N.J. Model Civil Jury Charge 3.30B

3.30B TORTIOUS INTERFERENCE WITH CONTRACTUAL

RELATIONS (REALTY BROKER V. THIRD PARTY)

(Approved 6/79)

The law protects those in the pursuit of their livelihood. The right to pursue

the real estate brokerage business is one of the property rights and interest which

the law protects against unlawful interference 1. A person who unjustifiably

interferes with the contract of another is guilty of a wrong. The protection of the

law is not limited only to those contracts already made, but also protects a person’s

interest in a reasonable expectation of economic gain 2. When a party contracts

with a real estate broker, the broker ag rees to use his/her knowledge of what

property is or can be made available and who is or can be interested in a given

parcel, in return for a commission if he/she succeeds in bringing buyer and seller

together at terms agreeable to both. In the practical world of business dealings, the

broker trusts that those who accept or seek his/her services will not cheat him/her

of the fruit of his/her labors.

In order to show that a party has in terfered with the broker’s expectation of

economic gain from the successful performance of his/her services as a broker, the

broker must prove several elements of his/her claim:

1Louis Kamm, Inc. v. Flink, 113 N.J.L. 582 (E. & A. 1934).

2Harris v. Perl, 41 N.J. 455 (1964).

FIRST: The broker must prove the existence of an agreement

between himself/herself and the seller of the property, under which agreement

the seller agreed to pay the broker a commission.

SECOND: The broker must prove that th e defendant had knowledge of the

agreement between the broker and the seller.

THIRD

: The broker must prove that th e defendant intentionally, and

maliciously, that is, with motive to harm and without justification, interfered with

the contractual relation existing between the broker and the seller by inducing,

procuring or causing a breach of termination of the agreement,3 or if he/she did not

act out of sheer malice, but rather for profit or to enhance his/her financial position,

then it must be shown that his/her conduct went beyond or transgressed generally

accepted standards of morality; that is, a violation of standards of socially

acceptable conduct.4

FOURTH: The broker must also prove it is reasonably probable he/she

could have found a purchaser willing and able to buy on the seller’s terms as

communicated to the broker and thus would have received the anticipated

economic benefit.5

3McCue v. Deppert, 21 N.J. Super. 591 (App. Div. 1952); DiCristofaro v. Laurel Grove

Memorial Park, 43 N.J. Super. 244 (App. Div. 1957); Sustick v. Slatina, 48 N.J. Super. 134

(App. Div. 1957).

4Lesli Blau Co. v. Alfieri, 157 N.J. Super. 173 (App. Div. 1978).

5Myers v. Arcadio, Inc. 73 N.J. Super. 493 (App. Div. 1962).

Cases:

Harris v. Perl , 41 N.J. 455 (1964), suit by broker against purchaser and others,

involving interference with contractua l relations and interference with

reasonable expectations of economic advantage; George H. Beckmann, Inc., v.

Charles H. Reid & Sons, Inc ., 44 N.J. Super. 159 (App. Div. 1957), broker had

oral listing from seller and rec overed damages from purchaser; Sustick v.

Slatina, 48 N.J. Super. 134 (App. Div. 1957); Wear-Ever Aluminum, Inc., v.

Townecraft, etc., Inc ., 75 N.J. Super. 135 (Ch. Div. 1962); Kurtz v. Oromland,

33 N.J. Super. 443 (Ch. Div. 1955), “malice” as necessary element of action for

malicious interference with contract, meant intentional commission of wrongful

act without just case or excuse ; as to suit against owner, see Brenner and Co. v.

Perl, 72 N.J. Super. 160 (App. Div. 1962), motion for summary judgment

denied; Louis Schlesinger Co. v. Rice , 4 N.J. 169 (1956); Louis Kamm, Inc. v.

Flink, 113 N.J.L. 582 (E. & A. 1934).

NOTE TO JUDGE

For distinction between the tort of interference with contractual

relations, and interference with th e opportunity to enter into an

advantageous business relationship, see Fitt v. Schneidewind Realty

Corp., 81 N.J. Super. 497 (Law Div. 1963), involving suit by broker

against purchaser.

The mere fact that a contract is unenforceable between the parties

affords no justification for the act of a third person who, for his/her

own purposes, takes steps which pr event its performance by one of

the parties to it, who, although not bound to execute it, is willing and

anxious to do so.

Prosser, Torts ( 2nd Ed .) Sec. 726; 1 Harper & James , Sec. 6.7

(1956); AALFO Co., Inc. v. Kinney , 105 N.J.L. 345, 347 (E. & A.

1929); Louis Kamm, Inc. v. Flink , 113 N.J.L. 582, 591 (E. & A.

1934); George H. Beckmann, Inc. v. Charles H. Reid & Sons, Inc., 44

N.J. Super. 159 (App. Div. 1957) at p. 165; Harris v. Perl , 41 N.J.

455 (461), and cases therein cited.

But see Tanenbaum v. Sylvan Builders, 50 N.J. Super. 342 (App. Div.

1958), which holds that an unlicensed broker cannot sue for tortious

interference with a real estate commission contract, affirmed in 29

N.J. 62 (1959) but modified to permit the cooperating New Jersey

broker to sue on his/her commission agreement.

Myers v. Arcadio, Inc ., 73 N.J . Super. 493 (App. Div. 1962); C.B.

Snyder Realty Co., Inc. v. Seaman Bros., Inc., 79 N.J. Super. 88 (App.

Div. 1963); Sustick v. Slatina, 48 N.J. Super. 134 (App. Div. 1957);

Fitt v. Schneidewind Realty Corp ., 81 N.J. Super. 497 (Law Div.

1963); Harper and James Law of Torts , (1956), Sec. 6.11, p. 510;

DiCristofaro v. Laurel Grove Memorial Park , 43 N.J. Super. 244

(App. Div. 1957); Weinstein v. Clementsen, 20 N.J. Super. 367 (App.

Div. 1952) (as to competing real estate brokers).