Inter partes fixed recoverable costs bear no relevance to solicitor-client assessments. The “swings and roundabouts” fairness of the fixed costs scheme relates only to recovery between litigating parties, not contractual remuneration.
The assessment of non-contentious business costs under the Solicitors’ (Non-Contentious Business) Remuneration Order 2009, where the retainer is based on hourly rates, should first involve a detailed assessment of the reasonableness of the time spent and the rates charged. Only after that exercise should the court ‘step back’ to consider whether the resulting sum is fair and reasonable in all the circumstances, having regard to the factors in Article 3 of the Order. [18, 20, 94, 95]
The level of costs recoverable from an opposing party under a fixed or predictable costs regime is not, of itself, the benchmark for determining what constitutes fair and reasonable remuneration as between solicitor and client. The fairness of a ‘swings and roundabouts’ inter partes scheme is a separate consideration from the fairness of the contractual bargain between the solicitor and their own client. [22, 23, 24]
When considering whether costs are ‘unusual’ for the purposes of assessment, the question of what is usual or unusual as between solicitor and client is a very different question from what is recoverable between the parties. [24]
Informing a client of a clear maximum liability for costs, such as a percentage cap on deductions from damages, can be sufficient to discharge a solicitor’s duty to keep the client informed about potential shortfalls between costs incurred and costs recoverable from the other side, even where a more detailed explanation of the likely shortfall is not provided. [15, 25]
Where a costs assessment has already taken into account challenges to hourly rates and the time spent on individual items, those specific factors should not be reconsidered a second time as part of the final, holistic assessment of whether the global sum is fair and reasonable. [20]
