Agency, Contracts, and Brokerage Practice
Agency
Agency is a consensual fiduciary relationship: the client authorizes the broker to act on the client's behalf, and the broker owes care, obedience, loyalty, disclosure, accounting, and confidentiality. Hawaii recognizes seller agency, buyer agency, and dual agency. Dual agency is lawful only with the informed, written consent of all parties, and it inevitably trims two duties: undivided loyalty and full disclosure. Separate the client (represented, owed confidentiality) from the customer (unrepresented, owed honesty and fair dealing, but not confidentiality).
Contracts
HRS 656 requires land sale contracts to be written and signed. Listing and buyer-representation agreements should be written, with definite price, term, commission, and exclusivity terms. Commissions are fully negotiable - no statute, commission rule, or association sets them. Know how contingencies (financing, inspection, appraisal, sale of the buyer's home) allocate risk, and how earnest money is held and released.
Traps
- A dual agent may not tell the buyer the seller will accept less, and may not tell the seller the buyer's top price.
- Confidential information survives the end of the relationship.
- "My friend is the agent, so I can tell her everything" does not hold once the brokerage represents both sides.
Worked example: a buyer tells her agent she would pay up to $900,000, and the same brokerage also represents the seller. The agent cannot reveal that ceiling. She obtains written dual-agency consent and steers the discussion to objective merits - condition, comparable sales, inspection findings.