Code of Professional Conduct and Ethical Standards

Introduction & Learning Outcomes

Code of Professional Conduct and Ethical Standards are published pursuant to the Bye-Laws
of Professional Institutes so that members of them may be reminded of the professional and
moral principles which should always govern their conduct.

Learning Outcomes expected from this article are as follows:

 Explain the meaning and origins of ethics.

 Relationship between law and ethics.
 Ethical dilemmas.
 AIQS Code of Professional Conduct.
 Any additional requirements by other professional institutions.

What is ethics?

Ethics is defined in the Oxford English Dictionary as ‘the science of morals’. The word is
derived from the Greek ‘ethos’, of which one meaning might be ‘the set of moral values and
principles which underpin any particular society’.

Ethics is a standard for deciding write and wrong. It is general moral beliefs and rule of
conduct. It states what one should do instead of what one will do in particular instance.

Ethics is essentially a product of our humanity; the human beings are driven to bring about
changes for the better in their environment, and that the motives from which they act depend
largely upon a combination of their personal and ethical value systems. Culture plays a
fundamental role in determining our basic norms and values as well as the environment
in which our ethical values develop.

A modern philosopher, Mary Warnock, sums up the essence, and the contradictions, of
modern ethics in the following words:

‘Ethics is a complicated matter. It is partly a matter of general principles or even rules, like
those of manners, but is largely a matter of judgment and decision, of reasoning and
sentiment, of having the right feeling at the right time, and every time is different’ (Mary
Warnock, An intelligent person’s guide to ethics).’

Why do professionals need to comply with ethics?

In recent years, the society has become more commercialized and some of the professionals
tend to be towards the commercialism than respecting professional values. Therefore,
governments, banks, commercial organizations and changes in business practice demand
greater certainty of professional standards and ethical considerations to the forefront of
current business thinking.

Need for greater openness and transparency in business dealings have highlighted the fact that
contemporary business problems cannot always be resolved by legislation and experience.

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Accordingly, many of the professional institutions have drafted guidance on ethics for their
members, and businesses are also now more willing to set out publicly their ethical standards.

Ethics and the Law

It is important to differentiate between one’s legal and ethical responsibilities.

The law is often regarded as a critical part of the bond that holds the fabric of society
together, and protects us from the risk of social disorder and anarchy. Law made by the
parliament, delegated authorities & previous cases decided by courts of law. (As most of you
are aware, in Oman, the Supreme Laws are made through Royal Decrees. Ministerial Decrees
are made as subordinate legislations).

The criminal law, in particular, is important in this respect, since it defines those behaviors
which are regarded as sufficiently antisocial or potentially damaging to the public good as to
be outlawed and punishable by the state. In most of the countries such as Australia, New
Zealand, USA and Sri Lanka have their own written Criminal / Penal Codes for this purpose.
On the other hand, the civil law basically lays down the rights and liabilities arising from
relationships between individuals. Breach of civil law generally results not in the imposition
of a penalty but restitution to the injured party so that they are, as far as possible, put in the
same position as they would have been had the infringement of their rights not occurred.

In contrary to the law, one’s ethical responsibilities go beyond the extent of legal
responsibilities and establish with moral obligations. Ethical responsibilities are therefore
concerned not with ‘black and white’, objective definitions of right and wrong, but with
personal value judgments. Therefore, the resolution of ethical issues normally involves a
subjective decision based upon one’s own personal ethical values.

However, the distinction between law and ethics is not a clear-cut one. For example, in the
recent past, most of the countries in the world have enacted ‘human rights’ legislations
through which moral rights are codified in to the Acts of Parliaments. As an example, Human
Rights Act 1998 in UK plays an important role by incorporating some of the human rights
under the Act. Some of those rights are the right to free speech, the right to free choice of
employment, the right to just and fair working conditions and remuneration, the right to
reasonable periods of rest and leisure, and the rights to privacy. The above said rights could
all be seen to be essentially moral rights which now are enshrined in the law. Legislation such
as this blurs the boundary between ethics and the law.

