Per Se Justification of a Property Owner’s Right to Exclude in Tortious Interference Claims

Introduction

In In the Matter of the Certified Question: Diamond Quality, Inc. v. Dana Light Axle Products, LLC (2025), the Supreme Court of Indiana addressed whether a property owner’s conduct in barring another party from its premises can ever constitute “wrongful” or “unjustified” interference with that party’s contractual or business relationships. The case arose when Diamond Quality, an industrial inspection and sorting company, was twice denied entry to sort defective parts at Dana Light Axle Products’ facility despite being under contract with Dana subsidiaries in Mexico. Diamond sued for tortious interference; Dana Fort Wayne removed the suit to federal court, which—finding no controlling Indiana precedent—certified two questions for the Indiana Supreme Court’s resolution. The Indiana Supreme Court reframed the issue into a single dispositive question: does a property owner act without justification, for purposes of a tortious interference claim, when it simply excludes another from its land? The Court held unequivocally “no,” announcing a per se rule that, absent a contractual or statutory duty, exclusion of any person from private property is always justified and cannot support a tortious interference claim.

Summary of the Judgment

Justice Slaughter, writing for the majority, reorganized the certified questions into one: whether a property owner’s act of barring someone from its premises can ever be “unjustified” or “illegal” for purposes of tortious interference. After outlining Indiana’s existing tortious‐interference framework—derived from Restatement (Second) of Torts § 767—the Court held that the fundamental property right to exclude is so absolute that its exercise can never be tortious, absent a contractual or statutory limitation. In reaching this result, the Court surveyed longstanding state and federal authority—from Barnes v. Born (1892) and Donovan v. Grand Victoria Casino (2010) to the United States Supreme Court’s modern statements in Cedar Point Nursery v. Hassid (2021) and Kaiser Aetna v. United States (1979)—and even cited Sir William Blackstone’s description of property as “sole and despotic dominion.” Because Diamond Quality’s only allegation was that it was refused entry to Dana Fort Wayne’s facility, the Court concluded these acts were necessarily justified and thus could not support any tortious interference claim.

Analysis

1. Precedents Cited

Barnes v. Born (30 N.E. 509, 1892): Recognized the “right to exclude all others” as integral to exclusive possession.
Donovan v. Grand Victoria Casino & Resort (934 N.E.2d 1111, 2010): Reaffirmed the absolute right of private property owners to exclude without justification.
Cedar Point Nursery v. Hassid (594 U.S. 139, 2021): Described the exclusionary right as “one of the most treasured rights of property ownership.”
Kaiser Aetna v. United States (444 U.S. 164, 1979): Called the right to exclude “one of the most essential sticks in the bundle of rights.”
Winkler v. V.G. Reed & Sons (638 N.E.2d 1228, 1994): Adopted Restatement (Second) of Torts § 767’s seven‐factor test for whether interference is “justified.”
American Consulting, Inc. v. Hannum Wagle & Cline Eng’g, Inc. (136 N.E.3d 208, 2019): Reaffirmed the five elements of contract‐based interference, including lack of justification.
Brazauskas v. Fort Wayne‐South Bend Diocese (796 N.E.2d 286, 2003): Held that interference with business relationships requires an independent illegal act.
Restatement (Second) of Torts §§ 767, 766B (1977): Provides guidance on factors for justification and on interference with business expectancies.
Restatement (Third) of Torts § 17–18 (2020): Recent model imposing “wrongful” conduct requirement but not adopted here.

2. Legal Reasoning

The Court’s reasoning followed two steps:

Review of Indiana’s Tortious‐Interference Standard: Under Indiana law, interfering with a contract requires proof of five elements (valid contract; knowledge; intentional inducement; lack of justification; and damages). Interfering with business relationships similarly requires wrongful or illegal conduct. The court noted that most disputes center on the “justification” question, resolved by weighing Winkler’s seven Restatement (Second) factors.
Per Se Justification Rule: Citing centuries of property law, the Court concluded that the right to exclude is absolute, “one of the most treasured rights of property ownership” (Cedar Point). Absent a duty to admit (contractual or statutory), a landowner may exclude at will. Such exclusion can never be “unjustified,” “wrongful” or illegal, and therefore cannot satisfy the fourth element of a contract‐interference claim nor constitute the requisite “independent illegal act” for business interference.

The majority declined to resolve whether Indiana should formally adopt the Restatement (Third) of Torts on economic harm, noting the per se rule renders that decision unnecessary at this time.

3. Impact on Future Cases and on Tort Law

This decision establishes a bright‐line rule in Indiana: any claim of tortious interference based solely on the exercise of a private landowner’s exclusionary rights is foreclosed. Practitioners and lower courts must now consider whether any exclusion is accompanied by a contractual obligation or statutory limitation before advancing such interference claims. The ruling may narrow the scope of tortious interference litigation, particularly in property‐related disputes, and could prompt parties to negotiate clearer site‐access provisions in their contracts. It also sidesteps the “justification” balancing test in property‐access contexts, potentially reducing litigation costs but raising questions about situations where the exercise of exclusion intersects with broader tort duties (e.g., premises liability, anti‐discrimination laws).

Complex Concepts Simplified

Tortious Interference: A wrong claim that a defendant intentionally disrupted someone’s contract or business expectancy without legal excuse, causing harm.
Justification: A legal defense showing that the defendant had a valid reason or privilege (e.g., free speech, property rights) for its allegedly interfering conduct.
Restatement (Second) § 767 Factors: Seven considerations—ranging from motive to social policy—that courts weigh to decide if interference was unjustified.
Right to Exclude: A fundamental ownership right permitting a landowner to refuse entry to anyone on private property, absent a limiting agreement or law.
Certified Question: A procedure allowing a federal court to ask a state supreme court to clarify state law that is outcome‐determinative and unsettled.

Conclusion

The Indiana Supreme Court’s decision in Diamond Quality v. Dana Light Axle crystallizes the boundary between property rights and tortious interference claims. By holding that a property owner’s unqualified right to exclude is per se justified—and thus cannot form the basis of interference—Indiana has put to rest any ambiguity over whether simple denial of entry can be “wrongful.” This bright‐line rule underscores the enduring primacy of property ownership rights while carving out future questions about how these rights intersect with other duties and public‐interest considerations. For practitioners, the lesson is clear: if you wish to guarantee access to private premises, secure it by contract or rely on statutory protections; otherwise, the landowner’s gate stands closed to any tort‐based challenge.