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RICS APC - Residential > Case Study > Flashcards

Case Study Flashcards

1
Q

Tell me about the terms of engagement for management.

A 
The written terms of engagement for management are reviewed annually. 
They include;
- Obligations of both parties
- The services Burlington will provide 
- The fee Burlington will charge
- Additional Fees
- Termination Process
- The CHP
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2
Q

How did you agree the Terms of Engagement with the appointed Structural Engineer

A

I initiated the conversation having determined they were competent.
The ToE were produced by Burlington and I had an input.
They detail;
- The scope of service
- Fee agreed
- Included the CHP

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3
Q

When you take on a new client can you tell me the Money Laundering checks you carry out?

A

Check the company on Companies House.

  • Find out who the significant control directors are
  • These Directors provide a form of ID, council tax statement (not more than 3 months old), passport.
  • Then do credit check - Dun and Bradstreet
  • Review filed company accounts

look at what dad sends.

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4
Q

Is your client registered for VAT?

A
  • No, they can not reclaim VAT of expenditure.
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5
Q

Rebuild Value - how would this be calculated?

A

The RCA is carried out by a registered valuer.
The valuer attends site and measures the GIA or IPMS2.
The then choose an appropriate category from RICS BCIS and multiple it by the GIA.

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6
Q

The previous surveyors report, how did you resolve the dispute with this surveyor?

A
  1. Requested CHP from the surveyor
  2. First stage - formally raising complaint with senior member of the company
  3. Second stage - complaint reviewed by an independent third party. He confirmed that the complaint relating to the cracking should be upheld and fees reimbursed.
    The final outcome was 50% of fees were returned.
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7
Q

Why did the first surveyor fail to note that the property was affected by subsidence?

A

They stated that the cracked plaster was just old when considering the age of the building. Affected by the tube line that runs below the property.

But the extent of the cracking would not be caused by the tube line. This issue had been resolved and agreed a number of years ago.

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8
Q

How deep below the surface in the underground?

A

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9
Q

If the independent 3rd party had not been able to resolve the dispute, what could you have done?

A

The surveyor has been negligent so I can bringing an action for damages against the surveyor, in court.

Due to the nature of the dispute, I would have tried to resolve it through mediation. Or another alternative form of dispute resolution to avoid additional costs.

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10
Q

Your company will hold, a lot of information, how does GDPR affect your work?

A

It affects my work on a daily basis.

I ensure no confidential information is released to a 3rd party;

  1. Password protected computers and software
  2. Check recipients in email address
  3. Ask prior permission from the party before providing their information to a 3rd party.
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11
Q

What should you do if you breach GDPR?

A

Notify the company’s GDPR compliance officer and Information Commissioner’s Office.

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12
Q

What is the marriage value?

A

Marriage value is the value gained by extending a lease. 50% of Marriage value is added to the premium to compensate the landlord if the term remaining is less than 80 years.

It is the value of all interests after the extension minus the value of interest before new lease is granted.

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13
Q

What are the five methods of valuation

A
  1. Comparable
  2. Contracts Cost
  3. Residual
  4. Profits method - pubs, restaurants
  5. Investment

https://www.thepropertyvoice.net/get-best-property-valuation-according-rics-surveyor/

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14
Q

What are the key financial statements?

A
  1. Profit and loss
  2. Balance statement
  3. Case flow statement
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15
Q

What does IFRS stand for?

A

International Financial Reporting Standards - the standards that company accounts have to be reported to

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16
Q

What is GAAP?

A

Generally Excepted Accounting Procedures

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17
Q

How did you keep your client and leaseholders updated?

A

Fast moving project and regular communications required.
Clients;
1. Monthly meetings via Zoom
2. Prior to that I would provide a written update on each project with actions completed and next steps
3. This would be reviewed at the meeting
4. I would continue to provide action point updates throughout the month.

Leaseholders;

  1. Formally via Section 20 process
  2. I wrote a letter to all leaseholder in October and January providing an update on the information we could disclose at that moment in time.
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18
Q

How do you comply with the requirements of the Bribery Act?

A

The Bribery Act 2021 relates to the offering, receiving, gifting or soliciting of something of value.

In my day to day work, if I was offered a gift;

  1. If i did not eel comfortable accepting the gift I would politely decline it.
  2. I would consider the value, whether the gift is reasonable or proportionate and the timing.
  3. If i accept the gift I would;
    - act openly and transparently
    - record it on a gift register
    - notify a senior member of staff
    - thank the giver.
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19
Q

When you carry out inspections of property what do you take with you?

A

If I am inspecting a building site I would take with me;

  1. Hard hat
  2. Steel toe capped boots
  3. HiVis jacket
  4. Protective Glasses
  5. face mask
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20
Q

What other energy standards effective the residential market?

A 
MEES - Minimum Energy Efficiency Standards
Energy Efficiency (Private Rented Property) Regulations
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21
Q

What is Brutland Report?

