A principal may incur liabilityA) if a third party is induced to enter into a contract by the fraudulent misrepresentation of an agent.B) by revealing his or her identity in a situation where an agent negotiated a contract without disclosing his agency.C) where an agent reveals his agency in concluding a contract and acts within his authority.D) where an agent reveals his agency in concluding a contract and exceeds his authority.E) all of the responses are correct.

Question

A principal may incur liabilityA)  if a third party is induced to enter into a contract by the fraudulent misrepresentation of an agent.B)  by revealing his or her identity in a situation where an agent negotiated a contract without disclosing his agency.C)  where an agent reveals his agency in concluding a contract and acts within his authority.D)  where an agent reveals his agency in concluding a contract and exceeds his authority.E)  all of the responses are correct.

puvvada priyanka · Accepted Answer

Final Answer : E, Explanation :  All the responses correctly describe situations where a principal may incur liability. In A, the principal is liable for the agent's fraudulent actions. In B, the principal can be held liable once their identity is revealed, even if the agent initially did not disclose the agency relationship. In C and D, the principal is liable for contracts entered into by the agent acting within their authority, and also when the agent exceeds their authority but the third party was not aware of the limits of this authority.

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