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APC Revision > Ethics, Rules of Conduct and Professionalism (Level 3) > Flashcards

Ethics, Rules of Conduct and Professionalism (Level 3) Flashcards

1
Q

What is the meaning of the RICS moto?

A

The motto is ‘Est Modus in Rebus’ which in Latin translates to ‘There is measure in all things’.

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2
Q

What is the Mission Statement of the RICS?

A

• To qualify and equip their members to offer the highest standards of professional service.
• To promote and enforce standards
• To lead solutions to the major challenges facing the built environment through professional expertise.

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3
Q

When was the RICS founded?

A

1868

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4
Q

When did the RICS recieve it’s Royal Charter

A

1881

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5
Q

How is the RICS Structured?

A

Privy Council - grants and awards royal charter

Governing Council - manage and agree strategy

RICS Board - Directs RICS affairs
Standards and Regulations Board - Delivers independant proffessional regulation

Self regulated - no government intervention

By Laws - determine how RICS is regulated

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6
Q

What are the RICS’ 5 principles of better regulation?

A

• Proportionality.
• Accountability.
• Consistency.
• Targeting.
• Transparency.

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7
Q

What is the difference between RICS ethics and rules?

A

Ethics are a set of moral values

Rules of conduct are a framework we work to

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8
Q

What are the New Rules of Conduct?

And when did they change from the Global Professional & Ethical Standards?

A

They changed in 2022 to…

• Rule 1. Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
• Rule 2. Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.
• Rule 3. Members and firms must provide good-quality and diligent service.
• Rule 4. Members and firms must treat others with respect and encourage diversity and inclusion.
• Rule 5. Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession.

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9
Q

What are the changes to the rules of conduct?

A
  • The Rules of Conduct October 2021 Global Practice Statement will overhaul the previous separate
    documents:
    o Rules of conduct for Members.
    o Rules of Conduct for Firms.
    o Global Professional and Ethical Standards.
  • Appendix A of the Rules of Conduct now contains the professional obligations of Members and Firms.
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10
Q

Why did the previous Rules of Conduct change?

A

• To replace the existing Rules of Conduct and separate Global Professional and Ethical Standards.
• This was to provide a single document to enable greater clarity for RICS members and firms.
• I also understand there is now a greater focus on clearer example behaviors, understanding evolving technology and tackling climate change.

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11
Q

What are the professional obligations of members?

A

• 1. Members must comply with the CPD requirements set by the RICS which requires 20 hours of CPD for each calendar year, 10 hours of which must be formal CPD.
• 2. Members must cooperate with RICS.
• 3. Members must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.

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12
Q

What are the professional obligations of firms?

A

• 1. Firms must publish a complaints-handling procedure, which includes an alternative dispute resolution provider approved by RICS, and maintain a complaints log.
• 2. Firms must ensure that all previous and current professional work is covered by adequate and appropriate professional indemnity cover that meets the standards approved by RICS.
• 3. Firms with a sole principal must make appropriate arrangements for their professional work to continue in the event of their incapacity, death, absence from or inability to work.
• 4. Firms must cooperate with RICS.
• 5. Firms must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.
• 6. Firms must display on their business literature, in accordance with RICS’ published policy on designations, a designation to denote that they are regulated by RICS.
• 7. Firms must report to RICS any matter that they are required to report under the Rules for the Registration of Firms

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13
Q

Why does the RICS have Rules of Conduct?

A

• To provide a framework that we can all work to and so the client knows he is getting a set level of service.
• As well as being an important tool for the Institution, the Rules of Conduct are also a useful professional guide for individual institution members

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14
Q

Your brother-in-law is a chartered surveyor. You find out that he is working outside the RICS Rules of Conduct. What do you do?

A

• I verify the facts and confront him reminding him of his duties as a member of the RICS.
• I inform the RICS specifying my relationship to the person and any corrective action which I believe my brother-in-law is committed to put in place

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15
Q

In the case of a breach of a rule of conduct what is the procedure?

