Paula Enterprises hires Able to act as its agent to purchase a 1,000-acre tract of land from Thompson for $1,000 per acre. Paula Enterprises does not wish Thompson to know that it is the principal or that Able is its agent. Paula wants the land for a new country housing development, and Thompson may not sell the land for that purpose or may demand a premium price. Able makes the contract for the purchase, signing only his name as purchaser and not disclosing the agency relationship to Thompson. The closing and transfer of deed are to take place on September 1.

(a) If Thompson learns of Paula’s identity on August 1, can Thompson legally refuse to deed the property on September 1? Explain.

(b) Paula gives Able the funds for the closing, but Able absconds with the funds, causing a breach of Able’s contract at the date of closing. Thompson then learns of Paula’s identity and wants to enforce the contract. Discuss fully Thompson’s rights under these circumstances.