RICS party wall guidance 7th edition with Michael Cooper

RICS party wall guidance 7th edition with Michael Cooper

Michael Cooper, head of Neighbourly Matters at Colliers International and Chairman of the Working Group on RICS Party Wall Legislation and Procedure 7th edition Guidance Note walks us through the most important changes of the 7th edition and how to implement them.

You can also watch this interview in video format here.

Introduction 

PW – Welcome to another edition of Party Wall PRO the podcast

It has been a while again and I’m really sorry; the reason why is because we have been busy working on the software for your schedules of condition (www.surveykit.io). Actually Michael that’s something I never actually talked to you about but our Party Wall PRO customers have been asking us for ages for a tool to help them with their scheduling and so we have developed something for phones so that they can take photos and dictate on their device and it automatically inserts photos into the report with the relevant condition avoiding the hassle after a site visit of having to go through hundreds of pictures and deciding which goes to which condition and so we have been busy developing that.

Also because I wanted to have this podcast and we have been talking about this for nearly a year I think and of course with public consultation it took ages. So I’m really excited to have Michael Cooper with us, who as you probably already know is head of neighbourly matters at Colliers international and you were the chairperson of the working group on this 7th edition right?

MC – That’s right 

PW – so the purpose of or the subject matter of this podcast is the RICS 7th edition party wall guidance note which will be effective on 1 December 2019.

So this podcast is more of a kind of lecture format as opposed to Q&A because Michael has a lot of good stuff to deliver and I hope we can cover where this 7th edition is coming from and where the changes are and may be kind of a good way of explaining what our audience needs to know in order to implement the 7th edition. So I hope this is a good enough introduction Michael.

MC -where would you like to start 

PW – How did you get involved ?

Essentially the RICS, as I’m sure you are aware, is currently spilt into a number of faculties that includes Building surveying, land surveying, quantity surveying etc.  now I can’t claim to know anything about the inner workings of the RICS suffice to say that I think each faculty head takes a certain responsibility for ensuring guidance is kept up to date and to do this they select a team, of advisors from the relevant area of the profession and I happen to be on the RICS boundaries and party wall panel which comes under the faculty of Land surveying.

So It was decided essentially by the panel dare I say it on the advice of myself and another practising party wall surveyor that we should consider a revision to the 6th edition of the RICS guidance note following a little bit of online criticism and some relevant criticism of the old guide.  The changes being borne mostly out of commentary on case law, and so I was tasked along with Andrew to form a working group to essentially rework the guide and see if it needed any adjustments and for want of a better description this is where it started.

PW – and how long did this take?

I would say 15 months or so from start to finish, so once we formed the working group, we set an agenda of trying to meet once a month and we initially put in 8 meetings in the hope that it would be enough but it proved it wasn’t going to be enough!  It took about 15 meetings in the end, but once the new working party had been formed and got together we sub divided some tasks and went away in smaller groups and came back with our small group conclusions on certain things but, on the whole we sat on the whole we sat in somebody’s office for 4 hours at a time and went through the old guide page by page and comment by comment and added in a few things of our own, you will notice that there is a new draft party wall award at the back mostly at the insistence of Nick Isaacs which met with a lot of resistance by us surveyors who don’t like changing things, but,  but eventually we saw the sense of it and after much tooing and throwing we came to a conclusive document that in the end everyone was happy with

So to answer your question it took quite a long time, there is a whole process behind this, the RICS need to also consider the document, consider the commentary and context of giving wider advice to surveyors on Codes of conduct etc. so there was a consultation period with them as well before the public consultation and then of course there was a roadshow which I think you are aware of around the whole country.

PW – Ok so let’s get into the meaty things how do you want to cover that do you want to cover the main changes, do you have a list of things you want to cover, do you want to cover everything?

