QUEENSLAND CIVIL AND 
ADMINISTRATIVE TRIBUNAL

CITATION: 
	Valuers Registration Board of Queensland v Murphy [2023] QCAT 86
	
PARTIES:	VALUERS REGISTRATION BOARD OF QUEENSLAND	
	(applicant)	
	V	
	NEIL PATRICK MURPHY	
	(respondent)	
APPLICATION NO/S:	OCR252-18	
MATTER TYPE:	Occupational regulation matters	
DELIVERED ON:	5 January 2023	
HEARING DATE:	18 October 2022	
HEARD AT:	Brisbane	
DECISION OF:	Member Lember	
ORDERS:	The applicant pay the respondent’s costs of the proceedings from 23 March 2022 (excluding any costs incurred with respect to the strike out applications), to be assessed according to the District Court scale. 	
`	PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – DISCONTINUANCE OF OR WITHDRAWAL FROM PROCEEDING – whether costs should be awarded - where late discontinuance of proceeding– where applicant lacked expert evidence to support application 
PROFESSIONS AND TRADES – LICENSING OR REGULATION OF OTHER PROFESSIONS, TRADES OR CALLINGS – OTHER PROFESSIONS, TRADES AND CALLINGS – VALUER – DISCIPLINARY PROCEEDINGS – where referral of disciplinary proceeding to the Tribunal - professional misconduct – where disciplinary proceeding discontinued for want of evidence – where costs order sought

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 6, s 100, s 102, s 105, s 106, s 107
Queensland Civil and Administrative Tribunal Rules 2009 (Qld) r 86, r 87
Valuers Registration Act 1992 (Qld) s 5, s 30, s 44, s 50, s 52, s 59

Allison v General Council of Medical Education and Registration [1884] 1 QB 750
Ascot v Nursing & Midwifery Board of Australia [2010] QCAT 364
Barnett & Anor v Pirrone & Anor [2019] QCATA 166
Beasley v Department of Education and Training [2006] VCAT 2044
Briginshaw v Briginshaw (1938) 60 CLR 336
Bunnings Properties Pty Ltd v Valuer-General; The Trust Company Limited v Valuer-General [2016] QLC 63
Chief Executive Department of Justice and Attorney General v Leach [2012] QCAT 318
Colgate-Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248
Creek v Raine & Horne Real Estate Mossman [2011] QCATA 226
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd [1988] FCA 202; (1988) 81 ALR 397
Gilbert v Valuers Registration Board of Queensland [2016] QCAT 531
Kennedy v The Council of the Incorporated Law Institute of New South Wales (1939) 13 ALJ 563
Mahanthirarasa v State Rail Authority of New South Wales (2008) 72 NSWLR 273
Medical Board of Australia v Wong [2017] QCA 42
Micrac Pty Ltd v Collins & Ors [2021] QCAT 23
Nursing and Midwifery Board of Australia v Clydesdale [2013] QCAT 191
Pillai v Messiter (No 2) (1989) 16 NSW LR 197
Psychologists Board of Queensland v Robinson [2004] QCA 405
Psychology Board of Australia v McEvoy [2017] QCAT 473
Queensland All Codes Racing Industry Board v Abbott (No. 2) [2016] QCATA 49
Queensland Building and Construction Commission v Richardson [2015] QCATA 85
Queensland Racing Integrity Commission v Vale [2017] QCATA 110
Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2) [2010] QCAT 412
Schwede v QBSA [2009] QCCTB 157  
Sweetvale Pty Ltd v Minister for Planning [2004] VCAT 2000
Tamawood Ltd v Paans [2005] QCA 111
Valuers Registration Board v Murphy [2021] QCA 159
Valuers Registration Board v Murphy (No. 2) [2019] QCAT 41
Valuers Registration Board of Queensland v Murphy (No. 2) [2022] QCAT 338
	
APPEARANCES & REPRESENTATION:		
Applicant:	Mr S Templeton of Counsel, instructed by RBG Lawyers. 	
Respondent:
	Mr R Traves KC, instructed by Colin Biggers & Paisley Lawyers 	
REASONS FOR DECISION
What is the application about?
[1]	This is a costs application on a referral of disciplinary proceedings that endured for four years before the applicant sought to withdraw them within a week of the scheduled Tribunal hearing. 
Background
[2]	Following receipt of a complaint, and an investigator’s report, the Valuers Registration Board of Queensland (the Board) decided that Mr Murphy, a registered valuer, had engaged in professional misconduct during Land Court proceedings and sought to reprimand him, that he undertake not to repeat the conduct, and that he pay a financial penalty, and costs. 
[3]	As is his right, Mr Murphy requested the Board refer the matter to the Tribunal, at which time the Board became the applicant in the proceeding.   
[4]	Between the filing of the referral on 19 September 2018 and the scheduled date of the final hearing on 17 October 2022 the parties engaged in something of a dogfight that involved: 
(a)	A strike out application by Mr Murphy filed on 12 October 2018, which was successful at first instance on 25 February 2019; 
(b)	An appeal by the Board to the Appeal Tribunal on 25 March 2019, which on 18 September 2020 confirmed the first instance decision to strike out;  
(c)	An appeal by the Board to the Queensland Court of Appeal on 16 October 2020 which on 6 August 2021 allowed the appeal and remitted the referral back to the Tribunal with an order of costs against Mr Murphy (which have been paid); 
(d)	A further strike out application by Mr Murphy filed 11 November 2021, dismissed at first instance on 22 March 2022; and  
(e)	An unsuccessful costs application by the Board on Mr Murphy’s second unsuccessful strike out, dismissed on 8 August 2022. 
