Ethics L1 Flashcards
History/Background of RICS Rules of COnduct Ethics decision Tree Displinary procedures Social Media Hot Topics 2025 RICS Business Plan Negligence
Why do you want to become a member of RICS
I feel that the job market has become ever more competitive and becoming MRICS qualified will provide a considerable market advantage.
In addition, eventhough I provide good quality and diligent service I know that becoming a qualified surveyor provides confidence to the client
Furthermore, it opens a network to members globally.
What is the role of the RICS
- To maintain the highest standards of education and training
- To protect consumers through strict regulation of professional standards
- To be the leading source of information and independent advice on land, property, construction and associated environmental issues
Rules of Conduct and date this was published and came into effect
Honesty
Integrity
Competence
Service
Respect
Responsibility
October 2021 wef 2 February 2022
Who is the RICS president
Justin Sullivan now Nick Maclean
Levels of membership
FRICS
MRICS
AssocRICS
Candidate/trainee
How to become fellow
4 characteristics
1. 5 or more years as MRICS
2. Leadership role
3. Professional/technical achievement
4. Portfolio of professional achievement
What is a royal charter
Granted by the Privy Council in 1881. This means RICS has to act in the public interest
What do you understand by self regulation?
it operates within it’s own published regulatory framework, rather than being legislated by the government
Principles of better regulation
- Proportionality
- Accountability
- Consistency
- Targeting
- Transparency
What is a bye law
Provide power for the Head of Regulation and Regulatory Tribunal to make disciplinary and regulatory decisions
Give an example of a RICS Bye-Law
Bye Law 2 - membership and registration
Tell me about the history of RICS
1868 founded and was awarded Royal Charter in 1881
Structure of the RICS
Governing Council - management and strategic decisions The Standards and Regulation Board and RICS Board report to the Governing Council
Tell me about the Richard Bichard Review
Following the Levitt review in 2021
June 2022, 36 key recommendations, 7 key areas.
1. renewed and increased focus on public interest and public interest panel
2. maintaining self regulation through greater independence for regulatory functions
3. Increased focus on diversity and inclusion
4. Renewed focus on young members
5. Independent review every 5 years against its Charter for the public interest
6. New clear governance structure
7. Greater leadership on issues that matter most to society eg sustainability and climate change
5 Future Foundations of RICS
2023 published after Richard Bichard review
- Vision
- Mission
- Strategic Goals
- Values
- World class organisation
Requirement for RICS registration
In accordance with RICS Registration for Firms:
Mandatory:
United Kingdom
Surveying
and 50% of principals are qualified
Eligible:
At least 25% qualified
Surveying
Each firm must appoint a Responsible Principal
Firm must provide infomation to Standards and Regulation Board
What information is required by the RICS for registration
- Type of business and staffing details
- Name of responsible principal
- Statutory regulated activities - such as for financial services
- Nature of clients
- CHP
- PII
7 Whether the firms holds clients money
What are the professional obligations
Within Appendix A - Rules of Conduct 2021
3 for members
7 for firms
Members
1. CPD
2. Cooperate with RICS
3. Provide all information provided by the Standards and Regulation Board or those delegated on their behalf when requested
Firms
1. CHP
2. PII
3. Sole trader, appropriate arrangements
4. Cooperate with RICS
5. Provide all information provided by the Standards and Regulation Board or those delegated on their behalf when requested
6. Display RICS logo on business literature
7. Report to RICS any matter they are required under the Rules for the Registration of Firms
Example for Rules of Conduct
Honesty - open and transparent with clients about their fees and services.
Integrity - gaining consent for sharing confidential information
Competence - undertake work that they have the knowledge, skills and resources to carry out competently.
Service - understand clients’ needs and objectives before accepting any professional work.
Respect - treat everyone fairly and do not discriminate against anyone on any improper grounds. (Office party not to centralise around drinking alcohol).
Responsibility - any formal complaints are handled prompty, openly and professionally
An example when have you used the RICS Ethics Decision Tree
Cotswolds -
1. Do I have sufficient facts on the issue? YES
2. Is it Legal ? YES
3. Is in line with the Rules of Conduct? NO Rule 2
Therefore did not proceed
- Consult with appropriate people to make informed decision
- Do you have clear reasoning?
- Is your decision informed?
- Happy for actions to be made public?
- Final decision - Act or Record
What Disciplinary Procedures can the RICS impose?
Initial investigation by Head of Regulation, will decide to impose penalty or close case
Minor breaches and admitting breach - HoR may impose Regulatory Compliance Order (fine, caution or conditions)
If member does not admit allegations the Single member of the Regulatory tribunal can decide outcome.
