Valuers Registration Board of Queensland v Conroy t/as Bevan Conroy & Associates Valuers
[2013] QCAT 688
| CITATION: | Valuers Registration Board of Queensland v Conroy t/as Bevan Conroy & Associates Valuers [2013] QCAT 688 |
| PARTIES: | Valuers Registration Board of Queensland (Applicant) |
| v | |
| Mr Bevan Conroy t/as Bevan Conroy & Associates Valuers (Respondent) |
| APPLICATION NUMBER: | OCR 149-12 |
| MATTER TYPE: | Occupational Regulation matters |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Member Fitzpatrick |
| DELIVERED ON: | 12 December 2013 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | It is ordered that: 1. Mr Conroy be reprimanded; 2. Mr Conroy pay to the Valuers Registration Board of Queensland a penalty of 40 penalty units ($4,400.00) within 3 months of 12 December, 2013; 3. Mr Conroy pay to the Valuers Registration Board of Queensland the costs of the investigation that led to the proceeding. The Board is to file an affidavit swearing to the costs and attaching any relevant invoice no later than 10 January 2014, whereupon a final order will be made. |
| CATCHWORDS: | Disciplinary proceedings – Valuer – negligence – incompetence – professional misconduct – penalty – costs. Valuers Registration Act 1992 ss 50, 59 Baxter v FW Gapp & Co Ltd [1939] 2 All ER 752; |
This matter was heard and determined on the papers pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act).
REASONS FOR DECISION
The Valuers Registration Board of Queensland (the Board) has applied to this Tribunal to decide whether a disciplinary ground is established with respect to Mr Bevan Conroy, the respondent.
The Board received a complaint, dated 6 October, 2009, from Mr Joe Camilleri, Director Tactical Compliance, Office of Fair Trading, pursuant to section 43 of the Valuers Registration Act 1992 (the Act), regarding three valuations conducted by Mr Conroy in September, 2004, July, 2005 and November, 2005 with respect to properties in Toowoomba, Queensland. The principal complaint was that Mr Conroy had valued the three properties at amounts far in excess of their true market value and that the valuation reports for the properties contained information in relation to the sale evidence that amounted to false representations.
The Board instructed Mr Marcus Johnson to carry out an investigation of the complaint on its behalf. Mr Marcus Johnson, a registered valuer and a solicitor conducted an investigation and prepared a report, dated 15 February, 2011.
Following receipt of Mr Johnson’s report, the Board resolved to make this application, by way of referral, which was filed on 8 May, 2012.
The Board alleges that Mr Conroy has engaged in:
(a) professional misconduct; and
(b) incompetence or negligence in his performance as a valuer.
The Tribunal is required to decide whether a disciplinary ground is established.
Jurisdiction
Pursuant to section 50 of the Act, if after considering an investigator’s report, the Board reasonably considers that a valuer has engaged in professional misconduct; or incompetence or negligence in the person’s performance as a valuer, the Board may refer the matter to QCAT to decide. Referrals to this Tribunal relate to serious matters.
Pursuant to section 59 of the Act, if QCAT finds a registered valuer has engaged in professional misconduct, incompetence or negligence, QCAT may do one or more of the following –
(a)admonish or reprimand the valuer;
(b)order the valuer to give an undertaking to abstain from specified conduct;
(c)order the valuer to pay to the board a penalty of an amount equal to not more than 100 penalty units;
(d)order that the valuer’s registration be suspended for up to 12 month;
(e)order that the valuer’s registration be cancelled.
QCAT may also order payment of the costs of the Board, by the valuer.
I note the long period of time from the date of the valuations the subject of the complaint to the Board and the ultimate referral of this matter to the Tribunal. It does not appear from the Act or earlier versions that there is any time limit associated with the commencement of disciplinary proceedings.
Material relied upon
No material has been filed by Mr Conroy challenging the matters of fact referred to in the Board’s material. The Board was directed to serve all its material on Mr Conroy. Mr Conroy has been given sufficient time to respond. The Tribunal directed on 31 May, 2013 that if no submissions are received from Mr Conroy the application will be determined on the basis of material filed.
The only indication from Mr Conroy as to his attitude to the matter raised against him appears in his letter to the Tribunal received on 20 August, 2012 stating: “From my best recollection of the correspondence previously received I would probably agree with all the allegations listed.”
