Hawaii Real Estate Broker Exam — All Questions

In Hawaii, the licensee who has primary responsibility for supervising a brokerage firm and its affiliated licensees is the:

• a.Principal Broker (PB)✓
• b.Salesperson of record
• c.Escrow officer
• d.Listing agent

Every Hawaii brokerage must designate a Principal Broker (PB) who is responsible for the firm's overall operations, trust-account handling, and supervision of associate brokers and salespersons. A Broker-in-Charge (BIC) may be designated to supervise a specific branch office, but the Principal Broker carries the top supervisory responsibility for the entity.

A Hawaii brokerage opens a second office on a neighbor island. Under Hawaii law, that branch office must be supervised by a:

• a.Salesperson with at least five years of experience
• b.Non-licensed office manager approved by the Commission
• c.Broker-in-Charge (BIC) designated for that branch✓
• d.Rotating panel of the firm's salespersons

Hawaii requires each branch office to be under the supervision of a Broker-in-Charge (BIC) who is a licensed broker responsible for that location. This ensures that trust funds, advertising, and licensee conduct at every office are overseen by a qualified broker, not by a salesperson or an unlicensed manager.

When a Hawaii Principal Broker receives client trust funds such as earnest money, the funds must be:

• a.Deposited into the brokerage's general operating account
• b.Held in a client trust account separate from the broker's own funds, with no commingling✓
• c.Given to the seller within 24 hours of receipt
• d.Converted to a cashier's check kept in the office safe

Hawaii law requires the Principal Broker to hold client money in a separate client trust (escrow) account and prohibits commingling trust funds with the broker's business or personal funds. The broker must keep accurate records and be able to account for all trust money. Commingling or conversion of trust funds is a serious violation subject to discipline.

A Hawaii Principal Broker practices dual agency, representing both buyer and seller in one transaction. This is permitted only when:

• a.The transaction is below a set dollar amount
• b.Both parties give informed written consent to the dual agency✓
• c.The two parties use separate escrow companies
• d.The Commission approves the specific transaction in advance

Dual agency is allowed in Hawaii only with the informed written consent of both the buyer and the seller. Because a dual agent cannot fully advocate for either party, the broker must disclose the limited nature of the representation and keep each party's confidential information private. A supervising broker must ensure affiliated licensees follow these consent requirements.