SPEAKER 1: Moving on now, let me contrast to a mutual mistake

with what in law is called unilateral mistake, a mistake that is only one
sided.
One party is under an important mistaken impression and the other is not.
I'll start with a case that never happened, because the outcome is
so clear that nobody would even think about arguing about it.
Suppose I'm a gambler on the horses and I've got a horse right here,
his name is Paul Revere, and a guy has told me if the weather is clear,
can do.
So thinking I've got a good bet, I go to the parimutuel window at the racetrack
and I put down $100 on Paul Revere to win.
The weather is clear, but unfortunately, Paul Revere
doesn't even finish in the top three.
Can't do.
Now, I obviously made a mistake.
A bad mistake, a bad gamble.
But the track didn't make a mistake.
Nobody I was gambling with made a mistake.
It was my mistake.
It was my gamble and I ended up losing.
Obviously, I can't go back to the window and say, hey,
I made a mistake can I get my money back?
No.
I was just wrong.
Too bad.
So, in a unilateral mistake, the contract is still binding.
Here is a more difficult case.
This one actually happened.
See how you think it ought to turn out.
The buyer is a collector of rare coins, and the seller is a coin dealer.
They're both experts.
The buyer sees in the seller's stock a coin
that claims to be a 1916 dime minted in Denver.
A coin like that is a particular rarity.
It's worth $500.
In fact, the dealer sometime before had bought it for $450.
The buyer looks at the coin very carefully,
takes out his magnifying glass, really checks it out,
and the seller says, "I'm going to charge you $500 for it.
I paid $450 for it," which is true.
"So if I can get a small profit, it's yours for $500."
The buyer says, "I want it.
I've always wanted a 1916 Denver dime for my collection.
It's a deal."
He buys it for $500.
Not long after that, another coin collector
learns that the buyer had this rare 1916 Denver dime, and he says, "I want that.
I'll pay you $700 for it.
But, of course, first I have to get it certified by the American Numismatic
Society.
He does, and it turns out that the coin is a very clever fake.
Now, the first buyer wants to get his money back.
One lower court said that the buyer of the coin, the guy who paid $500,
was out of luck.
This kind of thing is not like buying a standard grain of the wheat
by the carload and finding that you've been sold some other grade,
or that some of the wheat has spoiled or sprouted.
This is an inherently risky business.
Buying and selling antiques is always something of a gamble.
And both sides were gambling, and the buyer lost.
It would be quite a different story if the seller of the coin
had known that it was a forgery, or indeed had forged it himself.
That's cheating.
But neither side was cheating.
They were both taking their chances.
And so, the court below said, it's a little bit
like betting on the horse Paul Revere.
However, that's not what the higher court, the appellate court
said, the court that reviewed that decision.
The appellate court said that they were both equally innocent, both equally
persuaded, neither of them thought they were gambling,
and therefore, since they were both mistaken, it was like the two ships
Peerless or Rose of Avalon, a mutual mistake.
The deal was called off.
What do you think?
Do you agree?