Episode 158 - *Bonus* ARB New Code of Conduct Consultation Results

This week we will be talking about the ARB’s New Code of Conduct Consultation Results. This episode content meets PC1 - Professionalism of the Part 3 Criteria.

Resources from today's episode:

• https://arb.org.uk/consultations/results/code-consultation-results/?dm_i=4ZCL,10PJF,1J6QNB,4RHCI,1
• https://arb.citizenspace.com/policy-and-communications/consultation-on-guidance-for-the-architects-code/?dm_i=4ZCL,10PJF,1J6QNB,4RN11,1

Guidances:

• https://arb.org.uk/wp-content/uploads/Dealing-with-complaints-draft-for-consultation-1.pdf
• https://arb.org.uk/wp-content/uploads/Professional-indemnity-insurance-draft-for-consultation-1.pdf
• https://arb.org.uk/wp-content/uploads/Terms-of-engagement-draft-for-consultation-1.pdf

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Transcript

Episode 158:

Hello and Welcome to the Part3 with me podcast. 

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I am your host Maria Skoutari and this week is a bonus episode following on from Episode 133 where we discussed the ARB’s New Code of Conduct. Todays episode meets PC1 of the Part 3 Criteria.

Back in September 2024 the ARB launched a consultation proposing a reformed Code of Conduct based on six Standards. The initial consultation has now concluded as of December 2024 and the ARB have released the findings to date with the aim of releasing the new Code in the summer of 2025. 

In todays episode we’ll look at the results of that consultation and what ARB’s next steps are. 

From the consultation, ARB identified:

• That the Code was too weak or lenient in its requirements (91 respondents, 21%) 
• That the Code was too demanding in its requirements (68 respondents, 15%) 
• Suggestions that the structure or format was not suitable (66 responses, 15%) 

Respondents also raised:

• Requests for clarification on the definition of a phrase or word in the Code; 
• Requests for clarification on the Code’s intent, status or implementation; 
• Suggestions which were based on a misunderstanding of the purpose of the Code or ARB’s role;
• Concerns that elements of the Code are unachievable or technically difficult, which included comments on challenges arising from practice size or the role of an architect in the construction sector. 

So from these findings, the consultation highlighted that the two strongest arguments were in essence in contradictions with each other that the Code is too lenient and too demanding. 

To address this, the ARB will release additional guidance and amend some of the language within the Code to provide clarity on both arguments raised. Once the final Code is released, the ARB will explain with it the role and purpose of the new Code and address any misunderstanding about ARB’s role or any suggested topics they believe are better dealt with elsewhere or by other organisations. 

As such, throughout 2025, the ARB will be seeking consultation on guidance documents that will be expanding on matters such as:

• Dealing with complaint and disputes
• Professional Indemnity Insurance
• Terms of Engagement
• Building Safety
• Financial Conduct
• Managing conflicts of interest
• Sustainability
• Equality, diversity and inclusion
• Leadership
• Mentoring
• Raising Concerns  

The guidance documents they are initially seeking consultation which have already been published is the ones relating to:

• Dealing with complaints
• Professional Indemnity Insurance
• Terms of engagement 

The consultation for these will run for six weeks and will close on the 9th of April 2025. Subject to the outcome of the consultation, these three documents will be finalised and published alongside the new Code later this year.

Lets look at these three guidance documents in more detail and what ARB are recommending they cover:

Starting with the first one, Dealing with Complaints:

This document has been developed to support the proposed new standard 4 - Professional Practice. The guidance will provide clarity to architects on how they should deal with a complaint or dispute concerning their professional work. Its not a mandatory document but architects that depart from it will need to be prepared to justify why they did so. 

The guidance provides clarity on how to recognise a complaint, which tends to include:

• Concerns about the quality of design or workmanship
• Issues relating to communication or delays
• Perceived breaches of contract or professional standards
• Allegations of unprofessional behaviour

Then it provides guidance on the complaints procedure itself stating that architect should inform their clients of their complaints procedure through their terms of engagement or initial client care documentation. 

Then the guidance provides details on actually dealing with a complaint by:

• Recognising and acknowledging the complaint promptly
• Explaining who will be dealing with the complaint, and how long it will likely take
• Finding out what outcome the complainant is seeking
• Arrange a meeting if that will help getting the required information
• Ensure that accurate records are kept of the actions, communications and decisions made during the investigation
• Provide a written response to the complaint
• Remain polite and respectful, even when the complainant is not

The guidance then goes a step further to provide some insight on how to deal with unresolved disputes, in which case, the guidance suggests that architects should:

• Seek advice from their professional indemnity insurers
• Consider whether alternative dispute resolution mechanisms, such as mediation or arbitration should be pursued
• Inform the complainant of their right to escalate their complaint to ARB or other relevant regulatory bodies

So that’s the guidance the ARB is currently seeking consultation on regarding Dealing with Complaints. Now lets move onto the second guidance they are currently seeking consultation on, Professional Indemnity Insurance:

This document has also been developed to support the proposed new standard 4 - Professional Practice. The guidance will provide clarity to architects on how they should cover their professional liabilities through PII under the Architects Code of Conduct and Practice. Again its not a mandatory document but architects that depart from it will need to be prepared to justify why they did so. 

