1. What is a unilateral mistake? When would a mistaken party be able to rescind or avoid a contract based on having been mistaken about a material factor in the contract? Explain how a mistake of fact differs from a mistake of value. Does the law treat these two kinds of mistakes the same or differently? Explain your answer fully.
2. Kara inherited a jewelry box from her grandmother and in it she finds a big ring with a green stone. She shows it to Larry, who says "Wow! That could be valuable." Neither Kara nor Larry knows what the ring is made of or whether it is valuable. Kara sells the ring to Larry for $100 saying "Don't come griping to me if it turns out to be worth two dollars." Larry takes the ring to a jeweler who tells him it is an unusually perfect emerald and worth at least $3,000. Kara sues to rescind her sale of the ring to Larry. What is Larry's best argument that he should be able to keep the ring? What is Kara's best argument that she should be able to rescind the sale? Which side you believe will win and why?