Agency
What is the 'duty of loyalty' an agent owes to a principal in Hawaii?
AA. The agent must always recommend the agent's own listings
BB. The agent must place the principal's interests above all others, including the agent's own interests✓ Correct
CC. The agent must be loyal to the brokerage firm above the client
DD. The agent must refer all business to their supervising broker
Explanation
The duty of loyalty requires an agent to place the principal's interests above all others—including the agent's own financial interests, interests of other clients, and interests of the broker. This is a fundamental fiduciary duty and prohibits self-dealing or conflicts of interest.
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Key Terms to Know
Fiduciary Duty
The highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Buyer's AgentA real estate licensee who represents the buyer's interests in a transaction, owing fiduciary duties to the buyer.
Seller's Agent (Listing Agent)A real estate licensee who represents the seller's interests, markets the property, and owes fiduciary duties to the seller.
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