[5]	Once it was determined that the matter might finally proceed on its merits, directions were made that relevantly included the following: 
(a)	Mr Murphy to file and serve his response by 26 April 2022;
(b)	Parties to file a statement of agreed facts and an agreed bundle of documents by 20 May 2022;
(c)	The Board to file and serve its affidavit material including any expert evidence it wished to rely upon at the hearing or advise the Tribunal and Mr Murphy in writing if there is no material to be filed by 10 June 2022;
(d)	Mr Murphy to file and serve his affidavit material including any expert evidence he wished to rely upon at the hearing or advise the Tribunal and the Board in writing if there is no material to be filed by 8 July 2022;
(e)	The Board to file and serve its reply or to advise that there was none to be filed by 22 July 2022;
(f)	The Board to file and serve its submissions by 5 August 2022; and 
(g)	Mr Murphy to file and serve his submissions by 26 August 2022. 
[6]	A two-day hearing was scheduled to commence on 17 October 2022, shortly prior to which the parties again came before the Tribunal in a dispute over whether Mr Murphy ought to be permitted to call one Mr Crawford (an Assistant Member of the Board) as an expert witness despite notice of his proposed involvement not having been given to the Board within directed timeframes, despite Mr Crawford appearing to have a conflict of interest that may render his evidence little to no value, and despite his refusal to give his evidence in writing. 
[7]	I permitted Mr Crawford to give evidence but allowed the Board additional time to produce expert evidence of their own in reply and extended the time for filing and serving submissions. 
[8]	Upon receipt of that expert evidence, the Board conceded its position to Mr Murphy and on 18 October 2022, the Board sought to withdraw the referral (requiring a waiver of compliance with Rule 57A requiring withdrawal in the approved form, which I refused for reasons given at the time). The application was therefore instead dismissed. 
[9]	At the time, the parties also made written and oral submissions on costs. 
[10]	Mr Murphy seeks orders that the Board be ordered to pay Mr Murphy’s costs, to be assessed on the District Court scale:
(a)	from the commencement of the referral (19 September 2018); alternatively
(b)	from 31 May 2022; alternatively
(c)	from 20 June 2022.
[11]	The Board seeks an outcome in which each party bears its own costs. 
[12]	 The decision on costs and my reasons for it follow. 
What is the legislative framework? 
[13]	The Valuers Registration Act 1992 (Qld) (VRA) is an ‘enabling Act’ conferring original jurisdiction on the Tribunal for disciplinary proceedings. However, the VRA only deals with costs where the Tribunal orders the valuer to pay the Board’s costs in the context of a successful disciplinary referral. Therefore, on Mr Murphy’s costs application against the Board, the general position as to costs set out in sections 100 and 102 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act) applies. 
[14]	The starting point in the Tribunal is that each party to a proceeding must bear its own costs. However, the Tribunal can order costs if it considers it is in the interests of justice to do so.   
[15]	In Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2) Justice Wilson (then President) said: 
The phrase “in the interests of justice” is not defined in the Act but is to be construed according to its ordinary and plain meaning, which obviously confers a broad discretionary power on the decision-maker.
[16]	The question is whether the circumstances relevant to the discretion inherent in the phrase ‘the interests of justice’ point so compellingly to a costs award that they overcome the strong contra-indication against costs orders in section 100 of the QCAT Act.
[17]	In deciding whether to award costs in a matter the Tribunal may have regard to factors such as: 
(a)	whether a party to a proceeding acted in a way that unnecessarily disadvantages another party to the proceeding; 
(b)	the nature and complexity of the dispute the subject of the proceeding;
(c)	the relative strengths of the claims made by each of the parties to the proceeding;
(d)	the financial circumstances of the parties; and 
(e)	anything else the Tribunal considers relevant. 
[18]	These factors are not grounds for awarding costs but factors to be considered in determining whether, within the context of the facts and circumstances of each case, the interests of justice require (not merely justify) a costs order.
[19]	Section 105 of the QCAT Act acknowledges that rules may authorise the Tribunal to award costs in other circumstances, including, for example, the payment of costs in a proceeding if an offer to settle the dispute the subject of the proceeding has been made but not accepted.
[20]	Rule 86 of the Queensland Civil and Administrative Tribunal Rules 2009 (Qld) (Rules) provides that:
86 Additional power to award costs if particular offers to settle rejected
(1) This rule applies if—
(a) a party to a proceeding, other than a proceeding for a minor civil dispute, makes another party to the proceeding a written offer to settle the dispute the subject of the proceeding; and
(b) the other party does not accept the offer within the time the offer is open; and
(c) in the opinion of the tribunal, the decision of the tribunal in the proceeding is not more favourable to the other party than the offer.
(2) The tribunal may award the party who made the offer all reasonable costs incurred by that party in conducting the proceeding after the offer was made.
(3) If a proceeding involves more than 2 parties, this rule applies only if the acceptance of the offer would have resulted in the settlement of the matters in dispute between all the parties.
(4) In deciding whether a decision is or is not more favourable to a party than an offer, the tribunal must—
(a) take into account any costs it would have awarded on the date the offer was given to the other party; and
(b) disregard any interest or costs it awarded relating to any period after the date the offer was given to the other party.
[21]	Section 106 of the QCAT Act expressly permits the Tribunal to award costs “at any stage of a proceeding or after the proceeding has ended”.
[22]	If costs are ordered, section 107 of the QCAT Act provides that costs must be fixed if possible, or, if not possible, assessed under the Rules. 
[23]	Rule 87 of the QCAT Rules provides:
87 Assessing costs 
(1) This rule provides for how costs are to be assessed under section 107 of the Act if the tribunal makes a costs order that requires the costs be assessed under the rules. 
(2) The costs must be assessed—
(a) by an assessor appointed by the tribunal; and 
(b) if the tribunal directs the costs be assessed by reference to the scale of costs applying to a court—by reference to the scale of costs directed by the tribunal.
[24]	In Ralacom Pty Ltd the Tribunal ordered indemnity costs, observing: 
[58] The watershed case for awarding costs on an indemnity basis is the judgment in Colgate-Palmolive Co v Cussons Pty Ltd. Following a comprehensive review of the authorities, Sheppard J sets out a number of factors at 257 which may warrant the exercise of discretion, including: 
(i) the fact that proceedings were commenced or continued in wilful disregard of known facts; 
(ii) the making of allegations which ought never to have been made; 
(iii) the undue prolongation of a case by groundless contentions; 
(iv) evidence of particular misconduct that causes loss of time to the Court and to other parties; and 
(v) imprudent refusal of an offer to compromise. 