A

• Not every shortcoming will necessarily give rise to proceedings.
• A formal investigation by the Head of Regulation of the RICS is the first step in the process.
• The RICS can request information and/or visit and inspect to investigate compliance.
• Members must cooperate fully with all enquiries

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16
Q

How can a disciplinary proceeding be triggered?

A

• Someone complaining to the RICS.
• An allegation by a client or third party.
• Information received or established by the RICS

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17
Q

What three actions can be imposed after the end of the investigation stage?

A

Fixed penalty
Consent order
Disciplinary panel

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18
Q

What are fixed penalties?

A

A fine by the RICS

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19
Q

What are consent orders?

A

• It is a written agreement between the RICS and a member or firm concerning a disciplinary issue on a breach of the RICS rules.
• It can require the member to take certain corrective actions, or restrain them from taking certain actions for a specified period of time and may require them to pay a fine or costs

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20
Q

What sort of breaches would expulsion be suitable for?

A

• Gross, persistent or willful failure to comply with an RICS rule of conduct.
• Fraud, dishonesty, conviction of a serious criminal offence, gross incompetence, deliberate discrimination, misappropriation of a client’s money

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21
Q

What procedures must you follow if you are starting up a new practice?

A

• Contact the RICS for guidance and obtain a company start up pack.
• Inform the RICS and register for regulation.
• Appoint a contact officer for all RICS communication.
• Prepare a complaints handling procedure.
• Obtain Professional indemnity insurance cover.
• Abide by the Rules of Conduct for Firms.
• Use the designation ‘Regulated by RICS’ on all practice material

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22
Q

Would you advertise your new company in the press?

A

Yes as long as it is in a trustful and responsible manner in line with the Rules of Conduct for Firms

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23
Q

What insurances would you need if you were starting up your own firm?

A

• Professional Indemnity Insurance.
• Employer’s Liability.
• Public Liability.
• Building’s insurance of an office premises

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24
Q

What sort of information do registered firms have to send to the RICS annually?

A

It is called annual return and carried out on-line.

Failure to do so leads to a fixed penalty.

It includes:
- Type of business and staffing.
- Nature of clients.
- Training provision.
- Complaints handling procedures details and records.
- PI insurance details.
- Whether the firm holds clients’ money

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25
Q

What processes do regulated firms need to put in place when handling Clients’ Money?

A

Preserve the security of clients’ money which does not belong wholly to the company.

RICS regulated firms that operate a client account must:
- Set clear segregation of duties for employees.
- A Principal oversees the client money accounting functions.
- Principles cannot override controls.
- Competent and knowledgeable staff are to process clients’ money with cover provided for long term absence.
- Accounting systems and data must be secure.
- Client money must be kept separate and clearly identifiable with the word ‘client’ included in the bank account name.
- Clients must always have access to funds.
- We must agree the terms and advise the client on bank details.
- The account must not be overdrawn.
- We must maintain client ledgers and provide a running balance.

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26
Q

What are the different types of client money accounts?

A

• General accounts hold money for more than one client.
• Discrete accounts reference a single named client.

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27
Q

What is meant by the term Negligence?

A

• A duty of care is owed to all clients and 3rd parties using reasonable skill and care

• If it is breached due to Negligence a claim may arise resulting in damages being paid or a Professional Indemnity Insurance claim

• Negligence is a failure to provide the duty of care that is owed to the client

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28
Q

Tell us about the Merrit V Babb case law?

A

• This case dates back to 2001 and highlights the importance of having run-off cover in place.
• A surveyor was sued for negligence by a former client.
• Because the surveying firm was no longer in existence therefore the individual surveyor was pursued for damages successfully.
• This caused a big shock in the industry and highlighted the need to ensure that run-off cover is in place for all previous employees

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29
Q

What limitation periods are associated with underhand and deed forms of contract?

A

• 6 years when executed under hand.
• 12 years when executed as a deed.

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30
Q

What must a complaints handling procedure include?