If you don’t mind, I am going to read a few little notes that I made for myself, but, I’m not going to read them verbatim, but, I think probably the starting point is to look at why we decided to look at this in the RICS committee and I think that was borne out of the Lea Valley and Derbyshire case and essentially there was some criticism of the draft award in the appendix of the edition 6, and the criticism there related to the ability to ask for ‘making good’ as opposed to ‘compensation in lieu of damages’ associated with party wall work. Now the last draft and let’s be clear here, the appendices and the whole guide is a guidance document.  

Unfortunately, people do have a tendency to copy certain clauses verbatim and consider them appropriate because they are in the recommended guide. And I will take a good example of this, Scaffolding clauses, where I have seen them appear in awards related to section 6 which is foundation work, now clearly there is no scaffolding needed to dig a hole. So people unfortunately copy the clauses and in this case (the Lea Valley case) they went on to say that making good as opposed to compensation in lieu was an appropriate remedy.  That was a standard clause in the old draft award. But Let’s be clear, the actual remedy is only available for making good under sections 2 (2) a, e, f, g, h and j, for all other clauses the remedies are under section 11 (8) for compensation. So the clause for allowing for making good, (and I think it was in relation to a section 6 award if I’m not mistaken) , so the remedy for making good is not available under the act for that particular section of work. The remedy is compensation for damages.

So the award read that making good was a required remedy and that was ultra vires or outside of the act, and the old draft award within the old RICS standard stated that, but, essentially it should have been edited at the surveyor’s discretion and I think the judge had a heavy criticism of the RICS draft, but, I think what you will see now in the current draft we clearly say Please look at these documents and edit them appropriately for the use you intend to place upon them.

So that essentially was the first and probably the main criticism of the old guide that came through, mostly from online conversations, and there are linked in forums etc. for party wall surveyors. And quite rightly so, I think it was worth reiterating that that clause wasn’t necessarily always relevant and surveyors need to edit clauses, so one of the things we put in the new guide was an emphasis on editing clauses and we have also made a distinction between the making good availability and the compensation in lieu. 

So that was where it started.

PW -So let’s look at some of the Other Changes

I can also say that another significant area but not the most significant one was the emphasis on ethics and the guide focuses some immediate attention in the opening chapters on rules of the RICS and rules of conduct. I think it’s particularly important and we have emphasised certain rules surveyors should be familiar with and it should come as no surprise that we don’t have a special status because we are acting under statue.  We still have to perform our duties to the codes of the RICS and this have been emphasised and rule 3; members shall at all times act with integrity and avoid conflicts of interest and avoid any actions or situations that are inconsistent with their professional obligations, 

Rule 4 – members shall carry out professional work with due skill, care and diligence and with proper regard to the technical standards expected of them and 

Rule 5 – members should carry out their professional work in a timely manner and with proper regard to standards of service, customer care expected of them 

I would say, and this is also stated, I will read this as I think it’s a particularly important part of the guide – ‘where an RICS member is appointed as a party wall surveyor there should be a real benefit to the customer in terms of the requisite competence, ethical behaviour and customer care of an RICS member.’ That is something that is very strongly on my agenda at the moment, to ensure the ethical standards of practising surveyors are not overlooked or overshadowed by the statutory provisions and that we must maintain this level of customer care to place the reputation of our professional body above the rest, because essentially, we undergo years of training to become Chartered surveyors. To take our Charter we have to start with degrees, as you know we have to sit through a professional test of competence and then we sit to pass our charter, and part of that charter, and what sets us aside from the rest, is our ethical standards and our rules of conduct and the fact we have to carry PI insurance for instance which is essential for RICS surveyors and may it not be essential for people that don’t have professional qualification and that is what sets us apart. So this is an RICS guide for RICS members reminding them of that fact. That I think is very important 

Moving on because I think that’s a little bit of a hobby horse of mine, that nevertheless the RICS guide now covers it.