Accordingly, in deciding this matter I have had reference to:
·The application filed 8 May, 2012;
·Submissions on sanction filed on behalf of the Board on 30 October, 2012.
·A copy of Mr Marcus Johnson’s report and annexures, filed by the Board on 5 March, 2013.
11 Uniplaza Court
Mr Conroy assessed the current market value of the house at 11 Uniplaza Court, Toowoomba as at 22 September, 2004 at $395,000.00 and the annual rent value at $19,500.00.
Mr Marcus Johnson concluded in his report that Mr Conroy had mis-described the floor area of the house, overstating its size by 12%. He based this conclusion on his interview with Mr Conroy, who admitted that he had no floor plans for reference and that he did his own measurement. Mr Marcus Johnson also noted measurements undertaken by Mr WE Johnson, valuer, who conducted a valuation at the request of the Office of Fair Trading. Mr Conroy’s valuation describes a floor area of 186 square metres and a patio area of 5 square metres. Mr WE Johnson describes the floor area as 166.8 square metres and a patio of about 2 square metres.
On the basis of Mr Marcus Johnson’s investigation I find that Mr Conroy did mis-describe the floor area of the house in question.
Mr Marcus Johnson analysed Mr Conroy’s file in relation to the valuation. He noted that Mr Conroy compared 11 Uniplaza Court with four larger superior properties yet arrived at a valuation comparable to the value of those properties in an amount of $395,000.00. Mr Marcus Johnson was critical of this conclusion.
In view of Mr Marcus Johnson’s unchallenged expertise as a valuer, I accept his opinion and find that the value of the subject property should be markedly below $383,000.00, the sale price of a property with double the land and a larger and more stylish dwelling. In this regard, Mr Marcus Johnson referred to a valuation by Mr WE Johnson, engaged by the Office of Fair Trading, that the value of the property at the relevant time, was $260,000.00. Mr Marcus Johnson noted that valuation was untested by him.
I accept Mr Marcus Johnson’s conclusion and find that Mr Conroy adopted the direct comparison methodology for his assessment, however, the evidence in Mr Conroy’s file as to four comparable sales does not support a valuation of $395,000.00.
In making these findings and the other findings of fact set out in this decision, the standard of proof is the civil standard of reasonable satisfaction or comfortable satisfaction on the balance of probabilities.[1]
[1]A.Walmsley, A. Abadee, B.Zipser, Professional Liability in Australia, 2nd ed., Lawbook Co, Sydney,2007,p.110.
Allegations of Incompetence or Negligence
The Board has alleged that Mr Conroy was incompetent or negligent in the preparation of the valuation relating to this property in that he:
(a) failed to exercise the skills necessary to undertake the valuation assessment by making an assessment that is far in excess of the proper market value for the property and the assessment is not supported by the sales evidence;
(b) failed to apply reasonable care and diligence when making comparative assessments of the sales evidence which affected the valuation of the property; and
(c) failed to properly or adequately analyse and compare the sales evidence cited in his valuation report.
The Board also alleges incompetence or negligence in that Mr Conroy’s notes were inadequate and that they ought to have revealed the enquiries, objective comparisons, deductions and calculations made by him. Mr Marcus Johnson made no comment in this regard in his report and there is no other evidence on the issue. Without any evidence, I am unable to find that this allegation is made out.
Negligence
QCAT’s task is to decide whether Mr Conroy has “engaged” in “negligence”. [2]
[2] Valuers Registration Act 1992 s 59.
The Tribunal’s task is not to determine whether a civil claim for the tort of negligence is made out. Obviously, there is no complainant before it seeking damages for harm caused by the valuer’s allegedly negligent acts.
Negligence means a failure to exercise care and skill. In my view the Tribunal’s task is to determine whether on the facts before it Mr Conroy’s conduct amounted to a failure to exercise care and skill. Cases where valuers have been found civilly liable for negligence are useful in eliciting the requisite standard of care and skill reasonably expected of a valuer. Of course that question is inter-related to the issues which must be proved in actions for negligence, namely whether a duty of care is owed to a person to prevent harm, whether that duty has been breached by a failure to exercise care and skill and whether any failure to exercise care and skill has caused harm.
