APC Bible (Rev1.2) PDF

CONTENTS CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE.................................................................. 1 ROYAL INSTITUTION OF CHARTERED SURVEYORS (RICS)................................................................ 2 PRINCIPLES OF BETTER REGULATION............................................................................................. 8 RICS ETHICAL AND PROFESSIONAL STANDARDS............................................................................. 9 RULES OF CONDUCT.................................................................................................................... 11 BREACH OF CONDUCT................................................................................................................. 14 COMPLAINTS HANDLING............................................................................................................. 15 HANDLING CLIENT’S MONEY........................................................................................................ 17 PROFESSIONAL INDEMNITY INSURANCE...................................................................................... 18 CONDUCT UNBEFITTING.............................................................................................................. 20 CLIENT CARE.................................................................................................................................... 25 OBTAINING CLIENTS.................................................................................................................... 26 RETAINING CLIENTS / GOOD CLIENT CARE................................................................................... 27 CLIENT OBJECTIVES...................................................................................................................... 27 CLIENT FEEDBACK........................................................................................................................ 27 COMMUNICATION AND NEGOTIATION............................................................................................ 28 COMMUNICATION....................................................................................................................... 29 NEGOTIATION.............................................................................................................................. 30 HEALTH AND SAFETY....................................................................................................................... 31 RISK............................................................................................................................................. 32 SURVEYING SAFELY...................................................................................................................... 32 H&S ON SITE................................................................................................................................ 33 POLICIES AND LEGISLATION......................................................................................................... 34 CDM REGULATIONS 2015............................................................................................................ 36 DOCUMENTATION....................................................................................................................... 40 HAZARD REPORTING.................................................................................................................... 41 HAZARDOUS SUBSTANCES........................................................................................................... 42 ACCOUNTING PRINCIPLES AND PROCEDURES.................................................................................. 43 TERMINOLOGY............................................................................................................................ 44 COMPANY ACCOUNTS................................................................................................................. 45 DEVELOPMENT COSTS................................................................................................................. 47 INSOLVENCY................................................................................................................................ 48 BUSINESS PLANNING....................................................................................................................... 51 TYPES OF BUSINESS..................................................................................................................... 52 BUSINESS PLAN............................................................................................................................ 53 MARKET ANALYSIS....................................................................................................................... 54 CONFLICT AVOIDANCE AND DISPUTE RESOLUTION.......................................................................... 55 CONFLICT.................................................................................................................................... 56 AVOIDANCE................................................................................................................................. 56 RESOLUTION................................................................................................................................ 56 NEGOTIATION.............................................................................................................................. 58 MEDIATION................................................................................................................................. 59 ADJUDICATIVE PROCESSES........................................................................................................... 61 EXPERT DETERMINATION............................................................................................................ 61 ADJUDICATION............................................................................................................................ 62 ARBITRATION.............................................................................................................................. 64 LITIGATION.................................................................................................................................. 66 JCT STANDARD BUILDING CONTRACT DEALING WITH DISPUTE RESOLUTION............................... 67 DATA MANAGEMENT...................................................................................................................... 68 DATA MANAGEMENT.................................................................................................................. 69 DATA PROTECTION LEGISLATIONS............................................................................................... 70 TEAMWORKING............................................................................................................................... 75 GOOD TEAMWORK...................................................................................................................... 76 TEAM CONFLICT.......................................................................................................................... 76 COMPROMISE............................................................................................................................. 76 DESIGN ECONOMICS AND COST PLANNING..................................................................................... 77 RIBA PLAN OF WORK................................................................................................................... 78 NRM1.......................................................................................................................................... 80 ORDER OF COST ESTIMATES........................................................................................................ 80 COST PLANNING.......................................................................................................................... 97 PRE-TENDER ESTIMATE.............................................................................................................. 108 COST ESTIMATE / COST PLAN SOFTWARE.................................................................................. 108 VALUE....................................................................................................................................... 109 PROJECT C VALUE ENGINEERING............................................................................................... 110 FINANCIAL IMPLICATIONS OF PHASING PROJECT E.................................................................... 111 CONTRACT PRACTICE..................................................................................................................... 112 LEGISLATION GOVERNING CONSTRUCTION............................................................................... 113 CONSTRUCTION CONTRACT....................................................................................................... 114 KEY ELEMENTS FOR CONTRACT FORMATION............................................................................. 116 ATTESTATION............................................................................................................................ 117 STANDARD FORM VS AMENDED FORM VS BESPOKE.................................................................. 118 TYPES OF CONTRACT................................................................................................................. 120 2|P ag e SUITES OF CONTRACT / PUBLISHING BODIES............................................................................. 121 JCT CONTRACTS......................................................................................................................... 123 CONTRACT CHANGES: 2011 TO 2016......................................................................................... 132 CONTRACT SELECTION............................................................................................................... 134 SECTIONS OF THE CONTRACT.................................................................................................... 140 CONTRACTOR DESIGN............................................................................................................... 144 CONTRACT ADMINISTRATOR / EMPLOYER’S AGENT................................................................... 147 ACCESS AND REPRESENTATIVES................................................................................................. 149 POSSESSION.............................................................................................................................. 