Pete hires Alice as an agent to sell a piece of property he owns. The price is to be at least $300,000.00. Alice discovers that the fair market value of Pete’s property is at least $450,000.00 and could be higher because a shopping mall is going to be built nearby.
Alice forms a real estate partnership with her cousin Carl. Alice prepares a contract for Pete’s signature to sell the property to Carl for $320,000.00. Pete signs the contract.
Before passage of title, Pete learns about the shopping mall and the increased fair market value. Pete refuses to deed the property to Carl.
Carl claims that as Pete’s agent, Alice created a binding contract.
Q: Discuss fully whether Pete is bound by the contract and why.