[25]	In that case, although the applicants were not legally qualified, their conduct in pursuing their application when they ought to have understood that it was futile, was found to have “bordered on the inexplicable”, resulted in the respondent incurring unnecessary costs and their persistence with the proceedings, after an interlocutory decision was made that suggested they should not, was found to be “unreasonable and irresponsible” and justified an order on an indemnity basis.
[26]	In Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd Woodward J said:
I believe that it is appropriate to consider awarding `solicitor and client' or `indemnity' costs, whenever it appears that an action has been commenced or continued in circumstances where the applicant, properly advised, should have known that he had no chance of success. In such cases the action must be presumed to have been commenced or continued for some ulterior motive, or because of some wilful disregard of the known facts or the clearly established law.
[27]	In Barnett & Anor v Pirrone & Anor the Appeal Tribunal ordered indemnity costs on a withdrawal, finding that the withdrawing party had not acted reasonably in commencing and maintaining the proceedings.  In that case, the withdrawal occurred at a late stage and after repeated warnings at directions hearings that the Tribunal lacked jurisdiction in respect of part of the claim.  Costs were ordered from when the applicant should have known that the application was misconceived, which was eighteen months after proceedings commenced.  
[28]	In Micrac Pty Ltd v Collins & Ors the Tribunal was not minded to award costs in a retail shop lease dispute where the application was withdrawn at an early stage but after the respondent had taken steps in the proceedings. The early withdrawal was important to the Tribunal’s decision, but the Tribunal was also not satisfied that the applicant acted unreasonably in commencing proceedings. 
[29]	In Medical Board of Australia v Wong with respect to another body with similar functions, in refusing a costs application against the board, McMurdo JA said: 
..it must be kept in mind that the board has a statutory responsibility for the protection of the public and the fact that the outcome was not that which was sought should not of itself burden the board with an order for costs, especially in a proceeding in QCAT where the starting position is that prescribed in section 100. 
[30]	Her Honour observed the mandatory nature of section 193 (which required the board to refer the matter upon forming a reasonable belief of professional misconduct) on the question of whether the proceeding was properly brought and noted that the board was bound in that case to commence proceedings because it formed the requisite belief. 
Did the Board act in a way that unnecessarily disadvantaged Mr Murphy in the proceeding? 
[31]	This factor refers to conduct that occurs in a proceeding, as opposed to any that took place prior to the commencement of the proceeding. However, conduct prior to the proceeding would fall under a consideration of “any other factor the Tribunal considers relevant to its decision on costs” under section 102(3) of the QCAT Act and I address that earlier conduct here, for convenience, on that basis. 
A. The changing nature of the Board’s role prior to and during proceedings
[32]	As I mentioned in Murphy No 2 the Board administers the VRA and plays an important protectionist role in ensuring that registered valuers are and remain fit and proper, appropriately qualified, educated, and experienced and in acting on conduct complaints to safeguard consumers of valuation services.  
[33]	Prior to the Tribunal’s involvement in the disciplinary proceedings, the VRA permits the Board to authorise an investigation of a complaint made to it about a registered valuer, with the investigator to give a written report to the Board on the investigation. 
[34]	Once the report had been considered by the Board, if the Board “reasonably considers that a valuer has engaged in professional misconduct” it could refer the matter to the Tribunal, take disciplinary action against the valuer under section 51, or take no further action. 
[35]	Before acting against a valuer under section 51, the Board must give to the valuer written notice of its intention, and the proposed action cannot proceed if the valuer requires the matter be referred to the Tribunal. 
[36]	The Board submits that it was bound to refer the proceedings to the Tribunal to fulfil its statutory obligation after having been required to do so by Mr Murphy, but this is, respectfully, incorrect, and represents an apparent departure from their earlier concession to the Court of Appeal, noted by Mullins JA as follows (emphasis added): 
The board accepts the respondent’s contention that, as a result of the request made by the respondent to refer the matter to QCAT, it was open to the board in reliance on s 24AA of the AIA to reconsider the course of action the board proposed to take in respect of the respondent pursuant to s 50(2) of the Act. 
[37]	Upon receipt of the valuer’s request to refer the Board in fact could: 
(a)	refer the matter to the Tribunal in accordance with the request; or
(b)	reconsider the decision to find professional misconduct and take disciplinary action and, in doing so: 	
(i)	affirm the original decision and proceed to refer the matter to QCAT in accordance with the request;
(ii)	find that there was no professional misconduct;
(iii)	find that there was professional misconduct and decide to take no further action; or
(iv)	amend the original decision, find that there was professional misconduct and decide to take action that was different to the original decision. 
[38]	This distinguishes this case from that of Wong on the question of whether the Board was bound to commence the proceedings. 
[39]	Importantly, once the Board referred the matter to the Tribunal: 
(a)	the potential consequences for a registered valuer under section 59(1) of the VRA are more significant than if the Board takes disciplinary action pursuant to section 51(1); 
(b)	accordingly, section 59 requires the Tribunal to be positively satisfied that the valuer “has engaged in professional misconduct” before it can make any orders (which differs from the “reasonably considers” standard required of the Board to issue notice); and
(c)	the Board, as the applicant regulator in disciplinary proceedings, was expected to be a ‘model litigant’ and, like any other administrative body, was obliged to try to avoid rather than pursue litigation wherever possible. Demonstrating professional misconduct is a demanding onus to discharge. The Board was compelled to be cognisant of the matters refer to in sub-paragraphs (a) and (b) above and to consider, in the exercise of its statutory functions, the merit in pursuing the application to those higher standards. 
B. The standard of proof for a finding of professional misconduct once before the Tribunal
[40]	As there is no definition “professional misconduct” in the VRA, the common law definition applies.