Serious cases - disciplinary panel, from the independent regulatory tribunal (fine to expulsion)
Appeal panel - to consider an appeal made by the opposed member or firm. Panel includes lay members
When did RICS last update their disciplinary panel rules
2020 - Conduct and Appeal committee now called Regulatory Tribunal
Are you aware of any guidance that applies to RICS Members when using Social Media?
New guidance published in September 2024
Sets out the same standards as stipulated in the RICS Rules of Conduct and reminds members that these do not change whether communicating via social media, face to face or traditional forms of media
How do you ensure you operate inline with RICS guidance on the use of Social Media?
Responsible and professional manner in the same way that I communicate via face to face or other written forms of communication
When would the RICS investigate a Social Media post made by one of its members?
An investigation may take place if a social media post is:-
- Abusive or threatening
- Discriminatory
- Dishonest
- Likely to cause significant harm, distress or offence
Please explain your understanding of the RICS Business Plan for 2024?
- Sustainability Leadership – RICS aims to lead on global issues such as decarbonisation, climate resilience, biodiversity, and the circular economy
- Attracting Diverse Talent - modernising the assessment process, increasing support for early-career professionals
Can you please explain your understanding of the recent RICS Fee changes?
3.5% increase in professional subscription fees for 2025
New subscription framework - UK MRICS - £558 FRICS - £681
Please explain your understanding of the recent updates to RICS Professional Indemnity Insurance Cover around Fire Safety?
Fire safety insurance was removed in 2019 following Grenfell.
The RICS agreed with insurers in May 2021 that fire safety exclusions could be requested by writing
However these would not apply to work on properties with four or fewer storeys above ground level.
What is the RICS doing to improve Rule 4
RICS have set up ‘Diversity & Inclusion leadership’ which is a knowledge hub
And launched new scheme RICS Inclusive Employer Quality Mark.
Explain your understanding of how the RICS define Professional Standards vs. Practice Information?
Following the Birchard Review RICS have introduced two new definitions, Standard and Practice Information
Professional Standards – set out mandatory requirements in BOLD and also best practice with the word should
Practice Infomration - includes definitions, processes, infomration, advice etc to help learn more about property, land and the built environment. Not mandatory
What is your Economic Outlook for the 2025 UK Property Market?
UK property market in 2024 has been dampened by high interest rates which aim to combat rising inflation.
With interest levels decreasing, this is impacting buying affordability. Should increase in market confidence with a backlog of postponed developments and transactions taking place.
Please explain your understanding of the Harris Debate?
Annual debate organised by the RICS to address ethical concerns
What was discussed at the Harris Debate 2024?
Ethics in the Age of Artificial Intelligence and its impact on Valuation Practices
What is your view on the use of AI for the purposes of property valuation?
potential to offer greater accuracy and efficiency if used by a competent valuer
Following concerns:
1. Red Book Valuations need to be transparent
2. Property condition and assumptions cannot always be considered
3. Reliance on bad data
What wider impact do you feel AI will have on the property industry?
Enhanced Property Management
Data-Driven Decision Making
Streamlining Transactions
Risk Management
What are the CPD requirements for members
- 20 hours (at least 50% formal)
- Maintain understanding of Rules of Conduct during a rolling 3 year period
- Record CPD on Management System by 31 January
What could cause negligence
Negligence is when a duty of care is breached resulting in a loss and damages.
How to avoid negligence
Clearly understand the clients objectives and confirm precise instructions in writing in ToE
Competent - necessary skills
Undertake work with the PS and Practice Information
Detailed file notes and photographs
Keep up to date with market knowledge and CPD
Mention the Cap the PII excess in the ToE
Yianni v Edwin Evans (1981)
Surveyors valued house for mortgage purposes
Buyers relied on this however once purchased noticed structural issues
Court found surveyors negligent
Scullion v Bank of Scotland (2011)
Buy to let investment property
Expected rental income was lower making it unviable
Scullion sued the surveyor
Court found surveyor not liable as was a buy to let investment property
Burgess v Lejonvarn (2020)
No contract pro-bono work (not paid) however relied on her professional expertise
Court found the professional owed a duty of care in tort
Hart v Large (2021)
Very similar to Yianni v Edwin Evans (1981)
Hope Capital Ltd v Alexander Reece Thompson LLP (2023)
ART undervalued a house. Borrower defaulted and therefore sued
The substantial reduction in the property’s value was attributed to factors beyond ART’s control, including disputes with the National Trust and the impact of the COVID-19 pandemic on the property market
The purpose of the advice or information provided is central to determining the extent of a professional’s duty
Tell me about the Act for limitation periods for negligence
Limitation Act 1980 - 6 years from the date of negligent act
In a negligence claim, what would help to show that you acted with consideration and due process?
Recorded everything
Clients objectives clearly set
Have the necessary Skills, Understanding and Knowledge
Everything written in ToE
ToE signed
