Conflict Avoidance and Dispute

Question 1

What is a conflict of interest?

Answer 1

When your involvement with one party affects your ability to act with impartiality in an instruction.

Question 2

What literature covers Conflicts of Interests.

Answer 2

RICS Professional Statement: Conflicts of Interest 1st Edition 2017

Question 3

what are the different types of conflict

Answer 3

Three types of conflict as outlined by the RICS Guidance Note: Conflicts of Interest:

Party Conflict:

a situation in which to act in the interests of a client or other party in a professional assignment conflicts with a duty owed to another client or party in relation to the same or a related professional assignment

Own interest Conflict:

a situation in which to act in the interests of a client in a professional assignment conflicts with the interests of that same RICS member/ firm (or in the case of a regulated firm, the interests of any of the individuals within that regulated firm who are involved directly or indirectly in that or any related professional assignment

Confidential information Conflict:

Question 4

Small practice of sole practitioner where there is no conflict checking software.

Answer 4

Self checking must be undertaken.

Question 5

How do you undertake a conflict of interest check?

Answer 5

We have a conflict check system and I therefore put all the details of the instruction onto the system, including all the parties involved and the building involved and I receive an email confirming if there is a conflict and what actions I should take.

Question 6

How would you handle a conflict of interest?

Answer 6

1) Consider if it should be avoided or can be managed
2) Disclose the nature of the conflict and how you propose to manage it
3) Advise both clients to seek independent professional advice if they have any concerns
4) Request written confirmation from both parties that they are satisfied with these measures and wish you to proceed. known as informed consent.
5) Once agreement received set up information barrier

Question 7

what is Informed consent?

Answer 7

Informed consent is the express written consent of a party acknowledging the conflict and the associated risk that they could be adversely affected by a conflict and proceeds to instruct the RICS member/ firm anyway.

Surveyors must only seek informed consent if satisficed that it is in the best interests of all parties to do so.

Question 8

What can you do if a conflict arises and what is the difference between them.

Answer 8

Conflicts can either be Avoided or Managed.

Avoidance – Don’t accept the instruction

Management - Manage the conflict with information barrier and written agreement of all parties.

Question 9

What are the practical implications of an Information Barrier?

Answer 9

An information barrier that separates two or more groups, usually as a means of restricting the flow of information. This may include:

Location - working in different locations,

Staff - using different support staff,

Passwords - using passwords to restrict who can view the information

Compliance Officer - the process should be overseen by the firm’s compliance officer.

Question 10

can you give an example of a conflict that may arise in your day to day work?

Answer 10

A payment dispute between contractor and employer. For example, contractor believes they are owed more and the employer issues a pay less notice. The contractor can refer the dispute to adjudication.

Question 11

What is RICS Conflict Avoidance and Dispute Resolution in Construction Guidance Note?

Answer 11

• Describes processes for conflict avoidance with the aim of avoiding litigation.

Question 12

How can you best avoid conflicts?

Answer 12

By communicating well, clearly and in a timely manner.

Question 13

What are the conflict avoidance processes?

Answer 13

Good Management
            Good project management
            Good client management
            Good constructor management
            good design team management

Clear contract documentation

Good payment practice

Good record keeping

Regular reporting proactivity.

Question 14

What is an ombudsmen?

Answer 14

An ombudsman is someone who investigates complaints about companies or organisations.

Question 15

What are the processes required to avoid conflicts?

Answer 15

• Good management
• Clear contract documentation
• Good client management
• Good contractor management
• Good payment practices
• Record keeping
• Regular reporting

Question 16

Any literature produced by the RICS for conflict avoidance and dispute?

Answer 16

RICS Guidance Note: Conflict Avoidance & Dispute Resolution.

Question 17

What is ADR?

Answer 17

Alternative Dispute Resolution.

Question 18

What the three pillars of dispute resolution

Answer 18

Negotiation, mediation and (binding) adjudicative process

Question 19

What dispute resolution procedures are you aware of?

Answer 19

Negotiation
Mediation
Conciliation
Adjudication
· Arbitration
-       Expert determination

Question 20

Why is ADR better than litigation

Answer 20

• Cheaper
• Quicker
• Confidential

Question 21

What is litigation?