Ethical dilemmas

An ethical dilemma is a complex issue that cannot be satisfactorily determined by the use of
facts and technical rules alone. They are often, but not always, management issues involving
both people and a moral question. It is not easy to define “solution” to problems like these.
Sometimes several options can be given. More than one solution may be appropriate in a
given context. The practitioner must follow his or her convictions and professional judgment.
In order to obtain an in depth understanding of ethical dilemmas, please also refer to
“Maintaining Professional and Ethical Standards, 01 April 2010 – Help Sheet” under RICS
Regulation.

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AIQS Code of Professional Conduct

As a full text of Code of Professional Conduct is available in the AIQS website, this article
will follow only extracts from a presentation slides in short form. However, more detailed
explanations are given wherever required.

1. Generally

1.1 Members of AIQS shall be governed by the Articles of Association and by laws of the
institute.
1.2 Members must adhere to the standard of professional conduct. Any member whose
conduct is contrary to this code shall be liable to reprimand (warn officially),
suspension or expulsion as provided by the Articles of Association of AIQS.
1.3 Any transgression (wrongdoing/lapse) of this code by a partnership or corporation
shall be deemed a transgression by the ……(please refer to the code for continuation)

Q1 – What you would do, as member of AIQS, if you come to know another
member /partnership / corporation is in any apparent breach of this code?

Answer to Q1 can be found under the 1.4 of the code which states that “It is the
responsibility of every member to report to the Secretary any apparent breach of this
code for investigation in accordance with the provision of the Article of Association”.

2. Definitions (please refer to the code for Definitions)

3. Responsibility of Members, Partnerships and Corporations

Members, partnerships or corporations shall:

3.1 Provide professional services of a high standard - Members, partnerships or

corporations shall exercise all reasonable skill, care and diligence in the performance
of the Services under the agreement with the clients / employers.

In order to obtain a further understanding on what form of professional services of a

high standard required by the clients / employers in Oman, please refer to clause no.
19.1 of Oman Standard Form of Agreement and Conditions of Engagement for
Consultancy Services for Building and Civil Engineering Works (Second Edition –
March 1987).

3.2 Maintain a high professional standard, be of good fame (recognized), integrity (be
trustworthy in all that you do – never deliberately mislead, whether by withholding or
distorting information), and character.

Further explanations are being honest and straightforward in all that you do. Being
trustworthy, being open and transparent in the way you work, respecting confidential
information of your client and potential clients. Not taking advantage of any one to

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whom you owe a duty of care, Not allowing bias, conflict of interest or the undue
influence of others to override your professional or business judgments and
obligations.

Q2 – A Quantity Surveyor who is MAIQS, X prepares a BOQ for a tender based on

Actual and Correct Quantities (Clause no. 56 of Oman Conditions). In order to
overcome the doubts on accuracy of his quantities, he increased all the quantities by
5% without informing the client. What is your decision on X’ action?

Answer to Q2 - X has breached the 3.2 of Code of Professional Conduct of AIQS

which he owed to the client by increasing the quantities by 5% in the BOQ for a
tender without informing the client. As the quantities included in a BOQ for a tender
based on Actual and Correct Quantities would have a major cost implication by
increasing the Contract Price because of the quantities set out in such a BOQ are to be
taken as to be the actual and correct quantities of the work to be executed by the
contractor.

3.3 Compete fairly with other members, partnerships and corporations by promoting the
selection of QSs by clients upon the basis of merit, not on the basis of fees alone.

Q3 - you were advised by a potential client that lowering your original quote for a job
would lead to beating a competitor and gaining the commission. What you would do
in this situation? Give the reason for your answer.

Answer to Q3 – You should diplomatically refuse to do what the potential client

asked you to do. Reasons are that you are not in a position to lower your original fee
quotation because you have made no provision for the hidden profits in your original
fee quotation. Therefore, you cannot offer any discount from your original fee
quotation. In addition to that offering such a discount is a breach of the 3.3 of Code of
Professional Conduct of AIQS.