[41]	That test, summarised as regards certifiers in Schwede v QBSA states that: 
…professional misconduct is a very serious matter: it is conduct that shows serious incompetence, lack of knowledge, judgement, integrity, diligence or care;…it is corruption in the sense of seeking or taking benefits in return for breaching the regulating act…; it is defiance of the orders of the tribunal or the BSA; it is fraud, dishonesty, unethical and improper conduct.
…professional misconduct is misconduct of a nature and seriousness that a private certifier in good standing would regard as disgraceful or dishonourable and which warrants severe disciplinary action.
[42]	In Allison v General Council of Medical Education and Registration Lopes LJ expressed the test as: 
…if it is shown that a medical man, in the pursuit of his profession, has done something with regard to it which would be reasonably regarded as disgraceful or dishonourable by his professional brethren of good repute and competency, then it is open to the General Medical Council to say that he has been guilty of infamous conduct in a professional respect.
[43]	In Kennedy v The Council of the Incorporated Law Institute of New South Wales Rich J said that professional misconduct by a solicitor:
…amounted to grave impropriety affecting his professional character and was indicative of a failure either to understand or to practice the precepts of honesty or fair dealing in relation to the courts, his clients or public. 
[44]	Rich J distinguished such conduct from that which, although a lapse from propriety, was not inconsistent with general professional fitness and habitual adherence to moral standards. 
[45]	The Tribunal in Gilbert v Valuers Registration Board of Queensland [2016] QCAT 531 endorsed the tests in Allison and Kennedy in disciplinary proceedings under the VRA.
[46]	In Psychologists Board of Queensland v Robinson the Queensland Court of Appeal said the test to be applied is whether the conduct violated “to a substantial degree” the standards observed by members of the profession of good repute and competency.
[47]	In Pillai v Messiter (No 2) Kirby P said:
The statutory test is not met by mere professional incompetence or by deficiencies in the practice of the profession. Something more is required. It includes a deliberate departure from accepted standards.
[48]	The requisite standard to which the Tribunal must be satisfied under section 59 is the balance of probabilities, albeit to a sliding scale. According to Justice Dixon in Briginshaw v Briginshaw: 
The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding, are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters “reasonable satisfaction” should not be provided by inexact proofs, indefinite testimony, or indirect references.
[49]	It is generally accepted that a finding of professional misconduct leads to serious consequences.  
[50]	Decision-makers assisting the Tribunal in disciplinary proceedings must conduct themselves in a manner that recognises the seriousness of the proceeding.
C. The importance of peer/expert opinion
[51]	The Board’s decision to discontinue the proceedings occurred in circumstances where:
(a)	on 31 August 2022 it received a summary of evidence of expert (and Assistant Board member), Alan Crawford in which it was said that Mr Crawford would give evidence of his opinion that Mr Murphy’s conduct did not amount to a breach of rule 3.1(c) of the API code and did not amount to professional misconduct; and 
(b)	on 7 October 2022, it received its own expert report of Mr Ross Perkins, in which he opined that Mr Murphy acted in breach of rule 3.1(c) of the API Code; however, that this conduct did not amount to professional misconduct.
[52]	Essentially therefore, the case turned on peer/expert evidence. 
[53]	The difficulty for the Board being, as I see it, that this issue was made known to the Board by its investigator as early as 6 June 2017 when at paragraph 50 of his first report he said (emphasis added): 
In my view whether there was arguable misconduct in the conduct by Mr Murphy of the Bunnings appeal in the Land Court. That question is to be answered by asking whether a competent valuer acting reasonably as an advocate in those proceedings) before an expert valuation tribunal would do what he did…
[54]	On the question of peer opinion concerning conduct generally, the Tribunal and its predecessors have relevantly held: 
(a)	the conduct in question “must be assessed against the reasonable expectations of the public and his professional peers”; and
(b)	expert evidence is not required to establish the standard which might reasonably be expected; however,
(c)	whether the conduct complained of is of lesser standard than that reasonably expected is a question of fact that will need to be established by evidence.
[55]	The Board’s own submissions in response to the second strike out application in February 2022 acknowledge both the importance of expert evidence and suggest that it will be led (emphasis added): 
36. Similarly, while it may be accepted, as Mr Murphy submits at paragraph 24, that rule 3 of the API Code does not impose a blanket prohibition upon valuers from acting as advocates in all matters, there is a factual dispute about whether it is “common practice”, and, in particular, whether it is common practice for a member of the same firm to be involved as an expert in the same matter as discussed in the next paragraph, the board, which is constituted by majority registered valuers, does not hold the view that such practice is standard or common. Consequently, that factual issue which is important to the resolution of the issue of whether Mr Murphy’s conduct was improper, is a contested one upon which evidence will be led. It is therefore not competent to dismiss the referral summarily.
37. Mr Murphy’s submission at paragraph 26 with respect to Mr Savage QC’s conclusion does not tell the full story. Mr Savage QC’s advice dated 5 October 2017 was predicated on an assumption that it was standard practice for valuers to appear as advocates in circumstances similar to Mr Murphy, and then withdraw in favour of a barrister who is obliged to obtain the services of another member of the same firm as an expert. The board (which must be 3/5 constituted by valuers) did not accept that it was standard practice. Mr Savage QC’s advice dated 8 January 2018 did not express a view about whether Mr Murphy’s conduct amounted to professional misconduct, but rather indicated it would be necessary to receive a further submission from him before reaching a conclusion…
38. …The only available conclusion is that at the very least the board’s case is arguable, and there are questions of fact which may only be resolved after competing evidence is led, and tested, by the parties.
[56]	On 22 March 2022 the Board reiterated its intention to call expert evidence and insisted that: 
A close examination by way of evidence presented and tested and findings of fact are necessary to either support or refute Mr Murphy’s allegations.
