Opinion ID: 2599393
Heading Depth: 3
Heading Rank: 1

Heading: The State Tort Liability Act

Text: As a threshold matter, we first address the State's contention that it is immune from suit based on the State Tort Liability Act (STLA), HRS chapter 622. Generally, [a] sovereign [s]tate is immune from suit for money damages, except where there has been a `clear relinquishment' of immunity and the [s]tate has consented to be sued. Bush v. Watson, 81 Hawai`i 474, 481, 918 P.2d 1130, 1137 (1996) (quoting Pele Defense Fund v. Paty, 73 Haw. 578, 605, 837 P.2d 1247, 1265 (1992)) (internal quotation marks omitted). The STLA provides that [t]he State hereby waives its immunity for liability for the torts of its employees and shall be liable in the same manner and to the same extent as a private individual under like circumstances[.] HRS § 662-2 (1993). Notwithstanding this general waiver, the STLA contains numerous exceptions for which the State retains its sovereign immunity. Here, the State contends that Defendants' cross-claim falls within HRS § 662-15(4) (1993), which states an exception for [a]ny claim arising out of . . . interference with contract rights[.] [6] Assuming, without deciding, that a claim for interference with prospective business advantage [7] or prospective contractual relations [8] falls within the aforementioned exception, [9] we nevertheless disagree that Defendants' claims for unreasonable failure to consent and negligent claims handling constituted such an interference claim. It cannot be said that the State improperly interfered with the alleged settlement agreement because, pursuant to HRS § 386-8, the State was a necessary party to such agreement. See Hall v. Burger King Corp., 912 F.Supp. 1509, 1537 (S.D.Fla.1995) (holding that because any prospective sale of the restaurant required the defendant's consent, defendant's refusal to consent did not give rise to a claim for tortious interference). Cf. Ethyl Corp. v. Balter, 386 So.2d 1220, 1224 (Fla.App.1980) ([A] cause of action for interference does not exist against one who is himself a party to the contract allegedly interfered with); Uptown Heights Assocs. Ltd. P'ship v. Seafirst Corp., 320 Or. 638, 891 P.2d 639, 647 (1995) (holding that a party to a contract could not be liable in tort for conduct which the party was entitled to do under the contract, even if party has malevolent purpose); Fort Vancouver Plywood Co. v. United States, 747 F.2d 547, 554 (9th Cir. 1984) (concluding that a tort [] committed by persons sustaining contract relations does not constitute the tort of interference with contract rights) (citing Nicholson v. United States, 177 F.2d 768, 769 (5th Cir. 1949)). We therefore hold that the interference with contract rights exception does not apply to the instant case.