Tort law (2022): Economic torts: Conspiracy

Economic torts, which are also called business torts, are torts that provide the common law rules on liability which arise out of business transactions such as interference with economic or business relationships and are likely to involve pure economic loss.

Nature of economic torts[edit]

Economic torts are tortious interference actions designed to protect trade or business. The area includes the doctrine of restraint of trade and, particularly in the United Kingdom, has largely been submerged in the twentieth century by statutory interventions on collective labour law and modern competition law, and certain laws governing intellectual property, particularly unfair competition law. The "absence of any unifying principle drawing together the different heads of economic tort liability has often been remarked upon."

The principal torts are:

passing off,

injurious falsehood and trade libel (see also Food libel laws),

conspiracy,

inducement of breach of contract,

tortious interference (such as interference with economic relations or unlawful interference with trade),

negligent misrepresentation, and,

watching and besetting.

These torts represent the common law's historical attempt to balance the need to protect claimants against those who inflict economic harm and the wider need to allow effective, even aggressive, competition (including competition between employers and their workers).

Two cases demonstrate economic torts' affinity to competition and labour law. In Mogul Steamship Co Ltd the plaintiffs argued they had been driven from the Chinese tea market by a 'shipping conference', that had acted together to underprice them. But this cartel was ruled lawful and "nothing more than a war of competition waged in the interest of their own trade." Nowadays, this would be considered a criminal cartel.

In English labour law the most notable case is Taff Vale Railway v Amalgamated Society of Railway Servants. The House of Lords thought that unions should be liable in tort for helping workers to go on strike for better pay and conditions. But it riled workers so much that it led to the creation of the British Labour Party and the Trade Disputes Act 1906. Further torts used against unions include conspiracy, interference with a commercial contract or intimidation.