The Board relies in its submissions on the analysis of negligence in Mr Conroy’s performance by Mr Marcus Johnson in his report. Mr Marcus Johnson refers to a discussion in relation to negligent misstatement in Shaddock & Associates v Parramatta City Council to the effect that when a person gives information or advice to another: “the speaker…comes under a duty of care both to utilise with reasonable care the information and sources of information at his disposal and to employ with reasonable care what capacity he has for judgment in relation to the matter and to exercise reasonable care in the expression of what he is prepared to convey by way of information or advice.”[3]
[3] [1981] 55 ALJR 713.
I accept that submission. It is settled law that a person such as Mr Conroy owed a duty of care to the person who had requested the valuation. The duty is to take reasonable care as a trained professional valuer to give a reliable informed opinion on the open market value of the land in question at the date of valuation.[4] It is also now settled that a valuer may owe a duty of care to a third party receiving a valuation containing a negligent misstatement which causes economic loss. For example, in this case, the finance company or companies which Mr Conroy acknowledges on the face of the valuations are entitled to rely on the valuations.[5]
[4] I&L Securities Pty Ltd v RS Melloy Pty Ltd [2002] QSC 306 at pars [133] and [134]
[5] Kestrel Holdings Pty Limited v APF Properties Pty Ltd [2009] FCA FC 144.
Where a valuer owes a duty of care to a client or third party, he or she is required to exercise the care and skill of an ordinary skilled practitioner within that profession.[6] Mr Conroy will be found to have breached that duty (not if he merely made a mistake or an error of judgment) but if he failed to properly analyse and investigate comparable sales and failed to adopt and apply with reasonable care well recognised and generally applied principles and practices of valuation.[7]
[6] Rogers v Whittaker (1992) 175 CLR 479 at 487.
[7] I & L Securities Pty Ltd, op.cit. at par [132].
The facts establish that Mr Conroy did not properly analyse and investigate comparable sales, suggesting as he does that the house in question should be valued at an equivalent value to larger, superior properties.
The Board has referred the Tribunal to decisions which suggest that superior courts have consistently recognised that over-valuation by an acceptable “margin of error” or “margin” or “bracket” of 10% - 15% is evidence of negligence.[8]
[8]Baxter v FW Gapp & Co Ltd [1939] 2 All ER 752; Hahn Nominees Pty Ltd v National Australia Ltd [2000] FCA 454; Trade Credits Ltd v Baillew Knight Frank (NSW) Pty Ltd (1985) Aust Torts Report [80-757] and Lancini Properties Pty Ltd v Savills (Qld) Pty Ltd & Anor [2009] QSC 323.
In comparing Mr Conroy’s valuation and that conducted by Mr WE Johnson, it would appear that Mr Conroy has overvalued the property by approximately 34%.
As to loss or damage caused by Mr Conroy’s conduct, it is possible, for example, that a lender may have lent more than it otherwise would on a correct valuation and that the owner of the land had less equity in the property than was needed to repay the owner’s indebtedness and that they suffered loss as a result of relying on the valuation. There is no evidence before the Tribunal of loss or damage suffered by the person who requested the valuation or by the financier parties which were involved with the property. In my view, so long as it was possible on the facts that a person owed a duty of care by the valuer could have suffered loss and damage, the lack of such evidence does not affect the Tribunal’s ability to determine if there has been a failure to exercise the requisite care and skill expected of a valuer. However, if there were evidence of loss or damage it would be helpful in assessing the extent of penalty which may be appropriate.
I have found that:
(a) Mr Conroy mis-described the property;
(b) the value of the property should have been markedly less than that attributed to it by Mr Conroy by reference to the comparator properties; and
(c) the property was apparently over-valued to a significant extent.
I am satisfied that an ordinary skilled valuer exercising care and skill would not have engaged in the conduct found against Mr Conroy. I find that Mr Conroy engaged in negligence as alleged by the Board, apart from the issue as to the records kept by Mr Conroy on his file.
Incompetence
The Tribunal is required to determine whether Mr Conroy “engaged” in “incompetence”.[9]
[9] Valuers Registration Act 1992 s 59.
As to the alleged incompetence of Mr Conroy, the Board submits that Mr Marcus Johnson’s analysis of the meaning of “incompetence” is apposite. Namely, that the ordinary dictionary meaning should be adopted, being “not sufficiently skilful to do something successfully”.[10]
[10] Compact Oxford Dictionary (Online), 2010.