Q4 – Suppose, despite some doubt, in order to maintain the long standing relationship
with the client, the above offer is accepted by you. Now you understand that the fee
accepted by you is insufficient to carry out and complete the job undertaken. What
should you do?

Answer to Q4 - Complete the job undertaken by you despite incurring a loss and
recognizing that this tactic is not of long-term benefit to your practice. It is desirable
for the client to select a surveyor according to fairness and not manipulation.

However, having agreed a lower fee, it is your responsibility to try not to exceed the
quote, risking future business opportunities with the client.

Apart from the above answer, you should also be concentrated on the following.

• Be clear about what service your client wants and the services you are providing.
• Act within your scope of competence.
• Be transparent about fees and any other costs or payments such as referral fees or
commissions.

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3.4 Conduct themselves in a manner which is not derogatory (insulting) to their

professional character nor likely to lessen the confidence of the public in the Institute
or the profession nor bring them into disrepute (disgrace).

3.5 Promote the advancement of the Quantity Surveying Profession. This includes
organizing, conducting and attending in CPD events, attending assessor training
sessions, becoming assessors and chairmen of APC interview panel, conducting APC
interviews, act as supervisor and counselor of APC candidates, becoming member of
steering committee of AIQS local branch, writing articles and books on quantity
surveying etc.,

3.6 Inform their clients or employers of the existence or likelihood of any conflict
between interest of themselves, their partnership or corporation or where applicable,
any personal conflict of interest related to their association with the partnership or
corporation and that of their clients or employers.

Not taking advantage of any one to whom you owe a duty of care, not allowing bias,
conflict of interest or the undue influence of others to override your professional or
business judgments and obligations. The society expects the professionals to be
impartial in their all activities.

I wish to quote an answer previously provided by me for an assignment of a legal

study on conflict of interest as follows. This would provide you with a wide range of
knowledge on this subject.

“ Introduction

This question requires to describe, explain and critically discuss, with reference to Lord
Reid’s observation in the case of Sutcliffe v Thackrah (1974) and other relevant sources and
published opinion the (actual and theoretical) conflict of interest that attends the architect’s
role in carrying out certifying functions under a building contract, having regard to the fact
that the architect has responsibilities to the employer under the law of agency but at the same
time is required to reach decisions on certification “fairly, holding the balance between his
client (i.e. the employer under the building contract) and the contractor.

Answer to this question would cover critical discussion of contract between the employer
(owner) and the architect through which the architect is appointed under conditions of
engagement for consultancy services (i.e. design and supervision etc.,), construction contract
between the employer and the contractor wherein the architect’s impartial role is expected,
but the architect acts as an the employer’s agent who is remunerated by the employer and
apparently the architect seems to be in conflict of interest. Eventually, there may be
possibilities of architect would be legally liable for actions in negligence from both the
employer and the contractor if he acted biased to any of the parties.

Discussion

Architect is appointed by the employer using one of the standard forms of contracts such as
RIBA Conditions of Engagement and RIBA scale fees through which architect’s scope of
services, remunerations, terminations, dispute resolution and other conditions are agreed.

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Architect has a dual role to act as an employer’s agent and as a trusted independent
professional. However, it is a question whether the every architect would act as an impartial
certifier in the current heavily commercialized society.

Many standard forms of contracts such as JCT Standard Forms, FIDIC Standard Forms and
New Engineering Contracts etc., are used to enter into construction contract between the
employer and the contractor. As per those standard forms, the architect has a number of
different roles which may be classified as designer, quality controller and certifier and
adjudicator.

Architect is authorised to certify completion of all or part of the works, granting extension of
time to the duration of contract, requiring remediation of defects, interim payments and final
payments.

As noted in MacRoberts in Scottish Building Contracts (page 136 – on-line version in

Westlaw), the certifier is normally engaged by the employer and act as his agent in respect of
building contract. Accordingly, he must have regards for his employer’s interests and in
respect of many matters, act upon the instruction of his employer. When acting as certifier,
however, he is under a duty to act fairly, honestly and independently. 1

The comments of Lord Hoftman in the case of Beaufort Developments (NI) Ltd. v. Gilbert-Ash
NI Ltd and Another (1998) are instructive in this regard. He stated that: 2

‘the architect is the agent of the employer. He is a professional man but can hardly be called
independent’.

