PJC Business

PJC 106.4

T ORTIOUS I NTERFERENCE

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); Juliette Fowler Homes, Inc. v. Welch Associates, Inc. , 793 S.W.2d 660, 666 (Tex. 1990) (terminable on-notice fundraising contract), superseded on other grounds by statute as recognized in Coinmach Corp. v. Aspenwood Apartment Corp. , 417 S.W.3d 909, 922 (Tex. 2013). Because at-will employment entails a contract, it may be the subject of a claim for tortious interference. Sterner , 767 S.W.2d at 688–89; In re Swift Transportation Co. , 311 S.W.3d 484, 489 (Tex. App.—El Paso 2009, no pet.) (“Texas courts have for many years considered an employment-at-will agreement to be a contract.”); White head v. University of Texas Health Science Center at San Antonio , 854 S.W.2d 175, 180 (Tex. App.—San Antonio 1993, no writ) (“We do not disagree with the argument that all employment relationships are implicitly contractual.”). 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 tortiously 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 , but holding that, for purposes of determining the dam ages available to a prevailing plaintiff in a Sabine Pilot retaliation case, there is no contract between at-will employees and their employers). In Sterner , the supreme court affirmed that Marathon Oil may have tortiously inter fered 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). Discussion of Sterner in post- ACS cases generally recognizes 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 Lazer Spot , 387 S.W.3d at 51–53;

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