A

It was produced in 1992 and demonstrated the need to act sustainability to support future generations.

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22
Q

What is the regulations that affect measurement of property?

A

IPMS - International Property Measurement Standards

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23
Q

How is a Rebuild cost valued?

A

(GIA*BCIS) + demolition and site clearance + professional fees (12.5%) +VAT

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24
Q

What are the typical cues for subsidence?

A
  1. Cant open windows and doors

2. Cracking through brick works rather than along the mortar

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25
Q

How did I know the surveyors appointed were competent?

A
  1. He was previously known to me
  2. He was a qualified Chartered Surveyor
  3. I reviewed references of previous projects he had advised on.
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26
Q

What are the typical cues for subsidence?

A
  1. Cant open windows and doors

2. Cracking along the mortar, in a zig zag pattern.

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27
Q

What is a ‘wholly unconnected’ contractor?

A

Where the parties involved are not connected with the contractor. A connection is present if any individuals concerned is a director, manager, or partner in the business of the other contracting party, or a close relative.

28
Q

What is the difference between Occupiers Liability Act 1957 and 1984?

A

In the 1984 act Trespassers are covered.

29
Q

What is the HSAW etc Act 1974?

A
  • Primary UK legislation governing health and safety.
  • Sets out duties of employers, directors, self-employed, person in control of a premises, suppliers.
  • They must safeguard the health and safety of public and employees who may be affected by their works.
  • Enforced by the Health and Safety Executive
30
Q

What is the HSAW etc Act 1974?

A
  • Primary UK legislation governing health and safety.
  • Sets out duties of employers, directors, self-employed, person in control of a premises, suppliers.
  • They must safeguard the health and safety of public and employees who may be affected by their works.
  • Enforced by the Health and Safety Executive
31
Q

What are The Service Charges (Consultation Requirements) (England) Regulations 2003 (‘the Regulations’) ?

A

These are the regulations from were produced under the Section 20 of Landlord and Tenant Act 1985. To be compliant with Section 20 of LTA 1985 these regulations must be adhered to. They set out the consultation procedure for major works.

32
Q

Why does the landlord have to review observations?

A

The landlord has a duty to have regard observations.
There is no statutory definition of ‘have regard to’, although in some instances the landlord must provide a response to the observations within a period of 21 days.

33
Q

What is the Trafford Housing Trust Ltd Vs Rubenstein case?

A

In 2013, a notice was issued which stated a notice period of 30 days, the period commenced on the date the notice was posted. But the notice was not considered served on this date so the leaseholders did not have the full 30 days and the notice was invalid.

34
Q

What statue can be relied on in regards to the commencement of a notice period?

A

Section 7 of the Interpretation Act 1978, the commencement of a notice period is when the notice is served on the recipient. This statute states service is effective at the time the letter would be delivered in the ordinary course of post, if the letter was properly addressed, pre-paid and posted.

35
Q

Could you serve this notice via email?

A

I wish to ensure the notice reaches the leaseholder so i would email it to them but I would also post it to the correspondence address and property address. As I would not consider the notice served if I just issued it via email.

36
Q

In the case of Deajan Vs Benson, what do you mean by financially prejudiced?

A

If the leaseholders had been consulted fully would they have benefitted financially.

37
Q

What were your concerns with the original surveyor’s report?

A

Their initial report advised that following the collapse of the arch above an apartment door, significant cracking in apartments and ground heave below the paving, the block did not currently have any major structural defect and the apartment plaster was just old.

38
Q

What does the FTT have the power to do?

A
  1. Under S20ZA they have the power to dispense S20 consultation requirements.
  2. Determine a lease extension premium
  3. Determine a lease variation
39
Q

What movement monitoring did the structural surveyor carry out?

A
  1. Took soil samples to measure soil moisture content and to check for desiccation.
  2. Installed reflective targets along the external walls for monthly measurements to provide information on the direction and extent of movement
40
Q

How did you compare the drainage quotes?

A

I provided both companies with a clear and detailed specification.
I spoke to the companies directly to determine whether they were using the same materials and methods.

41
Q

How many tenders did you gather for the lightwell project?

A

7

42
Q

How many tenders did you gather for the drainage project?

A

3 were invited, 2 returned tenders.

43
Q

Why did you carry out Section 20 if the insurance claim covered the cost of subsidence remedials?

A
  1. To protect my client in case the insurance company did not want to cover 100% of the costs.
  2. Formal leaseholder communications.
44
Q

What was included in the light well repair project specification?

A
  1. Redecoration
  2. Repairs and replacement of non-compliant pipework
  3. Installation of supports to the window arches.
    The specification agreed by my client included both options of repairing the window arches and installing support, to cover all eventualities. It was decided that at this stage supports were more appropriate.
45
Q

What was included in the light well repair project specification?

A
  1. Redecoration
  2. Repairs and replacement of non-compliant pipework
  3. Installation of supports to the window arches.
    The specification agreed by my client included both options of repairing the window arches and installing support, to cover all eventualities. It was decided that at this stage supports were more appropriate.
46
Q

The loss adjuster was able to instruct the tree project work very soon after the inspection, how was this possible?