150 EARLY WORKING....................................................................................................................... 151 EARLY HANDOVER..................................................................................................................... 154 CONTRACTUAL COMPLETION.................................................................................................... 157 ACCELERATION.......................................................................................................................... 158 EXTENSION OF TIME (EoT)......................................................................................................... 160 RELEVANT EVENTS..................................................................................................................... 161 PRACTICAL COMPLETION........................................................................................................... 164 DEFECTS AND RECTIFICATION.................................................................................................... 166 RETENTION................................................................................................................................ 168 CONTRACT SUM........................................................................................................................ 170 PAYMENT.................................................................................................................................. 172 INTERIM PAYMENT.................................................................................................................... 173 VARIATIONS............................................................................................................................... 179 LOSS AND/OR EXPENSE............................................................................................................. 184 RELEVANT MATTERS.................................................................................................................. 185 PROVISIONAL SUM.................................................................................................................... 187 FINAL ACCOUNT........................................................................................................................ 188 BREACH OF CONTRACT.............................................................................................................. 191 LIQUIDATED DAMAGES (LDs)..................................................................................................... 192 SET-OFF, ABATEMENT AND QUANTUM MERUIT........................................................................ 194 TERMINATION........................................................................................................................... 195 TRANSFER OF BENEFITS AND OBLIGATIONS............................................................................... 199 INSURANCE............................................................................................................................... 200 JOINT FIRE CODE........................................................................................................................ 206 COLLATERAL WARRANTIES AND THIRD PARTY RIGHTS............................................................... 207 BONDS....................................................................................................................................... 209 NET CONTRIBUTION CLAUSE...................................................................................................... 212 SUB-CONTRACTING................................................................................................................... 213 REINSTATEMENT VALUATIONS.................................................................................................. 214 3|P ag e PLANNING................................................................................................................................. 215 CONSTRUCTION TECHNOLOGY...................................................................................................... 216 BUILDING REGULATIONS........................................................................................................... 217 BUILDING ELEMENTS................................................................................................................. 219 SITE INVESTIGATIONS................................................................................................................ 221 PRELIMINARIES.......................................................................................................................... 222 STRIP OUT / DEMOLITION.......................................................................................................... 223 FOUNDATIONS.......................................................................................................................... 225 BASEMENTS............................................................................................................................... 230 SLABS........................................................................................................................................ 233 CORES....................................................................................................................................... 233 FRAME....................................................................................................................................... 234 ROOF......................................................................................................................................... 238 STAIRS....................................................................................................................................... 239 EXTERNAL WALLS...................................................................................................................... 240 INTERNAL WALLS....................................................................................................................... 242 INTERNAL FINISHES................................................................................................................... 244 FITTINGS, FURNISHINGS AND EQUIPMENT................................................................................ 245 MECHANICAL SERVICES............................................................................................................. 246 ELECTRICAL SERVICES................................................................................................................ 259 MODERN METHODS OF CONSTRUCTION................................................................................... 265 EXTERNAL WORKS / PUBLIC REALM........................................................................................... 267 PROCUREMENT AND TENDERING.................................................................................................. 268 PROCUREMENT......................................................................................................................... 269 PRIVATE PROCUREMENT ROUTES.............................................................................................. 270 PUBLIC PROCUREMENT ROUTES................................................................................................ 275 COLLABORATIVE WORKING....................................................................................................... 276 TENDERING............................................................................................................................... 278 TENDERING PROCEDURES.......................................................................................................... 278 TENDERING STRATEGY/TECHNIQUE........................................................................................... 280 TENDER PROCESS...................................................................................................................... 286 PROJECT FINANCIAL CONTROL AND REPORTING............................................................................ 294 MAINTAINING VALUE................................................................................................................ 295 COST REPORTING...................................................................................................................... 296 CASH FLOW FORECAST.............................................................................................................. 298 CHANGE CONTROL PROCEDURE................................................................................................ 300 QUANTIFICATION AND COSTING OF CONSTRUCTION WORKS........................................................ 302 NEW RULES OF MEASUREMENT (NRM)..................................................................................... 303 4|P ag e RICS PROPERTY MEASUREMENT................................................................................................ 306 CODE OF MEASURING PRACTICE................................................................................................ 309 INTERNATIONAL PROPERTY MEASUREMENT STANDARDS......................................................... 312 ECONOMICS OF DESIGN............................................................................................................ 336 MEASUREMENT / TAKE-OFF...................................................................................................... 338 QUANTIFYING............................................................................................................................ 340 COSTING.................................................................................................................................... 340 RISK MANAGEMENT...................................................................................................................... 341 RISK........................................................................................................................................... 342 TYPES OF RISK............................................................................................................................ 342 RISK MANAGEMENT.................................................................................................................. 342 IDENTIFICATION........................................................................................................................ 343 ANALYSIS................................................................................................................................... 344 RESPONSE................................................................................................................................. 