What background knowledge is needed for this Agency question?

Native Hawaiian traditional and customary rights are rooted in ancient Hawaiian culture and were formally preserved through Article XII, Section 7 of the Hawaii State Constitution, adopted in 1978, and codified under HRS Section 1-1, which preserves the customs and usages of the Native Hawaiian people. These rights survived the overthrow of the Hawaiian monarchy, the annexation by the United States, and statehood, reflecting a deliberate legislative and constitutional commitment to protecting indigenous cultural practices. The landmark Hawaii Supreme Court case Public Access Shoreline Hawaii v. Hawaii County Planning Commission (PASH, 1995) significantly clarified that these rights can encumber private lands, not just government-owned ceded lands, making disclosure in private transactions essential.

What is a good way to remember the answer to this Agency question?

Use the acronym 'ALOHA RIGHTS' to remember: A buyer's agent must Always disclose Land-burdening Obligations, Historic Access rights, and gathering rights — because these rights are as fundamental to Hawaii as the Aloha Spirit itself. Visualize a traditional Hawaiian figure walking freely across a lush green parcel while a buyer stands at the fence looking confused — that image of someone else legally walking on 'your' land is the material fact Moana must reveal before the buyer ever signs a contract.

What exam tip applies to this Agency question?

On Hawaii real estate exam questions involving Native Hawaiian rights, always treat these rights as a special category of material encumbrance that exists independently of recordation and independently of whether the land is state-owned or private — any answer suggesting these rights only apply to ceded lands or only require disclosure upon buyer inquiry is a distractor. When you see a question involving indigenous rights, gathering rights, or access rights on Hawaii property, your default answer should be that the buyer's agent must proactively disclose, because fiduciary duty requires it regardless of how the encumbrance was created.

How does this Agency concept apply in real world practice?

Imagine a buyer from the mainland purchases a rural property on the Big Island without knowing that a nearby 'ohana (family community) holds recognized gathering rights to harvest medicinal plants from a forested section of the parcel. After closing, the buyer attempts to fence the entire property and is confronted by community members asserting their constitutional rights, leading to a costly legal dispute. Had Moana disclosed this encumbrance before closing, the buyer could have negotiated a reduced price, requested a survey of affected areas, or simply chosen a different property — all outcomes that a proper buyer's agent disclosure would have made possible.

AgencyAgency_typesMEDIUM

A Hawaii real estate salesperson, Moana, is working with a buyer who is interested in purchasing a property that includes a parcel with traditional Native Hawaiian gathering and access rights running across it. Moana's buyer is not aware of these rights. What is Moana's obligation as the buyer's agent?

Correct Answer

B) Moana must disclose these rights to the buyer because they are a material encumbrance that affects the buyer's use and enjoyment of the property.

Native Hawaiian traditional and customary access and gathering rights are recognized under HRS Section 1-1 and the Hawaii State Constitution and may encumber private property. These rights are a unique Hawaii encumbrance that a buyer's agent must proactively disclose because they are a material fact affecting the buyer's use and enjoyment of the property. As the buyer's agent, Moana has a fiduciary duty to disclose all known material facts, including these unique Hawaii-specific encumbrances.

Answer Options

Moana has no obligation to disclose these rights because they are not recorded in the Bureau of Conveyances.

Moana must disclose these rights to the buyer because they are a material encumbrance that affects the buyer's use and enjoyment of the property.

Moana should disclose these rights only if the buyer specifically asks about encumbrances on the property.

Moana is not required to disclose these rights because they apply only to state-owned ceded lands, not private property.

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Related Concepts

Agency Termination

The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.

Confidentiality Duty

The fiduciary obligation to protect a client's private information and not disclose it to third parties without permission, surviving even after the agency relationship ends.

Customer vs Client

In real estate, a client is someone to whom the agent owes fiduciary duties through an agency relationship, while a customer is a third party to whom the agent owes only honesty and fair dealing.

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