Answer 21

Litigation is the process of making a civil claim in a Court of Law, where Barristers act on each party’s behalf.

Question 22

Why should you avoid Litigation?

Answer 22

not private
Bad for relationships
Cost and time implications

Question 23

What are the types of ADR?

Answer 23

• Mediation
• Expert Determination
• Adjudication
• Arbitration

Question 24

Explain the process of conciliation?

Answer 24

• Similar to mediation

* Conciliator provides a non-binding decision

Question 25

Explain the process of mediation?

Answer 25

· A neutral mediator facilitates negotiation between the two parties. · It’s a confidential and informal process · Usually conducted on a 'without prejudice' basis. · The Mediator has no decision making authority and cannot impose a resolution upon the two parties. There is an RICS GN on mediation 2014.

Question 26

What is expert determination?

Answer 26

An expert in the field is agreed with a contract. They review evidence and make a legally binding decision. (hard to appeal)

Question 27

Explain the process of adjudication?

Answer 27

· Commonly used for construction payment disputes since section 108 Housing Grants, Construction and Regeneration Act 1996 Process: - Referring party notifies other party. - Adjudicator appointed within 7 days - Referral notice served within 7 days · The adjudicator comes to a legally binding decision · Must reach a decision within 28 days of their appointment There is no requirement for contracts to be in writing. The adjudicator can correct a clerical or typographical error in the construction contract. Adjudication can be overturned by Arbitration and litigation.

Question 28

Who do you name in contracts as the appointed Adjudicator?

Answer 28

RICS Adjudication Service. They will nominate an expert adjudicator

Question 29

Why do you use the RICS Adjudication service?

Answer 29

* Well established service * RICS is the UK’s leading * It is my professional body and they use RICS chartered professionals

Question 30

What amended the Housing Grants, Construction and Regeneration Act 1996

Answer 30

Local Democracy, Economic Development and Construction Act 2009

Question 31

Explain the process of Arbitration

Answer 31

· The Arbitrator takes on a partly judicial role. - They provide a legally binding award · The parties are bound by the decision · Arbitrator can order a hearing or consider written representation · The Arbitrator will have specialist knowledge of the subject area · The Arbitrator cannot be sued for negligence · Their decision can only be overruled by a court of appeal on a point of law only · for arbitration to occur there must be a written agreement in the contract to arbitrate. · Advantages – fast, cost effective and confidential solution.

Question 32

What is the difference between adjudication and arbitration?

Answer 32

* arbitrators have the power to order costs whereas adjudicators do not. * Adjudication must adhere to strict timescales and typically takes up to 28 days. Where as timescales are not as strict for arbitration. * Due to quick timetable cost of adjudication is usually low compare to arbitration.

Question 33

What is the difference between adjudication and mediation?

Answer 33

* Timeframe - mediation depends upon the parties' agreement whereas adjudication set to 28days unless referring party extends. * Mediation is informal whereas rules of the adjudication are set by the adjudicator nominating body e.g. RICS.

Question 34

What is your experience of ADR?

Answer 34

Dilapidations - negotiation CA - negotiation around costs. Aware of adjudication and arbitration due to preparing contracts but have not been involved.

Question 35

You are an expert witness acting on behalf of a client and there is a separate expert witness acting on behalf of a separate client. What are your duties acting as an expert witness?

Answer 35

An expert witness has a duty to the court, not to the client. (appointed by a client) Duties include: * establishing the facts * assessing the merits of a case, * define and agree the issues between the parties, * help quantify or assess the amount of any sum in dispute, * give expert (opinion) evidence to the tribunal and * conduct enquiries on behalf of the tribunal and * report to that body as to findings

Question 36

Can an expert witness be sued?

Answer 36

* Yes they can be sued for negligence

Question 37

When is one form of dispute resolution better than another?

Answer 37

* where money is a concern negotiation is better option * when the matter concerns payment dispute in relation to a construction contract adjudication must be used * when relationships want to be preserved - negotiation, then mediation. * when confidentiality is required - mediation is private and 'without prejudice'.

Question 38

Tell me about process which you undertake to avoid disputes.

Answer 38

Checking contractors payment applications before providing a payment certificate. Ensuring that they have accurately claimed for the works they have completed.