A
  • The RICS provides a model form.
  • The process must include a redress mechanism.
  • Details of the policy should be issued to the client with the Terms of Business.
  • It must be clear, quick, transparent and impartial and free of charge within the first stage.
  • Names and contact details of the nominated investigating person must be stated.
  • The complaint must be investigated within 28 days.
  • All complaints, their progress and outcomes must be recorded.
  • We must note the need to advise PI insurers of a complaint immediately.
  • The process must have two stages as a minimum:
  • Stage 1 is where there needs to be consideration of the complaint by a senior member of the firm or the complaints handling officer.
  • Stage 2 if the issue is not resolved, the complaint is referred to an independent third party with the authority to award redress. The complainant may be expected to contribute towards costs at this stage
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31
Q

What is an independent redress scheme?

A
  • It is a consumer scheme designed to handle small issues that would be disproportionally expensive to take to court.
  • If the scheme judges in favour of the complainant, it is binding.
  • If it judges in favour of the firm, the complainant can escalate the matter to court.
  • RICS firms must specify which redress scheme they want to use, it could be an ombudsman, arbitration or sometimes adjudication.
  • If the complaint relates to a large amount of money or if the complainant wishes so, he can take the matter to court
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32
Q

What do you do if you receive a letter of complaint?

A

• I would acknowledge receipt and I would forward it to my firms designated complaint handler, as per our complaint handling procedure, providing additional information as required.

• I would also highlight the importance of informing our Professional Indemnity insurance providers immediately

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33
Q

What is the ‘Clients’ Money Protection Scheme’?

A

• This is a money protection scheme operated by the RICS.
• It contains provision for any member of the public to be reimbursed their direct loss of funds when using an RICS regulated firm.
• This is provided through an RICS insurance policy

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34
Q

What is the purpose of the joint names on a client account?

A

For the purpose of dual authorisation

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35
Q

What is the purpose of Professional Indemnity Insurance?

A

To provide financial cover in the event a client suffers financial loss as a result of a breach of professional duty e.g. neglect, errors or omissions

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36
Q

What benefits does PII provide for the professional?

A

The professional is protected from financial losses

The firm does not have to meet the claim from their own assets and resources

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37
Q

What benefits does PII provide for the client?

A

They are able to recover from their financial losses

38
Q

On what basis is PII underwritten in the UK?

A

On a claims made basis

This means the insurance policy that is in place at the time the breach is discovered is responsible for providing the indemnity, not the insurance policy in place when the breach was made.

39
Q

What are the requirements regarding Professional Indemnity Insurance set by the RICS?

A
  • The policy cover must be made on an ‘each and every’ claim basis.
  • The RICS sets out the minimum levels of indemnity.
  • The RICS sets out the maximum levels of uninsured excess.
  • Run off cover must be in place for at least 6 years, ideally 12.
  • The policy should include cover for past and present employees, directors and partners
  • Must be fully retro-active
40
Q

What are the new RICS minimum levels of indemnity and Maximum levels of uninsured excess?

A

Minimum indemnity levels:

Turnover up to £100k - £250k cover
Turnover £100-200k - £500k cover
Turnover over £200k - £1m cover

Maximum Levels of uninsured excess:

Firm turnover in the preceding year £10m or less - The greater of 2.5% of the sum insured or £10k

Firm turnover in the preceding year over £10m - No limit

41
Q

What measures should be taken to try and avoid PI claims?

A

• Keep full and detailed records of meetings and conversations.
• Record recommendations and advice given.
• Use proper letters of engagement, scope of services and terms of engagement.
• Don’t advise on a specialism outside your field of experience.
• Use RICS guidelines.
• Avoid poor management and excessive workloads

42
Q

If you made a mistake in your cost plan what would your insurance company expect?

A

For you to notify them and comply with any conditions & procedures set out in the insurance policy.

43
Q

If an estimate prepared by a QS is incorrect can the client claim damages?

A

• An estimate that is incorrect in itself will not provide the client with a right of redress.
• The client must demonstrate that the QS warranted the accuracy of the estimate or that it was incorrect due to a lack of reasonable skill and care.
• It could have been incorrect due to reasons outside their control for example market conditions or an item referred to in their exclusions

44
Q

How can you limit your liability when agreeing terms of appointment with a client?

