Topic: Interference with Contractual Relations

SO PING BUN v. CA
21 September 1999

Facts:
 Tek Hua Trading Co through So Pek Giok (managing partner) entered into 4
lease agreements with Dee Chuan and Sons, Inc. (DCCSI), each having a 1 year
term. When they expired, the parties did not renew the contracts but Tek Hua
continued to occupy the premises. Tek Hua Trading dissolved and Tek Hua
Enterprising Corp was formed.
 Upon So Pek Giok’s death, So Ping Bun (grandson) occupied the warehouse for
his own textile business (Trendsetter Marketing). DCCSI sent a letter to Tek Hua
Enterprises informing them of a 25% increase in rent but was later on reduced to
20%. Thereafter a 30% increase was implemented with new contracts sent to
petitioner for signing.
 Petitioner was asked to vacate but refused and requested for formal contracts in
favor of his own business (Trendsetter Marketing). DCCSI acceded to the
request but later filed a suit for injunction to nullify the contracts.
 The trial court ruled in favor of DCCSI (So Ping Bun is guily of tortous
interference) and on appeal the CA affirmed the decision of the trial court.

Issue: WON So Ping Bun is guilty of tortous interference

Held: Yes. Petition denied. (Attorney’s fees reduced from 200k to 100k)

 Ruling:
The three elements of tort interference are:
1. Existence of a valid contract
2. Knowledge on the part of the third person of the existence of the contract
3. Interference of the third person without legal justification or excuse
 Petitioner asked DCCSI to execute lease contracts in its favor, and as a result
deprived it of its property right. The three elements are present in the instant
case.
 A duty which the law of torts is concerned with is respect for the property of
others, and a cause of action ex delicto may be predicated upon an unlawful
interference by one person of the enjoyment by the other of his private property.
 Where there was no malice in the interference of a contract, and the impulse
behind one’s conduct lies in a proper business interest rather than in wrongful
motive, a party cannot be a malicious interferer. While lack of malice precludes
damages, it does not relieve the interferer of the legal liability for entering into
contracts and causing break of existing ones.
 While lack of malice precludes damages, it does not relieve the interferer of the
legal liability for entering into contracts and causing breach of existing ones.
 In connection with attorney’s fees, the award should be commensurate to the
benefits that would have been derived from a favorable judgment.