A party’s contractual obligation may create a legal duty and that a breach of that duty may support a tort action. . . .Conduct amounting to a breach of contract becomes tortious only when it also violates a duty independent of the contract arising from principles of tort law. Generally, outside the insurance context, a tortious breach of contract may be found when

1. the breach is accompanied by a traditional common law tort, such as fraud or conversion;
2. the means used to breach the contract are tortious, involving deceit or undue coercion; or
3. one party intentionally breaches the contract intending or knowing that such a breach will cause severe, unmitigable harm in the form of mental anguish, personal hardship, or substantial consequential damages.

Focusing on intentional conduct gives substance to the proposition that a breach of contract is tortious only when some independent duty arising from tort law is violated.

Tort damages have been permitted in contract cases where a breach of duty directly causes physical injury; for breach of the covenant of good faith and fair dealing in insurance contracts; for wrongful discharge in violation of fundamental public policy; or where the contract was fraudulently induced. In each of these cases, the duty that gives rise to tort liability is either completely independent of the contract or arises from conduct which is both intentional and intended to harm.

CALIFORNIA STATE COURTS

Supreme Court of California: Robinson Helicopter Co., Inc. v. Dana Corp., 34 Cal. 4th 979, 990 (2004); Erlich v. Menezes, 21 Cal. 4th 543, 551-52 (1999).

California 1st District: Stop Loss Ins. Brokers, Inc. v. Brown & Toland Medical Group, 143 Cal. App. 4th 1036, 1043 (2006).

California 2d District: Food Safety Net Services v. Eco Safe Systems USA, Inc., 209 Cal. App. 4th 1118, 1130 (2012) (“a party alleging fraud or deceit in connection with a contract must establish tortious conduct independent of a breach of the contract itself, that is, violation of “‘“some independent duty arising from tort law.”’”); Benavides v. State Farm General Ins. Co., 136 Cal. App. 4th 1241, 1251 (2006).

California 3d District: None.

California 4th District: None

California 5th District: None

California 6th District: None

CALIFORNIA FEDERAL COURTS

United States Court of Appeal for the 9th Circuit: None.

Central District: Aqua Connect v. Code Rebel, LLC, No. CV 11-05764 RSWL (MANx), 2013 U.S. Dist. LEXIS 103080, at *10-11 (C.D. Cal. July 23, 2013).

Eastern District: Nucal Foods v. Quality Egg LLC, 918 F. Supp. 2d 1023, 1028 (E.D. Cal. 2013).

Northern District: Fari Holdings, Ltd. v. Info-Drive Software, Inc., No. C13-02053 HRL, 2013 U.S. Dist. LEXIS 154513, at *5-7 (N.D. Cal. Oct. 28, 2013).

Southern District: Martinez v. Welk Group, Inc., 907 F. Supp. 2d 1123, 1134 (S.D. Cal. 2012) (“Thus, ‘conduct amounting to a breach of contract becomes tortious only when it also violates a duty independent of the contract arising from principles of tort law’ and ‘exposes a plaintiff to liability for personal damages independent of the plaintiff's economic loss.’”).

(1) Cal. Code Civ. Proc. § 431.30(b)(2) (pleading affirmative defenses), and other standard defenses. See Chapter 1 for all defenses.

(2) Statute of Limitations: Uncertain but likely to depend on the gravamen of the claim.

(3) The economic loss rule does not apply to claims for fraud in the performance of a contract. Robinson Helicopter Co., Inc. v. Dana Corp., 34 Cal. 4th 979, 991 (2004).

(4) A tortious breach will not be found if the claim arises out of the breaching party’s negligence. Robinson Helicopter Co., Inc. v. Dana Corp., 34 Cal. 4th 979, 990 (2004) (“If every negligent breach of a contract gives rise to tort damages the limitation would be meaningless, as would the statutory distinction between tort and contract remedies”).