The guidance provides clarity in defining Professional Indemnity Insurance and what architects should look out for in terms of the policy terms and conditions in respect of:

• Level of indemnity (the maximum amount the policy will pay out)
• The type of loss that will be covered
• Excess levels (the ‘first’ amount that the insured must pay on a claim before the policy will react)
• Exclusions (areas of architectural practice that will not be covered by the insurance)

Then it expands on the Architects Code of Conduct and Practice that architects should ensure their liabilities are covered by adequate and appropriate professional indemnity insurance so as to avoid expensive litigation processes. Architects should choose adequate insurance levels to meet a claim, taking into account the nature and scope of the work being carried out, and also carefully review the PII policy terms to ensure it meets the practices needs. Consideration should be given to the implications of the date the practice first commenced work and the start date of cover.

The guidance then proceeds to expand on the level of indemnity, whereby under the Code, architects are required to maintain sufficient cover to meet any claims against their practice. Architects should maintain sufficient cover to meet any claims made against their professional practice. The level of indemnity required will vary widely, depending on the scale and nature of the architectural work undertaken. While architects should seek expert advice from an insurance broker, there should be in place a minimum level of indemnity to be £250,000 and that insurance should be acquired on an each and every claim basis. The only exception for this may be in relation to fire-safety claims or cladding claims.

The guidance then continues to expand on what this means regarding Fire Safety and cladding claims:

In recent years its become increasingly difficult for architects to secure professional indemnity insurance in respect of fire safety or cladding claims. Its therefore acceptable for architects to hold professional indemnity insurance on an aggregate basis to cover these types of claims. The guidance then highlights the importance of understanding that having such restricted cover in relation to these areas will not mean that liability is reduces, therefore, architects should take care to manage these risks within their practice. Such policy restrictions should only be accepted where there is no alternative after an architect has taken all reasonable steps to find comprehensive cover. Upon each renewal architects should take all reasonable steps to ascertain whether they are able to remove any such policy limitations, and be able to evidence that they have taken those steps.

Then the guidance continues on to provide direction relating to Uninsured Liabilities:

Advising that if there are new exclusions which apply to historic liabilities, architects should contact former clients to whom the change in policy coverage may affect their ability to bring a claim that is covered by insurance. Also in instances where the insurance cover for existing appointments is no longer available, architects should notify their clients and also inform the ARB to explain the circumstances of their non-insurance. As long as the architect can demonstrate the acted in accordance with the Code and PII Guidance, the ARB will not take regulatory action against them. 

Now in cases of run-off cover, the guidance advises that a principal or director of a practice should take reasonable steps to ensure there is adequate run-off cover in place when they cease practice, wether because of retirement or the closure of a business, in order to cover for work previously undertaken. The run-off cover should be maintained for a minimum of 6 years, this cover should be held at the same level as the last year prior to the cessation of practice. Here is where its crucial for architects to be aware of any liabilities that will extend beyond the normal statutory time-limits, including contracts made as a deed for which the period of liability is 12 years or for claims that can be brought under the Defective Premises Act. 

So as mentioned, in cases of insolvency or closure of a practice, the principal or director of the practice should confirm that run-off cover can be put in place to cover previous liabilities, and to inform their present and previous clients of the position. 

In any scenario, the guidance stresses the importance of architects notifying their insurers of any circumstance that likely to lead to a claim. Architects are responsible for understanding the terms and conditions of their insurance policy in respect of notifications and they should seek advice from their broker if in any doubt as to whether an incident requires referral to the insurers.

So that’s the guidance the ARB is currently seeking consultation on regarding Professional Indemnity Insurance. Now lets move onto the third guidance they are currently seeking consultation on, Terms of Engagement:

This document has also been developed to support the proposed new standard 4 - Professional Practice. The guidance will provide clarity to architects on how they should provide clear, understandable written terms of engagement to their client before commencing work. Again its not a mandatory document but architects that depart from it will need to be prepared to justify why they did so. 