The meaning of incompetence was discussed in the District Court of Western Australia, by Groves DCJ, in Worthington v Jack Willers – Senior Complaints Officer of the Department of Consumer and Employment Protection[11] an appeal from a decision of the Western Australian Land Valuers Licensing Board.
[11] [2005] WADC 38 at paras 46 and 47.
His Honour said: “…it seems to me to be a correct statement as to what would commonly be understood to amount to incompetence. That is not a single occurrence of not coming up to the requisite standard but rather a “generalised deficiency” endemic in the way of the person’s professional practice. The new Shorter Oxford English Dictionary gives a definition of incompetent as ‘of inadequate ability or fitness; lacking the requisite capacity or qualification: incapable.’ A single incident would not demonstrate an inadequate ability or fitness to practice. Applied to the present circumstances it is my opinion that a finding of “incompetence” cannot be made on an isolated finding of negligence in respect of one event.”
Although 3 complaints are before the Tribunal and the Board has referred me to a disciplinary decision of the Valuers’ Disciplinary Committee dated 16 December, 2009 in Matter C116-3/09, I am not satisfied that there is evidence of endemic lack of skill in the conduct of Mr Conroy’s practice. I note that he has been a valuer for 25 years. I decline to find that his conduct with respect to the valuation of 11 Uniplaza Court demonstrates endemic incompetence.
Unit 11, Spencer House, 5-7 Uniplaza Court.
Mr Conroy valued Unit 11, Spencer House at $238,000.00 and assessed the gross annual rental at $13,000.00. The date of the valuation was 10 November, 2005.
The Valuation provides a certification that “…we inspected the herein described property on 10 November, 2005 and have personally carried out the valuation assessment…”
Mr Conroy’s signed record of interview attached to Mr Marcus Johnson’s report contains an admission that he inspected the unit during construction in September, 2004, but he did not inspect the unit upon completion.
At the time of inspection he had a schedule of finishes that were to go into the unit upon completion and those appointments were included in the valuation. He admitted that some of the appointments referred to in the Schedule of finishes were not included in the completed unit. In particular he agreed that although he expected split system air-conditioning to be installed in the bedrooms, it was not installed.
Mr Conroy noted that his valuation refers to 4 units sharing one laundry, however, the Complaint by the OFT refers to 8 units sharing one laundry. Mr Conroy did not appear able to make any explanation for this alleged anomaly.
Mr Conroy also admitted that he arranged for the developer of the unit complex, Mr Mackay, to inspect some units sourced by Mr Conroy as comparable from RP Data, and to send him a full description of the sales. Mr Conroy admitted that he asked Mr Mackay to contact a local real estate agent to obtain details of rental. Mr Conroy used this information to prepare his valuation.
In his record of interview Mr Conroy acknowledged that the rental obtainable from the unit the subject of the valuation was not available for 52 weeks per year as his valuation suggested, because being student accommodation the unit was only rented for 42 weeks per year.
In his record of interview Mr Conroy indicated that he was in no position to challenge complaints made about the comparison properties being erroneously described because he had relied on Mr Mackay to inspect the properties. Some of the errors put to him related to the age and size of the comparator properties and whether they were in fact inferior to the subject unit. Mr Conroy expressed the opinion that: “Well, it appears, well I mean, it is quite obvious that he sent me through what would assist him achieving his outcome. And as I said in that letter I was very reluctant to do it but I was under other pressures and those other pressures were more important for me to overcome than a couple of valuations for Stewart Mackay.”
Mr Marcus Johnson notes in his report that Mr WE Johnson’s valuation of the subject unit as at 10 November, 2005 was $160,000.00.
Unit 14, Alexander House, 9 Uniplaza Court, Toowoomba
Mr Conroy valued Unit 14, Alexander House, at $220,000.00 and assessed the gross annual rental at $13,000.00. The date of the valuation was 7 July, 2005.
The valuation contains a certification that the property was inspected on 7 July, 2005 and that Bevan Conroy had personally carried out the valuation assessment.
