27.9 Defenses or Privileges

• Jurisdiction: Arizona

27.9 Defenses or Privileges. An actor may interfere with another’s performance of an existing contract to protect a legally protected interest . In Snow v. W. Sav. & Loan Ass’n ,⁶¹ the court held:

one who, by asserting in good faith a legally protected interest of his own or threatening in good faith to protect the interest by appropriate means, intentionally causes a third person not to perform an existing contract or enter into a prospective contractual relation with another does not interfere improperly with the other’s relations if the actor believes that his interest may otherwise be impaired or destroyed by the performance of the contract or transactions.⁶²

Arizona courts define a legally protected interest as one “so legitimate that everyone is under a duty not to invade it by interfering with its realization, and those who do so would be civilly liable to the possessor.⁶³ For instance, when two parties have separate contracts with a third party, each party may employ legitimate means to secure performance of their contract even though the other party’s contract will be breached.⁶⁴ The actor’s state of mind toward the plaintiff is irrelevant so long as he is acting to protect his own interest.⁶⁵

Likewise, an actor may avoid liability for interference with the contractual rights of another for a “legitimate competitive reason” regardless of whether he bears ill will toward his competitor.⁶⁶ Early Arizona case law restricted the application of the legitimate competition privilege to business expectancy interest and not existing contracts.⁶⁷ Arizona courts have since held the privilege will apply to at-will contracts.⁶⁸

For example, in Ulan , the court stated that a difference exists between inducing the breach of an at-will contract and a contract for a definite period.⁶⁹ In the case of an existing...