The guidance emphases the importance on adequate terms of engagement for both architects and client, as they:

• Establish a shared understanding of the project’s scope and objectives.
• Provide clarity on fees, payment schedules, and other financial arrangements.
• Define responsibilities and expectations on both sides.
• Offer a basis for resolving misunderstandings or disputes.

The guidance stresses that failure to provide adequate terms of engagement can lead to disputes with clients and difficulties in architects getting paid for the services they have provided. It is the most common cause of complaints about architects to ARB.

As such, the guidance then elaborates on what the requirements for terms of engagement are and that all terms should include either within the document or supplier as additional information on the:

• Details of the contracting parties
• The scope of the services to be provided
• The fee, or method of calculating it
• The architect’s and client’s responsibilities
• Any limitations or exclusions of liability
• Procedures resolving disputes and terminating the agreement
• Confirmation that professional indemnity insurance is held
• That there is a complaints-handling procedure, available on request
• How data will be handled (in accordance with data protection legislation)
• The name of the architect in control and management of the architectural work, and that they are regulated by the Architects Registration Board

Once the terms have been outlined, then architects should always seek to formalise them through recording the terms of engagement in writing and providing a copy to the client, if any amendments are made to the initial terms, these should also be recorded in writing and copies provided to both parties. It is important to receive confirmation from a client that they have understood and agree with the terms proposed. 

In cases where the parties have previously contracted on other projects, it will considered as a new commission and as such will require new terms to be agreed. In all cases, communication should be written in a way that all recipients will understand and architects to be prepared to guide clients through the document. 

Now in cases where the architect is appointed as the Principal Designer, the guidance states that if those duties are to be undertaken, they should be advised of in writing before an appointment is accepted and the architect has advised the client of their legal obligations under the CDM and/or Building Regulations and sought written confirmation from the client that they are aware and have understood those duties. 

So that’s the guidance the ARB is currently seeking consultation on regarding Terms of Engagement. As mentioned, the consultation for these three guidances concludes in April 2025. I will capture the outcomes from the consultation in a future episode. 

Now reverting back to the consultation results regarding the new Code of Conduct itself, the findings showed the majority of respondents more agreed than disagreed with each Standard. 

Standard 1 - Honesty and Integrity received the higher level of agreement with Standard 2 - Public Interest receiving the lowest. Public Interest also had the highest level of disagreement. Standards 3 - Competence, 4 - Professional Practice, 5 - Communication and collaboration and 6 - Respect all received more agreement from respondents regarding their reform and proposed requirements. 

The Guidances also all received more positive than negative views. 

The strong levels of support across each Standard and guidance area mean ARB are confident that these topics are appropriate. As such, they will proceed with each of the proposed Standards and guidance areas. They will publish an updated Code that considers the specific and helpful drafting suggestions received from respondents, particularly those that will help provide clarity.  

In terms of the common themes that respondents raised within their responses included:

• Seeking clarification on the definition of something. 
• Seeking clarification on the intent, status or implementation. 
• Misunderstandings about the purpose of the Code or ARB’s role. 
• Concerns that elements of the Code are unachievable or technically difficult. This included comments on challenges arising from practice size or the role of an architect in reality. 
• Views that the structure of how the Code is formatted or set out is not suitable. 
• That the Code was ‘too weak or lenient’ or, conversely, ‘too demanding’, either in general or on specific topics: safety, sustainability or equality, diversity and inclusion. 

ARB’s view on these was that the consultation helped them gain a better understanding of respondents views and where misunderstandings were evident. As a result, ARB aim to improve the language used in the Code and they will use their regular communications channels to e-mail registrants and gain further feedback prior to releasing the final Code. Which is also why the ARB is consulting on each guidance prior to releasing the final version to ensure the final version are appropriately drafted and address members concerns and feedback.   

As mentioned, the next steps now for the ARB are to seek consultation on the remaining guidance documents once the first one concludes in April and finalise the new Code by the summer of 2025. 

I will keep you updated with forthcoming episode with further news and guidance notes as they are released. 

To sum up what I discussed today:

• Consultation on the Code of Conduct: The Architects Registration Board (ARB) conducted a consultation on a reformed Code of Conduct based on six Standards. The consultation concluded in December 2024, and the ARB plans to release the updated Code of Conduct in the summer of 2025.
• Guidance Documents: The ARB is seeking consultation on guidance documents covering "Dealing with Complaints," "Professional Indemnity Insurance," and "Terms of Engagement." These consultations will close on April 9, 2025, and the documents will be finalised alongside the new Code later in the year.
• Future Consultations: After the initial consultations conclude, the ARB will seek feedback on additional guidance documents covering topics like Building Safety, Financial Conduct, and Sustainability.