As with Unit 11, Spencer House, Mr Conroy acknowledged in his record of interview that:
(a) he had not inspected the Unit as at the date of the valuation;
(b) there were errors in his description of the Unit in the valuation in relation to air conditioning, which was not in each bedroom but only in the living room and in relation to the laundry servicing four units, not being present in each unit,
(c) the rental had been wrongly assessed over 52 weeks rather than 40 weeks because it was student accommodation; and
(d) he relied upon Mr Mackay having inspected comparable properties and that he was provided with information which was erroneous as to the size, age and relative status of the comparator properties.
Mr Marcus Johnson noted that Mr WE Johnson had valued the Unit at $175,000.00 as at 7 July, 2005.
Findings in relation to Unit 11 Spencer House and Unit 14 Alexander House
I have read the letter from Mr Conroy to the Valuers Registration Board of Queensland dated 18 February, 2010. The acknowledgements made by Mr Conroy in his record of interview are again made in the letter to the Board.
On the basis of the acknowledgements made by Mr Conroy in his record of interview and in his letter of 18 February, 2010, I find that he:
(a) did not inspect the properties on the dates given in the certification part of the valuations;
(b) erroneously described the air conditioning installed at the Units and the laundry facilities.
(c) used wrong information as to comparator properties, provided by another self-interested person, Mr Mackay, to assess the value of the properties, without conducting any inspections or enquiries himself.
(d) failed to allow for the shortened rental periods associated with student accommodation rentals in assessing the annual market rental for the properties.
Although Mr Marcus Johnson did not conduct his own valuation of the properties, I am satisfied by reference to the written valuations prepared by Mr WE Johnson for the Office of Fair Trading, that an appropriate valuation for Unit 11, Spencer House was $160,000.00, not $238,000.00 as at 10 November, 2005; and an appropriate valuation for Unit 14 Alexander House was $175,000.00, not $220,000.00 as at 7 July, 2005. That is an overvaluation of approximately 32% and 20% respectively.
I note from Mr WE Johnson’s letterhead that he is a registered urban and rural valuer. There is no other evidence of value before me. Despite being given the opportunity, Mr Conroy has not challenged any of the evidence before me.
Allegations of incompetence or negligence
The analysis with respect to negligence set out in relation to the house at 11 Uniplaza Court is relevant. That is, having regard to the duty owed by Mr Conroy to his client and third party financiers, did Mr Conroy exercise the care and skill of an ordinary skilled valuer, in circumstances where it was likely that he would cause loss or damage if he failed to do so?
I am satisfied that an ordinary skilled valuer would not have engaged in the conduct I have found. Although not referred to me as evidence of the degree of care and skill which should have been exercised by Mr Conroy, I note the Australian Property Institute Rules of Conduct which Mr Conroy is bound to follow. The Rules are discussed below in the context of professional misconduct. However, I consider they represent a useful guide as to the standard of care and skill to be expected of an ordinary skilled valuer, insofar as some of the negligent acts of Mr Conroy are concerned.
In particular:
Rule 1.3: “Members shall maintain the strictest independence and impartiality in undertaking their professional duties. To this end, no Member shall
:…
(d) rely upon crucial information supplied by a client without appropriate qualification or confirmation from other sources”
Rule 1.10: “A valuation shall not be performed by a Certifed Practising Valuer without an inspection of the property concerned…”
I also note Regulation 7 of the Valuers Registration Regulation 2003 which provides that: “A registered valuer, in making a valuation, must conform to the Code of Professional Practice stated in the publication “Professional Practice” published by the Australian Property Institute, including taking all necessary steps to obtain and verify factual data that may affect the valuation.”
Accordingly, I find that the following allegations of negligence made by the Board are made out, with respect to Mr Conroy’s conduct in relation to both Unit 11, Spencer House and Unit 14 Alexander House. That is, Mr Conroy:
(a) failed to exercise the skills necessary to undertake the valuation assessment by making an assessment of market value that is far in excess of the proper market value for the property;
(b) failed to apply reasonable care and diligence by relying upon an inspection of the property and the comparative assessments of the sales evidence carried out by his client, Mr MacKay without making his own independent investigations which affected the valuation of each property;
(c) incorrectly relied upon the proposed finishes schedule for the properties to determine the level of finish of the properties upon completion of construction without inspecting the properties to independently determine their level of finish. The finishes were not in accordance with the proposed finishes schedule;
(d) failed to properly or adequately investigate the sales evidence cited in his report; and
(e) failed to properly allow for the shortened rental periods associated with student accommodation rentals in assessing the annual market rental for the properties.