344 EXAMPLES OF RISK.................................................................................................................... 345 SUSTAINABILITY............................................................................................................................. 347 SUSTAINABILITY REGULATIONS/TARGETS.................................................................................. 350 LEVIES....................................................................................................................................... 352 SUSTAINABILITY ASSESSMENTS.................................................................................................. 353 LIFECYCLE COSTING (LCC).......................................................................................................... 359 WHOLE LIFE COSTING (WLC)...................................................................................................... 361 SUSTAINABLE DESIGN................................................................................................................ 362 SUSTAINABLE TECHNOLOGIES................................................................................................... 363 WASTE MANAGEMENT.............................................................................................................. 368 CURRENT TOPICS........................................................................................................................... 369 CURRENT STATE OF CONSTRUCTION MARKET........................................................................... 370 BREXIT....................................................................................................................................... 371 2018 AUTUMN BUDGET............................................................................................................. 373 LIDUIDATION OF CARILLION PLC................................................................................................ 374 GRENFELL TOWER FIRE.............................................................................................................. 376 END OF VALUE ENGINEERING.................................................................................................... 378 GENDER PAY GAP IN CONSTRUCTION........................................................................................ 379 RISING SKYLINE.......................................................................................................................... 380 OUT OF TOWN SHOPPING CENTRES........................................................................................... 381 US TARIFFS ON UK STEEL........................................................................................................... 382 5|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE 1|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE ROYAL INSTITUTION OF CHARTERED SURVEYORS (RICS) HISTORY OF THE RICS 1792 Surveyors Club. 1868 John Clutton elected as the first president of the Institute of Surveyors. 1881 RICS received its Royal Charter from Queen Victoria requiring it to “promote the usefulness of the profession for the public advantage in the UK and other parts of the world”. ROLE OF RICS Regulate and promote the profession. Maintain the highest educational and professional standards. Protect clients and customers through a strict code of ethics and professional standards. Provide impartial advice, analysis and guidance. MOTTO Est Modus in Rebus = there is measure in all things OPERATING COUNTRIES In 2018 there are RICS-qualified professionals operating in 147 countries across: o North and South America o Asia Pacific o Europe o Middle East and Africa o Oceania o South Asia o UK (the RICS operates in all 4 regions with a growing presence in Ireland) HEADQUARTERS 12 Great George Street, Parliament Square, London (close to Houses of Parliament) Non-UK key regional offices: New Delhi, Sydney, New York, Hong Kong, Brussels, Dubai. GOVERNANCE STRUCTURE Governing Council: 32 members The structure of the RICS is that the Royal Charter is granted by the Privy Council. All boards sit under the governing council which meets twice a year and decides the strategic direction and key objectives of the RICS. Policies on regulatory matters are administered by the Regulatory Board(s) which is chaired by a non- member to demonstrate that regulation is independent from members’ interests. The audit committee reviews internal systems and ensures quality of service. Management board is in charge of the day to day operational accountability. It has established subsidiary boards and committees to assist in the management of 4 aspects. 2|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE PRESIDENTIAL TEAM RICS President: John Hughes FRICS (new: Chris Brooke – signed in Modus as President) o Based in Toronto, Canada. o Founding Partner of Hemson Consulting Ltd: land use, planning and development consultancy. President Elect: Chris Brooke FRICS (new: Tim Neal) o Previously the Chair of the RICS Asia Pacific World Regional Board o Co-Founder of Brooke Husband Limited, a consulting firm based in Hong Kong which provides strategic market insight, development consulting and investment advisory services Senior VICE President: Tim Neal (new: Kath Fontana) EXECUTIVE TEAM CEO: Sean Tompkins Executive Director and CFO: Violetta Parylo Regional MDs, Directors responsible for products, professional standards, reputation and people and corporate responsibility. REGULATORY BOARD Chairman: Stephen Haddrill 8 members MEMBERS Currently over 125,000 members Four levels of membership: o Student – studying RICS accredited degrees and undertaking their APC studies - £155/year o Associate (AssocRICS) – non-chartered membership for technical staff - £286/year o Member (MRICS) – chartership – £519/year or £340/year if been a member for less than 2 years. o Fellow (FRICS) – chartership requiring 5 years of experience, managerial responsibilities and proof of a significant contribution/promotion of the profession through academic study, specific skills or undertaking RICS activities – £633/year RICS PROFESSIONAL GROUPS Professional groups provide technical advice across the organisation. Their duties include: o Outline standards of competence and practice o Provide training, development, CPD and network opportunities o Promotion and representation There are 17 professional groups including: o Quantity Surveying and construction § Chairman: Justin Sullivan o Building Surveying o Commercial Property o Project Management o Planning and Development o Arts and Antiquities o Rural 3|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE RICS INFORMATION SERVICES [International] Standard: Mandatory (under RICS bye-laws, members must comply) Professional Statement: Mandatory (under RICS bye-laws, members must comply) Code of Practice: States Mandatory or not in document itself Guidance Note: Not Mandatory (intend to embody best practice) Information Paper: Not Mandatory (intend to embody best practice) Insight: Not Mandatory (Information Only) Economic / Market Report: Not Mandatory (Information Only) Consumer Guide: Not Mandatory (Information Only) Research: Not Mandatory (Information Only) RICS MATRICS Division of the RICS dedicated to student members and chartered surveyors under the age of 35 or those with less than 10 years of experience. Programme of charity, networking events and seminars and lectures. RICS EXHIBITION Exhibition to celebrate the 150th anniversary of the RICS. ‘Shaping the World, Building the Future’ exhibition. ‘Cities of our Future’ competition: £50,000 prize for innovative idea of how to deal with issue in cities (e.g. rapid urbanisation – sustainable accommodation). Officially opened by RICS president (John Hughes) and RICS CEO (Sean Tompkins). LIONHEART Benevolent fund/charity for past and present RICS members and their families. Funded by generosity of past and present RICS members (no government grants). Provide: financial support, health and wellbeing packages, professional counselling, work- related support, legal advice and help for illness. Office located within the RICS building in Coventry (Surveyor Court). UPDATES TO THE RICS (OCTOBER 2018 ADVANCED NOTICE) Proposed changes to establish a high-level governance structure fit for an agile 21st century profession and ensure the profession remains trusted to set and enforce our own professional standards. Current Governing Council is proposing the following changes to the governance of RICS: 1. Reduce the size of the Council because a small Council will be more agile and responsive in its decision making 2. Adjust the composition of the Council to be a smaller, more geographically diverse governing body to be representative of the global professional membership body. The Council will also include the newly created position of Chair of Governing Council who will chair for 6 years to create continuity to the governing body (since the president only site for 1 year). 3. Create a new joint Standards and Regulation Board under independent oversight to ensure that our profession remains trusted by society to set and enforce its own standards. 4. Rename the Conduct and Appeals Committee to the RICS Regulatory Tribunal to better reflect its role. Two stage approach 1. Deadline 27th November Endorsement by Privy Council then MRICS and FRICS vote 2. If voted yes then the council will build logically on first with wider package of reforms 4|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE Regulation by the RICS STIPULATIONS FOR BEING REGULATED BY THE RICS Firms with over 50% of their partners as members of the RICS. Firms which have applied. REQUIREMENTS FOR STARTING UP A NEW FIRM Submit an RICS firm details form. Appoint a Contact Officer (to liaise between the new firm and the RICS) Suitable level of insurance: PI, employer’s liability, public liability, building of own office Pay registration fees and membership fees Systems for handling Clients’ money Complaints handling procedure in place Provide appropriate staff training and development programmes Commit to abide by the Rules of Conduct for Firms Use RICS designations where appropriate Joining the RICS Q. Why do you want to join the RICS? To be respected as RICS chartered. I’d be very proud of being part of such an esteemed organisation. It also presents CPD support and career and networking opportunities. Q. It is a big change from Geography? I feel that geography is a subject that incorporates everything current in the world and therefore is relevant to anything. In terms of construction I have learnt about techniques in developed and undeveloped countries and how countries that suffer natural disasters mould their architecture to suit. Q. So why did you choose surveying? Because I love buildings and have always been interested in architecture and the construction of towns. I have always been quite able at maths and therefore felt that quantity surveying suited my ambitions. I am enjoying it so I think I made the right choice! Q. What can you bring to the RICS? I lead my personal and professional life according to ethical and professional standards. I am qualified academically. I believe I am professionally competent to warrant chartered status. Q. What can you bring that is different? I am very passionate about the importance of being chartered and I will strive to pass this passion and my knowledge on to new surveyors. If I become chartered I will help new candidates joining my firm to also pass their APC and I will continue to attend careers fairs to promote the profession to those who are undecided on their career paths. 