Additional Ethics Questions Flashcards
What are the key functions of RICS?
- The RICS promotes and enforces the highest professional qualifications and standards in the development and management of land, real estate, construction and infrastructure.
- Its functions: consumer protection, influence policy, set standards, accredit professionals, quality assurance
What’s a Royal Charter?
A Royal Charter is an instrument of incorporation, granted by The King, which grants independent legal personality on an organisation and defines its objectives, constitution and powers to govern its own affairs.
What do you understand by the term self-regulation?
An organisation regulates itself without the involvement of external bodies
Can you tell me what you understand by the principles of better regulation?
Transparent, proportional, accountable, consistent and targeted
What is a bye-law?
Regulation made by an organisation or corporation
Explain to me the new RICS Rules of Conduct - what do they replace?
Replaces rules of conduct for member and rules of conduct for firms
What publication sets out disciplinary procedures the RICS can impose>
Sanctions Policy: Guidance to RICS Disciplinary, Registration and Appeal Panel Rules (2019)
When did RICS last update their disciplinary panel rules?
1st October 2019
What do you understand by the term professional practice?
Refers to the conduct and work of someone from a particular profession. Professions are occupations that require a prolonged period of education and training. They are often overseen by professional bodies who may accredit educational establishments and qualified professional
What is Professional Indemnity Insurance (PII)?
Professional indemnity insurance protects against claims for loss or damage made by clients or third parties as a result of the impact of negligent services provided or negligent advice offered
What is a PII aggregation clause?
An aggregation clause governs what happens if there is more than one claim under the same policy in the same year. It enables two or more separate losses covered by the policy to be treated as a single loss for the purposes of the excess or deductible or the limit of liability
What does ‘claims made’ mean in terms of PII?
Basis of policy means that policy in place at the time the claim is made by the client will provide cover
In a negligence claim, what would help to show you acted with consideration and due process?
Showing you undertook the instruction adhering to RICS best practice guidance
Can good record keeping help to provide a defence in a PII claim?
Yes, shows acted with consideration and due process and acted reasonable not to inflict damage or harm
What is the RICS document for PII?
RICS Regulation Professional indemnity insurance requirements, Version 9, Effective 2nd February 2022
What is run off cover?
Cover in place for the period after a firm ceases to trade.
What changes did RICS recently make to the Minimum Approved PII Wording?
- 2022 update to reflect change to excess requirements
- Removed for larger firms
- 2.5% maximum excess requirement for smaller firms remains
Explain PII requirements relating to fire safety cover?
Insurers are not permitted without specific dispensation to exclude fire safety claims on a property four storeys or less and fire safety coverage must be provided, as a minimum, on an aggregate, defence cost inclusive basis
How long can a PII claim arise after the work is undertaken
6 years for claims regarding negligence
What is the Assigned Risks Pool (ARP)?
RICS market facility to ensure availability of professional indemnity insurance to regulated t firms who are unable to obtain PII which meets RICS minimum requirements
Who might need to access the ARP?
Firms who are unable to get cover due to the insurance market – doesn’t necessary reflect firm
Explain your understanding of the RICS Guidance Note Risk, Liability and Insurance?
- RICS Guidnace Note: Risk liability and insurance, 1st edition, 2021
- This guidance note is intended to assist both RICS-regulated firms and their clients to understand the main risks and liabilities associated with professional services provided by RICS members. It guides firms in the negotiation of equitable contracts with clients and the avoidance of major risks and pitfalls.
What is a liability cap?
A contractual agreement that a client can only claim damages up to the amount agreed, even if the law would otherwise award a greater sum in damages
Explain when you might agree a liability cap
- Used as a way to manage the risk in professional work, to ensure there is a fair allocation of risk and reward between members and their clients
- Valuation – red book requires valuers to include a statement on limitations on liability in terms of engagement and valuation report
How would set out third party reliance in Terms of Engagement?
- Should be incorporated within the original terms of engagement of an instruction
- Granted in line with PII
What are the three key terms that should be considered from a risk perspective in the context of every instruction you undertake?
The scope of the work
The basis on which the fee will be calculated
The liability cap