Opinion ID: 2833120
Heading Depth: 3
Heading Rank: 2

Heading: Davidson=s attempts to create consideration fail.

Text: In an attempt to create consideration where none exists, Davidson claims that the language regarding the unilateral termination right complied with contractual mutuality requirements because, A If...Davidson changed the ADR policy, or abolished it altogether, the changes would have applied to both parties. @ However, because Davidson alone had the unilateral right to terminate or change the agreement, the agreement is illusory. It is irrelevant that any changes made by Davidson would apply to both parties. Davidson also argues that the promise to arbitrate is not illusory because, under Halliburton, 80 S.W.3d at 570, it is bound to resolve any dispute according to the ADR plan in effect at the time the dispute arises. However, the express contract terms we relied on to find the Halliburton agreement enforceable are missing here. The plain language of the Halliburton ADR plan required the employer to provide notice before enacting any modifications or terminating the plan. Davidson suggests that because the agreement we upheld in Halliburton required notice and prospective application, the same protective language can be implied here. I disagree. In Halliburton , we relied on the ADR policy = s notice provisions to conclude that Halliburton could not A avoid its promise to arbitrate by amending the [policy] or terminating it altogether. @ Halliburton , 80 S.W.3d at 570 . Here, we cannot imply the obligations that precluded Halliburton from avoiding its promise to arbitrate. The agreement = s plain language establishes Davidson = s unhindered right to modify or terminate the agreement without notice. It is not proper to imply terms that contradict the express contract language. See Haws & Garret Gen. Contractors, Inc. v. Gorbett Bros. Welding Co., 480 S.W.2d 607, 609-610(Tex. 1972) (the terms of an implied contract are inferred from the circumstances). Davidson further attempts to explain the unilateral termination language as simply acknowledging an employer = s right to make changes to at-will employment terms, as in Hathaway v. Gen. Mills, Inc ., 711 S.W.2d 227, 229 (Tex. 1986). But, the arbitration agreement = s language contradicts Davidson = s explanation. In Hathaway , we held that an employer may enforce changes to an at-will employment contract if the employer unequivocally provides notice of a definite change and the employee accepts the change by continuing employment. Hathaway , 711 S.W.2d at 229 . Here, the contract expressly allows Davidson to effect a change in the ADR plan = s terms without notice. Thus, it is inconsistent to explain the reservation language as merely restating our holding in Hathaway, because the arbitration agreement = s terms contradict the Hathaway requirements. Additionally, whether an employer has satisfied the Hathaway requirements is a separate inquiry from the determination of whether the arbitration agreement is enforceable under traditional contract principles. If an employer seeks to change the terms of an employment relationship by implementing an agreement to arbitrate all disputes, the employer must show the arbitration agreement, standing alone, satisfies all requisite elements of a valid contract. See Light , 883 S.W.2d at 645-46; Halliburton , 80 S.W.3d at 569. This showing is separate from the employer = s duty to meet the Hathaway requirements of notice and acceptance. Id . Davidson = s attempts to create consideration via an alternate reading of the language of the agreement are not reasonable. When the meaning of an agreement is plain and unambiguous, a party = s construction is immaterial. 718 Associates, Ltd., 1 S.W.3d at 360. I would find the contract unenforceable because it fails for lack of consideration and is illusory.