Final answer:
The principal is liable to a third party for breach of contract in the case of a signature by a partially disclosed principal. In such situations, the third party is aware of the principal's existence but not their identity, and both the agent and the principal can be held liable.
Step-by-step explanation:
The question pertains to situations where the principal is liable to a third party for a breach of contract, as opposed to the agent who acted on behalf of the principal. In the context of agency law, liability depends on the nature of the principal's disclosure to the third party at the time of the contract. Specifically:
- Ratification by disclosed principal: If a principal is disclosed, meaning the third party knows who the principal is and that the agent is acting on their behalf, the principal is typically liable for the agent's actions, assuming the agent was acting within the scope of their authority.
- Ratification by undisclosed principal: In cases of an undisclosed principal, the third party is unaware of the existence of a principal at the time of contracting. If the principal later ratifies the contract, they could become liable to the third party.
- Signature by undisclosed principal: If a contract is signed by the agent without revealing the principal, the agent is usually liable to the third party. However, if the principal's existence (but not identity) is later disclosed and ratified, the principal may be held liable.
- Signature by partially disclosed principal: When the principal's existence is known to the third party, but the principal's identity is not, this is known as a partially disclosed principal. The principal can be held liable to the third party, along with the agent.
Therefore, the answer to the question 'In which of the following situations is the principal - and not the agent - liable to a third party for breach of contract?' is option d. signature by partially disclosed principal.