Asked by Camilla Fernandez on May 27, 2024
Verified
Which of the following is true regarding an agent's liability when a third party obtains a judgment against a previously undisclosed principal?
A) The agent is freed from liability to the third party.
B) The agent remains liable to the third party.
C) The agent is freed from liability to the third party unless the principal refuses to pay.
D) The agent is freed from liability to the third party unless the principal files for bankruptcy.
E) The agent is freed from liability to the third party unless a contract for personal service was involved.
Previously Undisclosed Principal
A principal whose identity was not revealed by the agent at the time of entering into a contract with a third party.
Third Party
An entity that is not directly involved in a transaction or contract but may be affected by it or may have interests that are affected.
- Expound on the concept of undisclosed, partially disclosed, and disclosed principals, together with the legal implications tied to each scenario in representative relationships.
Verified Answer
PK
Parteek KumarMay 27, 2024
Final Answer :
A
Explanation :
In situations in which a principal was undisclosed,a judgment for a third party against an agent,when the third party comes to know of the undisclosed principal's identity,releases the principal from liability.Also,a judgment against a previously undisclosed principal frees the agent from liability.
Learning Objectives
- Expound on the concept of undisclosed, partially disclosed, and disclosed principals, together with the legal implications tied to each scenario in representative relationships.