[57]	By 15 June 2022, the Board became aware that their intended expert, Ross Perkins (who they first approached on 9 June 2022) was unlikely to be available to give evidence before 30 June and observed in a letter to Mr Murphy’s solicitors that, despite numerous attempts to identify valuers with appropriate expertise and relevant experience, some original proposed valuers were rendered unsuitable on account of unavailability and lack of recent relevant experience and some potential experts had ruled themselves out on the basis of the conflict of interest. 
[58]	Ultimately, the Board did not obtain evidence from Mr Perkins until around 11 October 2022 and only then in response to Mr Murphy being granted leave to call Mr Crawford to give expert evidence.  
[59]	The Board have simply not explained in any submissions why they did not make an early choice to review the merits of the referral, source evidence to support their position or to reconsider their decision once it was known, from when Mr Murphy requested the referral, that: 
(a)	section 59 of the VRA would be engaged, which required both a higher standard of proof and a positive finding that the valuer had engaged in professional misconduct, moving the Board well beyond a “reasonable belief” that misconduct may have occurred; and 
(b)	the case would turn on expert/peer evidence which they did not instruct the investigator to obtain during the investigation, nor seek in the proceedings until very late in the piece. 
[60]	The Board submits that it acted reasonably in commencing and in continuing the proceeding until the expert evidence came to hand in October 2022 based upon:
(a)	a Member of the Land Court, in a judgment in proceedings in the Land Court, expressed concerns about Mr Murphy’s conduct in acting as an advocate in proceedings where he proposed to rely upon expert evidence from another member of his own firm;
(b)	an investigator appointed by the board concluded, after receiving detailed submissions from Mr Murphy, that an arguable case of a breach of the API Code is made out and that such breach constitutes misconduct; and
(c)	Mr Murphy failed in his strike out applications. 
[61]	I do not accept any of these submissions, addressing each in turn: 
(a)	The Land Court 
(i)	The complaint to the Board that triggered the investigation attached a copy of the Land Court decision and complained of: 
A.	Misconduct in a professional respect; and
B.	Breach of the API Code.  
(ii)	The Land Court observations regarding Mr Murphy were that: 
It does appear on the face of it that the manner in which these appeals have been conducted is contrary to the Code of professional conduct which is sought to be imposed on members of the Australian Property Institute.
(iii)	The observation of a prima facie ‘appearance’ of conduct contrary to the Code is merely that - an observation, and an untested one at that.  It was made without notice or submissions. Mr Murphy is correct when he submits that such an observation, whilst it may (and, in my view, did) form a reasonable basis for an investigation, could never form a basis for concluding that there had been a breach of the Code or professional misconduct.  
(b)	The Investigation
(i)	As mentioned, the VRA permitted the Board to authorise an investigation of the “suspected contravention” of the API Code. 
(ii)	According to the Merriam-Webster dictionary, “investigate” means to “to observe or study by close examination and systematic inquiry”. According to the Cambridge Dictionary it means to “examine something carefully, especially to discover the truth about it”. 
(iii)	The brief to the investigator on 12 May 2007 variously included the following relevant instructions (emphasis added): 
Complaint
…The specific allegations made in the complaint appear to be based on the comments made by Member Cochrane and specifically paragraphs 117-128 of that decision when Member Cochrane suggests that there has been a breach of the Australian Property (API) Code of Professional Conduct.
Investigation
The Board requests that you conduct a desktop investigation to provide your legal opinion as to whether the valuer may have engaged in professional misconduct… in the person’s performance as a valuer within the meaning of section 50(1) of the [VRA].
…It may be necessary for you to provide an opinion on whether an apparent breach of the code of conduct may also amount to professional misconduct...
Report
…The report should set out the facts and your findings about the complaint and whether the complaint is made out.
To report on your findings please use language that shows whether or not the valuer under section 50(1) of the [VRA] has engaged in professional misconduct…in the person’s performance as a valuer.
(iv)	The investigator’s first “Memorandum of Advice” on 6 June 2017 (where he first raises the issue of peer evidence) observed that: 
A.	Mr Murphy “has a good case to answer concerning professional negligence in the conduct of a proceeding in the Land Court” but suggested that Mr Murphy make submissions on who undertook certain steps in the Land Court proceedings and when those steps were undertaken before any conclusions are reached; and 
B.	If there wasn’t an adequate explanation of those matters, “it is impossible to exclude the prospect that Mr Murphy as a valuer acting as an advocate may have neglected his professional obligations…”.
(v)	In his subsequent Memorandum of Advice dated 5 October 2017, following submissions from Mr Murphy, the investigator notes: 
A.	At paragraph 9 that he had no doubt that what Mr Murphy did in the instant circumstances was both in the client’s interests and in accordance with usual practice; 
B.	At paragraph 10 that: 
I.	it remained to be seen whether the usual practice is in accordance with rule 3 of the API Code; but
II.	he found no breach of the Code; and 
III.	he was unable to see how it is offensive to perform as a valuer in a way that valuers have historically performed without complaint in Queensland.
C.	At paragraph 11 that: 
As I understand it (and I stand to be corrected by those with more knowledge of practice than I) that is the standard practice. It would be surprising if a standard practice of long-standing amounted to professional misconduct. Especially would that be so when no professional guidance had been given to valuers generally appearing by rule of court or otherwise that practice was not to be adopted.
D.	At paragraph 12 that, although not unarguable on balance, prosecution of the complaint against Mr Murphy is not warranted.
(vi)	The Board then addressed a letter to the investigator on 17 November 2017 in which they say that the narrow issue to be determined is “whether the actions as described by Member Cochrane in his decision dated 2 November 2016 amount to a breach of the API Code and, or, an act of professional misconduct”.
(vii)	They state: 
As read, the Board understands your advice to be based on the assumption that the actions of these valuers were standard practice and because of that, not a breach of the Code. That assumption is incorrect. 