If the architect acts in a manner his own personal interest, even for the survival of his
employment, conflict with that of the subject matter of the construction contract it can be
described as conflict of interest. In addition to that undisclosed interest; fraud or collusion
with the certifier with one of the parties (usually with the employer); or acts or breach of
contract by the employer, under the “prevention principle” are subject to challenge to
certificates. It is worth of considering the following decisions of the courts given in
MacRoberts in Scottish Building Contracts (page 136):

A certifier must apply the terms of the contract exercising his own skill and judgement, failing
which his certificates will be invalid and he will be open to disqualification. He should not be
unduly influenced by or act on his client’s instruction to the extent that he jeopardises his
independence and impartiality.3

A certifier does not, however, have to apply the strict rules of natural justice and he has
discretion as to how to gather information and whether to allow parties a hearing. 4

1
London Borough of Hounslow v. Twickenham Garden Developments Ltd.(1970), Sutcliffe v. Thackrah
and Others (1974), and Costain Ltd and Others v. Bechtel Ltd (2005)
2
MacRoberts, Solicitors, MacRoberts on Scottish Building Contracts, 2nd Edition, Blackwell Publishing
Ltd, 2008, page 136 (On-line version in Westlaw)
3
Nash Dredging Ltd v. Kestrel Marine Ltd.(1986)
4
The British Railway Company v. William Wilson (1911) and London Borough of Hounslow v.
Twickenham Garden Development Ltd. (1970)
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The application of the rules of natural justice was considered further in the English case of
Amec Civil Engineering Ltd. v. Secretary of State for Transport (2005). The contract between
the parties in that case incorporated the Institute of Civil Engineering Conditions of Contract
(Fifth Edition). It was the role of the Engineer acting under the dispute provisions in clause
66(1) of that contract which came under review. The court held that the Engineer in that role
was acting as a certifier and that although he was required to act independently, honestly and
fairly. Lord Justice May puts the point simply:5

‘The rules of natural justice are formalised requirements for those who act judicially.
Compliance with them is required of judges and arbitrators and those in equivalent position,
but not of an engineer giving a decision under clause 66 of the ICE Conditions….Under
clause 66, the engineer is required to act independently and honestly’.

As described in Atkin Chambers, Hudson’s Building and Civil Engineering Contracts (page
622 & 623) - On-line version in Westlaw- ‘ it should be noted that acts which would be
considered collusion or interference by the employer or indiscrete conduct by the certifier, if
occur after a contract is signed,6 (e.g. the request for the assurances as to keeping down final
cost), may be classified under interest if they occur prior to the contract being signed. On the
other hand, acts occurring subsequent to contract, for example, an acquisition of shares by
the certifier in one of the parties to the contract, may be either as disqualifying interest, or, it
is suggested as indiscrete conduct.

Cases where the interest is financial, for example, the holding of shares, are likely to be
matter of degree, since a senior director or official of any really large industrial organisation
or company might well be expected to have a holding of shares in the company. These cases
may turn upon whether such an interest was to be expected in the circumstances of the
particular case7 (or knowledge of this interest may waiver), and also, no doubt, on the
relative size of this interest and the degree to which it might be effected by the contract and
decision in question. In Locabail (UK) Ltd v. Bayfield Properties Ltd. (2000), considering the
analogous case of judicial apparent bias, cases were cited where there were held to be de
minimis exception. The case also considered the question of interest of significant others. The
court said “it would be dangerous and futile to attempt to define or list the factors which may
or may not rise to a real danger of bias. Everything will depend on the facts, which may
include the nature of the issue to be decided.” However, the court then helpfully outlined a
number of factors that would be unlikely to constitute bias.

