Scenario Based Ethics Questions Flashcards
You are a property manager overseeing multiple office buildings. During routine communications, a tenant discloses confidential information to you regarding their financial difficulties, which could affect their ability to meet lease obligations. The tenant asks that you keep this information confidential.
However, your client (the landlord) has specifically requested that you alert them to any risks regarding tenants that might impact rental income, especially in the case of potential defaults.
As an RICS member, I have an obligation to uphold both the confidentiality of the tenant and the best interests of my client. In this situation, I would first ensure that I have a full understanding of my professional obligations under RICS regulations, which require me to act in a way that protects the landlord’s interests while also respecting the tenant’s confidentiality rights.
I would acknowledge the tenant’s disclosure but clarify that, as part of my professional responsibility to the landlord, I am required to inform them of any risks that could affect the property’s income or performance. I would explain to the tenant that while I will respect their privacy, my duty to the landlord means that I must disclose material information that could affect the lease terms.
Before doing so, I would seek to gain the tenant’s consent to disclose the relevant information to the landlord, ensuring that I handle the situation with transparency and respect for both parties.
A client asks you to advise on the valuation of a commercial property that they are considering purchasing. However, after conducting initial research, you realise that you lack sufficient knowledge of the local market and property type to provide an accurate valuation. The client, however, is keen for a quick turnaround and pressures you to proceed with the valuation to meet their deadlines.
In this case, I must adhere to my professional duty of providing accurate and competent advice, which requires a thorough understanding of the market and the specific property type. I would explain to the client that I do not possess sufficient knowledge in this area to complete the valuation to the necessary standard, and therefore, I would not be able to carry out the valuation myself.
To ensure that the client’s needs are met, I would suggest recommending an experienced colleague or another qualified professional who specialises in the market and property type in question. I would also make sure the client understands that this is in their best interest, as an inaccurate valuation could lead to significant financial loss or reputational damage.
This approach ensures that I comply with RICS ethical standards by upholding professional competence and integrity, even if it means delaying the client’s timeline or recommending an alternative solution.
You are acting for a property developer who is seeking to sell a high-value commercial property. During your due diligence, you discover several significant structural defects that could decrease the market value of the property. The developer is under significant pressure to achieve a high sale price and asks you to exclude this information from the sale brochure.
As an RICS professional, I have an ethical duty to act with transparency and in the best interests of all parties involved, including potential buyers. I cannot knowingly mislead prospective buyers by omitting significant material facts about the property, even if it may result in a higher sale price for my client.
I would explain to the developer that withholding information about the structural defects could lead to legal action in the future, damage to their reputation, and potentially a breach of RICS’ rules and regulations. I would advise the developer to disclose the defects to potential buyers in order to ensure a fair and transparent transaction, protecting both the client’s and the buyer’s interests.
If the developer insists on excluding the information, I would consider withdrawing from the assignment, as continuing under these conditions would compromise my professional integrity and breach RICS ethical standards.
You are a surveyor employed by a large property consultancy firm. The firm has been instructed by a new client to sell a commercial property. Shortly thereafter, you find out that one of your close family members is a senior employee at a competing firm, which has also been asked to tender for the same property. You realise that there could be a potential conflict of interest in this situation.
In this scenario, I would immediately disclose the potential conflict of interest to my employer and the client. Transparency is key in resolving such ethical issues, and I would ensure that any potential bias is removed from the decision-making process. I would request to be recused from the specific project to avoid any appearance of impropriety or potential conflicts of interest.
If my employer or the client insists that I remain involved in the transaction, I would take extra care to ensure that I do not access confidential information from the competing firm. To mitigate any concerns, I would propose implementing safeguards such as non-disclosure agreements or involving another surveyor from my team to handle aspects of the deal, ensuring that I remain impartial throughout the process.
This approach aligns with RICS guidelines, which require professionals to act with integrity and transparency, avoiding situations where personal interests could influence professional judgement.
You are managing a commercial office portfolio and the tenant has paid the rent in advance for a full year. However, due to a delay in processing, the money is sitting in your firm’s client account, and you are aware that interest is accruing on the funds. The client has asked you to release the funds for other uses temporarily.
I must adhere to strict ethical standards and RICS regulations regarding the handling of client money. As the funds are being held in a client account, I have a fiduciary duty to ensure that they are managed in accordance with the client’s instructions and that any interest accrued belongs to the client unless otherwise agreed.
I would inform the client of the potential implications of releasing the funds prematurely, including the risk of breaching the terms of the lease or creating a situation where the funds are not available for their intended purpose. If the client insists on releasing the funds, I would require written confirmation of their instructions and provide the necessary safeguards to ensure that this action complies with relevant RICS guidelines.
It is important that I maintain transparency and integrity in my handling of client funds to ensure compliance with professional ethical standards.
