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It might be uncomfortable and even against our own immediate interests but if we don’t ‘do the right thing’, we can get into trouble.
Some examples from recent court cases about questionable conduct are discussed below but the key principles are well understood. In business, as a member of a professional institution you must ‘do the right thing’.
This is the test applied by the ICE Code of Professional Conduct. The code is more detailed but this simple obligation is what is required. But if you put your clients interests first and are open and transparent in your dealings you will be doing the right thing and acting professionally.
People may snipe about others failing to ‘do the right thing’ and about what they see as unprofessional conduct. Much of this is trivial or misguided. If people do not get what they want then that is a human thing to do. It does not mean those they have complained about have been unprofessional. However, there are clear edges as to what amounts to misconduct.
For those of us that are involved as dispute resolvers, there is a particularly high benchmark. This especially applies to where there could be any allegation of a conflict of interest.
The Royal Institution of Chartered Surveyors (RICS) provides very detailed guidance. The guidelines are similar for to all professionals acting in a dispute resolution capacity. It is a traffic light system with red, orange and green warnings of the type of issues which arise and might cause a conflict of interest.
The test is not that you have an interest which actually means the objectivity of your judgement is impaired. The test is, would a reasonable person knowing all the relevant facts form a view that you are conflicted? This is a high test.
An extremely experienced adjudicator and arbitrator fell foul of this and ended up being criticised in court following an issue which arose in an arbitration. He was the arbitrator.
During the process, he was quizzed by one party about his involvement with the other party’s representative. He ducked the question and got drawn into an argument with the representative who raised it. It ended up in court, which was stinging in its criticism.
It turned out that the arbitrator had derived a significant portion of his work from the representative on the other side. This amounted to him being paid a very considerable sum of money – £250,000-plus over three years.
That he had not disclosed this initially was bad enough but he then refused to be drawn on it when it was put to him. It also turned out that the representative involved maintained a black list of adjudicators and arbitrators which might have weighed on his mind. The result was he was removed as arbitrator because there was a real possibility of bias and received strong public censure.
However, the obligation to behave properly and ‘do the right thing’ extends beyond the dispute resolver when disputes occur and the parties themselves cannot escape sharp practice.
Two recent examples demonstrate the point:
These cases are all stark reminders of the importance of behaving properly in any business or professional setting but particularly whenever dispute resolution is involved.
Frequently, the right thing is to call in an external dispute resolver either through adjudication or arbitration or to engage in some form of formal dispute resolution.
But in doing so it is also the right thing to ‘do the right thing’.