Mr Ryan Perrett v Wolferstans LLP

Hearing date: 21 May 2025

Approved Judgment

This judgment was handed down remotely at 10.30am on 14 January 2026 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

SENIOR COSTS JUDGE Rowley

Introduction

In these proceedings brought under the Solicitors Act 1974, I gave a reserved judgment on 17 January 2025 in respect of preliminary issues numbered 2, 3, 4 and 5. On 21 May 2025 I dealt with the remaining “line by line” items which resulted in the profit costs in the statutory bill dated 13 April 2022 being reduced from £4,800 to a figure in the region of £3,850–£4,000 (all sums including VAT) and the success fee of £1,775.85 being allowed as claimed.

The apparent imprecision of the profit costs element was simply a result of the parties' advocates seeking to deal with the remaining issue prior to a precise calculation of the sums that I had allowed. The remaining issue did not require a precise figure because it involved me “stepping back” and considering the figures allowed in the round. To that extent it did not matter whether I had allowed, for example, £3,864 which the advocate for the defendant, Mr Brighton's running total suggested might be correct (and which, henceforth, I shall treat as the assessed figure for simplicity, rather than the suggested range).

The need for me to “step back” arises from the end of my January judgment in which I said:

“86. This then leads to Mr Carlisle's fallback position that the costs still need to be fair and reasonable in accordance with the S(NCB)RO. Article 3 of that Order says:

“3. A solicitor's costs must be fair and reasonable having regard to all the circumstances of the case in particular to –

(a) the complexity of the matter or the difficulty or novelty of the questions raised:

(b) the skill, labour, specialised knowledge and responsibility involved;

(c) the time spent on the business;

(d) the number and importance of the documents prepared or considered, without regard to length;

(e) the place where and the circumstances in which the business or any part of the business is transacted;

(f) the amount or value of any money or property involved;

(g) whether any land involved is registered land within the meaning of the Land Registration Act 2002;

(h) the importance of the matter to the client; and

(i) the approval (express or implied) of the entitled person or the express approval of the testator to –

(i) the solicitor undertaking all or any part of the work giving rise to the costs; or

(ii) the amount of the costs.”

87. The method of assessment forms the substance of point of dispute 5. However, as canvassed in argument, relevant considerations can also potentially be found in the detailed points of dispute. The decision, at this stage, can only be a high level one concerning the method of assessment itself.

88. The claimant's argument is that the court should at least contemplate making an overall assessment of a fair and reasonable sum rather than descending into the detail. Such an approach would bear in mind the factors set out in Article 3 but, in order to consider all the circumstances, the court should look at other elements as well. It is on this line of reasoning that Mr Carlisle sought to bring in various points such as the failure to comply with the SRA Code of Conduct. The absence of any information to the client about the inevitability of (a) a shortfall in the recovery of profit costs and (b) the imposition of a 25% deduction should weigh heavily in the scales. In respect of this second point, Mr Carlisle referred to the hourly rates in the CFA and the 60% success fee sought. Even if the success fee percentage was reduced on assessment, the 25% deduction would be justified, at least arithmetically, by the time claimed at the hourly rates and which would not be recovered from the opponent.

89. Furthermore, the difference between the incurred costs and those that could be recovered by the fixed recoverable costs allowed, should be considered as unreasonable or unusual in line with comments made by Constable J in St James. The reference to those comments actually related to costs above the budgeted costs allowed in a costs management order but Mr Carlisle drew an analogy with a level of recovery which is essentially fixed. He also referred to paragraph 70 of the judgment which criticised the solicitors' reliance upon any shortfall being within the 25% cap as absolving them of a responsibility for keeping the client informed so as to look after his interests.

90. In order to reflect these various factors, Mr Carlisle relied upon the words of Longmore LJ in Jemma Trust v Liptrot [2003] EWCA Civ 1476 when considering the assessment of non-contentious costs with the assistance of two decisions from Donaldson J (as he then was) in the 1970's ( Property and Reversionary Investment Corporation Ltd v Secretary of State for the Environment [1975] 1 WLR 1504 and Treasury Solicitor v Regester [1978] 1 WLR 446.)

91. The headnote to the report of one of the Donaldson J cases refers to it being one of the few reported cases on the quantification of non-contentious costs. Half a century later, that remains the case. As such, I have no criticism of Mr Carlisle for relying upon such authorities but it seems to me that they involve cases which are fundamentally different from this one.

92. All three cases support Mr Carlisle's argument in principle that the court should refrain from simply considering the amount of work done but should look at the other factors set out in what is now the S(NCB)RO. As a quotation from the Treasury Solicitor decision describes,

“The magnetic attraction of [the time spent] as a foundation for assessment of fair and reasonable remuneration is that, in the absence of an approved scale applied to value, it is the only figure which is readily calculable. It is an attraction which must be sternly resisted in cases of this sort where one or more of the other factors is such as to dwarf it into insignificance.”

93. In two of the three cited cases, the value of the property was the key issue. The Property and Reversionary case involved the conveyance of a property worth £2.25million and in Jemma Trust, the estate was worth almost £10 million. In the Treasury Solicitor case, the key issue was described as the “adrenalin factor” where urgency and precision were key. (The value was said to be £2 million.)

94. In all three cases, the courts were at pains to say that these other factors made simply looking at the time spent the wrong approach to take to reflect the appropriate figure to allow for the solicitors' fees. There was no suggestion, as I understood Mr Carlisle, that any of the specified factors in the S(NCB)RO ought to “dwarf” the time spent in this case in the manner suggested by Donaldson J. Instead, Mr Carlisle's submission was that I should take factors which are not specified in the S(NCB)RO so as to take all the circumstances into account. The court's reference to an adrenalin factor in Treasury Solicitor supports that approach since it too does not really come within in any of the matters specified by the Order. But, it seems to me that simply to treat those factors as a non-exhaustive list for which other matters should be equally important is a path that I should be hesitant to follow. The previous incarnations of the S(NCB)RO in 1972 and 1994 are differently worded. They cover the same ground but there has obviously been consideration given to the precise terms of those factors and it seems to me that they should be given the greater weight, in the same way as the relevant parts of the CPR are considered when assessing contentious work.

95. Accordingly, where, as here, there are no other specific factors said to dwarf the time spent, I consider that I should assess the costs by reference to that time spent and then to consider the sum allowed to see whether other matters cause me to adjust that figure in order to determine a sum that is fair and reasonable. As Donaldson J concluded in Treasury Solicitor, the court's role is to make a value judgment based on discretion and experience to establish:

“ a right figure: one which is reasonable in all the circumstances and which is fair both to the client and to the solicitor.””

Mr Carlisle referred to point 6 of the claimant's points of dispute. He began with reference to the decision of Simon J in Nizami v Butt [2006] EWHC 159 (QB) regarding the concept of fairness where the recoverability of costs were fixed by the rules. He said:

“It seems to me that the intention underlying CPR 45.7–14 was to provide an agreed scheme of recovery which was certain and easily calculated. This was done by providing fixed levels of remuneration which might over-reward in some cases and under-reward in others, but which were regarded as fair when taken as a whole.”

These words were approved twice by the Court of Appeal as this passage from the decision in Kilby v Gawith [2008] EWCA Civ 812 demonstrates:

“Although I recognise that this case is not on all fours with Nizami v Butt on the facts, Simon J there made it clear that the purpose of the new rules was to provide fixed levels of remuneration which might operate on a swings and roundabouts basis, which was regarded as fair taken as a whole. That approach was subsequently approved as correct by this court in Lamont v Burton.”

From these authorities, Mr Carlisle put forward the...