(viii)	The Board go on to inform the investigator that the Land Court commented that the actions of the two valuers in question amounted to a breach of Rule 3 (this overstated the Land Court’s remarks) and that the Board “does not consider the actions of these valuers to be standard practice”. It is not clear on what basis the Board formed its definitive view as to the “standard practice” of valuers.  The only evidence led on point seems to rely upon the Board’s constitution of “3/5 registered valuers” although, according to Board minutes, one of those three recused themselves from all discussions regarding Mr Murphy’s matter and it is not clear why the remaining two considered themselves as representative of the definitive opinion on industry practice. Certainly, the ultimate outcome in the proceeding did not support the Board’s position.   
(ix)	The Board’s letter concludes by asking the investigator to consider the information obtained from his investigation and to advise whether, among other things, the conduct of Mr Murphy amounted to a breach of rule 3, and if he was not in breach, the reason for that finding and if he was in breach, whether such conduct amounted to professional misconduct “in light of this not being the standard practice of the profession”.  In doing so, the Board asked the investigator to proceed on an assumed fact that they knew Mr Murphy contested. 
(x)	In response to that correspondence, the investigator produced a further report dated 5 January 2018 in which he says in paragraph 10 that (emphasis added): 
A breach of the API code as suggested here if it in fact exists may amount to professional misconduct because Mr Murphy was a member of the API and therefore bound by the code of conduct published by the Institute, alternatively because publication of the Code is evidence of the standards expected of valuers in the way set out in the Code.
(xi)	The investigator, however, remained of the view that he did not think the conduct the subject of the complaint constituted a breach of the Code.  In paragraph 15 he observes Mr Murphy’s submissions that he did no more than act in accordance with standard practice of the profession, and comments that the standard practice of the profession of valuers is something that he did not understand to be controversial until the Board’s most recent letter.
(xii)	In paragraph 17 he says if he were to assume that it is not the standard practice of valuers acting as advocates in the Land Court to do what Mr Murphy did, then it would merely be open to conclude that Mr Murphy’s actions amounted to professional misconduct. 
(xiii)	In reply, the Board sent a further letter to the investigator on 25 January 2018 firmly stating that: 
This issue is not controversial.
It is not standard practice for two members of the same firm to act as advocate and expert witness in the same matter. The standard practice of valuer advocates is in accordance with rule 3.1(c) of the API Code.
The board is seeking your advice on the effect of the breach rather than Mr Murphy’s assessment on whether his conduct resulted in professional misconduct or some other offence under the VRA and regulations.
(xiv)	This represented a significant departure from the original brief that sought an investigation into whether a breach had occurred. The investigator had, until that point, stated that a breach had not occurred. Nonetheless, the Board simply asked for advice on “the effect of the breach”.   
(xv)	The investigator’s Final Report dated 23 February 2018 concluded: 
Mr Murphy’s appearance as an advocate before Member Cochrane was based upon his receipt of expert opinion which was to be used to advance his application to amend on behalf of his clients. That expert opinion came from another member of the firm. 
It follows in my view that an arguable case of a breach of the code of professional conduct is made out. A breach of the code of professional conduct constitutes misconduct. A case of professional misconduct constituted by those (and only those) facts is made out on material that I reviewed in this investigation.
(xvi)	In summary therefore: 
A.	A complaint was made based upon a suggestion of the Land Court that it appeared that Mr Murphy may have acted contrary to the API Code;
B.	On 12 May 2007 an investigator was tasked with undertaking a desktop investigation to provide an opinion as to whether, based upon the circumstances in which that suggestion was made, a breach of the API Code had occurred and whether in those circumstances Mr Murphy may have engaged in professional misconduct under section 50(1) of the VRA; 
C.	The final instruction to the investigator on 25 January 2018 directed that the investigator assume the Board’s position as to the standard practice of valuers (even though this was without basis and a contested issue), assume a breach of the API Code had occurred (even though this was originally part of the investigator’s brief to determine and the investigator had made a contrary finding) and sought “advice” on the effect of that breach; and
D.	Even in the face of that limited instruction, the report only found that there was an “arguable case of a breach of the Code” but suggested, without explaining the basis of the finding, that such breach constitutes professional misconduct under section 50. 
(xvii)	It was not reasonable for the Board to rely on that Report without reconsidering the weight it might carry upon a referral to a jurisdiction in which the relevant test was that set out in section 59 rather than section 50, with the onus upon the Board to establish its case to the Briginshaw standard where the consequences to the respondent were serious.
(xviii)	Moreover, the Board’s ongoing communication with the investigator inappropriately narrowed the focus of the investigation and ultimately required the investigator to assume critical facts and circumstances that they knew were contested and ought appropriately to have been the subject of examination and further inquiry and evidence.  They made a mockery of the investigative process and fatally tainted the report in doing so. 
(c)	The strike out applications  
(i)	The failure of the strike out applications bears no relevance to the Board’s decision whether to continue the substantive claim.  The test applied to strike out applications is entirely different as: 
A.	the power to strike out ought only to be exercised “sparingly” and “when a claim is groundless or futile”;  
B.	the Board needed only to establish an “arguable” case to defeat the applications; 
C.	the lack of any cause of action must be very clear to support a strike out; and
D.	the Tribunal needs to be satisfied to a “high degree of certainty about the outcome” to strike the proceeding out. 
(ii)	Even if the Board were considered unlikely to succeed on an issue of fact, in circumstances where there are factual issues in dispute and capable of dispute, summary dismissal will not be granted.
[62]	The Board did not obtain any further evidence, advice or opinion beyond the investigators report until Mr Perkin’s evidence of 11 October 2022.  Considering these circumstances, the Board therefore does not appear to have: 
(a)	properly considered the merits of the referral under section 59 (as opposed to under 50) to the final hearing standard (as opposed to the standard that applied during the various strike out applications that were filed); or 
(b)	if it did, reconsidered those merits when it became obvious that it could not or would not lead expert/peer evidence.
