Perrett v Wolferstans: Assessment of non-contentious costs and fixed recoverable costs

In Ryan Perrett v Wolferstans LLP [2026] EWHC 50 (SCCO), Senior Costs Judge Rowley delivered an important judgement concerning the assessment of non-contentious costs under the Solicitors Act 1974, particularly where fixed recoverable costs apply.

The proceedings arose from a statutory bill dated 13 April 2022, with profit costs of £4,800 and a success fee of £1,775.85. Following a detailed assessment, the court reduced the profit costs to approximately £3,864 whilst allowing the success fee as claimed.

The central issue concerned whether the court should "step back" after the line-by-line assessment to consider whether the allowed sum remained fair and reasonable under Article 3 of the Solicitors (Non-Contentious Business) Remuneration Order 2009.

The claimant argued that fixed recoverable costs of £900 represented fair remuneration on a "swings and roundabouts" basis, relying on Nizami v Butt and Kilby v Gawith. It was submitted that the defendant's failure to adequately explain the shortfall between recoverable and incurred costs should weigh heavily against the solicitor, drawing parallels with the budgeting principles established in St James v Wilkin Chapman.

The defendant countered that budgets and fixed costs were not analogous. Whilst budgets could be anticipated at the outset, the level of fixed recoverable costs only crystallised at conclusion. The contractual documentation clearly provided for a 25% deduction cap, which the client understood and confirmed when accepting settlement.

Senior Costs Judge Rowley distinguished the 1970s authorities relied upon by the claimant, noting that cases like Property and Reversionary Investment Corporation Ltd v Secretary of State for the Environment concerned situations where factors such as property value "dwarfed" time spent. In contrast, where an agreement based on hourly rates contains no such exceptional factors, the appropriate method involves assessing time and rates first, then stepping back to consider overall fairness.

The court rejected the proposition that fixed recoverable costs represent fair remuneration between solicitor and client. As Lavender J observed in SGI Legal LLP v Karatysz, these are "very different" concepts. The fixed costs scheme relates to inter partes recovery under an agreed framework designed to be fair across cases generally, not to individual solicitor-client relationships governed by contract.

The judgement emphasised that the concept of "unusual costs" under CPR 46.9(3) cannot simply transfer from contentious to non-contentious business to create a presumption of unreasonableness based on exceeding recoverable costs. The contractual relationship between solicitor and client operates independently from third-party cost recovery.

Regarding the information provided to the client, the court found that confirmation of maximum 25% liability satisfied the essential requirement. Whilst fuller understanding would have been preferable, the contractual documentation itself attracted no criticism.

Senior Costs Judge Rowley concluded that the sum of £3,864 allowed following the item-by-item assessment remained fair and reasonable under the 2009 Order. The reduction from the original bill already reflected appropriate scrutiny of hourly rates and time spent. No further adjustment was warranted based on the divergence from fixed recoverable costs or alleged failures in client communication where the essential contractual terms were properly documented and understood.

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