Aрpeal from an order of the Supreme Court (Rose, J.), entered January 12, 1993 in Tioga County, which granted defendants’ motion to dismiss the complaint for, inter alia, failure to state a cause of action.
In 1989 plаintiff, a contract manufacturing firm in Tioga County that had previously borrowed approximately $4 million from defendants, petitioned for reorganizatiоn in bankruptcy. The reorganization plan approved by Bankruptcy Court provided a moratorium on loan repayments until January 15, 1991, at which time рlaintiff was to begin making monthly payments to defendants in stated amounts. When plaintiff anticipated difficulty making the scheduled payments, the parties entеred into an agreement on January 25, 1991 according plaintiff a further moratorium, in exchange for which it agreed, inter alia, to pay defendants $50,000 in six equal monthly instаllments beginning on February 1, 1991.
Meanwhile, during 1990, as the moratorium discussions were going on, plaintiff began negotiating with Ozalid Corporation. Those negotiations came into fruition in January 1991, when plaintiff entered into a contract to perform substantial manufacturing work for Ozalid. Whether, as asserted by plaintiff, defendants were aware of and supported these negotiations and approved the contract with Ozalid is of no moment, for resolution of this aрpeal does not turn on that circum
In response to defendants’ threats, plaintiff claims that it canceled the contract with Ozalid and that the serious financial downturn plaintiff allegedly experienced as a result prompted it to bring this action charging defendants with tortious interferenсe with that contract and also economic duress. Defendants’ motion to dismiss the complaint, pursuant to CPLR 3211 (a) (1) and (7), was granted and plaintiff appeals.
The gravamen of plaintiff’s first cause of action is that defendants, by wrongfully threatening to declare plaintiff in default despite having agreеd to an extended moratorium, caused plaintiff to breach its contract with Ozalid and consequently to suffer economic damages. This claim is unаvailing, for even if a party can recover for tortious interference from one who caused it to breach its own contract with anothеr (see, Stiso v Inserra Supermarkets,
Whether conduct which interferes with another’s contraсtual relations is improper, and thus actionable, is determined by reference to a number of factors, including the nature of the conduct itself, the motives of the interfering party and the interests which it acts to protect, the interest with which it interferes and the relationship between the parties (see, Guard-Life Corp. v Parker Hardware Mfg. Corp., supra, at 190; Restatement [Second] of Torts § 767). In the matter at hand, the chief factors are the competing interests of the parties and the social utility of those interests. While we recognize that
Although defendants’ actions were, in part, designed to preserve their funding, which is dependent on the political process, and the protection of one’s own economic interests will rarely justify interference with another’s executed contract, State agencies dispensing public funds, such as defendants, must be given leeway to influence the business practices of their beneficiaries in order to safeguard the public fisc. As demonstrated by the facts of this case, an agency must be permitted to exert a sufficient level of control over a recipient of public funds to enable the agency to ensure that those funds are used in a manner consistent with the public policy of this State. The record indicates that while defendants made the loans at issue for the purposе of creating new jobs, the Ozalid contract involved only the shifting of jobs from one location to another and facilitated Ozalid’s avoidance of its collective bargaining agreement, entailing the loss of bargained for jobs, a result contrary to the public policy of the State.
Taken together, these interests are sufficient to justify the use of persuasion, economic pressure or other conduct which is not immanently unlawful in an attempt to affect the business practices of the funded concern, at least to the extent that those practices threaten to аffect the agency’s ability to secure funding or otherwise bear on legitimate societal interests, such as those previously noted (see, Restatement [Second] of Torts § 767, comments c, d, f; cf., Restatement [Second] of Torts § 771).
If defendants hаd a preexisting contractual obligation to provide continuing forbearance, their refusal to do so could be considered wrongful. Under the terms of the January 25, 1991 agreement, however, they had agreed only to provide plaintiff a respite from payments for four months; moreover, рlaintiff had materially breached that agreement in several respects. Thus, defendants had every right to enforce the provisions of the loan agreements at the time of their meeting with plaintiff in June 1991 and the conduct which plaintiff claims induced it to breach the contract with Ozalid, that is, defen
Plaintiffs second cause of action, sounding in economic duress, was also rightly dismissed. As noted, the documentary evidence presented, including the loan instruments and the January 25, 1991 agreement, clearly establishes that defendants were еntitled, in June 1991, to declare the notes due and payable, and it is axiomatic that they cannot be guilty of economic duress for failing to grant further forbearance when they had no legal duty to do so (see, 805 Third Ave. Co. v M.W. Realty Assocs.,
Cardona, P. J., Crew III, Casey and Weiss, JJ., concur. Ordered that the order is affirmed, with costs.