Conflicts, Management and Dispute - Summary of Experience

Question 1

Tell me about a conflicts of interest check you have undertaken?

Answer 1

Property sale (144-146)
1) Checked property databases to see if we had previous involvement
2) Nothing held - assumed no conflict
3) If there was I would discuss with partner and submitted for a board review

Question 2

What ADR does your firm use?

Answer 2

• Centre for effective dispute resolution
• Property redress scheme
• PACT

Question 3

How expensive is RICS dispute resolution?

Answer 3

L and T (£510 each) -This is capped

Question 4

How do you report a conflict of interest?

Answer 4

Raise with partner / conflict of interest advisory board

Question 5

Can you tell me how you would effectively avoid conflict?

Answer 5

Due diligence

Question 6

How do RICS guidelines relating to service charges ensure conflicts are avoided?

Answer 6

• Timely issue of budgets and YE certificates - reduces causes of dispute
• Strong guidance for LL and PMs regarding setting of budgets
• Uniformity and best practice
• Mandatory obligations

Question 7

Can you talk me through the key guidelines part of RICS service charges in commercial property?

Answer 7

• Budgets issued to occupiers 1 month prior to start of year
• Expenditure within 4 months - Reviewed independently
• Clarity on costs that can/can’t be recovered
• Basis and method of apportionment is to be fair

Question 8

Can you take me through the steps to ensure budgets and reconciliations are issued in these timeframes, and how this ensures conflicts are avoided?

Answer 8

Steps to setting budget
1) Collate costs
2) Input into excel document + RICS
3) Seek line manager approval
4) Collate RICS budget/CIF into PDF - Client approval
5) Raise make actual w/ accounts

Question 9

What is arbitration?

Answer 9

ADR - Resolves a dispute outside of the courts

Question 10

What is litigation?

Answer 10

Not ADR - Taking issue to court to resolve

Question 11

What is adjudication?

Answer 11

Simplified arbitration
- UK statutory dispute resolution procedure
- Binding until dispute determined by litigation/arbitration
- Usually used in construction disputes
- Takes 28 days usually

Question 12

What is mediation?

Answer 12

ADR - Brings in separate impartial party to guide a decision based on both parties needs (BOTH COMPROMISE)

Question 13

What is PACT?

Answer 13

Professional Arbitration on Court Terms

Question 14

What are the benefits of using PACT?

Answer 14

• Speed (compared to court)
• Expertise (have expert knowledge0
• Flexibility (tailored to needs)
• Privacy (protect sensitive info)

Question 15

Why was PACT set up?

Answer 15

Alternative to litigation
- Flexible
- Speed
- Experts
- Cheap

Question 16

What is an independent expert?

Answer 16

A party that is governed by the terms of the lease
- use knowledge and experience to arrive at their determination
- Decision final and binding
- Impartial

Question 17

What is an expert witness?

Answer 17

A party appointed by the court who uses their knowledge and experience and is unbiased
- Acting as an expert witness overrides any contractual duty to your client

Question 18

Difference between independent expert and expert witness?

Answer 18

Expert witness is appointed by the court.

Question 19

Difference between an arbitrator and independent expert?

Answer 19

Arbitrator
- governed by Arbitration Act 1996
- Award is between 2 offers
- Cannot be sued for negligence (if acted in bad faith)
- Reasoned award must be given by arbitrator unless agreed

Independent expert
- Governed by lease
- Use own knowledge to determine rent
- No right of appeal
- Can be sued for negligence

Question 20

When did RICS conflicts of interest come effective?

Answer 20

1 Jan 2018

Question 21

Tell me something about RICS conflict of interest

Answer 21

• Every member must identify and manage conflicts of interest
• Keep records of decisions made

Question 22

What would you do if a conflict had arisen?

Answer 22

• Withdraw/stop acting - Disclose conflict and submit to partner in charge
• Board make decision if you can proceed
• If you can proceed, disclose to client and receive approval to continue

Question 23

When did RICS service charges in commercial property come effective?

Answer 23

April 2019

Question 24

What are the benefits of pro-active management and how can it settle disputes?

Answer 24

• Anticipate problems before they arrive
• Shows good attitude to help solving

Question 25

Why would you use mediation over litigation?

Answer 25

• Flexible
• Cheap
• Quicker

Question 26

What are the 3 formal forms of ADR?

Answer 26

• Arbitration
• Independent expert - 3rd Party determination
• Adjudication

Question 27

Informal forms of ADR?

Answer 27

• Mediation
• Negotiation

Question 28

Can you name some RICS approved forms of ADR?

Answer 28

• Arbitration (PACT)
• RICS Dispute Resolution Scheme
• Property ombudsman

Question 29

What ADR does your firm use?

Answer 29

• Centre for effective dispute resolution
• Property redress scheme

Question 30

Tell me about a complaint you have handled?

Answer 30

Never received one

Question 31

What is the difference between arbitration and litigation?

Answer 31

Arbitration = governed by Arbitration Act 1995 (outside court)
Litigation = Matter is settled within court

Question 32

How would you use RICS dispute resolution?

Answer 32

Fill out a form - Double check details

Question 33

What is the property redress scheme?

Answer 33

Allows tenants to escalate a dispute that can’t be resolved between yourselves

Question 34

What is a property ombudsman?

Answer 34

Provides redress to consumers - considered case by case

Question 35

What is the centre for effective dispute resolution?

Answer 35

A form of alternative dispute resolution whereby a business or individual can speak to a case adviser who provides advance and can recommend an accredited mediator to resolve dispute. Can also provide adjudication and arbitration processes

Question 36

What is informed consent?

Answer 36

Occurs when a party who might be adversely affected by conflict of interest acknowledges it but still agrees to instruct RICS regulated firm/member to proceed

Question 37

What is Workman’s complaints handling procedure?

Answer 37

Acknowledge complaint within 7 days, investigate within 28 days (if can’t resolve, redress scheme or property ombudsman)

Question 38

Do you know any RICS guidance relating to expert witness?

Answer 38

RICS practice statement and guidance note: Surveyors acting as expert witnesses, 4th ed, Feb 2023
- Explains need for clear instructions and TOE, outlines written report format, and clarifies differences between roles of expert and advocate

Question 39

What is conciliation?

Answer 39

an impartial 3rd party that helps to reach a resolution of disputes (They can intervene and persuade you to reach agreement based on their evaluations)

Question 40

What are the dispute boards?

Answer 40

RICS DRS is a division that provides ADR for firms

Question 41

What are the 3 pillars of dispute resolution?

Answer 41

1) Negotiation (problem solving of the parties themselves)
2) Mediation/Conciliation (third party intervention - not binding)
3) Adjudicative process (third party decision binding)