A

• Base the appointment on reasonable care and skill rather than fitness for purpose which is more onerous.
• If the client’s requirements are performance based, this may imply fitness for purpose. It is advisable to request a clause limiting the appointment to reasonable skill and care only.
• Run off cover must be in place.
• Execution of the appointment under hand will result in a reduced liability period of 6 years instead of 12

45
Q

What are the main elements included within a fee proposal?

A

• Terms and conditions.
• Scope of services.
• Exclusions.
• Assumptions.
- Fee breakdown

46
Q

Who is the president of the RICS?

A

Tina Paillet

47
Q

Why do you want to be part of the RICS?

A

An RICS qualification is a global benchmark for integrity and professionalism, recognised and valued by clients and governments around the world.

48
Q

Which RICS documents are Mandatory and which are good practice?

A

Mandatory:
- RICS Practice Statement
- RICS Code of Practice

Good Practice:
- RICS guidance notes
- RICS information paper

49
Q

What suits of contract are you aware of?

A
  • JCT
  • NEC
  • PPC
  • FIDIC
50
Q

What are the main features of the Bribery Act 2010?

A

Offences:
- Making a bribe
- Receiving a bribe
- Bribery of a foreign public official

Applies to all UK entities
Includes associated persons

6 principles of prevention:
- Proportionate procedures
- Top level commitment
- Risk assessment
- Due diligence
- Communication
- Monitoring and review

51
Q

Under the bribery act, under what circumstance is a facilitation payment permitted?

A

The only circumstance in which it is OK to make a facilitation payment is if you are under duress

I.e. if there is a real and present risk or danger to “life, limb or liberty”

If you or your companions are under immediate physical threat

52
Q

You are bidding for a project and the client advises you that if you reduce your fee by £3,000 you will win the job. What would you advise them?

A
  • It’s unfair competition
  • Not treating others with respect
  • Not acting with integrity
  • Unable to undertake business in this manner
  • Avoid Dutch auctions as it devalues the profession
  • Reduced scope of services, would a high standard of service still be achieved
  • Could be interpreted as a bribe
53
Q

What was the Carsberg report 2005?

A

A thorough internal and external review of the regulation of the RICS.

Response to members general dissatisfaction of aspects of the RICS

54
Q

What were some of the key recommendations of the Carsberg report?

A
  • A conduct board should be introduced to operate disciplinary structures
  • The RICS should regulate firms as well as members
  • A review of existing CPD requirements
55
Q

What is the maximum value of a gift you can recieve?

A

£250 group gifts
£150 individual gifts

56
Q

What are the 3 types of conflict?

A

Personal Conflict - When an RICS member or firm’s duty to act in the interest of a client conflicts with their own interest or the interest of another member of the firm (Brother works for Contractor)

Party Conflict - When an RICS member or firm’s duty to act in the interest of one client conflicts with their duty to another client (Neighboring Buildings)

Confidential information conflict - When an RICS member’s duty to provide information to one client conflicts with their duty to keep that information confidential from another client (NDA)

57
Q

What would yousay if a client offers you cash up front?

A

The RICS expects surveyors to remain objective and impartial, and accepting cash could unintentionally compromise that perception.

If a client insists on paying upfront in cash, the surveyor should explain their payment policy and suggest alternative methods (such as bank transfers), which are more secure and transparent.

58
Q

What does it mean to act with integrity?

A

Acting with morality even when it’s tough.

59
Q

What is in Appendix A of the rules of conduct?

A

Profesional obligations of Members and Firms

60
Q

What are the RICS CPD requirements?

A
  1. All members must undertake a minimum of 20 hours CPD each calendar year (January to December).
  2. Of the 20 hours at least 10 hours must be formal CPD. The remainder can be informal CPD. (For guidance, see below and download examples.)
  3. All members must maintain a relevant and current understanding of our professional and ethical standards during a rolling three-year period. Any learning undertaken in order to meet this requirement may count as formal CPD.
  4. Members must record their CPD activity online by 31 January.
61
Q

What is a facilitation payment?

