12.6.1 Individual Supervisor's Liability.

• Jurisdiction: Arizona

12.6.1 Individual Supervisor’s Liability. A vexing issue in the employment context is the extent to which a supervisor or other coworker may be individually liable for tortious interference. Arguably, when an employee acts in the course and scope of employment, the supervisor and employer are one and the same, and the lack of a third party is fatal to the claim. The court of appeals took this position in the pre-Wagenseller case of Payne v. Pennzoil Corp.⁹¹ In Payne, the court affirmed dismissal of an intentional interference claim against supervisors who discharged Payne. The court concluded that the supervisors were acting for the company when they discharged Payne, and they therefore were the company and could not interfere with their own contract.⁹²

Two years later, Wagenseller did not overrule or even mention Payne, but the case’s procedural outcome¾remanding to determine if the supervisor’s conduct in terminating the employee was “improper”¾indicates that under some circumstances, a supervisor may be individually liable for intentional interference with an employment contract. In Wagenseller, the plaintiff’s supervisor had allegedly caused plaintiff’s termination by, among other things, refusing to participate in group “mooning” on a camping trip with co-workers.⁹³ Presumably, the court would not have remanded for the determination of “improper” conduct, if the supervisor could not be individually liable for tortious interference in the first place.

Importantly, in Wagenseller, it appears the parties did not directly raise the argument of the lack of a third party. Moreover, the “mooning” and other behavior in Wagenseller arguably occurred outside the course and scope of employment, making the supervisor, in those respects, a third party to Wagenseller’s employment contract.⁹⁴ Therefore, a conflict does not necessarily exist between Payne and Wagenseller.

Post-Wagenseller cases have produced conflicting results and reasoning on the issue of individual supervisor liability for intentional interference. In Lindsey v. Dempsey,⁹⁵ the court of appeals held that there was no evidence that the supervisor’s conduct was “improper,” without addressing the third party element of the tort. In Barrow v. Arizona Board of Regents,⁹⁶ the court of appeals followed Payne in affirming the dismissal of a professor’s intentional interference claim against the university officials who caused his suspension. The court reasoned that because the officials were acting for the board of regents, they were the board of regents and could not interfere with their own contract.⁹⁷ Kelley v. City of Mesa⁹⁸ similarly followed the Payne rationale.⁹⁹

However, in Bernstein v. Aetna Life & Casualty,¹⁰⁰ the Ninth Circuit, applying Arizona law, did not mention Payne and instead emphasized that one must look to whether the interference is improper, not whether it was in the course and scope:

Aetna has argued that Fischer was a supervisor acting within the scope of his authority as an agent of Aetna, and that, therefore, Bernstein cannot claim interference because Aetna cannot be guilty of inducing a breach of its own alleged contract. This argument is meritless. It was specifically rejected in Wagenseller. 147 Ariz. at...