[63]	Additional conduct by members of the Board convinces me that they did not conduct themselves in these proceedings, or towards Mr Murphy prior to the referral in a manner befitting a model litigant: 
(a)	Firstly, when the investigator referenced the Board’s communication in his final report, Mr Murphy’s solicitor was prompted to ask the Board for a copy of all instructions given to the investigator, communications exchanged with Mr Savage, submissions made to the investigator and any other notes or documents provided to him. Internal Board emails exchanged at the time included comments by a Board member that:
I have an element of discomfort in providing all of the material that has been requested…While the request sounds very cordial, I’m reluctant to provide too much ammunition that can potentially be used against the board in any subsequent action by Mr Murphy. 
…my preference would be to provide the very minimum that we are “required” to provide, rather than to give everything we have. 
While I suspect this matter will simply not fade away, I would prefer that we do not make it too easy for Mr Murphy to take action against the board, with the benefit of information that we were not legally obliged to provide.
(b)	The comments were supported by a responding Board member and were made at a time when the Board had received the investigator’s report and were required to consider it and any submissions by Mr Murphy when deciding whether to take disciplinary action against Mr Murphy. That they viewed their communications with the investigator as potential “ammunition” to be used against them is telling.  It infers that the Board did not consider the investigation as a process of examination, inquiry, or discovery or truth, but rather a step in a conflict or battle with Mr Murphy that they were determined to win.  
(c)	Secondly, on 15 February 2021 internal communication between members of the Board who wanted to redraft Rule 3 acknowledged that its provisions weren’t clear and went on to say that they were having trouble redrafting it:
Conflict of interest provisions – API Rule 3. 
We felt these provisions were unclear – for example, rule 3.2 prohibits any conflict by requiring a member to ensure one does not arise and the balance of the clause attempts to address what happens if it does. 
(d)	Yet, the Board continued to pursue Mr Murphy in disciplinary proceedings in seeking to establish a breach of that rule sufficiently serious to constitute professional misconduct. 
(e)	Finally, as late as 24 May 2022 the Board asserted that it had “strong prospects of obtaining a finding of professional misconduct at the hearing of the referral” and objected to Mr Murphy’s then current offer to settle on the basis that “the terms of the offer do little more than require the Board to effectively capitulate from its position”. 
(f)	Again, the Board in the proceeding ought not to have acted doggedly or inflexibly.  They did, ultimately, capitulate their position because they could not source any evidence to support their case.  
[64]	On balance, I am satisfied that the Board acted in a way that disadvantaged Mr Murphy in the proceedings.  As an “other relevant factor” I find that the Board acted in a way that disadvantaged Mr Murphy prior the proceedings in such a way that lead to the referral of the proceeding in circumstances where such litigation ought to have been avoided. 
[65]	This conduct also, ultimately, consumed the resources of the Tribunal unnecessarily, and caused loss of time, reputation, and legal expenses to Mr Murphy. The Tribunal’s resources serve the public, not just the parties to the proceedings.  
[66]	This factor favours an award for costs in Mr Murphy’s favour. 
The relative strength of the parties’ claims
[67]	As Justice Carmody observed in Queensland Racing Integrity Commission v Vale: 
The expression “relative strength” contemplates a “substantial disparity between the strength of one claim and the weakness of its competitor”. A high level of un-tenability rather than mere tenuousness is envisaged.
It is unlikely that this criterion alone would call for a costs order where there was a real issue to be tried and real justification for the claims made on either side, however the ultimate test is still whether justice requires the costs order or not.
[68]	To a large extent I have addressed the flaws in the Board’s position from the outset, in addressing the conduct of the Board (from paragraphs 31 onwards) and I am satisfied following that examination that the Board did not act reasonably in taking the disciplinary action (which triggered the referral) and made no attempt to satisfy itself in doing so that it had or could source evidence to support its case.  On the contrary, Mr Murphy’s position was put to the Board’s investigator comprehensively, he maintained it throughout and was supported by expert evidence.   
[69]	Ultimately Mr Murphy says, and I agree, that: 
The conclusions of the Board’s expert, which were consistent with the views of Mr Crawford, demonstrate that the Board’s case was ultimately bound to fail. The jurisdiction of the Tribunal to make orders is founded on a finding of professional misconduct. In the end, the Board led no evidence to that issue; and the only evidence it obtained was, consistent with Mr Murphy’s evidence, to the contrary. This was not a close-fought matter which could have gone either way. The tragedy (for Mr Murphy, who has now spent years of his life carrying the burden of this case) is that it took the Board so long to investigate the matter sufficiently to realise that its case was bound to fail.
[70]	This factor favours an award of costs in Mr Murphy’s favour.
The nature and complexity of the dispute the subject of the proceeding
[71]	As mentioned, it is generally accepted that a finding of professional misconduct leads to serious consequences.  I accept Mr Murphy’s submissions that the case was of considerable importance to him. The sanctions that the Tribunal might have imposed under section 59(1) of the VRA would have had serious ramifications for Mr Murphy.
[72]	The proceedings did involve considerable legal complexity including a proper construction of an ambiguous provision of the API Code, and analysis and application of the common law in relation to professional misconduct, including a consideration of relevant industry practice in 2016 in a niche profession.
[73]	In those circumstances, it could not be said that Mr Murphy acted unreasonably in retaining solicitors and counsel to defend himself. The Board also retained solicitors and counsel.
[74]	In Tamawood Ltd v Paans, referring to the like provisions of the Commercial and Consumer Tribunal Act 2003 (Qld), it was determined that where each party was justified in engaging the services of legal representatives to assist them in the conduct and defence of complex proceedings, that alone could be a sufficient basis to conclude that the interests of justice warranted the exercise of the discretion to award costs in favour of the successful party, at least in the absence of any countervailing consideration. 
[75]	Keane JA concluded that in the absence of countervailing considerations, where a party has reasonably incurred the cost of legal representation, and has been successful before the Tribunal, it could not rationally be said to be in the interests of justice to allow that success to be eroded by requiring that party to bear the costs. 
[76]	Mr Murphy had, in any event, a right to legal representation in the proceeding by virtue of section 54 of the VRA.  
