Conflict Avoidance Flashcards
What is a conflict?
- Arises during failure to comply with contractual obligations
- Important to follow the hierarchy of avoidance, management, and resolution of conflicts
What is conflict avoidnace
- Clear, concise and careful drafting of the contract
- Adopt proactive conflict avoidance risk e.g. misinterpretation
- Manage parties’ expectations, understand their objectives, and communicate clearly
- Keep good records of documents and communication
What are the 3 main process in resolving disputes
1) Negotiation – problem solving efforts of the parties themselves
2) Mediation or Conciliation – a third party intervention which assist in resolving difficulties.
- Not a binding decision.
3) Adjudicative Process – e.g. litigation or arbitration.
Final outcome is determined by a third party.
Binding Decision on both parties
Alternative Dispute Resolution (ADR)
These are dispute resolution processes and techniques that fall outside the scope of court litigation
Advantages include:
Speed – less time consuming than court proceedings
Informality – outside a court
Greater opportunity for negotiation
Cost – less money spent on professional fees for litigation
Quality of decision making – outcome can be made by a surveyor rather than a judge
Confidentiality
Forms of ADR:
1) Mediation
1) Mediation
* Comprises a neutral mediator who facilitates discussions between both parties to explore a solution
* Confidential and informal
* ‘without prejudice’ basis
* Not a legally binding decision
* RICS Guidance note in Mediation, 2014
2) Arbitration
- Appointed in a quasi-judicial role in accordance with the Arbitration Act 1996.
- Parties are bound by the decision
- Have specialist knowledge in the area and cannot be sued for negligence
- Decision can be over-ruled by the Court of Appeal
- Fast, cost-effective and confidential solution to the dispute
- Surveyors can act as an arbitrator having passed the Chartered Institute of Arbitrators exams
- PACT (Professional Arbitration on Court Terms) used for lease renewals
3) Independent Expert Determination
- Independent Expert is appointed by both parties (or by the President of the RICS)
- RICS Guidance Note on Independent Expert Determination, 2016
- Both parties are bound by the decision, based on evidence provided by both parties
- Can also use their own opinion and evidence
- Quick and provides specialist knowledge in the solution
What is early neutral evaluation?
- Use of an independent person, experienced in the subject matter of the dispute, to investigate and give their non-binding opinion
Acting as an Expert Witness
- When a surveyor provides evidence to a judicial or quasi-judicial body
- RICS Practice Statement: Surveyors acting as Expert Witnesses, 4th Edition, 2015
- Primary duty of care to the court or other dispute resolution panel (not the client)
- A surveyor should only accept instructions to act if they have knowledge, experience, qualifications, appropriate training and no conflicts
Acting as an Advocate
- RICS Professional Statement: Surveyors Acting as Advocates, 2017
- Surveyor acting for a client as an advocate, represents their client at the judicial hearing
- Duty is solely to the client
- Must act with integrity and be competent
RICS Guidance Note ‘Surveyors Acting as Expert Witnesses’, 4th Edition, 2023,
This comprehensive Mandatory guide is written for surveyors who provide expert evidence to be relied upon in civil proceedings before a wide range of tribunals.
This document:
* Explains the need for clear instructions and terms of engagement
* Gives guidance on what to do in situations of conflict of interest
* Outlines the written report format
* Clarifies the differences between the roles of expert and advocate
* Helps remove pressure upon experts to support their clients’ cases irrespective of their honest professional opinion
What is the RICS guidance on conflicts?
- RICS Gloval Professional Statement on Conflicts of Interest, 2017
- Defines the type of conflicts
o Own interest
o Party conflict
o Confidential information conflict
Conflicts of Interest – UK Commercial Property Market Investment Agency, 2017
- Dual agency
o Cannot act for a purchaser and a seller ‘double dipping’ - Multiple instructions
o ToE state if exclusive or non-exclusive basis
Exclusive – cannot advise other parties
Non-exclusive – need informed consent from all clients and information barrier. Need to inform the vendor also.
How would you run a conflict-of-interest check?
- Check client entity and address
- Check property address
- Internal client management system – salesforce
- Review any conflict or potential conflict and assess next steps
How can you avoid conflicts?
- Clear and concise terms of engagement, leases, contracts
- Accurate record keeping and processes
- Proactive conflict checks
- Information barriers