Broker Ikaika in Hawaii is approached by a buyer, Chen, who wants to purchase a property that Ikaika has listed. Ikaika explains the dual agency situation and both the seller and Chen provide their informed written consent. During negotiations, Chen asks Ikaika: 'Does the seller have any motivation to sell quickly — like a financial hardship or divorce?' What is Ikaika's obligation as a dual agent?
Correct Answer
A) Ikaika must keep the seller's personal motivation confidential and may not share it with Chen.
In a dual agency relationship, the licensee's fiduciary duties to each party are limited, but the duty of confidentiality to each party remains intact. Under Hawaii Administrative Rules Title 16, Chapter 99, a dual agent must not disclose one client's confidential information — such as personal motivation, financial distress, or urgency to sell — to the other client. The seller's personal circumstances are confidential information that Ikaika must protect even while also representing Chen.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A relationship where a listing broker authorizes other brokers to act as agents of the seller, extending the seller's agency relationship to cooperating brokers.
A non-agency relationship where the broker facilitates a real estate transaction without representing either party, owing limited duties of honesty, fairness, and competence to both.
The legal principle that holds a broker responsible for the actions of their agents and employees performed within the scope of the agency relationship.
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