Haw. Code R. § 16-99-3.1

Current through November, 2024

Section 16-99-3.1 - Disclosure of agency

(a) As used in this section:

"Buyer" includes a vendee, lessee, party to an exchange, or grantee of an option.

"Buyer's agent" means a real estate broker who acts as the agent of the buyer.

"Contract between the buyer and seller" includes a purchase contract, an option, an offer to purchase, a sales contract, an offer to lease, or a lease.

"Listing brokerage firm" means the real estate brokerage firm that obtains a listing of real estate for sale, lease, exchange (residential, time share, industrial, or commercial) or for an interest in a residential cooperative housing corporation.

"Seller" includes a vendor, lessor, party to an exchange, or grantor of an option.

"Selling brokerage firm" means a real estate brokerage firm that acts in cooperation with a listing broker and finds and obtains a buyer in a transaction.

"Subagent" means a real estate brokerage firm or salesperson to whom an agent delegates agency powers.

"Transaction" means any sale, lease, rent, or exchange of real estate (residential, time share, industrial, or commercial) transaction or a sale or exchange of, or option involving, an interest in a residential cooperative housing corporation, but excluding leases for one year or less.

(b) At the time a listing brokerage firm obtains a listing, the listing brokerage firm shall disclose the following:

(1) Whether the seller authorizes the listing brokerage firm to appoint seller's subagents through a multiple listing service or otherwise; and

(2) Whether the seller authorizes the listing brokerage firm to share commissions with seller's subagents or buyer's agents.

The disclosure shall be in writing, dated, and signed by the seller and the listing brokerage firm.

(c) Prior to preparing any contract between the buyer and the seller, the following disclosure shall be made at least once to the buyer, in writing or orally:

(1) If the licensee acting as the listing brokerage firm is acting alone and providing services to the buyer, the licensee shall disclose who the licensee represents in the transaction;

(2) If the licensee, acting in cooperation with a listing brokerage firm, has found the buyer in the transaction, the licensee shall disclose who the licensee represents in the transaction; or

(3) If there is no listing brokerage firm, each licensee providing services to the buyer with respect to the transaction shall disclose whether the licensee represents the buyer or the seller in the transaction.

(d) Prior to presenting a contract between the buyer and the seller to the seller, the following disclosure shall be made at least once to the seller, in writing or orally:

(1) The licensee acting as the listing brokerage firm shall disclose to the seller who the selling brokerage firm represents in the transaction; or

(2) If there is no listing brokerage firm, each licensee involved in the transaction shall disclose to the seller whether the licensee represents the buyer or the seller in the transaction.

(e) Any disclosure required by subsections (c) and (d) shall be confirmed in writing in a separate paragraph titled "AGENCY DISCLOSURE" in the contract between the buyer and the seller. The title shall be in no less than ten-point bold print. No particular disclosure language is required. To assist licensees, the commission approves the following language:

"AGENCY DISCLOSURE(S):

________________________, and all licensees

(Print name of Selling Brokerage Firm,)

(or Listing Brokerage Firm if acting alone)

employed by or associated with the brokerage firm,

represents the_____________________. By

(Buyer or Seller)

initialing below, the Buyer and Seller confirm that oral or written disclosure of such representation was provided to them before the signing of this contract.

___________ _____________

Buyer's initials Seller's initials"

(f) Unless specifically restricted by the real estate brokerage firm in writing, any real estate salesperson, employed by or associated with a real estate brokerage firm, shall be authorized to make the required disclosures on behalf of the real estate brokerage firm. Failure to make the disclosure required by subsections (b), (c), and (d) or to obtain the written confirmation thereof shall subject the real estate brokerage firm and the real estate salesperson to disciplinary action by the commission.

(g) A licensee may not be the agent for both the buyer and the seller without obtaining the written consent of both the buyer and the seller. The written consent shall state that the licensee made a full disclosure of the type of representation the licensee will provide and shall briefly describe the type of representation the licensee will provide to the buyer and to the seller. A general statement in the consent signed by the buyer and seller that the licensee represents both buyer and the seller is not sufficient.

(h) A licensee representing a buyer shall disclose, orally or in writing, such agency to the seller, or the listing brokerage firm if there is a listing brokerage firm, before negotiations are initiated. The licensee shall disclose, orally or in writing, to the seller, or the listing brokerage firm if there is a listing brokerage firm, whether the licensee is, or intends to be, the buyer, before negotiations are initiated.

(i) If any change occurs in a transaction which makes a prior written or oral disclosure required by this section incomplete, misleading, or inaccurate, the licensee shall promptly make a revised written disclosure if the prior disclosure was in writing, or a revised oral disclosure if the prior disclosure was made orally, to the buyer or seller, or both, as the case may be. Any revised written disclosure shall include the date of the revised disclosure and be acknowledged separately by the signature of the buyer or seller, or both, as the case may be.

(j) The obligation of either the seller or buyer to pay compensation to a brokerage firm is not determinative of the agency relationship.

(k) Nothing in this chapter shall affect the validity of title to real property transferred, based solely on the reason that any licensee failed to conform to the provisions of this chapter.

Haw. Code R. § 16-99-3.1

[Eff 7/11/87; am and comp 11/3/90; comp 2/25/91; am and comp 5/21/01] (Auth: HRS § 467-4) (Imp: HRS § 467-14(12))

Am and Comp 12/19/2016