannot, by itself, be tortious interference and does not require a justification defense. See Greenville Automatic Gas Co. v. Auto matic Propane Gas & Supply, LLC , 465 S.W.3d 778, 787 (Tex. App.—Dallas 2015, no pet.) (“The willful act could not merely be [defendant’s] hiring of Anderson: the par-

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