An interest will not disqualify if it is known to the complaining party at the time of
contracting.8

On the other hand, MacRoberts in Scottish Building Contracts (page 137) states concealed
interest on the part of the certifier can also lead to disqualification. It is implied that certain
interests are already known about and accepted by both parties. For example, it is known that
certifier will be paid by the employer for the work carried out by him, is liable to the

5
MacRoberts, Solicitors, MacRoberts on Scottish Building Contracts, 2nd Edition, Blackwell
Publishing Ltd, 2008, pp 136 & 137 – online version in Westlaw -
6
Kimberley v. Dick (1871)
7
Thornton Hall v. Wembley Electrical Appliances (1947)
8
Matthew v. Ollerton (1672)
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employer for breach of contract and that, to an extent, he has to look after the employer’s
interest. Interests in the welfare of either party may, however, disqualify: for example, if the
certifier is a shareholder in either of the parties or has a financial interest in the outcomes of
the certification process. This can lead to particular difficulties where, for example, the
certifier has given advice to the employer in respect of the cost of the contract. If the certifier
has guaranteed a price to the employer or will receive incentive payment for savings made
then this could lead to disqualification. Where, however, certifier has simply estimated the
cost of the job for the employer then it is unlikely that this would amount to an interest
sufficient to disqualify.

A certifier may also be disqualified if his dual roles as employer’s agent and certifier become
incompatible. This may occur where the certifier becomes a witness to fact or a key witness in
support of one party’s position. A certifier is not disqualified simply because an error in
judgement or an error in the exercise of his discretion. Where such errors occur then it may
be possible for one party to the contract to challenge the certificate by means of adjudication,
arbitration or through the courts. There is authority which suggest that there is no obligation
on an employer who becomes aware of errors on the part of the certifier to bring them his
attention and ensure that he adequately performs his duties9

However, in order to comply with the requirements of conditions stipulated in standard forms
of building contracts, the architect does routine correspondences, meetings, and consultations
with the employer and his advisors in relation to certificates. Outcomes of them should not
become directions or instructions to the architect from the employer or his advisors. There
would not be an undue influence to the certifier, if there are mere advisors.

As noted in MacRoberts in Scottish Building Contracts (page 137) if the certifier does lose
his independence then he will become disqualified and any certificates issued by him will be
invalid. Fraud or dishonesty or taking account of unduly influential matters and advice would
disqualify a certifier. Similarly, fraudulent misrepresentation on the part of either party to the
contract can also invalidate certificates issued in reliance upon such a misrepresentation. 10

Conclusion

Architect as the independent trusted certifier in construction contracts is required to reach

decisions on certification ‘fairly, holding the balance between his client (i.e. the employer
under the building contract) and the contractor. Whilst carrying out his dual roles as
employer’s agent and independent certifier, he must avoid conflict his personal interests with
that of the subject matter of the contract. His failure to do so would result in invalid
certification and disqualification of himself”.

Q5 – Y is a member of AIQS who becomes a member of the Government Tender Board to

which a tender is going to be submitted by the company “Z”. Own brother of Y is the
Managing Director of the company Z. What should the action be taken by Y? Give reason for
your answer.

9
Lubenham Fidelities and Investment Co, Ltd. v. South Pembrokeshire District Council and others.
(1986)
10
Gray and Others (The Special Trustees of the London Hospital) v. T P Bennett & Sons and Others
(1987) and Ayr Road Trustees v. W & T Adams (1883).
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Answer to Q5 – Y should immediately declare to the Chairman and the other members of the
Tender Board that the company “Z” to which his / her own brother is the Managing Director
is going to submit a tender to the Tender Board. If the Chairman and other members want Y to
be away from that particular tender opening, evaluation and decision making process, Y
should obey with it. Reason for the answer is that it is likely to be a conflict of interests
between Y’s personal interest to protect the interest of his own brother’s company and that of
the interest of the subject matter considered by the Tender Board.

You should attempt to answer the following question Q6.

