Thanks for pointing this out!
The diagram and solution have been updated to better reflect the actual situation. It is a 1 by 2 square, but it needs to be drawn differently to reflect that Scott can arrive between 1pm and 2pm while Mike arrives between 12pm and 2pm.
In the 2 by 2 square you're thinking of, the bottom half is impossible (as that would be Scott arriving before 1pm), so that does not count towards the probability.
Hope you can see the updated picture and let us know if this helps!