I have no evidence before me in relation to the contents of Mr Conroy’s files. Accordingly I am unable to make any finding in relation to the allegation by the Board that in contravention of Rule 1.4 of the API Rules of Conduct, Mr Conroy failed to retain adequate file notes to substantiate his valuation, which file notes ought to have revealed the enquiries, objective comparisons, deductions and calculations made by the respondent.
In relation to the allegations of incompetence made by the Board which mirror the allegations of negligence I decline to find that Mr Conroy has been incompetent in relation to these valuations. I do not consider I have sufficient evidence of an endemically incompetent practice by him to make such a finding, as it appears the failings in relation to the valuations in question are limited to those valuations, across a 25 year career.
Professional misconduct
The Board alleges that in relation to the valuations of the two units, Mr Conroy’s conduct amounted to professional misconduct.
The Board bases its submissions on Mr Marcus Johnson’s analysis of professional misconduct in his report.
In particular Mr Johnson cites Rich J in the High Court decision of Kennedy v Council of the Incorporated Law Institute of New South Wales[12]in relation to a charge of misconduct by a solicitor: “…a charge of misconduct as relating to a solicitor need not fall within any legal definition of a wrong doing. It need not amount to an offence under the law. It was enough that it amounted to grave impropriety affecting his professional character and was indicative of a failure either to understand or to practise with the precepts of honesty or fair dealing in relation to the courts, his clients or the public.”
[12] (1939) 13 ALJ 563.
Mr Johnson notes that in Queensland “professional misconduct” has been narrowly defined by the courts as being limited to misconduct in the course of professional work.[13]
[13]Re Wheeler [1991] 2 Qd R 690 at 697; Queensland law Society Incorporated v Smith [2001] 1 Qd R 649 at [10].
Mr Johnson concludes that the test of whether a professional person such as a valuer has engaged in professional misconduct relies upon a judgment which must be made of the conduct of a professional in comparison to the conduct of his or her peers. In this regard, Mr Johnson refers to the professional standards for registered valuers set out by the Australian Property Institute in their Rules of Conduct, which are used as the standard for the professional manner in which a valuer must conduct his or her professional work. Mr Johnson attaches to his report a copy of the Rules of Conduct effective as at 10 March, 2003, which covered the conduct of Mr Conroy at the time of his valuations.
I accept the Board’s submissions as articulated by Mr Johnson, with the qualification that professional misconduct requires something more than incompetence or negligence and that it is a different concept. In Pillai v Messiter, Kirby P in the New South Wales Court of Appeal, in considering the meaning of the term ‘misconduct” in a professional respect” in the Medical Practitioners Act 1938 (NSW) stated: “…it includes a deliberate departure from accepted standards or such serious negligence as, although not deliberate, to portray indifference and an abuse of the privileges which accompany registration as a medical practitioner.” [14]
[14]Pillai v Messiter [No 2] (1989) 16 NSWLR 197. See also the discussion on this issue in “Professional Liability in Australia”, op.cit. at para [1.1310].
The Rules of Conduct are made pursuant to the Valuers Registration Regulation 2003 which makes compliance by a registered valuer mandatory.