5|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE Modus CONTENT Latest news and views, expert advice and in-depth features spanning the breadth of the surveying profession around the world. Recently won ‘Best use of Illustration’ at the 2015 Content Marketing Awards. CIRCULATION Over 90,000 people. AUGUST – THE 150 TH ANNIVERSARY ISSUE – John Hughes FRICS (RICS President) In 1868 a group of distinguished surveyors came together to address what they knew was a risk to the profession – the rapid growth of cities without serving the public interest. Their response was ethical and professional standards which have defined the profession for 150 years. RICS has evolved with the world in shaping the built environment. RICS has grown to become a highly regarded, influential and global organisation. RICS’ Cities for Our Future competition aims to tackle today’s challenges (climate change, urbanisation and resource scarcity). John Hughes states that he has no doubt the RICS will be here for another 150 years. AUGUST – The Netherlands’ way with water – Tracy Metz 60% of the country [and where 65% of its GDP is earned] is below sea level. Since the 1995 floods they realised that they couldn’t fight the water, they had to work with it so in 2007 they started the ‘Room for the River’ project with a budget of €2.3bn to create space for control flooding and grow environmental awareness. o Nijmegen Bridge over the River Waal cost €126m and is the solution to working with the water. The new bridges are impassable at high water and make people aware that our surroundings are changeable and there are times when they cannot cross. AUGUST – Buildings are getting taller Growing skyline of major cities to cope with urbanisation/density increase Urban Land Institute has identified 4 common typologies of world cities according to density to the metropolitan, city and neighbourhood levels. o Low-low-low cities: N. American and Australian cities (expansive suburbs, high levels of car dependence, spacious downtown zones) o Low-low-high cities: Toronto, Oslo, Chicago (densified certain neighbourhoods but conscious effort to remain low overall) o Low-high-low cities: Most European cities (high density cores and low density suburbs which reduce the density of the overall metropolitan area, this is mainly because there is history and culture in the architecture of these buildings but they are also financial centres). o Medium-high-high cities: Asian city centres. Pace of growth in developing cities causes sprawling and dense with crowded informal housing. 6|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE SEPTEMBER - Clicks and Mortarboards – Dr Nigel Mehdi FRICS Pressure to go beyond location-based teaching, to provide online, distance learning. Dr N Mehdi doesn’t see online displacing universities. Advantages of online learning: o Enables people to learn freely about subjects of their choice. Disadvantages of online learning: o Dependent on willingness of the student to engage. o Drop-out rate is high. Advantages of location-based learning: o Built environment courses involve fieldtrips and lab work which cannot be replicated in a purely online environment (possible in the future through VR). o Being part of a cohort that works together decreases the likelihood of drop-out. Disadvantages of location-based learning: o Not the real world, online learning allows people to have jobs and families alongside Prediction is that over the next 5 years, immersive and game-based learning will develop but online learning will not make accredited university degrees obsolete any time soon. OCTOBER – High Street to Hell – Julian Dobson (regeneration consultant) City centre high streets have always been seen as shopping areas but it needs to be seen that they have the prime function for living, socialising and working. This is because of the influx of online shopping and also out-of-town shopping centres. The difficulty is that start-up retailers usually cannot afford a space in a mall so end up on high streets. This creates a divide. It is important for high street retailers to think about the common interest of the area ad gather a pot of money for improvements (e.g. Christmas trees). The government can help by: 1. Make business rates more equitable (as at the moment town centre retailers are at a disadvantage to online retailers who only pay business rates for remote warehouses). 2. Government resources have unfairly made large cuts from local authorities which has had a direct impact on the quality of high streets that people experience. Construction industry experts need to think of their knowledge as a resource for the public and not just for their Clients then they can help to promote a functioning mix of public, private and community spaces. UK’s fastest growing retail categories in 2017: 1. Hair dressers 2. Beauty salons 3. Vape shops 7|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE PRINCIPLES OF BETTER REGULATION REGULATION RICS is self-regulated (not regulated by the government/external body) because it adheres to the principles of better regulation in order to inspect itself and prevent the need for legislation 1. PROPORTIONALITY Regulators should intervene when necessary and remedies should be appropriate to risks posed. 2. ACCOUNTABILITY Regulators must be able to justify their decisions to prove complete fairness. 3. CONSISTENCY New regulations should take into account of existing or proposed regulations. Regulators must adopt a fair and consistent common sense approach. 4. TARGETING Guidance and support must be adapted to the needs of different groups. Regulations should be systematically reviewed and updated when necessary. 5. TRANSPARENCY Regulators should be open and honest. Regulations should be simple and clearly defined. Regulations should be issued in a reasonable timescale before they take effect. Those being regulated should be made aware of their obligations. 8|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE RICS ETHICAL AND PROFESSIONAL STANDARDS ETHICS Moral principles that govern a person’s behaviour. 1. ACT WITH INTEGTIRY Be open, honest and straightforward in all that you do. Do not intentionally/accidentally mislead others by presenting unclear information. Example: I noticed a mistake in a Contractor’s Payment Application on Project E that benefitted the Client. I alerted the Contractor and valued the works fairly and reasonably. 2. ALWAYS PROVIDE A HIGH STANDARD OF SERVICE Provide the best possible advice support and performance of the terms of engagement to whomever you have a professional responsibility. Example: A Client on Project E had to travel abroad for personal matters. He wanted to stay involved in the project whilst he was away so each I phoned him to update him on the progress. I came into work early to do this in order to account for the time difference. 3. ACT IN A WAY THAT PROMOTES TRUST IN THE PROFESSION Understand how your actions affect others and the environment. Understand that being professional is more than just how you behave at work; it is also about your personal life. Example: I noticed a mistake in a Contractor’s Payment Application on Project E that benefitted the Client. I alerted the Contractor and valued the works fairly and reasonably. 4. TREAT OTHERS WITH RESPECT Treat others in a way that you would expect to be treated Treat others with courtesy, politeness and consideration of sensitivities Example: I reviewed work done by a junior member of my team and found a mistake. I didn’t want to make him feel uncomfortable so privately explained the mistakes and rectifications. 5. TAKE RESPONSIBILITY Be accountable for your actions, don’t blame others Take action of you suspect something isn’t right Example: After issuing a cost plan I noticed an arithmetical error. I quickly notified the Client of the mistake and apologised. I then rectified and issued a corrected version. 9|P ag e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE International Ethics Standards Coalition (IESC) COALITION First meeting at UN in NYC in 2014. MEMBERS 24 members including: o RICS o RIBA o CIOB (Chartered Institute of Building) o Institution of Civil Engineers (ICE) AIM To create a universal set of ethical principles for real estate. Assert the role of ethics in real estate to meet the needs of today’s global market to maintain public trust and confidence. Change the approach to developing and reinforcing professional ethics in line with the property market changing and becoming increasingly international. Real estate is integral to society and economics as it represents a significant proportion of global wealth, therefore the IESC aims to ensure professionals have a duty to uphold the highest standards throughout the world. INTERNATIONAL ETHICS STANDARDS (IES) Written by a group of independent industry leaders and international ethics and compliance experts appointed by Trustees of the IES Coalition. High level principles to be implemented by Coalition organisations to provide consistency to users of professional services. Overarching standards to which land, property, construction, infrastructure organizations can subscribe rather than standards just being based on common principles such as integrity, transparency and trustworthiness. IES PRINCIPLES FOR PRACTICIONERS Accountability – take responsibility for service provided, respect client, give due attention to social and environmental considerations Confidentiality – not disclose information without proper permission unless required by law Conflict of interest – disclosures to be made in timely manner, if conflict cannot be mitigated, withdrawal unless parties mutually agree the practitioner should continue. Financial responsibility – truthful, transparent and trustworthy in all financial dealings Integrity – act with honesty and fairness and base professional advice on valid evidence Lawfulness – observe legal requirements and jurisdictions applicable to their discipline Reflection – regularly reflect on the standards and continually evaluate the services they provide to ensure it is consistent with evolving professional and ethical standards. Standard of Service – only provide services for which they are competent and qualified. Transparency – be open and accessible, do not mislead, misinform or withhold information, present relevant documentary or material in plain language. Trust – uphold responsibility to promote the reputation of the profession, maintain public trust and confidence in the IESC through ethical conduct. 