Ryan Perrett v Wolferstans LLP

On an assessment of non-contentious solicitor-and-client costs, the court should first assess the work done by reference to the time reasonably spent and the applicable rates. It should then step back and consider whether, having regard to all relevant factors under the S(NCB)RO, the resulting figure is fair and reasonable. The factors are not automatically of equal weight. A factor should displace the time-based assessment only where it materially outweighs the time spent. Fixed recoverable costs represent a scheme governing recovery from the opposing party. They do not, without more, establish fair remuneration as between solicitor and client. The crucial issue in obtaining informed consent is that the client understands the maximum liability under the retainer, including any permitted deduction from damages.

The claimant sought an assessment under the Solicitors Act 1974 of a statutory bill rendered by the defendant solicitors. In an earlier judgment dated 17 January 2025, the court determined preliminary issues. Following a line-by-line assessment on 21 May 2025, profit costs were reduced to approximately £3,864 including VAT, while the success fee was allowed as claimed.

The remaining issue was whether the assessed profit costs should be reduced further because the recoverable costs from the opposing party were fixed at £900, and because the claimant alleged that the likely shortfall had not been adequately explained. The central questions concerned the proper method of assessing non-contentious costs and the significance of fixed recoverable costs when determining fairness and reasonableness between solicitor and client.

1. Method of assessment. The court confirmed that, where the retainer is substantially based on hourly rates, the assessment should begin with the time spent and the applicable rates. Once item-by-item challenges have been resolved, the court should step back and consider whether the resulting figure is fair and reasonable in all the circumstances, particularly by reference to the factors in Article 3 of the S(NCB)RO (paras [18]-[20], [26]).
2. The earlier authorities concerning non-contentious costs, including Jemma Trust v Liptrot, Property and Reversionary Investment Corporation Ltd v Secretary of State for the Environment and Treasury Solicitor v Regester, supported consideration of factors beyond work done. They concerned cases in which matters such as property value or urgency were the substantial features. They did not require the time factor to be given little weight where no other factor materially dwarfed it (paras [18]-[19]).
3. Fixed recoverable costs. The fixed-cost scheme discussed in Nizami v Butt and Kilby v Gawith concerned fairness of recoverable costs across the scheme as a whole. It did not determine what was fair remuneration under the separate contractual relationship between solicitor and client. Costs recoverable inter partes and costs owed under the retainer are distinct concepts (paras [21]-[24]).
4. The court did not accept that the relevant passage in SGI Legal LLP v Karatysz had been superseded. That passage was obiter, but accurately distinguished solicitor-and-client costs from costs recoverable from a third party. The concept of unusual costs in CPR 46.9 did not assist in assessing the non-contentious costs in issue (paras [23]-[24]).
5. Confirmation of the client's maximum liability was the crucial element in obtaining informed consent. The claimant understood the contractual provision permitting a 25% deduction from damages. The lack of fuller understanding of the agreement's detail did not justify a further reduction (para [25]). The sum allowed after the line-by-line assessment was therefore fair and reasonable (para [26]).

The judgment records an earlier reserved judgment in the same proceedings on preliminary issues dated 17 January 2025, followed by the line-by-line assessment hearing on 21 May 2025. The present decision determined the remaining assessment issue.