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Date: Wed, 6 Jun 2007 16:03

From: Jason Neyers

Subject: OBG v Allen, Stratford v. Lindley and Lumley



I found a case comment on Stratford that suggests that I am right that according to traditional Lumley (which the HL returned to) there should be no liability in my second example. If it is indirect ('attacks' to the subject matter or parties involved in the contract) then you need to make out unlawful interference (28 Modern Law Rev 207).




John Murphy wrote:

This is an interesting question that I wondered about when reading OBG.

There seem to be two key passages in Hoffmann's speech.

The first comes from para 34.

Lord Denning said that it did not matter whether one procured a breach of contract "by direct approach to the one who breaks his contract or by indirect influence through others". There seems to me much sense in this observation, although whether it leads to the conclusion that the defendant should be liable in both cases or neither is another matter.

And here we are left dangling.

Then in para 36 he says:

the real question which has to be asked in relation to Lumley v Gye [is] did the defendant's acts of encouragement, threat, persuasion and so forth have a sufficient causal connection with the breach by the contracting party to attract accessory liability? The court in Lumley v Gye made it clear that the principle upon which a person is liable for the act of another in breaking his contract is the same as that on which he is liable for the act of another in committing a tort. It follows, as I have said, that the relevant principles are to be found in cases such as CBS Songs Ltd v Amstrad Consumer Electronics plc [1988] AC 1013 and Unilever v Chefaro [1994] FSR 135. By the test laid down in these cases, the Federation could not have incurred any liability. They were not encouraging or assisting the wholesalers in breaking their contracts. They were simply advising their members to exercise their own freedom to buy whatever newspapers they liked. The wholesalers had no right to the co-operation of the retailers in enabling them to perform their contracts. Liability could not depend upon the accident of whether the Federation had communicated (directly or through an intermediary) with the wholesalers. The distinction between direct and indirect interference was therefore irrelevant and misleading.

For what it is worth, I think that taken together the excerpts suggest (a) that indirect persuasion may suffice, but (b) that persuasion/procurement/inducement are very different creatures from merely advising X who later acts of his own volition in a way that causes a breach of contract. In short, where the intermediary is advised but not induced, his critical act becomes a novus actus in the chain of causation and thus the original advisor cannot be held liable for indirectly procuring breach of contract.

Like Jason, I'd be interested to know what others think.


Jason Neyers
January Term Director
Associate Professor of Law
Faculty of Law
University of Western Ontario
N6A 3K7
(519) 661-2111 x. 88435



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