10 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE RULES OF CONDUCT RULES OF CONDUCT Ensure a consistent, high standard of professionalism anywhere in the world so Clients know what to expect. The manner in which a person behaves in a particular place or situation. REGULATIONS Mandatory for members. Produced by the Regulatory Board of the RICS. Regulations do not repeat obligations placed by the general law. Rules of Conduct for Members 1. INTERPRETATION ‘Member’ refers to a chartered member, non-chartered member and honorary member. 2. COMMUNICATION RICS will communicate with members through post, e-mail, telephone and in person. 3. ETHICAL BEHAVIOUR Members shall act with integrity and avoid conflicts of interest and avoid a situation that is inconsistent with their professional obligations. 4. COMPETENCE Members shall carry out work with due skill, care and diligence. 5. SERVICE Member shall carry out work in a timely manner and with regard for standards of service and customer care. 6. CONTINUING PROFESSIONAL DEVELOPMENT (CPD) Members shall comply with requirements: o Minimum of 20 hours per calendar year o Minimum of 10 formal CPD hours (structured learning with clear objectives) o Remainder of hours informal (learning required for your professional role) o Every 3 years members must do professional and ethical CPD (RICS module online) o CPD must be recorded online on the RICS CPD Management System 7. SOLVENCY Members shall ensure personal data and professional finances are managed appropriately. 8. INFORMATION TO THE RICS Members shall submit a timely manner such information, as the Regulatory Board require. 9. CO-OPERATION WITH THE RICS Members shall co-operate fully with RICS staff and the Regulatory Board. 11 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE Rules of Conduct for Firms 1. INTERPRETATION ‘Firm’ means any corporate body, a partnership, a limited liability partnership, a sole practitioner regulated by the RICS Providing a surveying service to the public means acting to provide a service within those which are the responsibility of the RICS’ professional Groups to any Client. Contact Officer means the individual designated by the firm to be the liaison between the firm and the RICS and the person authorised by the RICS to submit the Firm’s Annual Return. 2. COMMUNICATION RICS will communicate with members through post, e-mail, telephone and in person. 3. PROFESSIONAL BEHAVIOUR Firms shall act with integrity and avoid conflicts of interest and avoid a situation that is inconsistent with their professional obligations. 4. COMPETENCE Firms shall carry out work with due skill, care and diligence. 5. SERVICE Firms shall carry out work with expedition and proper regards for the standards of service expected. 6. TRAINING AND CONTINUING PROFESSIONAL DEVELOPMENT (CPD) Firms shall have in place procedures to ensure staff are properly trained and competent. 7. SOLVENCY Firms shall ensure their finances are appropriately managed. Importance: o Insolvent members/firms have a higher risk of being bribed. o Perception that if a firm can’t manage its own money how can it be expected to manage others’. 8. INFORMATION TO THE RICS Firms shall submit a timely manner such information, as the Regulatory Board require. This will include: o Type of business and staffing o Nature of their Clients o Complaints handling procedures and records o PI insurance details o Whether the firm holds Clients’ money 9. CO-OPERATION WITH THE RICS Firms shall co-operate fully with RICS staff and the Regulatory Board. 10. COMPLAINTS HANDLING Firm shall operate a complaints handling procedure (CHP) and a complaints log. CHP must include an Alternative Dispute Resolution mechanism approved by the Regulatory Board. 12 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE 11. CLIENT’S MONEY Firm shall preserve the security of Clients’ money entrusted to its care. 12. PROFESSIONAL INDEMNITY INSURANCE (PII) Firm shall ensure all previous and current professional work is covered by adequate and appropriate indemnity which meets standards approved by the Regulatory Board. 13. ADVERTISING Firms shall promote their professional services in a truthful and responsible manner. 14. ARRANGEMENTS TO COVER THE INCAPACITY OR DEATH OF A SOLE PRACTITIONER Firms with a sole principal shall have in place appropriate arrangements in the event of their death or incapacity or other extended absences (Locum Agreements – locum steps in your place if you are incapable/death). 15. USE OF DESIGNATIONS Registered firms must display on business literature, in accordance with the Regulatory Board, a designation to denote that it is regulated by the RICS. 13 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE BREACH OF CONDUCT BREACH Bringing the profession into disrepute. An act of breaking or failing to observe a law, agreement, or code of conduct. TRIGGERS Complaint to the RICS/allegation by Client or 3 rd Party Information received/established by the RICS ENFORCEMENT RICS Charter and Byelaws allow the Regulatory Board to make the Disciplinary, Registration and Appeal Panel Rules. RICS DISCIPLINARY PROCEDURE 1. RICS Head of Regulation receives a complaint about a member or firm 2. RICS Head of Regulation makes enquiries as deemed appropriate 3. Fixed penalty may be issued or member/firm informed that they are liable for disciplinary proceedings (consent order or disciplinary panel). FIXED PENALTY Apply to: o Failure of a member to provide information to the RICS o Failure of a firm to pay annual registration fees Discipline: o Monetary fine that varies according to whether it is being applied to a member or firm and the period of time outstanding. Appeals can be made within 28 days but there is an administration fee of £100. CONSENT ORDER Apply to: o Minor breaches of the rules of conduct Discipline: o Restrain the member or firm from taking certain actions for a specified period of time. o Monetary fine of circa £2000 per breach. DISCIPLINARY PANEL Apply to: o Serious breaches of the rules of conduct o Gross persistent or wilful failure to comply with the rules of conduct Discipline: o Caution/reprimand o Unlimited fines o Conditions of membership / expulsion Public hearing conducted by a panel. Hearings are posted on the RICS website 14 days in advance. Decision is published in RICS business, on the website and in Modus. If a member/firm was not found liable they can apply to the RICS to recover their costs. 14 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE COMPLAINTS HANDLING COMPLAINT Expression of dissatisfaction from a person to whom I owe a duty of care. Usually arise when scope, quality, timeliness or understanding of the QS has not been met. RICS POSITION ON COMPLAINTS Firm shall operate a complaints handling procedure (CHP) and maintain a complaints log. CHP must include an Alternative Dispute Resolution mechanism approved by the Regulatory Board. RICS POSITION ON COMPLAINTS HANDLING PROCEDURES Guidance Note on complaints handling states that the CHP should: o Be fit for purpose o Be made available and understood by all staff o Be shared with complainants or potential complainants o Be regularly reviewed and updated o Be agreed with PII brokers so that they do not compromise cover o Provide details of the independent redress if the firm cannot resolve the complaint Clients should be made aware of the existence of a CHP in the terms of appointment. Complaints should be reviewed by a senior member of the firm or designated complaints handler. If the complaint cannot be resolved it should be passed to the firm’s independent redress scheme/dispute resolution service. The RICS maintains a directory of such organisations (ombudsman/arbitration service) on its website (i.e. CEDR – RICS default ADR). GARDINER & THEOBALD’S COMPLAINTS HANDLING PROCEDURE Designed to deal with complaints where compensation is sought. Existence is stated within our Terms & Conditions which is included in our fee proposal. CHP can be found on our intranet and is provided when requested. Includes complaints handler details, requests for complaints to be made in writing and procedure. Procedure: 1. If I receive a complaint I would speak to a senior member of my team who would help me to inform my firm’s designated complaints handler (Tony Burton). 2. Designated complaints handler has 7 days from receiving the complaint to write to acknowledge the complaint and outline the process and timescales to the complainant. 3. The complaint must be resolved/have a timescale set out for resolution with 28 days of acknowledgement of the complaint. 4. G&T must write to inform the complainant of the outcome of the investigation. 5. If the complaint cannot be resolved then the complainant will be referred to an ombudsman/independent redress scheme provided by the RICS (CEDR). Complaint resolved / Complaint Complaint referred to received acknowledged redress scheme + 7 days +28 days 15 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE INSURANCE PI insurer must be notified as soon as a complaint has formally been made so that they can update their premium if necessary. RICS INDEPENDENT REDRESS SCHEME (CEDR – RICS approved ADR provider) Independent adjudication for disputes between customers and companies regarding the surveying activities of subscribing RICS member firms including, but not limited to, Homebuyers Reports, Valuation, Land Measurement, Auctions, Building Surveys and Professional Advice RICS do not provide adjudication for residential lettings, residential property management or residential estate agency complaints. These will be covered by The Property Ombudsman (TPO) or Property Redress Scheme (PRS). RICS POSITION ON COMPLAINTS HANDLING LOG Enables complaints to be recorded. Enable complaints to be better managed. Identify areas of improvement. COMPLAINTS HANDLING FOR A SOLE PRACTITIONER Works in the same way with the sole practitioner acting as the complaints handler and independent redress if objected by the complainant. 