Case study

Once upon a time, in the vibrant city of Silverdale, there were two individuals named Sarah and Michael. Sarah, an aspiring entrepreneur, inherited an exquisite gold ring from her grandmother. Michael, a wealthy businessman and avid collector of precious gemstones, had been in search of a one$-$of$-$a$-$kind diamond ring to add to his collection.

One sunny morning, Sarah decided to sell her inherited gold ring to finance her dream business venture. She posted an online ad$,$ hoping to find a buyer who would appreciate the sentimental value of the piece and pay a fair price. Intrigued by Sarah's ad$,$ Michael reached out to set up a meeting to see the ring in person.

Excitement filled the air as Sarah and Michael met at a local caf$.$ Sarah gently handed over the gold ring to Michael, explaining its sentimental value and expressing her hope that it would find a special home. Michael took a quick glance at the ring, noticing its intricate design and assuming it to be a valuable diamond ring rather than gold.

Recognizing the priceless opportunity before him, Michael offered an exorbitant sum of money to purchase what he believed to be a diamond ring. Sarah, astounded by the offer and unaware of the mistaken assumption, eagerly accepted the deal, overwhelmed by the unexpected windfall.

As time passed, Michael began showcasing his newly acquired "diamond ring" to friends and colleagues. News of his remarkable find quickly spread, attracting attention from jewelers and gemstone experts alike. Suspicion grew among these experts as they noticed discrepancies between the ring's appearance and the qualities typically associated with diamonds.

One day, an esteemed gemologist decided to examine the ring carefully. After rigorous testing and evaluation, the truth was revealed$$the ring was indeed made of gold, not adorned with a diamond as Michael had assumed. Shocked and embarrassed, Michael realized he had paid an exorbitant amount for a simple gold ring.

Feeling deceived, Michael confronted Sarah about the true nature of the ring. Sarah, equally surprised by the revelation, explained that she had always advertised the ring as gold, never once mentioning any diamonds. It became clear that Michael's mistaken assumption had led to this unfortunate situation.

Eventually, Michael sought legal advice to understand his options and whether he could reclaim any of the considerable sum he had paid for the ring.

Please answer the questions: $(15$points$)$

What are the essential elements that render a contract legally binding and enforceable?

Does the contract entered into by Sarah and Michael fulfill the necessary criteria for it to be considered a legally binding agreement?

Is it possible for Michael to terminate the contract and seek a reimbursement of the amount he paid for the gold ring?