What is a disclosed principal?

A disclosed principal is one whose identity is known to third parties involved in a transaction. This means that when an agent acts on behalf of the principal, the third parties are aware of who the principal is. This designation is important in agency law because it affects the liability and the rights of both the principal and the agent in transactions.

When the principal is disclosed, third parties can interact with the principal directly if needed, and they understand that the agent is acting on behalf of that identifiable principal. This also allows for more security in transactions, as the parties involved are clear about who they are dealing with.

The context of agency relationships is essential in understanding the implications of disclosed versus undisclosed principals, as it can impact the enforceability of contracts, potential legal liabilities, and the agents' authority in binding the principal in dealings with third parties.