16 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE HANDLING CLIENT’S MONEY REASONS FOR HANDLING CLIENT’S MONEY Holding our fees in advance. Holding future payments to the Contractor. CASH Cash payments are avoided, politely decline a Client’s offer of payment in cash because: o No auditable trail o Do not know where it came from – risk money laundering. Money Laundering Act: cash can be accepted up to €10,000 (above the money holder has to register as a ‘high value dealer’ with HMRC. RICS HELP SHEET: CLIENT’S MONEY: GENERAL ADVICE FOR FIRMS All RICS regulated firms must protect the security of Clients’ money on their behalf with robust controls and systems in place. All regulated firms who hold Clients’ money must pay a regulatory fee on an annual basis to cover the operational costs of the Regulatory Review Visit audit by the RICS accountants. PRACTICES TO BE FOLLOWED – BEFORE ACCOUNT IS SET UP Client must agree to the account handling in writing with signatories from both parties. There must be an agreed drawdown schedule. PRACTICES TO BE FOLLOWED – DURING ACCOUNT USAGE Designated bank account set up named ‘Client’ and the name of my firm. o This could be a private account where the signatory is from our company. o This could be an escrow account which is a third-party which comes with fees. o Client must be advised of all details of the bank account. Only Client’s money should be deposited in the account. If Client sends to us first it must be deposited in account within 3 working days. Money in the account should be available to the Client on demand. Interest to be paid to the Client unless otherwise agreed. Bank reconciliation should be undertaken at regular intervals. Money should be distributed to me by direct debit in accordance with drawdown schedule. Needs to be procedures in place for insolvency and death of sole practitioner. PRACTICES TO BE FOLLOWED – AFTER ACCOUNT IS USED Records should be kept for 6/12 years from the last date of entry on the statement. If there is remaining money that cannot be returned (e.g. if the Client goes missing) then all efforts must be made to return it but after 6 years the money may be donated to a registered charity (e.g. Lionheart) [preferably offering refund indemnity for a Client claim]. CLIENT MONEY PROTECTION SCHEME Funded by the RICS. Free service to the Clients of the RICS regulated firms to be reimbursed by direct loss of funds (if a company is holding/has access to a Client’s money and something happens to it). Maximum limit of £50,000 per claimant subject to a maximum aggregate claim of £5.3million in any one year. Claims must be made within 6 months. 17 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE PROFESSIONAL INDEMNITY INSURANCE LIMITED LIABILITY How much a company can get sued for (standard is £1million). Indicates the amount of PII a company should take out. DEFINITION OF PROFESSIONAL INDEMNITY INSURANCE (PII) Third party liability insurance to protect professional advice and service by providing the insured from bearing the full cost of defending against a claim for negligence. If professional negligence has occurred it puts a party back in the position they would have been in if no loss had occurred. Provides financial protection in the event a Client suffers financial loss as a result of negligence. COMPLIANCE All regulated firms need to have adequate and appropriate professional indemnity insurance (PII) in place that complies with the requirements of the RICS Rules of Conduct for firms. All previous and current professional work is covered by adequate and appropriate indemnity which meets standards approved by the Regulatory Board. LEVELS OF PII Minimum requirement is based on an estimate of the firm’s annual turnover. Firm’s turnover in the Minimum limit of indemnity Cost per year preceding year £100,000 or less £250,000 £500 £100,001 to £200,000 £500,000 £700 £200,001 and above £1,000,000 £950 Gardiner & Theobald’s minimum level = £1,000,000. Various levels are held dependent on the project (£1m, 5m, 20m). For a new company (that doesn’t have a previous year turnover), the minimum requirement should be their expected turnover for their first year. Whilst these are the minimum levels required by the RICS, a firm’s level of PII should be assessed from a commercial point of view as to whether they need to hold more (type of work the firm undertakes should be considered) EXCESS The uninsured amount of a claim. If a claim were successfully brought against your firm, you would have to pay this amount. Reason for excess is to try and deter fraudulent claims. Maximum levels of uninsured excess that an RICS regulated firm can carry are: Limit of indemnity Maximum uninsured excess Up to and including £500,000 The greater of 2.5% of the sum insured or £10,000 Over £500,000 2.5% of the sum insured 18 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE ‘EACH AND EVERY CLAIM’ BASIS Limit of indemnity is payable in respect of each claim made in one year. Opposite would be ‘in the aggregate’ where the limit is only available once in the policy period no matter how many claims are made. ‘CLAIMS MADE’ BASIS When a claim is received, it is the insurer in place at that time that will respond rather than the insurer in place when the negligent act occurred. This is why policies must cover past and present employees (likely Employees have moved on so think of it as the claim is made against G&T not the individual). Fully Retroactive Policy To ensure a policy is fully retroactive the retroactive date should be stated as ‘none’. If a new policy is taken out when the previous policy ends, the start date of the new policy is the ‘inception date’. However the ‘retroactive date’ is the date that PII was first taken out. Therefore this covers the ‘claims made’ basis required. RUN-OFF COVER To ensure that members/firms ceasing to trading are not exposed to financial detriment in the period following. Claims can still be brought against members/firms for a project’s liability period and due to PII being made on a ‘claims made’ basis the insurer at the time is responsible for any claim. RICS recommend taking cover for 15 years because claims can be made in tort: the Latent Damages Act 1986 provides a 15 year long-stop from the act of negligence (claims can be made for up to 15 years). Traditionally this insurance is cheaper than ongoing PI insurance. Run-off cover premiums typically reduce over the period of time since the cease to practice. Merrett –v– Babb 2001 case law lead to the introduction and requirement for run-off cover: o Babb (surveyor) carried out a valuation on a property for Merrett. Babb’s employer went insolvent. Valuation later found to be negligent. Babb’s employer had no run- off cover. Courts rules than Babb was personally liable. RICS MINIMUM POLICY WORDING Policy wording should be written on a full civil liability basis. Covers negligent claims brought against members/firms in civil court not criminal court. ARRANGING PII The policy must be underwritten by an RICS listed insurer (these are recognised by the Dept of Trade): ‘approved’ insurers provide PII that meets RICS minimum terms and conditions. The level of PII can be changed during a policy year but this comes at a premium. If you are a new company and cannot afford PII then you would go to the RICS who give assurance. RICS recommended PI firms club together to support. Assigned Risk Pool allows a firm to be covered if they cannot get PII in the current market or if considered too risky. Apply to the RICS and meet correct criteria and they will cover you. There is a maximum cover period of 3 years. GIVING ADVICE TO A FRIEND Free work: politely say no Paid work: Undertake work in name of G&T so that it is definitely covered. 19 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE CONDUCT UNBEFITTING DEFINITION Behaviour that is disgraceful, dishonourable or liable to bring the profession into disrepute. AVOIDANCE Following the RICS Ethical and Professional Standards Approach someone who is behaving dishonestly and draw their attention to the dishonesty. Speak to a senior member of staff if pressured to act unethically. Speak to the RICS honestly if I have already acted unethically. Bribery BRIBE An offering in exchange for an influence or action in return. Giving, receiving, soliciting or promising of money, a gift or anything else of real or implied value as an inducement to do something that is dishonest, illegal or a breach of trust in order to secure business or a business advantage. World Bank estimates that over $1 trillion worth of bribes are paid annually. BRIBERY ACT 2010 Introduced to enhance UK law on bribery (bribery is illegal). Came into effect in 2011. Serious Fraud Office (SFO) investigates and prosecutes fraud, bribery and corruption. PRINIPLES TO AVOID BRIBERY Top level commitment Due diligence Training (no stipulation for how often training must be, G&T firm policy is every 3 years) Monitoring Proportionality Risk assessment BRIBERY OFFENCES Active Bribery: offering, promising or giving a bribe Passive Bribery: requesting, agreeing to receive or accepting a bribe. It is illegal to bribe a foreign public official in order to obtain or retain business or an advantage in the conduct of business. Corporate Offence: failure by a company to prevent persons associated bribing on its behalf. LIABILITY The Act applies to UK citizens; residents and companies established under UK law whether operating in the UK or elsewhere in the world. The Act applies to all companies doing business in the UK (whether national or international). A firm can still be liable for a bribe even if they are unaware of it. 20 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE PENALTIES Individuals can be imprisoned for up to 10 years and face unlimited fines. Companies failing to prevent bribery of an associated person can face unlimited fines. Companies can face EU wide ban on public procurement. Directors can be disqualified from holding office and can face criminal and civil liabilities. GARDINER & THEOBALD GIFT/HOSPITALITY POLICY Submit anything accepted from a contractor or client on the online gift register. Limit of £100 gift (receiving) and £250 gift (giving). Never accept cash, gift vouchers, valuable items, frequent gifts. Who it is given to (single person or group)? When giving or accepting hospitality, the host must be present – otherwise it becomes a gift AVOIDANCE OF ACTIVE BRIBERY Being open and honest in anything that could be perceived as bribery. AVOIDANCE OF PASSIVE BRIBERY Asking the following questions because if either of the following answers are yes then a bribe is likely involved: o Is this skewing my judgement / is this influencing my future decisions/actions? o Is this proportionate? AVOIDANCE OF BRIBERY DUE TO ASSOCIATED PERSONS Valid business case Senior management approval Educate third-party about our anti-bribery policy Conduct due diligence: check if third party operates in country with high corruption indicated on TI Corruption Perceptions Index, check third party’s capability to carry out requirements, check third parties payment history HYPOTHETICAL SCENARIOS Firstly ask yourself the questions above (is it skewing my judgement/is it proportionate) Contractor offers you: o A pen: accept and record on gift register (small monetary value so unlikely to be a bribe). o Lunch: accept and record on gift register (if less than £100). o Lunch before a valuation: politely decline and explain it could be seen to affect my impartiality. Client offers you: o Concert with project team: accept and record on gift register (this could be perceived as hospitality and tem building). o Concert only you: politely decline and explain it could be seen to affect my impartiality. o Bottle of wine: decline throughout the year but at Christmas it may be acceptable to receive gifts below £100 and record them on the gift register. If under immediate threat to life, limb or liberty then this is the only circumstance in which it is ok to make unofficial payments. This must then be reported to a partner. 