I said before the requirement to make good and of course we have made a lot of revisions throughout the guide on making good clauses and specifically identified what those clauses are, we mentioned the lea Valley case, now you may see very few mentions in the guide of court decisions and the reason for that is that – 

Binding Decisions 

Most of the decisions that we have on party wall matters are made in the County Courts.  They are not necessarily binding and can be overturned by a higher court. So to report them within the RICS guide could be an error because we on a different occasion a week later a different county court or a higher court a judge may have a different opinion so we have cited cases where the decisions are finalised by a higher court so they are binding decisions only.

The panel is made up from chartered surveyors, barristers, one of whom has just recently taken silk, a member of a university and both young and old surveyors, I might just emphasise that as well YOUNG and OLD. One of the other criticisms that was, and this is an online criticism, that we were a bunch of old fuddy-duddies, now I don’t think I’m that old , but we have two particularly younger surveyors on the panel, obviously with some experience, we need experience in the end to advise on a panel like this, so Jonny and Jack Norton who I think you have interviewed already were both very helpful in the production in this document and added some help in some sections where perhaps we are stuck in our ways a little bit and are a little bit resistant to change, so I don’t think we can be criticised of that anymore.

PW – No I have the list here and its true it …quite some important players in there 

Certainly we have to avail ourselves with those who are very familiar with party wall legislation and who have acted in some significant landmark cases and I would suggest that their influence was paramount to this document being something that we could reasonably rely on and I hope that the courts can reasonably rely on as well and it’s a good starting point for behaviour and, if you like, expected standards of a party wall surveyor.

Do you want me to carry on?

PW- yes please

We emphasised in the guidance the difference between contractual appointments and statutory appointments.  I think it is important, particularly for building owner surveyor’s the importance of supplying terms and conditions of business. It’s an RICS requirement and I think sometimes overlooked because there is a statutory appointment under the Act, but also terms of business need to be supplied.  

I’d like to mention there is a particularly useful section in section of 7.51 which deals with surveyor’s fees, this is additional wording says a surveyor may wish to make an owner aware that an Adjoi9ning owner may be exposed to costs if for instance they make excessive demands on either of the surveyors or give rise by their actions to additional or unnecessary time such as incurring surveyors in additional time in making abortive visits.

Now that I would like to stress because a lot of people have a misconception that the its the developing owner that pays the fees and it is not always the case, in fact section 2(2)b of the act provides for the surveyors to determine (this is in relation to a wall that is in defect or want of repair) so it gives the surveyors the right to determine who should pay or who is responsible for the defect or lack of repair and who should pay a proportion of the cost and it may be that that cost is shared. Let us also make clear there are some owners who may want to frustrate the process, now the party wall Act is an enabling Act enabling the construction by one owner and within the parameters provided by the Act, there are certain things they can do, there era 13 permitted rights under section 2, and there are section 6 rights and section 1 rights.

The frustrations by an owner next door who may not want the work to go ahead and steps in to try and do anything they can to delay and frustrate the process, well, they should be made aware very early on by their surveyor that they may be liable for the costs or part of the costs if that is what they are doing. 

So it’s unfair to label any owner with that take, but, it’s worth reminding them that if you are called out on a claim of potential damages where the damage was already existing for instance, who should pay for your time, well rightly or wrongly it should be them if they are calling you out for a spurious claim or maybe an un-needed additional visit and one that can’t wait until the final inspection. A precondition survey that is taken may help them to decide whether to call you out on that issue 

PW – So how do you Communicate this to your owner? Because you were talking about T’s and C’s you would put something like that in your T’s and C;’s 

Yes, I have, I have some paragraphs that set out in covering letters which accompany the terms and conditions, setting out and explaining exactly that, that if I am called out on a claim that is irrelevant or not part of the Act and they haven’t made an attempt to in the first instance discuss it with the neighbours or remedy the situation and it turns out it’s an errant mission then I may be charging them for that time.  To be clear I’m not going to charge them if they are a bit worried, or it’s an old lady who thinks she has got some cracks but isn’t too clear on it, but would like me to look at it, I would do that out of the kindness of my heart, but, there are some owners that insist that you come out every 5 minutes and wrongly so, I think it’s right to set that out that they could be liable for those costs when taking instructions.

