Prudential Ins. Co. v. Financial Review Servs., Inc., 29 S.W.3d 74 (Tex. 2000); Wal-Mart Stores, Inc. v. Sturges, 52 S.W.3d 711 (Tex. 2001); PJC 106.1
Tortious interference in Texas — existing contracts and prospective relations
A claim in Texas district and county courts · Last verified August 26, 2026
Texas recognises two interference torts, and the difference between them decides most competitor litigation. Interfering with an existing contract requires only a wilful and intentional act. Interfering with a prospective relationship requires conduct that was independently tortious or unlawful — competition, however aggressive, is not enough.
Neither claim carries attorney's fees, and both run on a two-year clock.
What the claims are
A third party wrecked a contract you had, or sabotaged a deal you were about to close.
Where the rights come from
Common law. The existing-contract elements come from Prudential Insurance Co. of America v. Financial Review Services, Inc., 29 S.W.3d 74 (Tex. 2000). The prospective-relations standard was rewritten by the Texas Supreme Court in Wal-Mart Stores, Inc. v. Sturges, 52 S.W.3d 711 (Tex. 2001).
What a plaintiff has to prove
Interference with an existing contract — PJC 106.1
- An existing contract subject to interference.
- A wilful and intentional act of interference by the defendant.
- That proximately caused injury.
- Actual damage or loss.
Prudential, 29 S.W.3d at 77. The defendant must have known of the contract, or known of facts that would lead a reasonable person to believe one existed.
Interference with prospective business relations
- A reasonable probability that the plaintiff would have entered into a business relationship.
- The defendant committed an independently tortious or unlawful act that prevented it.
- Done with a conscious desire to prevent the relationship, or with knowledge that interference was substantially certain to result.
- Actual harm or damage.
Sturges, 52 S.W.3d at 726. "Independently tortious" means conduct that would violate some other recognised tort duty — fraud, defamation, trade secret misappropriation, threats of physical harm. It does not mean conduct that is merely sharp, unfair, or hard on the plaintiff.
How long you have to file
Two years, under CPRC § 16.003(a). The claim accrues when the plaintiff knows of the injury — Exxon Mobil Corp. v. Rincones, 520 S.W.3d 572 (Tex. 2017).
What has to happen before you file
Nothing. But consider the TCPA first: a defendant may move to dismiss under CPRC ch. 27 if the claim is based on protected communications, and the 2019 amendments narrowed but did not eliminate that exposure for business torts.
What the claim pays
Actual damages — the lost benefit of the contract or the relationship, and consequential losses that flowed from the interference.
Mental anguish, in an existing-contract case, where the facts support it.
Exemplary damages on clear and convincing proof of fraud or malice, capped by CPRC § 41.008.
No attorney's fees. Neither tort carries a fee statute.
Who can be sued — and who cannot
The defendant must be a stranger to the contract. That single requirement disposes of a large share of these claims.
- A contracting party cannot interfere with its own contract. Its remedy, and its exposure, is breach.
- An officer, director or employee acting within the scope of their role acts as the company, not as a third party. The exception is an agent acting solely for personal benefit and against the company's interest.
- A parent company generally cannot interfere with its subsidiary's contract where their financial interests are aligned.
- An agent or attorney advising a client to breach is usually protected by the same principle, and by the justification defense.
Who is left: competitors, former employers, lenders, and third parties who induced the breach for their own reasons.
Common defenses
- Justification or legal right. An affirmative defense: a defendant who exercised its own legal rights, or acted in a good-faith belief that it had them, is not liable — and motive becomes irrelevant once justification is established (Texas Beef Cattle Co. v. Green, 921 S.W.2d 203 (Tex. 1996)).
- No knowledge of the contract.
- The defendant was not a stranger to the contract.
- No independent tort, for a prospective-relations claim. This defeats most of them.
- The relationship was speculative — hope is not a reasonable probability.
- TCPA dismissal.
- Limitations.
What people get wrong
Losing a customer to a competitor is not a tort. Texas protects competition. Without an independently unlawful act, taking business from a rival is lawful however aggressive it looks.
A parent company usually cannot interfere with its subsidiary's contract. Neither can an officer acting within their role. The claim requires a genuine third party.
Justification is powerful. Once the defendant establishes a legal right to do what it did, its motive stops mattering.
There are no fees on either side. These claims are expensive to try and pay nothing for the lawyer.
Where it came from
Texas had long recognised interference with contract when Sturges arrived in 2001 to sort out the prospective-relations version. Before it, the standard asked whether the defendant's conduct was "independently tortious or unlawful" in some courts, and whether it was merely "wrongful" in others, which made the tort a general licence to sue over lost business.
Sturges fixed the standard. Conduct must be actionable under some other recognised tort. The court was explicit that it was drawing a line around lawful competition, and the result is that most prospective-relations claims now rise or fall on whether the plaintiff can prove a separate tort.
Common questions
How long do I have to sue for tortious interference in Texas?
Two years from when you knew of the injury.
Can I recover attorney's fees?
No. Neither interference tort carries a fee statute.
Can I sue a competitor who took my customer?
Only if they did something independently unlawful — fraud, defamation, stealing trade secrets. Ordinary competition is protected.
What is the difference between the two claims?
Interfering with a signed contract requires only intentional interference. Interfering with a deal that had not closed requires an independently tortious act as well.
Can I sue an executive for interfering with their own company's contract?
Generally no. A party cannot interfere with its own contract, and an agent acting within their role is not a third party.
Can I get punitive damages?
Yes, with clear and convincing proof of fraud or malice, subject to the statutory cap.