21 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE Money Laundering MONEY LAUNDERING The concealment of the origins of illegally obtained money. WARNING SIGNS Client being evasive about who they are. Client being from a high risk country (i.e. Syria). Client giving strange instructions (i.e. early payment of overly high fees). Client wanting to pay large amounts in cash. PREVENTING MONEY LAUNDERING Conduct a money laundering and terrorist financing risk assessment. Implement systems and policies to address and deal with money laundering. Appoint a nominated officer who will report money laundering. Do not take cash as there is no auditable trail of the money. MONEY LAUNDERING, TERRORIST FINANCING AND TRANSFER OF FUNDS (INFORMATION ON THE PAYER) REGULATIONS 2017 (MLR 2017) Implements the EU’s Fourth Directive on Money Laundering. Replaces the Money Laundering Regulations 2007 and the Transfer of Funds (Information on the Payer) Regulations 2007. Changes to the MLR 2017 MLR 2017 requires the supervised estate agency sector to make significant changes to their processes and procedures to comply with the regulations. HMRC o Real estate businesses which fall within the scope of the regulations must register with HMRC. Under the MLR 2017, it is a criminal offence to act as a beneficial owner, officer or manager of an estate agent without having been approved by HMRC. Overseas subsidiaries o Parent undertakings, which are regulated under MLR 2017 in group companies, are obligated to ensure that the anti-money laundering (AML) policies and procedures they establish apply to all subsidiaries and branches, including those situated outside of the UK when engaging in any regulated activity. Firm-wide risk assessments o The MLR 2017 requires a firm-wide risk assessment to be conducted taking into account specific risk factors as listed in the MLR 2017. A written record of the firm- wide risk assessment must be maintained. Customer due diligence (CDD) o All estate agents must carry out CDD on their customers and the beneficial owners of their customers prior to entering into a business relationship with them and at other specified times. Politically exposed persons (PEP) o MLR 2017 now defines PEPs as including domestic PEPs as well as foreign PEPs. Regulated firms must have in place appropriate risk-management systems and procedures to determine whether a customer, or the beneficial owner of a customer, is a PEP or a family member or a known close associate of a PEP. 22 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE PROFESSIONAL STATEMENT: COUNTERING BRIBERY AND CORRUPTION, MONEY LAUNDERING AND TERRORIST FINANCING RICS update is currently in consultation. Aims to set out the obligations for RICS professionals and regulated firms to minimise their exposure to these risks and guard against these financial crimes in their day-to-day business operations. Collusion DEFINITION Secret or illegal cooperation or conspiracy in order to deceive others. EXAMPLE Contractors talking in tender process o Reduces competition o Avoided by issuing Certificate of Bona Fide Tender which tenderers sign to confirm they have not colluded. 23 | P a g e CONDUCT RULES, ETHICS AND PROFESSIONAL PRACTICE Conflict of Interest DEFINITION Anything that impedes or might be perceived to impede an individual's or firm's ability to act impartially and in the best interest of a client. INSTANCES Acting for another person with competing interests at the same time. Have obligations/pressures that detract from or affect your duty to the Client. Have conflicting duties to different Clients. TYPES Party conflict: where your duty is owed to two parties in relation to a related professional assignment (e.g. G&T working for a developer and purchaser) Confidential information conflict: where you have been provided with confidential information but are not able to share between Clients/friends Own interest conflict: a personal conflict (e.g. family member as a tenderer) ACTION Transparently disclose in writing the nature and circumstance of the conflict to the Client. Step down from your position or obtain informed consent in writing to continue (keep records). If continuing, enforce an information barrier if necessary. Chinese Wall/Information Barrier/Ethical Barrier Physical and electronic separation of individuals within the same firm that prevents confidential information passing between them. Used in the case of Confidential Information within a company of people acting for different parties. RICS PROFESSIONAL STATEMENT Came into effect 1 January 2018. RICS RULES ON CONFLICT OF INTEREST ‘Double Dipping’ is banned (the practice of advising on both sides of a deal, for commercial property investment transactions). Clients must be notified when agents are representing multiple parties bidding for a scheme, and for incremental increases in services provided. BREACH OF RICS RULES Could incur penalties. RICS CONFLICT OF INTEREST CASES (Jan 2017 – May 2018) 53 cases o 25 (45%) regarding firms and 29 (55%) regarding individuals o 11 under investigation and 42 closed 24 | P a g e CLIENT CARE CLIENT CARE 25 | P a g e CLIENT CARE OBTAINING CLIENTS SUBMISSION PACK Covering letter Scope of service Fee proposal o Indicative fee § Calculation: %-based Resource schedule (sets out the programme, scope and fee per professional). o Actual fee § Ad-hoq basis: assess the time spent. o Fee can only be reduced if scope is reduced. Standard Terms & Conditions o G&T’s registered address and VAT number. o States that G&T is regulated by the RICS. o Liability in connection to the T&C is limited to a total of £1m. o States that G&T is a LLP so claims cannot be brought personally against individual partners or employees. o G&T will produce broker’s letter of PII on request. o G&T will produce their complaints handling procedure on request. Exclusions (VAT, travel outside M25) Assumptions and programme CVs APPOINTMENT DOCUMENT Scope of services o Inception and feasibility (liaise and advise) o Pre-contract cost control (prepare, advice, monitor, maintain) o Tender and contractual documentation (liaise, advise, prepare, distribute). o Tender selection and appraisal (appraise, review, prepare) o Interim valuations (recommend) o Post-contract cost control and reporting (value, report) o Final account (prepare) o Attendance at meetings (liaise and attend) Payment terms Insurances IDENTIFYING CLIENTS The process of identifying new Clients in a particular market sector and attracting them to your business (with the understanding that different industry sectors have varying structures and these affect the nature of the Client and their objectives) Managing existing Client base to receive future business FRAMEWORK AGREEMENTS Contractual umbrella agreement between 2 or more parties that outline how goods and services are to be provided by either party. Client expects QS to know their organisation, business plan and long-term objectives. 26 | P a g e CLIENT CARE RETAINING CLIENTS / GOOD CLIENT CARE PRINCIPLES / CONCEPT OF CLIENT CARE Understanding the Client’s objectives Establishing your scope of services and the fee for doing so Deliver work to a high standard o Promote myself, my firm, the RICS and the profession as a whole o Act within your level of competence Appropriate behaviour o Being courteous, punctual and professional o Adhere to the RICS ethical and professional standards Clean lines of communication o Regular meetings and updates o Establish a transparent, trustworthy and open relationship DUTY OF CARE A moral or legal obligation to the Client (could include telling them something they don’t want to hear) Client care = working only in the best interest of the Client ENSURING REPEAT BUSINESS Ensures greater profit for the company More simple to provide a service as the Client’s overall objectives are understood EXAMPLE OF GOOD CLIENT CARE Monthly basis on Project E I provided the Client with a cost report which detailed the forecast outturn cost. This ensures awareness of the impact the changes are having. CLIENT OBJECTIVES CLIENT/STAKEHOLDER OBJECTIVES Understand from the outset of a project by setting up a meeting Assessed in terms of time, cost, quality and risk appetite. o Project E: Cost, time and risk transfer o Project C: Cost, time and quality (retaining risk) KEY PERFORMANCE INDICATORS A quantifiable measure used to evaluate the success of an organization, employee, etc. in meeting objectives for performance. CLIENT FEEDBACK CLIENT FEEDBACK Process for collecting and responding to feedback G&T: informal continuous feedback process (reviews and satisfaction surveys) 27 | P a g e COMMUNICATION AND NEGOTIATION COMMUNICATION AND NEGOTIATION 28 | P a g e COMMUNICATION AND NEGOTIATION COMMUNICATION COMMUNICATION METHODS Verbal o Face-to-face o Telephone o Web conferencing o Listening Written o Email o Letter o Report Presentations o A mixture of verbal and written/graphics IMPORTANCE OF COMMUNICATION Different parties to a project undertake different roles and communication allows their co- ordination. SITUATIONS Important to remain mindful of the person I am speaking to and tailor my language appropriately: o Client vs Contractor o Old vs young EXAMPLE OF GOOD COMMUNICATION/TEAMWORK Value Engineering: o Discuss with the architect different options for reducing the costs. Presentation: o Lower level of detail. o Use visual aids such as graphs. o Clear, simple explanation. Report: o Higher level of detail. o More time consuming. o