REG Agency · Updated November 2026
Who Is Liable on the Contract, the Agent or the Principal?
Classify what the third party knew, then analyze authority and liability.
Disclosed principal
The third party knows the agent is acting for a principal and knows the principal's identity.
Unidentified principal
The third party knows an agency relationship exists but does not know the principal's identity.
Undisclosed principal
The third party does not know the agent is acting for another person, which can increase the agent's contractual exposure.
Authority still matters
Also analyze actual authority, apparent authority where applicable, and ratification.
The takeaway
What the third party knew changes the liability analysis.
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FAQ
Can an agent be personally liable when the principal is undisclosed?
Yes.
Does disclosed status eliminate every possible agent liability?
No.
Can an undisclosed principal ever be liable?
Potentially, when applicable requirements are satisfied.