$$ S U M M A R Y

A promise is not binding if there is no consideration

for the promise. Consideration is what the promisor

requires as the price for his or her promise. That price

may be doing an act, refraining from the doing of an

act, or merely promising to do or to refrain. In a bilat$-$

eral contract, it is necessary to find that the promise of

each party is supported by consideration. If either

promise is not so supported, it is not binding, and the

agreement of the parties is not a contract. Conse$-$

quently, the agreement cannot be enforced. When a

promise is the consideration, it must be a binding

promise. The binding character of a promise is not

affected by the circumstance that there is a condition

precedent to the performance promised. Likewise, the

binding character of the promise and of the contract is

not affected by a provision in the contract for its can$-$

cellation by either one or both of the parties. A prom$-$

ise to do what one is already obligated to do is not

consideration, although some exceptions are made.

Such exceptions include the rendering of a partial per$-$

formance or a modified performance accepted as a

good$-$faith adjustment to a changed situation, a com$-$

promise and release of claims, a part$-$payment check,

and a compromise of creditors. Because consideration

is the price that is given to obtain the promise, past

benefits conferred on the promisor cannot be consider$-$

ation. In the case of a complex transaction, however,

the past benefit and the subsequent transaction relating

to the promise may have been intended by the parties

as one transaction. In such a case, the earlier benefit is

not past consideration but is the consideration con$-$

templated by the promisor as the price for the promise

subsequently made.

A promise to refrain from doing an act can be con$-$

sideration. A promise to refrain from suing or asserting

a particular claim can be consideration. Generally, the

promise to forbear must be for a specified time, as dis$-$

tinguished from agreeing to forbear at will. When con$-$

sideration is forbearance to assert a claim, it is

immaterial whether the claim is valid as long as the

claim has been asserted in the good$-$faith belief that it

was valid.

When the promisor obtains the consideration speci$-$

fied for the promise, the law is not ordinarily concerned

with the value or adequacy of that consideration.

Exceptions are sometimes made in the case of fraud or

unconscionability and under consumer protection

statutes.

When the promisor does not actually receive the

price promised for the promise, there is a failure of

consideration, which constitutes a breach of the

contract. ANSWER QUESTION BASED ON IRAC $($ISSUE RULE ANALYSIS CONCLUSION$)$ ; $1.$ Sarah's house caught on fire. Through the prompt assistance of her neighbor Odessa, the fire was quickly extinguished. In gratitude, Sarah promised to pay Odessa $$1,000.$ Can Odessa enforce this promise fi Sarah does not pay the money? $2.$ Dale Dyer, who was employed by National By$-$

Products, Inc., was seriously injured at work as the

result of a job$-$related accident. He agreed to give up

his right to sue the employer for damages in considera$-$

tion of the employer's giving him a lifetime job. The

employer later claimed that this agreement was not

binding because Dyer's promise not to sue could not

be consideration for the promise to employon the

ground that Dyer in fact had no right to sue. Dyer's only remedy was to make a claim under workers' com$-$

pensation. Was the agreement binding? $[$Dyer v National By$-$Products, Inc., $380$ NW$2$d $732($Iowa$)$