Final answer:
David is not required to pay due to the mutual mistake. Both parties had an incorrect assumption about a vital fact (number of living cattle), which can make the contract voidable. Legal outcomes may vary based on jurisdiction and other circumstances.
Step-by-step explanation:
The question at hand involves a legal concept often encountered in contract law related to a mutual mistake. When Carlos and David entered into a contract for the sale of five hundred head of Carlos's cattle at $95 per head, they both were unaware of an unforeseen storm that had killed many of the cattle. In legal terms, this situation is referred to as a mutual mistake of fact, which is when both parties enter a contract with the same incorrect assumption about a vital fact regarding the contract.
Option a) suggests that David is not required to pay due to the mutual mistake, and this is typically the correct answer in contract law. If a vital fact to the contract (such as the number of living cattle in this case) is mistaken by both parties, the contract could be voidable because the mutual mistake significantly impacts the performance of the contract. However, specific outcomes can differ depending on the jurisdiction and the precise circumstances surrounding the contract and the mistake.