Clear simple explanation AVOIDING DISPUTES Project C Termination meeting o Informed the Contractor of termination o Immediately arranged a meeting that had an agenda (Documents, valuation, site visit) o Remained professional (courteous to contractor but punctual) o Arranged site handover meeting 29 | P a g e COMMUNICATION AND NEGOTIATION NEGOTIATION DEFINITION Discussion aimed at reaching an agreement TYPES Competitive Principled COMPETITIVE (HARD) NEGOTIATION Characterised by both parties opening discussions with typically low or derisory offers and each gradually concede bit by bit until mutually acceptable compromise is reached. Our role is to be fair and reasonable so if the opposition states a valid point then this must be incorporated. Win-lose outcome. PRINCIPLED (SOFT) NEGOTIATION Both parties step back from their own position and negotiate on the basis of what is best for the project or the situation with the driver being what is their mutual interest not personal one. Win-win outcome. Open and honest about position, both provide back up and discuss. STRATEGY FOR NEGOTIATION Review relevant information Establish objectives Important to remain respectful of the opposing opinion/perspective Non-confrontational position to find common ground Present information clearly. NEGOTIATION EXAMPLE Changes to the Contract Sum on Project E I assessed the a variation fairly and reasonably however the Contractor disagreed I remained calm and firm to present my logic and information which was using contract rates and the Contractor explained why the nature of these works were a little different therefore through principled negotiation we agreed. NB. If you cannot agree the variation through a principled process of negotiation then it would go to the next stage of dispute resolution. BOTH RIGHT IN NEGOTIATION Get third party in office to check I am right (or mediator) Stalemate = adjudication. Right way to do it would be to go to adjudication if you’re both definitely right however in this situation we would go to the Client and explain that adjudication could be more costly than just adopting a soft negotiation with the Contractor and both concede. 30 | P a g e HEALTH AND SAFETY 31 | P a g e HEALTH AND SAFETY RISK HAZARDS Something that has the potential to cause harm RISKS The likelihood of harm being realised Construction industry is considered a high risk industry RISK ASSESSMENT (see risk assessment competency) Careful assessment of anything that can cause harm to people and the relevant precautions Conducted by following the HSE’s publication ‘Five Steps to Risk Assessment’ o Identify the hazard o Decide who might be harmed and how o Evaluate the risks and decide precautions o Record your findings and implement the precautions o Review the assessment and update it regularly OCCUPATIONAL HEALTH AND SAFETY RISKS Risks encountered in the workplace such as in an office Examples: repetitive strain injury, stress, eye failure. SITE HEALTH AND SAFETY RISKS Risks encountered when visiting a construction site or premises Examples: Falls from height, site traffic, dilapidated condition of property, asbestos Important to inform colleagues of times of site visit, location of site and contact of site member SURVEYING SAFELY USE Guidance Note/Professional Statement (when 2018 comes out) on health and safety responsibilities at both a corporate level (for all sizes of organisation) and that of the individual RICS member. EDITIONS Surveying safely 2011 1st edition Guidance Note. Surveying safely 2nd edition Practice Statement (not yet issued but consultation occurred in 2017). LIKELY CHANGES Professional Statement (mandatory) instead of Guidance Note (best practice). Includes changes to CDM Regulations and new H&S sentencing guidelines. Raises aware of ‘health’ aspect (e.g. asbestos awareness). Operational checklist to ensure adequate and proportionate H&S procedures, policies and systems are implemented. Concept of the ‘safe person’ (everyone is responsible for their own actions). 32 | P a g e HEALTH AND SAFETY H&S ON SITE CONSTRUCTION SKILLS CERTIFICATION SCHEME (CSCS) 50 question test aiming to improve and prove site workers’ competence to reduce accidents CSCS Cards (valid for 5 years): o Green – labourer, construction site operative (CSO) o Red – trainee, apprentice, experienced technical supervisor, experienced worker, provisional o Blue – skilled worker o Gold – advanced craft, supervisor o Black – manager o Grey – academically qualified person, professionally qualified person, construction related occupation (CRO) o Yellow – construction site visitor (no longer valid from 2020) PERSONAL PROTECTIVE EQUIPMENT (PPE) 5 points of PPE: o Hard hat (expiration stated on the label - approx. 2-3 years) o Steel toe cap and sole boots o High-visibility jacket o Eye protection o Gloves PPE should be maintained in a good condition and provided free of charge by an employer of someone attending site. SITE INDUCTION Organised briefing to the site specific risks and the control measures in place to minimise the occurrence of the risks. Includes emergency evacuation procedures, fire assembly point and exclusion zones. Teaches who the site manager is so that if I encounter anything dangerous he can be informed immediately. TOOL BOX TALK Formal briefing given to site operatives informing them of the changing health and safety risks as the project progresses Weekly or fortnightly basis Site Statistics Health and Safety statistics for the GB construction sector (published November 2017): o 30 fatalities in the year 2016/17 – this is 30% lower than the 5 year average for 2011-12 to 2015-16 (43 deaths). o 64,000 Non-fatal injuries to workers (RIDDOR) each year. o 80,000 workers suffering from ill health each year caused by or made worse by their work. o Most common fatal accident: falls from height (49%). o Most common non-fatal injury: slips, trips and falls (24%). o Most common ill health: musculoskeletal (65%). 33 | P a g e HEALTH AND SAFETY POLICIES AND LEGISLATION G&T Health and Safety Policy POLICY Document that acknowledges the firms responsibility to comply with all relevant health and safety legislation of the jurisdiction in which we operate. ‘RESPONSIBLE PERSON FOR HEALTH AND SAFETY’ Nominated person who annually reviews and updates the policy. G&T: Mike McCann. INCLUDES Carry out risk assessments Provide safe working environments Provide relevant training Take care of own H&S Co-operate with the firm Bring H&S issues to the attention of management RIDDOR Ensure PPE is maintained and kept in good condition. Health and Safety Framework in the UK EU Directive Governed by: Secretary of State for Health & Safety Law (e.g. Health and Safety at Work Act 1974) Work & Pensions. Regulations Enforced by: HSE Local Authorities Approved Codes of Practice EHO Fire Officers Health and Safety at Work Act 1974 LEGISLATION The key UK legislation relating to health and safety. DUTY Places a duty on Employers to ensure that health, safety and wellbeing of employees and others is not at risk, so far as is reasonably practicable. Employers have a duty to provide and maintain equipment, safe systems of work and safe premises. BREACH 34 | P a g e HEALTH AND SAFETY Criminal offence. Unlimited fine plus imprisonment for up to 2 years, Manslaughter charges can lead to more severe custodial sentences (directors can be disqualified from acting as director for up to 15 years). REQUIREMENTS Appropriate line management structure to monitor and manage health. Clear accountability, policies and procedures. Risk assessment. Staff training. Adequate resources provided (employer duty to provide and maintain safe equipment, systems of work and premises). Insurance in place. Health and Safety Commission POSITION Statutory Body established under the Health and Safety at Work etc. Act 1974. AIM Focused on preventing injury and death in the workplace. Police the workplace to ensure that individuals are not putting other workers at risk. Ensure duty holders deal with serious risks immediately, comply with the law/Health and Safety at Work Act 1974 and are held accountable if they fail in their responsibilities. Health and Safety Executive (HSE) POSITION National independent regulator for work-related health, safety and illness. Acts in the Great British public’s interest to reduce work-related death, injury and ill-health in work places. AIM Offer free guidance and advice to support businesses to manage risks correctly. 35 | P a g e HEALTH AND SAFETY CDM REGULATIONS 2015 CONSTRUCTION (DESIGN AND MANAGEMENT) REGULATIONS 2015 SBC 2016 Clause 3.23 / DB 2016 Clause 3.16 Primary construction legislation arising from Health and Safety at Work Act 1974. The law that applies to the whole construction process on all construction projects. What each dutyholder must or should comply with the law to ensure projects are carried out in a way that secures health and safety. AIM Aimed at improving the overall health, safety and welfare of those working in construction through the planning, designing and management of projects, from the outset by targeting effort where it can do most good. APPLICATION Apply in Great Britain, the territorial sea and the renewable energy zone (only construction of renewable energy structures) to all construction work. HISTORY Introduced in 1994 and came into force on 31 March 1995, revised in 2007, substantially revised on 6 April 2015. DIFFERENCES BETWEEN 2007 AND 2015 CDM2007 CDM 2015 Domestic Projects Did not need to be notified. Must apply the regulations Exempt from the in full. appointment of CDM dutyholder and documents. Duty Holders CDM Co-ordinator Principal Designer (see below for others) (see below for others) Notification to HSE Lasting over 30 days or 500 Lasting over 30 days with person days. more than 20 workers or CDM Co-ordinators job to 500 person days. notify HSE with an F10. Client’s job to notify HSE with an F10. Notification Impact Non-notifiable projects had All projects must comply fewer duties. with same duties. Appointment Requirements Notification triggered the More than 1nr appointment of a CDM Co- contractor/sub-contractor ordinator. triggers Principal Designer appointment. Construction Phase Plan Only required on notifiable Required on all projects. projects. Pre-Construction Information Only required on notifiable Required on all projects. projects. Completed by the Client Completed by CDM Co- with assistance from ordinator. Principal Designer. Health and Safety File Only required on notifiable Required on all projects. projects. 36 | P a g e HEALTH AND SAFETY Notifiable Projects DEFINITION Where the construction work is likely to: o Last longer than 30 working days (do not have to

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