Business Law Essay Example | Topics and Well Written Essays - 750 words - 7

Business Law - Essay Example this instance, the concept of unilateral and mutual mistakes under the Restatement (Second) of Contracts can be made use of by both the buyer and the seller. It is evident that, either both the parties made a mistake with regard to the value of the rock, or one of them (the owner through his inexperienced clerk) had made one. It is not clear in this instance whether the geologist had intentionally withheld his understanding of the rock’s value. But since the person (geologist) handed over the rock to experts for valuation, he may not be an expert and it can be assumed that it is a case of mutual mistakes. As per the Restatement (Second) of Contracts, â€Å"Where a mistake of both parties at the time of contract was made as to a basic assumption on which the contract was made has a material effect on the agreed exchange of performances, the contract is voidable by the adversely affected party unless he bears the risk of the mistake under the rule stated in 154† (Ayers, n .d.). It cannot be done in case of unilateral mistake. If it can be proved by the store owner that the geologist also made a mistake in assessing the value, he can make the contract voidable. But the geologist can take recourse to Section 154 mentioned above. Applying clause (b) of the section, the store owner had only limited knowledge about the stone and gave it to the geologist in the premise that he will have fairly good knowledge because of his professional qualifications. It is difficult to prove whether a person has limited or full knowledge of a product being exchanged in a contract. The store owner showed that he had limited knowledge, but not the geologist. In this instance there is every chance that the geologist may get full legal ownership of the stone. Since an employee is an agent of the employer, it does not matter whether the deal was done by the former. The choice of using the unconscionability clause is open to the store owner, but it is doubtful whether it can ov erride the