Q6 – “AM” is the chairman of a Board of Directors of a public liability company which

undertakes construction of roads as the Main Contractor. The company was awarded 600 Km
long road construction project with very short construction duration. The company obtained
the permission from the client to use reputed domestic subcontractors approved by the Client
subject to the condition that total project will be managed by the Main Contractor. Director
Board of the company took a decision to construct 300 Km long road by themselves and
award two subcontracts through competitive tenders to construct the balance. AM awarded a
subcontract to the company “X” following competitive tender procedure to construct a section
of 100 Km road which includes 8.5% mark up. AM awarded a subcontract to the company
“Y” through negotiation to construct the balance 200 Km road which includes 12.5% mark –
up without obtaining the approval of the Board of Directors. The owner of the company Y is
the son-in-law of AM.

Analyze AM’s ethical responsibilities towards his company, the main contractor in the above
given scenario. Highlight any breach of code of professional conduct made by AM.

3.7 Inform their clients or employers if an assignment requires qualifications and

experience outside their field of competence.

3.8 On being approached or instructed to proceed with quantity surveying work in

respect of which the member has reason to believe services of another member,
partnership or corporation have been engaged in respect of similar work by the same
client, notify such member, partnership or corporation.

3.9 Not falsify or misrepresent their qualifications, experience and prior responsibility.

3.10 Neither maliciously nor carelessly do anything to injure, directly or indirectly

the reputation, prospects or business of other members.

3.11 Not supplant (displace / oust) or attempt to supplant another member,

partnership or corporation who or which has been awarded a commission.

3.12 Not advertise and /or promote their business in an indiscrete (careless )
manner, or in a manner which is in conflict with any of the foregoing responsibilities.
3.13 Where holding themselves out to the public as practicing quantity surveyors,
have and maintain appropriate liability insurance.

Be thorough with the provision made under clause no. 21 (Scope of Liability of the
Consulting Engineer) and 22 (Duration of Liability) of Oman Standard Form of

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Agreement and Conditions of Engagement for Consulting Services. Similarly with

QS Consultancy document.

3.14 Undertake a prescribed minimum level of CPD activities, and certify their
compliance to the Institute every three years as notified by the institute.

The above notes must be read in conjunction with the Code of Professional Conduct,
Revised April 2014 distributed (a hard copy) in the CPD Event on 9th March 2015.

In addition to the above, please refer to the following information especially required by
APC candidates.

About run off cover – https://www.lawsociety.org.uk/support-

services/advice/articles/run-off-cover/#what

The following are some slides of a different presentation done by me.

Treat others with respect:

• Always being courteous, polite, give consideration to clients and potential clients and
everyone else you come into contact with.
• Never discriminate against anyone for whatever reasons.
• As much as you are able, encourage your firm to do so.

Take responsibility:

• Always act with skill, care and diligence.

• If you have been accused, respond in a appropriate and professional manner.

• Be prepared to question and raise the matter with your colleagues, organization that
you work for, with RICS, if you feel something is wrong.

UK Bribery Act 2010:

• Individual Members – Guide to the Bribery Act 2010
• Step 1 – Has there been a bribe?
• Step 2 – Jurisdiction
• Guidance for individual RICS members
• What are the offences under the Act?
• Bribery of Foreign Public Officials
• Corporate Criminal Offences.
• Factors relevant to Public Interest
• Guidance on Common Pitfalls
• Charitable or Political Donations
• Hospitality
• Hospitality to Foreign Government Officials
• Corporate Members – Guide to the bribery Act 2010.
• Step 1 – Jurisdiction. Does the UK Bribery Act apply to my business?

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• Step 2 – Has a bribe been paid?

• Step 3 – Is the business liable?
• Key Points

RICS Website contains a lot of useful information on Global Ethical Standards, Code of
Professional Conduct and Regulations. RICS – APC candidates must refer to them prior to
appear for the APC interview.

If the decision is beyond your control, please let it know to the panel and tell your
opinion about the particular decision such that if you were the decision maker,
you would have done the same or otherwise.

This article is prepared only for the purpose of education and as a service to the QS profession.

We wish You all the Best!

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