PW – So that’s specifically mentioned in the 7th edition saying you are responsible for communicating that to your owners?

We also suggested following the Mohammad Lawrie Antino Stevens case that, and I will read this – ‘The prudent surveyor should also secure the terms and conditions from the owners for the possibility of a matter being withdrawn by consent and having incurred costs in advance of an award being made’ , so what we meant by that is that there is a possibility of the surveyors being engaged to settle a matter in dispute and perhaps after the initial inspection that there is not too much of a matter to be had and advising the owners accordingly and the owners withdrawing the matter by consent and the surveyor have incurred costs in this process so as suggested, and it followed that case, that it would be prudent for the surveyors to have actually set out they will charge for a matter being removed by consent so they have the ability to recover their time costs. There is then a contractual relationship with the owner who removes the matter by consent, so the consent should probably be on the condition that the owner will meet the costs that they have incurred to date. So that’s appropriate advice to give to both owners and surveyors in that context.

So we have concentrated a bit of effort on surveyor’s fee, terms and conditions, how to secure an appointment, and an understanding that it’s not always the adjoining owner who pays the costs, again this is something new to the new guide and I hope this is helpful for surveyors.

Revised Draft Award

As I said one of the main changes Nick Isaac suggested was a revised draft award and I give him full credit for pushing this ahead. Surveyors don’t like radical change and it appeared in the first instance that the first draft that he put forward was quite radical. After me examined it, we realised it was pretty much the same thing, it was just Slightly reordered, and what it does is it separates those matters that we can award and matters that we want to mention because it helps the award.  I will give you an example, for instance we can’t award special foundation consent, previously in section 4 we may have tried to throw in somewhere within the award that there is special foundation consent. We can’t award that! That’s the owners privilege to say yes or no to that, but, we can mention it. So in the introduction part of the award there is a section to identify those matters you have relied upon to make your award, but not part of the actual award itself or settling of the difference, i.e. we made this on the basis that foundation consent has been given, and this is where we say that, in a separate section in our award, and then we can carry on and make our award with the special foundations etc. as per the drawings attached.  So essentially we are separating those matters that are within our control from those that are not. I think it’s a much more robust document from the last draft and it can be varied by the surveyors. I have no doubt that many surveyors will have their own form of award that they prefer to use, but I think it’s important to see what those changes are and I would suggest that surveyors start adopting some of those changes, because it has been looked at by legal heads as well as surveyors. We did conflict on some points and I will give an example where we conflicted, it was on the signature pages. Apparently an award probably doesn’t need witnessing and it’s also questionable as to whether it actually needs signing by surveyors. We decided to leave those in, mostly at the instance of the surveyors, who felt it was appropriate to record the date and the signature showing that they had approved that document so as not to confuse it with previous drafts. The witnessing signature block, again, not essential, but, it’s a recognised industry standard that most surveyors put into our awards.

I would have no problem signing an award without a witness block, it’s not essential, but it helps, it also helps I think but, in litigation if it ever arises that the judges or the people examining that award have the confidence in knowing that the surveyors did actually sign it and somebody saw them sign it when they said they has signed it.  It was that’s particularly important now with, some of the other main changes that we focused on, which was the electronic communications bill which came into force and which has actually amended the Act, it’s a piece of legislation that has brought about two changes in the Act itself in section 15, if I misquoted that forgive me, but there are two ne=w sections relating to electronic communications  

A word of warning goes out on that one, and this is a personal thought, I am concerned that particularly if an owner doesn’t agree to receive something electronically and perhaps doesn’t acknowledge receipt electronically then it could be questionable as to whether or not they received it or that it was a correct form of publication of an award for instance. So I’m very cautious of using that without consent or acknowledgement and I would recommend there are providers that can give read receipts or acknowledgement receipts to confirm receipt of important documentation. So with the electronic communications bill there is some hint that there is the possibility that there will be further cases in relation to the use of electronic communications for publication of important documents like awards. So I will wait to see what the courts decide in later years, but I think the guidance note does give a few sections relating to electronic communications because its new and something that wasn’t previously in the Act at all.

