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B is corrent because classification of a principal as disclosed, undisclosed, or partially disclosed affects the contractual liability of the agent toward third parties. The authority given the agent, however, is not affected. An agent representing an undisclosed principal has the same implied authority as an agent representing a disclosed principal.
A is incorrect because a fictitious business name statute requires a party conducting business under an assumed name to receive the state’s permission to use that name. Such a statute has no applicability to the Lux-Steel agency relationship.
C is incorrect because a principal’s liability for his agent’s torts is the same regardless of whether the principal is disclosed, undisclosed, or partially disclosed.
D is incorrect because once the identity of a previously undisclosed principal is known, the third party may elect to hold either the principal or the agent liable on the contract. Thus, Steel remains liable.