In March $2023,$ Arnold Construction was awarded a construction contract by the Gilliam County Court Commissioners $("$County$")$ to construct a facility for Gilliam County. The terms of the contract provided that it would not become effective until approved by the state director of the US Department of Agriculture Rural Development Office. In July $2023,$ construction still had not been authorized by the state director and Arnold Construction wrote to the County Commission requesting a $6\%$ increase in the price of the contract to reflect the additional costs it would incur due to inflation. The County countered with a $3\%$ increase. Arnold Construction then wrote the commission insisting on $6\%$ and stating if this demand was not agreeable, it was withdrawing its original bid and would not perform under the contract. The County voted to not grant a $6\%$ increase to Arnold Construction.

The commission soon thereafter contracted another company to perform the project, and on January $4,2024$ informed Arnold Construction that it had accepted its withdrawal from the March $2023$ contract. On February $1,2024$ the state director approved the contract. Arnold Construction later sues the County for breach of contract.

$1.$ Is Arnold Construction likely to prevail in its lawsuit? Explain.

$2.$ Does the County have a valid defense it can rely on for entering into a contract with another contractor? Explain.