Which of the following is correct with regard to a contract entered into with a third person by an agent of an undisclosed principal?
A) The agent has no liability to the third person if the agent has acted within the scope of her authority.
B) The agent is personally liable upon the contract.
C) The undisclosed principal has no liability on the contract, even if her existence and identity are discovered by the third person.
D) If the third party obtains a judgment against the principal and the judgment is satisfied, the agent may still have liability to that third party.

Question

Quizplus · Accepted Answer

In the case of a contract entered into by an agent on behalf of an undisclosed principal, the agent is personally liable to the third party. This is because the third party is unaware of the principal's existence at the time of the contract, and thus, the agent is the person with whom the third party believes they are entering into a contract.

Which of the Following Is Correct with Regard to a Contract