The Board in its application refers to a failure to comply with the Rules and sets out its particulars of professional misconduct. The facts relied upon as the basis for the allegation of professional misconduct are:
(a) Mr Conroy inspected the properties in or about September, 2004 whilst they were still under construction and had not reached the lock-up stage of construction;
(b) Mr Conroy relied upon an inspection of the property and an inspection and comparative assessment of the sales evidence by the client, Mr McKay in undertaking the valuation assessment of the property;
(c) Mr Conroy falsely certified in the valuation report that he had inspected Unit 14 on 7 July, 2005 and Unit 11 on 10 November, 2005;
It is alleged that Mr Conroy failed to comply with Rule 1 – Professional and Personal Conduct of the Australian Property Institute (API) Rules of Conduct, as in force at this time, in the following manner:
(i) by failing to inspect the property after construction was completed and falsely certifying the date of inspection of the property, the respondent valuer breached Rule 1.1 in that he failed to “conduct his professional duties and activities in a manner that reflects credit upon himself and the profession” and he failed to “observe at all times high standards of competence, integrity and honesty”;
(ii) by relying upon the inspection of the property and the inspection and assessment of the sales evidence by Mr McKay and not independently checking this information or qualifying his report by mentioning this fact, the respondent valuer breached Rule 1.3(c) by relying “upon critical information supplied by the client without appropriate qualification or confirmation from other sources”;
(iii) by relying upon Mr McKay for the inspections and comparative assessment of the sales evidence the respondent valuer breached Rule 1.4 by “making statements in the valuation report without reasonable foundation which were not appropriately qualified or limited” by identifying the role of Mr McKay in the inspections in the valuation report;
(iv) by agreeing to accept instructions to value the property from Mr McKay on the basis that the respondent valuer would not need to further inspect the property after construction was complete and by failing to state this in the valuation report, the respondent valuer beached Rule 1.10, which requires such disclosure; and
(v) by failing to disclose in the report that the valuation relied upon the inspection of the property and inspection and assessment of the sales evidence by the client, Mr McKay, the respondent valuer breached Rule 1.15. The respondent valuer failed to disclose the source of information that he relied upon and which was critical to the assessment of the value of the property, which disclosure is required by the rule.
I have found that the factual matters referred to as the basis of the alleged breach of the Rules of Conduct have occurred. I find that the conduct of Mr Conroy breaches the Rules of Conduct particularized by the Board.
I am satisfied that Mr Conroy has engaged in misconduct because he deliberately departed from the standards of his profession set out in the Rules. I am particularly persuaded of Mr Conroy’s professional misconduct because he has been dishonest in giving false certificates as to inspection of the properties and having personally carried out the valuation assessment. Honesty sits at the heart of the practice of a professional person. Without honesty there can be no public confidence in advice given by a professional, which is beyond the skill and knowledge of the public to test.
Accordingly, I find that the Board’s allegations are made out and that Mr Conroy has engaged in professional misconduct.
Penalty
As a consequence of the findings made in this Decision I consider that grounds exist for making disciplinary orders. In accordance with the Tribunal’s powers set out in section 59 of the Act I make the following orders:
(a) that Mr Conroy be reprimanded;
(b) that Mr Conroy pay to the Valuers Registration Board of Queensland a penalty of 40 penalty units ($4,400.00) within 3 months of 12 December, 2013;
(c) that Mr Conroy pay to the Valuers Registration Board of Queensland the costs of the investigation that led to the proceeding. The Board is to file an affidavit swearing to the costs and attaching any relevant invoice no later than 19 December, 2013, whereupon a final order will be made.
In making these Orders I am conscious of the Board’s submissions which include reference to a previous decision of the Disciplinary Committee which reprimanded Mr Conroy and ordered the payment of certain costs. It is submitted that Mr Conroy’s registration has been cancelled due to his failure to comply with the orders made by the Valuers’ Disciplinary Committee on 16 December, 2009. The Board has indicated that it does not proceed with its application for the suspension or cancellation of Mr Conroy’s registration.
The Board requested a penalty in the maximum amount of 100 penalty units (currently $11,000.00). I decline to order a payment in the maximum sum. Although the matters raised in this proceeding are serious and I have found that Mr Conroy gave false certificates in his valuations, it is possible to imagine more egregious circumstances. Further, I do not know what loss or damage, if any, Mr Conroy’s negligence or misconduct may have caused.
I have no submissions from Mr Conroy in relation to penalty, although Mr Conroy has been served with the Board’s submissions setting out the penalties sought and has had an opportunity to respond. I take into account Mr Conroy’s co-operation in the investigation and his frank acknowledgment of his errors in his record of interview and communications with the Board and this Tribunal.
I also take into account Mr Conroy’s acknowledgment in his letter to the Board dated 18 February, 2010, that what he did was foolish and that in 25 years of carrying out property valuations he has not prepared a report in this manner on any other occasion.
The Board requested payment of its costs of and incidental to the proceeding. I decline to order payment of any costs other than the costs of the investigation which led to the proceeding. No order granting leave for legal representation has been made. The hearing has been conducted on the papers and was not contested.
Final orders will be issued once the amount claimed by the Board for its costs of the investigation is known.
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