[77]	I am satisfied that the nature of the proceedings, and their complexity, warranted legal representation, and this factor favours a costs order in Mr Murphy’s favour. 
The financial circumstances of the parties 
[78]	The Board submits that it is self-funded by the contributions of members and that any order against it will bring hardship to the organisation. According to its annual report for the 2020 to 2021 financial year registration fees levied on valuers accounted for $388,457 of the Board’s total income of $411,839. Its net equity position was $336,625. Its financial position post 30 June 2021 was not the subject of evidence. 
[79]	As to Mr Murphy’s financial circumstances, oral evidence was given to the effect that Mr Murphy has, net of GST and tax savings, effectively self-funded his legal costs in the sense that they were met by his employer but deducted from his profit-share/drawings/dividend entitlements from the business. 
[80]	 No evidence was put as to his overall financial position or his ability to bear these expenses. Therefore, there is no material to support a conclusion that Mr Murphy cannot meet his legal costs or that a failure to award costs will cause him excessive hardship.  
[81]	This factor does not favour an award for costs.
Other relevant factors - offers
[82]	One additionally relevant factor is whether a settlement offer was made, and that the outcome was not more favourable than the terms of the offer.
[83]	Mr Murphy made three offers to settle the matter, which were refused by the Board:
(a)	The first, dated 11 May 2022 offered to resolve the proceeding on the basis, inter alia, that the Board would not enforce the costs order made by the Court of Appeal. The Board says the dismissal of the application by the Tribunal is more favourable than this first offer because the Board retained the benefit of the costs order made by the Court of Appeal. 
(b)	The second, dated 31 May 2022 offered to resolve the proceeding on the basis that the referral be dismissed by consent on the basis that each party bear its own costs, with the Board to issue a guidance note in a form drafted by the respondent and the respondent to undertake to comply with the guidance note. Again, the Board says the dismissal of the proceedings is more favourable than the respondent’s offer because the Board has not been (and could not be) ordered to issue a guidance note in the terms proposed by the respondent.  Whilst this is technically correct, the offer appears to have been made as an “assist” to the Board – to clarify a known inconsistency in rule 3 for the benefit its members. It is not clear why, other than on principle because the proposed author was subject to disciplinary action, this offer was rejected or why the Board didn’t counter-offer to resolve the matter on the same terms, save for that the Board would draft or redraft the guidance note, or without the guidance note at all. 
(c)	The third (responding to the Board’s offer by letter dated 11 October 2022 to withdraw the proceedings on the basis that the there be no order as to costs) offered to have the proceeding dismissed by consent with the Board to pay Mr Murphy’s cost of the proceeding fixed in the sum of $146,000.  
[84]	On the evidence currently before me I cannot find that rule 86 of the QCAT Rules is engaged with respect to any of the offers, nor whether it was unreasonable for the Board to reject those offers.  
[85]	This factor does not favour an award of costs. 
What do the interests of justice require? 
[86]	I find that the fatal flaws in the investigative process – solely attributable to interference by the Board, the Board’s over-statement of the Land Court’s observations, its continued over-reliance upon those observations after the tainted investigation concluded, the serious nature of the proceedings and the demanding onus that fell to the Board to satisfy the Tribunal that Mr Murphy had, in all the circumstances, engaged in professional misconduct (even if he had breached the API Code, which was not established), the known ambiguity of rule 3 and the known requirement for and importance of peer/expert evidence in the proceeding, the Board’s failure to obtain such evidence until a week prior to the final hearing of proceedings that had been on foot for four years and the fact that such evidence, once obtained, supported the position that Mr Murphy comprehensively put and consistently maintained from when he first responded to the investigator, suggest that, on balance, the matter against Mr Murphy should not have been referred or, if the Board at the time considered it was bound to refer (a position it later conceded was incorrect), it should not have pursued in light of its limited prospects of success and the likely cost to both sides.
[87]	In those circumstances, the interests of justice require that Mr Murphy have his costs of the proceedings (excluding the strike out applications) paid by the Board. 
The costs to be awarded 
[88]	Mr Murphy does not seek indemnity costs but submits that the complexity of the proceeding and its prolonged nature warrant the assessment of costs at the District Court scale. I agree with this submission and award costs to be assessed on that basis. 
The date from which costs should be awarded
[89]	Mr Murphy seeks costs from alternate dates being: 
(a)	from the commencement of the referral (19 September 2018); alternatively
(b)	from 31 May 2022; alternatively
(c)	from 20 June 2022.
[90]	The costs submissions also seek “the costs of responding to the investigation” although the source of any power the Tribunal is said to have to do so has not been cited in any submissions. Section 102 permits the power to award the costs of the proceeding.  The proceeding commenced upon referral; therefore, it is not possible to award costs incurred prior to that date. 
[91]	In my view, the interests of justice require the award of costs incurred by Mr Murphy to respond to the substantive proceedings. Whilst this ordinarily would have been calculated from the commencement of the referral, Mr Murphy brought two separate strike out applications, each of which were, ultimately unsuccessful at considerable cost to him. These actions necessarily contributed to the delay in the substantive proceedings being brought on, responded to and concluded and are, in any event, the subject of their own costs orders. 
[92]	Mr Murphy’s response in the proceedings was only filed on 4 May 2022 after these interlocutory steps that he initiated were exhausted and, therefore, on my reckoning, Mr Murphy began to incur costs in the substantive proceedings immediately after the hearing on 22 March 2022 wherein Mr Murphy was directed to file his response and to prepare for the final hearing.  
[93]	The costs of the application regarding Mr Crawford’s evidence were reserved, but in the context of this decision, the ultimate outcome in the proceedings and given the weight of the evidence Mr Crawford was to give and that it was supported by the Board’s expert, I include in the costs award Mr Murphy’s costs of that application. 
Decision 
[94]	For those reasons, my decision is to require the Board to pay Mr Murphy’s costs of the proceedings from 23 March 2022 (excluding any costs incurred with respect the strike out applications) to be assessed according to the District Court scale.