Ethics, Rules of Conduct & Professionalism Flashcards
(35 cards)
1
Q
What is the meaning of the RICS Motto?
A
The motto is ‘Est Modus in Rebus’ which in Latin translates to ‘There is measure in all things’.
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.
3
Q
When was the RICS founded?
A
1868
4
Q
How is the RICS Structured?
A
- The RICS was founded in 1868 with the Royal Charter being granted
by the Privy Council in1881. - The RICS is self-regulated and internally monitored meaning that it
is not regulated by the Government or external parties. - The Bye-Laws determine how the RICS is regulated.
- The Governing council manage and agree the strategy for the RICS.
- The Regulatory board, audit committee and management board are
beneath the governing council and execute the strategy set by
them.
5
Q
What are the RICS’ 5 principles of better regulation?
A
- Proportionality.
- Accountability.
- Consistency.
- Targeting.
- Transparency.
6
Q
How many Global Professional and Ethical standards are
there?
A
- Up until the 1st February 2022 there were 5 Global Professional &
Ethical Standards. - From the 2nd February 2022 onwards the Global Professional &
Ethical Standards have been consolidated within the New Rules of
Conduct 2022.
7
Q
When were the latest rules of conduct released?
A
The New Rules of Conduct were effective from the 2nd February 2022.
8
Q
What are the New Rules of Conduct?
A
- 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.
9
Q
Why did the previous Rules of Conduct change?
A
- The previous rules had been in place since 2007.
- Following research and consultation with RICS Members, Firms and
Members of the public, the majority voted in favour of replacing 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.
10
Q
What are the Rules of Conduct changes?
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
The Rules of Conduct now contains the professional obligations of Members and Firms.
11
Q
What are the professional obligations of members?
A
- 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. They must have a clear
learning objective.
- Members must comply with the CPD requirements set by the
- Members must cooperate with RICS.
- Members must promptly provide all information reasonably
requested by the Standards and Regulation Board, or those
exercising delegated authority on its behalf.
- Members must promptly provide all information reasonably
12
Q
What are the professional obligations of firms?
A
- Firms must publish a complaints-handling procedure, which
includes an alternative dispute resolution provider approved by
RICS, and maintain a complaints log.
- Firms must publish a complaints-handling procedure, which
- 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.
- Firms must ensure that all previous and current professional
- 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.
- Firms with a sole principal must make appropriate arrangements
- Firms must cooperate with RICS.
- Firms must promptly provide all information reasonably
requested by the Standards and Regulation Board, or those
exercising delegated authority on its behalf.
- Firms must promptly provide all information reasonably
- 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.
- Firms must display on their business literature, in accordance
- Firms must report to RICS any matter that they are required to
report under the Rules for the Registration of Firms.
- Firms must report to RICS any matter that they are required to
13
Q
Why does the RICS have Rules of Conduct?
A
To ensure quailty, integrity, consistency and standarisation within the profession
14
Q
What are punishments for non-compliance with the Rules of Conduct?
A
- Fixed penalty (fine by the RICS)
- Consent order (corrective actions or omission of actions)
- Disciplinary panel (like an arbitration, civil case burden of proof)
15
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.
16
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.
17
Q
What insurances would you need if you were starting up your
own firm?
A
- Professional Indemnity Insurance.
- Employer’s Liability (REALLY?)
- Public Liability (REALLY?)
- Building’s insurance of an office premises.
18
Q
What 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:
o Type of business and staffing.
o Nature of clients.
o Training provision.
o Complaints handling procedures details and records.
o PI insurance details.
o Whether the firm holds clients’ money.
19
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:
o Set clear segregation of duties for employees.
o A Principal oversees the client money accounting functions.
o Principles cannot override controls.
o Competent and knowledgeable staff
o Accounting systems and data must be secure.
o Client money must be kept separate and clearly identifiable.
o Clients must always have access to funds.
o We must agree the terms and advise the client on bank details.
o The account must not be overdrawn.
o We must maintain client ledgers and provide a running balance
20
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.
21
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.
22
Q
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.
23
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.
24
Q
What must a complaints handling procedure include?
A
- Details of the policy should be issued to the client with the Terms of
Business. - The process must include a redress mechanism.
- It must be clear, quick, transparent and impartial and free of charge
within the first stage. - 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:-
o Stage 1 is where there needs to be consideration of the
complaint by a senior member of the firm or the complaints
handling officer.
o 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.
25
What is an independent redress scheme?
* 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.
26
What do you do if you receive a letter of complaint?
* 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.
27
What is the ‘Clients’ Money Protection Scheme’?
* 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.
28
What are the requirements regarding Professional Indemnity
Insurance set by the RICS?
* 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.
* The policy should include cover for past and present employees
29
What measures should be taken to try and avoid PI claims?
* 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.
30
If an estimate prepared by a QS is incorrect can the client
claim damages?
* 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.
31
What are the main elements included within a fee proposal?
* Terms and conditions.
* Scope of services.
* Exclusions.
* Assumptions.
32
Tell me what you understand about conflicts of interest?
* A conflict of interest is where someone in a position of trust has
competing personal or professional interests making it difficult for
them to fulfil their duties impartially.
* An existing relationship will result in reduced impartiality and
Chartered Surveyors have an obligation to make clients aware of
this and if necessary, decline work opportunities where a conflict of
interest occurs.
33
If the client was insistent that you worked for them despite an
existing conflict of interest, how would you proceed?
* I would check the clients understanding around the conflict of
interest.
* I would then make the client aware of the potential for reduced
impartiality.
* If they were still insistent on the appointment, I would seek a letter
of instruction from the client to continue.
* Following the appointment I would agree working procedures to
manage the conflict of interest with the client and the teams
involved.
34
What are the Main Principles of the Bribery Act?
* The offences are:-
o Making a bribe.
o Receiving a bribe.
o Bribery of a foreign public official.
o Failure of a corporate entity to prevent bribery on its behalf.
* The legislation applies to all UK Entities and includes associated
Persons for example sub-consultants and external advisors.
* There are six principles of prevention companies should put in
place:
o 1. Proportionate Procedures.
o 2. Top Level Commitment.
o 3. Risk Assessments.
o 4. Due Diligence.
o 5. Communication.
o 6. Monitoring & Review.
35
What is a bribe?
A bribe is when someone offers or gives something valuable, like money or gifts, to a person in a position of trust to try to influence their decisions unfairly or get them to do something they shouldn’t.
