Hawaii Real Estate State Practice Exam

Is a general agent granted broad authority to act on behalf of their principal, while a specific agent has limited powers?

1. True

2. False

3. Only in written agreements

4. Only during certain transactions

The correct answer is: True

A general agent indeed has broad authority to act on behalf of their principal, which allows them to conduct a variety of transactions and make decisions within the scope of their agency relationship. This broad authority typically applies across an ongoing relationship, enabling the general agent to manage a principal's affairs in a comprehensive manner, such as managing a property or running a business. In contrast, a specific agent is granted limited powers, focusing on a single task or a defined range of tasks. This limited authority means that a specific agent can only make decisions or carry out actions expressly authorized by the principal, typically related to a particular transaction or purpose. The distinctions in authority between general agents and specific agents are fundamental concepts in agency law, highlighting how different types of agent relationships can affect the decisions and actions taken on behalf of the principal.