In Caley v. Gulfstream Aerospace, the employer told the employees that as a condition of continued employment they had to agree to a new dispute resolution policy that would take effect in two weeks. Caley sued, contending the new policy was not backed by consideration, so there was no enforceable contract. The appeals court held that:
A) there was an offer, acceptance and consideration so there was a contract
B) there was an offer and acceptance, but no consideration so there was no contract
C) there was an offer and consideration, but continued employment was not a sufficient method of acceptance so there was no contract
D) none of the conditions necessary for a contract were present so there was no contract
E) companies cannot offer employees contracts, so whether or not there was consideration is irrelevant

Question

Quizplus · Accepted Answer

The appeals court held that there was an offer (the new dispute resolution policy), acceptance (the employees' agreement to the policy as a condition of continued employment), and consideration (continued employment in exchange for agreeing to the new policy), thus constituting a valid contract.

In Caley V