PW – So for the moment, from a kind of practical perspective you would recommend surveyors to try to get consent being served electronically and make sure that if they do that the owners actually send an email back saying I have received it, thank you very much?

Yes I think that’s very important particularly as the date of receipt, as it were, electronically is the  start of the appeal period, the 14 day period for appealing and award and I think it’s important to recognise that some people may not open their emails every day and that there is a potential conflict between the time sent and the time received although apparently its instant but it can take some time sometimes, I don’t know if you have had that delay, someone sitting at the end of a phone saying I have sent it to you and it turns up ten minutes later, but not only that I also think that there is the possibility of an error and if you type the address incorrectly with a full stop in the wrong place, it’s very easy to be done and its never received and you think it has been, and that poor owner is without an award to suddenly find that you sent it to the wrong email address. So for your own protection as a surveyor I would strongly recommend you get a receipt / acknowledgement from whoever it is that you are sending it to. Certainly that have to approve that they will receive it in that manner in the first instance 

PW – that’s Something that can be included in party wall pro – Good next point, because, do you have more points regarding the award itself? again from a practical perspective you suggest to the audience to just go and have a look at the 7th edition, go and have a look at this award and think for themselves?

We have made that absolutely clear as well that this is a suggested document, it is good practice and is being looked at very very carefully by the panel, surveyors, solicitors, barristers and others and members of the RICS. This is a good practice guide and essentially this document is very robust, I’m very very pleased with the outcome. I was one of those that was very resistant to it initially so I am very pleased with the outcome and I would say it’s a must read, have a look, have a look at how its composed I say try it, I had my first one through just the other day and I went through it and thought this is fantastic as I can see where everything goes and it all seems to be in the right place. Whereas before it was a bit muddled 

I am not suggesting the previous edition was necessarily wrong, it was just muddled and this is clearer and it does make a distinction between those matters that surveyors can award and those matters, for instance who the owners who the surveyors are etc. are separated from the actual determination of the dispute.

Schedules of Conditions

There is one thing I would like to go back on because you started with schedules of condition, you mentioned that your services etc., we added in a clause, we did this because there has been much debate as to whether or not a condition survey is required.

My view is that a condition survey is almost essential and not least because it enables you the opportunity to visit the adjacent property.  When you visit the adjacent property whether you are acting as the adjoining owner’s surveyor or building owners surveyor then you can determine the nature and construction of that building and you can understand then the risks that there are associated with the building owners works.  If you don’t carry that out that visit, how are you to know what that structure is composed of. So, it could be made of glass but if you are sitting behind a desk and don’t visit that property you cannot determine whether or not the building owner’s work is going to have an unnecessary effect on that adjacent structure.  So let’s be clear, you need to visit and you also need to understand the internal workings of that property, so those nay sayers that say don’t do a condition survey it’s not in the act well frankly how are you going to make your determinations if you don’t understand the nature of that property next door.

And so we have put a clause in that the appointed surveyor should understand the construction, fabric and condition of the adjacent owner’s property before making an award and if necessary visit both owners properties to understand the consequence of the awarded works, and that’s a clause that was very carefully considered by the panel and was felt appropriate by all that this is something the surveyors should do. So going back to where you started condition surveys are, in my view, a requirement of good practice for party wall surveyors.

PW – but the form, the form is now…wasn’t it in the 6th edition something about schedules saying specifically how they should look or something?  

We extracted that, frankly we don’t need to tell Chartered surveyors how to do a schedule of condition. Not least that everyone has a different way of writing schedules, you suggested you could actually do it with a camera dicta phone of some description, which is great, things are moving forward, electronic things are enabling surveyors to do things better in some ways and I’m not opposed to that, and to just put a standard form in that people feel they have to follow because it’s in the guide, I think it is inappropriate, I think surveyors know how to do so we did feel it was necessary to put this back in.

