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Disciplinary Panel Hearings

7 APR 2011

Mr John Hope - 6 April 2011

Case of
John Hope FRICS [0049527], Wiltshire, SN8

on
Wednesday 06 April 2011

at
RICS, Parliament Square, London, UK

Chairman                                            
Lee Gledhill         

Members                                            
Barbara Duffner (Lay)
Peter McCrea FRICS

Legal Assessor
Tony Woodcock               

RICS Representative       
Vicki Buckley

Charges heard

The formal charges are:

  1. You have not at all times avoided any actions or situations that are inconsistent with your professional obligations in that as sole principal of and contact officer for the firm SW Surveys Ltd. you did not arrange for all previous work of the firm to be covered by adequate and appropriate professional indemnity run-off insurance for a period of time following the firm ceasing to trade on 07 July 2009 Contrary to Rule 3 of the Rules of Conduct for Members 2007.
  2. You have not co-operated fully with RICS staff in that you have not provided a copy of the professional indemnity insurance schedule for the firm SW Surveys Ltd. showing run-off cover to be in place requested in writing by RICS on 23 November 2009 and the subject of reminder in letters sent between 15 December 2009 and 24 March 2010 and you did not respond to written correspondence from RICS dated 21 July and 16 August 2010 Contrary to Rule 9 of the Rules of Conduct for Members 2007.

Determination

Findings of Fact

The Panel dealt with two preliminary issues both of which emerged from the case papers.

Firstly, is Mr Hope a “relevant person” for the purposes of the Disciplinary Rules?  The Panel has considered the chronology.  Mr Hope has been a member of the Institution for many years and was a director at the relevant time and the Institution’s contact officer for SW Surveys Ltd.  SW Surveys Ltd was registered as a member firm in 2006.  The company ceased trading in December 2008, but Mr Hope remained a member of the Institution.  He made no attempt to resign as a member until 6 July 2009.  It appears that he retired from practice earlier, but – for the purposes of deciding whether this Panel has jurisdiction - what matters is whether or not he is a member of the Institution, irrespective of whether he practises as such.  Once an investigation has commenced, it is not open to the member to resign until that investigation is complete.  The Panel is satisfied as a matter of fact that Mr Hope is a “relevant person” and that it has jurisdiction to deal with his case.

Secondly, Mr Hope has not attended the hearing today.  The Panel is satisfied that the Institution has complied with the rules relating to service of notice of the hearing and the documents.  It is also clear from the case papers that Mr Hope is aware, and has been aware for a number of weeks, of today’s proceedings.  Accordingly, the Panel is prepared to deal with the matter today.

There has been no admission of the charges in any of the correspondence which Mr Hope has sent to the Institution.  The Panel, therefore, treats the matter on the basis that the charges are denied.

On Charge 1, the Panel heard that, on the application for de-registration of the company, Mr Hope had indicated that it did not have adequate insurance cover (including run-off cover).  This prompted a referral to the Institution’s investigations team, who have made several attempts to analyse his comment further.  Suffice it to say that no evidence of the existence of any type of PI insurance has emerged.  Having regard to the answer on the application for de-registration, and to the failure of Mr Hope to provide any further information in circumstances where it would have been reasonable for him to do so, and where there is no explanation for his failure to do so, the Panel is entitled to treat those failures as evidence in support of the Institution’s case, and it does so.  The Panel accordingly finds that SW Surveys Ltd did not have compliant PI insurance.

That is not the end of the matter.  Mr Hope has no personal obligation to carry run-off insurance.  But Rule 3 of the Rules of Conduct for Members requires individual members not to act in a way which is inconsistent with his professional obligations.  As a director of SW Surveys Ltd, Mr Hope had an obligation to ensure that the company held compliant PI insurance.  He failed to do so.

The Panel finds that Mr Hope is in breach of Rule 3.

On charge 2, Mr Hope was afforded every opportunity to explain his position.  He was asked to provide an entirely reasonable range of information both as regards insurance and other matters.  Although Mr Hope sent letters to the Institution, none dealt sufficiently with the requests for information.  Some of the responses were high-handed and, in substance, amounted to a refusal to co-operate.  The failures spanned a period of nearly 10 months. 

The Panel is satisfied that Mr Hope is in breach of Rule 9 of the Rules of Conduct for Members is proved.   

Panel’s Decision

By reason of the above, the Panel finds that Mr Hope is liable to disciplinary action on both charges.

Penalty

The Panel has had regard to the Institution’s Sanctions Policies.  In accordance with proper practice the Panel has considered each of the sanctions open to it, starting with the least severe.

On charge 1, the obligation to bear PI run-off insurance is fundamental to the protection of the public.  The Institution has a prime obligation to protect the public.  It treats any failure to meet the PI obligation very seriously.  Mr Hope has provided no explanation for the failure.  Clients of SW Surveys Ltd have no recourse in the event that a claim is to be made against SW Surveys Ltd or Mr Hope for alleged professional failures on their part.

The Panel has determined that Mr Hope should be expelled from the Institution on this charge.

On charge 2, each of the requests for information was reasonable.  It is necessary for members to provide all such information required by the Institution for the purpose of carrying out its regulatory responsibilities.  The Institution has no statutory powers to compel the provision of information and places reliance on the co-operation of its members, a responsibility with which most members comply.  The breach is serious because it is an impediment to efficacious regulation.  A breach of this duration on such a fundamental matter is treated seriously.

The Panel has determined that Mr Hope should be expelled from the Institution on this charge also. No lesser sanction was deemed by the panel to meet the seriousness of the breaches.

It also is the fact that Mr Hope has evaded the cost of insurance, something for which he should have planned well before the cessation of practice.  He has accordingly gained financially from his failure.  It would be the wrong message to convey to the membership that expulsion alone will, in all instances, serve as a sufficient penalty where such gain has been made.  The Panel takes the view that it is appropriate also to impose a financial penalty.  It imposes a total fine of £10000. 

Determination on Publication and Costs

The Panel orders publication in accordance with the Institution’s publication policy.

An application for costs is made in the sum of £3558.50.  Those costs are reasonable.  The Panel has been told by the Institution that, had Mr Hope responded to the requests for information, the history of these may have been different.  Mr Hope has brought these proceedings on himself, and the Panel sees no reason why his treatment of the Institution should be subsidised by its compliant membership.  Costs are awarded in full against Mr Hope.

Appeal Period
Mr Hope has 28 days to appeal this decision in accordance with Rule 59 of the Disciplinary, Registration and Appeal Panel Rules.