The Supreme Court of Virginia has decided whether neighboring landowners tortiously interfered with a gun club's purchase of property, on which the club was going to build a shooting range.

The Rappahannock Pistol and Rifle Club, Inc., ("Gun Club") entered into a purchase contract for a parcel of land ("Property") owned by the C.F. Lumber Company ("Owner"). The Gun Club sought to purchase the Property in order to build a shooting range and a clubhouse on the premises. The purchase contract was for $22,000 and set a closing date of February 24, 1997. The purchase contract also stated that "[t]ime was of the essence," and required the Owner to deliver title documents to the Gun Club for examination prior to the closing.

Soon after the purchase agreement was executed, landowners in the surrounding area learned of the Gun Club's plans for the Property and a number of them objected to the proposed shooting range. The resistance to the shooting range was allegedly spearheaded by Robert and Catherine Bennett, who both had real estate licenses and also lived a little over a mile from the Property. Various people testified particularly about Catherine Bennett's vocal resistance to the project. An emergency ordinance was proposed in order to make the Property unusable as a shooting range (which was not adopted), and there was a tumultuous meeting between the surrounding landowners and members of the Gun Club in a futile effort to try to resolve the situation.

On February 17th, the Bennetts prepared and signed a "back-up contract," offering the Owner $26,000 for the Property. The back-up contract was left with the Bennetts' attorney as well as a check for $6,000 to serve as an initial deposit, and the Owner was made aware of the existence of the back-up contract and check. The Owner consulted with its attorney about the two contracts, and the attorney instructed the Owner that it had a valid contract with the Gun Club. On February 21st, the Owner delivered the deed and other closing documents to the Gun Club's attorney, in order to be held in escrow until the closing. However, the closing did not happen as planned on February 24th because the Owner had not delivered all of the title documents to the Gun Club.

On February 26th, the Owner called his attorney and told him that he now wanted to sell the Property to the Bennetts, allegedly because he was tired of all the negative publicity and pressure to not sell the Property to the Gun Club. Against his attorney's advice, the Owner sold the Property to the Bennetts on February 28th. The Gun Club tried to purchase another site, but the only site which met its needs cost $245,000. The Gun Club first sued the Owner and recovered the $4,000 difference between its contract price and the Bennetts' price. Thereafter, the Gun Club sued the Bennetts for tortiously interfering with its purchase of the property. A jury ruled in favor of the Gun Club, but the trial judge set aside the verdict and entered judgment in favor of the Bennetts, ruling that the evidence did not support the verdict. The Gun Club appealed.

The Supreme Court of Virginia affirmed the rulings of the trial court. The court first reviewed the elements necessary to allege tortious interference with a contract. To succeed in a lawsuit alleging tortious interference with a contract, an individual must demonstrate that the other party knew that a contract existed between the individual and a third party, knew the expectancy of the individual from the contract, intentional interference by the party inducing the third party to breach the contract with the individual, and resulting damage to the party. The Gun Club argued that the evidence at trial showed that the Bennetts had engaged in a consistent campaign to cause the Owner to breach the agreement with the Gun Club. Upon reviewing the evidence and testimony, the court disagreed with the Gun Club's arguments. The evidence before the trial court contained only two references to knowledge that the Owner had about the Bennetts' specific efforts to dissuade the Owner from completing the contract, which was insufficient to demonstrate tortious interference with a contract.

The court also rejected the argument that the higher offer made by the Bennetts indicated an attempt to tortiously interfere with the Gun Club's purchase, ruling that a higher purchase price does not automatically lead to the conclusion of tortious interference. The court found that back-up contracts were a standard practice in the real estate market according to testimony made by three attorneys at trial, and so the existence of a back-up contract with a higher offering price did not demonstrate tortious interference. Thus, the court affirmed the rulings of the trial court.

Rappahannock Pistol & Rifle Club, Inc. v. Bennett, 262 Va. 5, 546 S.E.2d 440 (2001).

Advertisement