A
  1. My client wanted the works to be done anyway, whether recoverable or not due to health and safety.
  2. The loss adjuster had already seen and reviewed the structural surveyor’s report and movement monitoring results.
  3. CML held funds to cover the cost of the project.
47
Q

Were the drainage works recoverable under the subsidence claim?

A

No, as it could not be determined that the sole cause was the subsidence.
Where the drains were affected the most, apartments had reported issues with raising damp and it was believed these were related.

48
Q

How is the company owned?

A

It is a Private Limited Company and is owned by share capital. Each leaseholder owes 1 share.

49
Q

You mentioned, relevant reports for the inspection, what were they?

A
  1. HSFRA
  2. Asbestos report
  3. Previous inspection report
  4. Recent professional reports
  5. Title plan
50
Q

What did the cracking look like?

A
  1. Significantly bigger than a hairline crack

2. Zig zag pattern

51
Q

Could the correction of non-compliant pipework be considered an improvement?

A

…

52
Q

What is the case of Deajan Vs Benson?

A

.

53
Q

Very risky to instruct works without dispensation granted?

A

significant cracking at the building and had to get on with it. But then I was granted dispensation.

54
Q

what does a CEP assess at the building?

A

reflected building and asset condition and lease obligations.

55
Q

what were your concerns with the orinigal surveyor’s report?

A

Their initial report advised that following the collapse of the arch above an apartment door, significant cracking in apartments and ground heave below the paving, the block did not currently have any major structural defect and the apartment plaster was just old. In addition, Burlington asked the surveyor to install tell tales, which they advised against.

56
Q

what does the FTT have power to do?

A

The FTT has the power, under S20ZA, to dispense the consultation requirements if they are satisfied that the lessees were not prejudiced by the failure of the landlord to carry out the formal consultation requirement. The lessees are obliged to identify the prejudice; they are given the opportunity to notify the FTT of their remarks.

57
Q

what is the dispensation process?

A
  1. Application is issued to the FTT by landlord
  2. FTT issue receipt of application and directions.
  3. LL issue application and directions to leaseholders
  4. Leaseholder have 20 days to formally oppose
  5. LL reply to oppositions in 14 days
  6. LL then issues a bundle to FTT will all related documents
  7. 15 days later the FTT will issue a determination
58
Q

what movement monitoring did the structural surveyor carry out?

A

took soil samples to check for desiccation then for further accuracy, he installed reflective targets along the external walls used for monthly measurements to provide information on direction and extent of movement.

59
Q

How did you compare the drainage quotes?

A

I spoke to the companies directly to determine whether they were using the same materials and methods.

60
Q

for the future reserve fund collection, how can you determine the level of collection for unforeable emergencies?

A
  1. the capex plan assesses all aspects of the building and eventualities, including condition andbuilding M&E. Thus a sufficient level of reserve fund could be hold to repair and maintenance these attributes.
  2. But if projects of a lower priority can be delayed a year and additional funds can be collected via a new budget.
  3. At the end of each year the cash flow forecast at the bottom of the Capex plan is updated to show the YE reserve fund held on account.
61
Q

why did you instruct the drainage repairs, if you werent sure that they could be covered by the subsidence claim.

A

three apartments were being badly affected by rising damp. The CCTV drainage footage showed that there were several cracked pipes below these apartments. There were no other common causes eg. Crackin external render. The drains were repairs to so tostop rising damp.

62
Q

why did you instruct the trees and do dispensation if the insurance company would pay for it?

A

In case the insurance company would not cover all of the costs.

63
Q

why did you instruct the lightwell project without backing from the insurance company

A

the lightwell project had been planned previously to the determination of subsidence. It also included non-complaint drainage works and redecoration and installation of supports and braces to support the brickwork. The client agreed that it was important to complete the project and put in place supports to mitigate against risk.

64
Q

did the insurance company cover the cost of the trees?

A

yes, they strucutral surveyor we had used was approved by the insurers and they agreed with his report and view and allow for the works to go ahead. I completed section 20 to mitigate against risk in the event that funds were not recovered by the insurers.

65
Q

What are the rules for nominated contractors?

A

“1. if a single nomination is made by RTA (Recognised Tenants Association) or just one leaseholder the landlord must try to obtain an estimate from that one contractor.

  1. If a single nominations are made by more than one leaseholder the landlord must try to obtain an estimate from;
    a. the contractor who received the most nominations
    b. if no contractor has the most nominations then the landlord must try to obtain an estimate from at least one person nominated by a leaseholder and one (different) person nominated by RTA.
66
Q

What documents will a contractor require from the contractors?

A
  1. Public Liability Insurance
  2. Confirmation of VAT status
  3. Copies of Health and Safety policy
  4. Confirmation of company status
  5. Credit check data

RICS APC - Residential (22 decks)

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