From the roadshow notes, there are quite a number of minor changes within the document as well.   Some of which was borne out discussion on words used or terminology. 

We had over 130 responses on public consultation, we took on board every one of those comments , some we addressed,  some we didn’t, I’m sure you can understand we have a few time wasters in there as well, we had already considered a lot of the questions in advance and in making our own determinations, so we felt we had already covered those. We did make a few changes and I think it’s important to recognise the terminology that we have used is intended to be surveyor friendly it may not be strictly in accordance with the terminology used in the act, being user friendly in the guide so that type of criticism really isn’t very helpful and we did have a lot of that from one or two particular individuals.

There are changes in the guide where we tried to improve the drawing for instance, no doubt there will be some criticism on that because generally technology isn’t that brilliant technology but we did have some help from CAD technicians that helped put the drawings together. 

We change some standard letters, AO’s appointment letters, Bo’s appointment letters etc. and made provisions for electronic communication. We changed the draft award which I have already mentioned 

PW – Thank you for changing all this.  I have been looking at the award already because the party wall pro generating all these documents I’m going to have to adapt everything to be 7th edition ready for 1 December.

It comes into force on the first of December but it is the 7th edition August 2018 which is available now for RICS members through their usual subscription and I’m sure it will become a public document if it isn’t already.

PW – It is  – So you have covered what 5 to 6 points so 

  1. Making good
  2. Ethics – obviously that’s something that should already be out there so it’s just putting down on paper the obvious, but for some people it’s not that obvious
  3. Terms and conditions – something that would require to take a few steps for people who have never thought of that 
  4. Draft award – that’s lot of work for everyone if they want to implement it and they need to do their homework.
  5. Schedule of conditions – I’m actually quite surprised because I thought doing a condition survey was kinda everyone would do it, but I guess some people are just too lazy to get in a car and go on site.

I do worry about them

Anything else you want to add to try and get more of a what the surveyor out there that wants to be 7th edition compliant- its obviously getting their hands on the 7th edition first  

Absolutely, I suggest they look at all the proposed standard documents at the back in the appendix but it’s worth having a thorough read all the way through.

As I say almost every single section of the old edition was reviewed and I think almost every section had some revision of some kind so under a main section I don’t think there was any section that went without amend. I think It is important for surveyors to keep up to date and I think it essential for party wall surveyors to be familiar with current thinking and case law and things that are changing the environment in which we are working.

The party wall legislation itself doesn’t evolve/change, although having said that the electronic communication bill did amend it. I think however, the Act being unchanging is changed by case law. So we have methods of working now that we have adopted from case law and also construction techniques are changing constantly. I think it’s important for surveyors to Keep up to date with case law, guidance notes and other essential reads written by solicitors or barristers, there are articles on linked in etc. 

I too often come across building surveyors who feel they should engage on party wall matters but with little or no experience and I would suggest they should be very cautious of doing so without understanding the wider concepts involved and perhaps the case law and the history of the legislation and how we got to where we are, because, it’s about the interpretation of a piece of legislation it’s not just about using a guide and following it verbatim, you have to think. And this guide I think emphasises the need by surveyors and not just follow verbatim, they need to think for themselves and apply it to a particular set of circumstances. So essentially, think use it, use it wisely consider what those draft documents say and which bits need changing 

PW – I think that’s a great way to conclude 

PW – If anyone wants to get in touch with you with questions and stuff do you want to?

I’m always happy to answer questions, I participate in the Pyramus and Thisbe online consultation so when questions come through the Pyramus and Thisbe club often directs them toward me, the RICS as well and I’m happy to take questions from surveyors or owners on all aspects of the Act. Where I can help I will I can’t promise that I will provide all the answers, but, I can certainly try.

PW – Your email address is out there, thank you so much.

Links mentioned in this interview:

Michael’s firm: Colliers International UK

Our new Software for Party Wall Schedules of Condition

Our flagship Software for Party Wall Surveyors

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