Business Law 4th Edition by David Twomey,Marianne Jennings

Exercise 14

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 consideration 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 employ on the ground that Dyer in fact had no right to sue. Dyer's only remedy was to make a claim under workers' compensation. Was the agreement binding? [Dyer v National By- Products, Inc., 380 NW2d 732 (Iowa)]