A

A facilitation payment is a small bribe or gift given to a public official or private employee to obtain a favor.

62
Q

Have you read any recent RICS publications?

A

Yes, I read an article in the RICS Built Environment Journal called “Industry must grasp principal designer responsibilities”

This detailed how the Building Safety Act 2022 introduced responsibilities to appoint a principal designer on all projects requiring building control approval, but confusion in the industry is delaying compliance.

63
Q

What is the updated structure of the RICS?

A

RICS Board
Standards and Regulation Board

64
Q

What is the purpose of the governing council?

A
65
Q

What is the purpose of the RICS board?

A
66
Q

What is the purpose of the standards and regulations board?

A
67
Q

What are the councils/ boards that sit under the RICS board?

A
68
Q

What are the councils/ boards that sit under the standards and regulations board?

A
69
Q

What is Lionheart?

A

A charity that is an independant body that provides:
- Councilling
- Financial Advice
- Legal Advice
- APC Support

70
Q

When does a firm need to be regulated by the RICS?

A

When over 50% of it’s principal directors are memebers of RICS

71
Q

What happens if you recieve a complaint through the RICS?

A
72
Q

What is a conflict of interest?

A

A circumstance that would prevent you from acting in a fair and impartial mannor

73
Q

What are the 6 principles of the Bribery Act 2010?

A

1) Proportionate procedures
2) Top-level commitment
3) Risk assessment
4) Due diligence
5) Communication
6) Monitoring and review

74
Q

Who is the CEO of the RICS?

A

Richard Collins

75
Q

Please can you give an example of a time that you have demonstrated Rule 1: Be honest, act with integrity and comply with their professional obligations, including obligations to RICS.

A
  • Working under NDA
  • Conflict of interest with relative working for Contractor
76
Q

Please can you give an example of a time that you have demonstrated Rule 2: Maintain professional competence and ensure that services are provided by competent individuals who have the necessary expertise.

A

When first working on the hospital fit-out, I ensured that I liased with senior memebers of staff when pricing specialist equipment. I also ensured that I didn’t advise on any of the systems that I wasn’t 100% sure on.

77
Q

Please can you give an example of a time that you have demonstrated Rule 3: Provide good-quality and diligent service.

A
  • Undertake work in a timely manner; with due care, skill and diligence
  • Ensure all cost data is up to date and accurate
  • Ensure work is comp checked
78
Q

Please can you give an example of a time that you have demonstrated Rule 4: Treat others with respect and encourage diversity and inclusion.

A
  • Inclusive culture in the workplace, I always make an effort to include new starters and make them feel welcome.
79
Q

Please can you give an example of a time that you have demonstrated Rule 5: Act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession.

A

Report breach of a rule in conduct.

80
Q

Why do we have the rules of conduct?

A

To provide a set of rules for everyone to follow, to ensure that Clients know the service they are getting.

81
Q

Who in the RICS would request information?

A

Head of Standards and regulation

82
Q

What is the fund called that protects firms handling Clients money?

A

Client Money Protection Scheme

83
Q

What is a bibe?

A

The act of offering, promising, giving, demanding, or accepting an advantage to induce someone to act improperly, illegally, unethically, or in breach of trust.

84
Q

What is the ethics decision tree?

A

A list of questions that enables a surveyor to make an ethical decision

85
Q

What is a locum?

A

a professional who is temporarily appointed to stand in for a surveyor who is unable to work, used for sole practitioners.

86
Q

What alternatives are there to run-off cover?

A

The RICS Assigned Risks Pool (ARP)

87
Q

What is the maximum fine you can recieve from the RICS?

A

£2,000

88
Q

What is excluded from a fee proposal?

A

VAT

89
Q

What needs to be considered when putting together a fee proposal?

A

Client T&Cs
Project details: Size, function, location
Procurement Route/ Tendering Strategy

90
Q

What are the Bye-laws?

A

They provide the power for Head of Regulation and Regulatory Tribunal to make disciplinary and regulatory decisions including issuing disciplinary penalties and costs.

APC Revision (20 decks)

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