Thе complaint alleges a conspiracy on the part of the respondents Grimm and Harrison to perpetrate
A conspiracy to cause a breach of contract is actionable.
Martens v. Reilly
(1901),
The plaintiff’s employment by the corporation at a salary of $9,000 per year established a contractual relationship between them. The complaint fails to allege that such employment was for any fixed period, and, therefore, it must be assumed for purposes of the dеmurrer that it was terminable at will by either party. However, the weight of authority is to the effect that a cause of action is maintainable for a wrongful interference by a third party with an employment relationship terminаble at will. Annotations entitled, “Liability for procuring breach of contract,” 84 A. L. R.
“However, eminent legal writers to the contrary notwithstanding, the overwhеlming majority of the cases have held that interference with employments or other contracts terminable at will is actionable, since until it is terminated the contract is a subsisting relation, of value to the plaintiff, and рresumably to continue in effect. The possibility of termination does, however, bear upon the issue of the damages sustained, and it must be taken into account in determining the defendant’s privilege to interfere.”
Wisconsin hаs aligned itself with the majority in holding that a cause of action is maintainable for unlawful interference with an employment contract terminable at will.
Johnson v. Aetna Life Ins. Co.
(1914),
Restatement, 4 Torts, p. 49, sec. 766, states that “one who, without a privilege to do so, induces or othеrwise purposely causes a third person not to perform a contract with another, . . . is liable to the other for the harm caused thereby.” (Emphasis supplied.) The respondents contend that they, because оf their position as majority stockholders, enjoyed a position of absolute privilege when they caused the corporation to dispense with the plaintiff’s services as general manager. The cases оf Vassardakis v. Parish (D. C. N. Y. 1941), 36 Fed. Supp. 1002, and Tye v. Finkelstein (D. C. Mass. 1958), 160 Fed. Supp. 666, directly pass upon such issue of privilege where an employee of a corporation is discharged at the instigation of a corporate stockholder or executive.
In
Vassardakis v. Parish, supra,
one count of the complaint alleged that the defendant Myers, who was an officer and director of the corporation which had employed the
“Whether or not Myers was acting with justification and in furtherance of the interests of the corporation and within the general scope of his authority or for personal wrongful motives ought to be determined by the evidence produced at a trial.”
The fact situation in Tye v. Finkelstein, supra, was that the defendant majority stockholder procured the discharge of the plaintiff as an employee of the corporation, and the plaintiff sought to hold the defendant liаble in damages. The court denied the defendant’s motion for summary judgment. It was determined that the plaintiff could hold the defendant liable for substantial damages, even though the employment contract was terminable at will, if thе plaintiff could prove that the defendant instigated the discharge without justification. The court in its opinion stated (p. 668) :
“The plaintiff must establish that instead of acting ‘within the privilege,’ the defendant acted outside of it, that is to say, from ‘an improper motive.’ It might be to the company’s advantage to break the contract. It is not enough to show that defendant knew, or intended, that plaintiff would be harmed thereby, or even that he was gratified by such a prospect. I hold that ‘malice’ will not suffice to destroy a privilege unless it is shown to have been the sole motive.”
Prosser, Law of Torts (2d ed.), p. 738, sec. 106, points out that a defendant, who otherwise would stand in a posi
One of the contentions advanced by the respondents is that the complaint is defective because it dоes not allege any facts which might tend to show “bad faith” on the part of Grimm and Harrison. Apparently respondents assume that it is necessary for the plaintiff to allege malice as an element of a cause of action for procuring the termination of the plaintiff’s employment as manager. However, this court declared in
Johnson v. Aetna Life Ins. Co., supra,
that malice is supplied when the act of procuring the discharge is done with an improper motive. Furthermore, in
E. L. Husting Co. v. Coca Cola Co.
(1931),
For a further discussion of the element of malice in causes of action for interference with contract rights, see Harper, Interference with Contractual Relations, 47 Northwestern University Law Review (1953), 873, 876, and Carpеnter.
“The courts which uphold liability for interference with contract do not use the word malice in the sense of malevolence, spite, or ill will. They probably use it to mean merely intentionally inducing a breach of contract without justification.”
In view of the foregoing pertinent authorities we are satisfied that the complaint does state a cause of action for conspiracy to wrongfully procure the termination of the plaintiffs employment as manager of the company. Thus it was error for the learned trial court tо sustain the respondents’ demurrer on the ground that the complaint failed to state a cause of action.
This disposition of the appeal renders it unnecessary for us to determine whether the complaint further states a cause of action for damages sustained as a result of the alleged conspiracy to coerce the plaintiff into selling his stock in the corporation for less than its fair market value. Wiscоnsin is one of the jurisdictions which has adopted the modern view which holds that contracts and transfers may be voided when procured by business or economic compulsion, as well as by physical coercion.
Minneapolis, St. P. & S. S. M. R. Co. v. Railroad Comm.
(1924),
However, the instant complaint does not pray for a rescission of the stock transfer because of duress, but seeks to recover damages for the alleged wrong perpetrated upon the plaintiff by reason thereof. The briefs of the parties wholly
One additional issue is presented by the instant appeal and that is whether the demurrer is sustainable on the ground that the complaint improperly unites several causes of action. The trial court failed to pass on this. As we construe the complaint, it sets forth but one cause of action for conspiracy involving two different elements of damages. While the allegations attempting to link the Blatz Brewing Company to the conspiracy are extremely weak, the weakness of such allegations is not material to the issue confronting us. The cause of action attempted to be alleged does affect all of the parties to the action. Therefore, there is no improper joinder of causes of action.
By the Court. — Order reversed, and cause remanded with directions to enter an order overruling the demurrers interposed by the defendants Grimm and Harrison.