Article 78: (Art. 27 of the Act of 1908):
The period of limitation for a suit for compensation for inducing a person to break a contract with the plaintiff is one year and the time of limitation begins to run from the date of the breach.
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In Pandurang v. Nagu, (ILR 30 Bom. 598), it has been held that inducing person to break a contract without any justification for interfering with contractual relations recognised in law is actionable in law. Justification can only arise when the defendant had an equal or superior right in himself.
In D C. Thompson & Co. v. Deakin, [(1952) 1 Ch 646], it has been held that when with the knowledge of the existence of contract and with intent to induce a breach of it by one of the parties to the contract to the prejudice of the other, the defendant does any of the following acts:
(i) Directly intervenes and induces one party to break a contract; or
(ii) Does some wrongful act preventing a party to the contract to perform his part of contract; or
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(iii) Gets a third party to do a wrongful act making it impossible for one of the parties to the contract to perform the contract, he shall be liable for compensation for inducing a person to break the contract.
In М. С hand ran v. Task Namgyal Academy Board, (AIR 2005 | Sikkim 2), it has been held that when a suit for compensation has been filed by the plaintiff on the ground that the authorities of the school broke j the contract of employment with him on account of malicious submission of a false report by one of the defendants, such a suit attracts Art. 78 of the Limitation Act, 1963.