What was the specific monetary dispute regarding the Claimant’s costs in the Renewed Application for Permission to Appeal in Denisova v Galtcev?
The dispute centered on the quantum of legal costs recoverable by the Claimant, Anastasiia Denisova, following the Defendants' unsuccessful Renewed Application for Permission to Appeal. The Claimant sought a total of USD 20,226 for work performed by her legal team, which included 22 hours of professional time split between a senior partner and a junior lawyer. The Defendants challenged this amount, arguing that the costs were disproportionate to the work required and suggesting a significantly lower figure of USD 4,836.
As noted in the court’s schedule of reasons:
In accordance with the orders made on 8 October 2025, the parties have exchanged submissions in relation to the quantum of the costs to be paid to the Claimant by the Defendants pursuant to those orders.
The core of the disagreement lay in whether the time spent by the Claimant’s counsel was reasonably incurred given the nature of the application. While the Claimant maintained that the hours were necessary, the Defendants argued that the work could have been performed more efficiently, specifically by delegating more tasks to junior staff and reducing the overall time spent on the skeleton argument. The court was ultimately tasked with reconciling these competing views to reach a fair assessment of costs.
Which judge presided over the assessment of costs in the DIFC Court of First Instance on 24 February 2026?
The assessment of costs was conducted by H.E. Chief Justice Wayne Martin. This order followed a series of previous procedural steps, including earlier orders issued by H.E. Justice Sapna Jhangiani in May 2025, which had addressed the preliminary issues and the initial costs order. The matter reached Chief Justice Martin following the Defendants' Renewed Application for Permission to Appeal, which necessitated this final determination on the quantum of costs.
What specific arguments did the Defendants raise regarding the delegation of tasks and the seniority of counsel in Denisova v Galtcev?
The Defendants advanced four primary grounds of objection to the Claimant’s bill of costs. A significant portion of their argument focused on the "mix" of legal talent employed by the Claimant. They contended that the senior partner had spent a disproportionate amount of time on the matter, arguing that the work should have been delegated to a more junior lawyer with a lower hourly rate.
The Defendants’ position was summarized by the court as follows:
Third, the Defendants contend that the costs are excessive because there should have been greater delegation of tasks to the more junior lawyer.
Furthermore, the Defendants argued that the entire exercise of responding to the Renewed Application for Permission to Appeal should have been completed within six hours. They asserted that by failing to delegate appropriately and by spending excessive time on the task, the Claimant had inflated the costs beyond what was reasonable. They specifically proposed that the total costs should have been capped at USD 4,836, a fraction of the USD 20,226 claimed.
What was the precise legal question regarding the assessment of costs that the Court had to resolve in this matter?
The Court had to determine whether the Claimant’s claimed costs were "reasonable and proportionate" under the standard basis of assessment, specifically in light of the quality and utility of the work product submitted. The central doctrinal issue was not merely whether the hours were actually worked, but whether those hours were reasonably incurred in the context of a three-page skeleton argument that lacked developed legal reasoning. The Court had to balance the principle of party autonomy in choosing legal representation against the court’s duty to ensure that the opposing party is not burdened by excessive or inefficient legal expenditure.
How did Chief Justice Wayne Martin apply the doctrine of professional discretion in the assessment of costs?
Chief Justice Martin rejected the Defendants' attempt to micromanage the Claimant’s internal staffing decisions. He affirmed that the court should not lightly interfere with how a law firm allocates work between its partners and associates, as the lead lawyer is best positioned to judge the complexity of the task.
However, the Court balanced this by noting that inefficient staffing can indeed lead to excessive costs. The reasoning was articulated as follows:
A determination as to the appropriate level of experience required to perform particular legal tasks is pre-eminently a matter for the lawyers involved. Experience in the assessment of costs shows that inappropriate delegation of tasks to more junior lawyers can increase costs because the costs of a senior lawyer reviewing and editing the work of the junior lawyer, when added to the cost of the work of the junior lawyer can be greater than the cost of the senior lawyer doing the work in the first instance.
The Court further emphasized that the ultimate test is the value provided to the court. Because the skeleton argument was found to be of "very limited assistance" and relied on conclusory dot points rather than substantive argument, the Court found that the time claimed was objectively excessive, regardless of the seniority of the fee earners involved.
Which specific DIFC practice directions and procedural rules governed the assessment of costs in this case?
The assessment was primarily governed by the principles of cost recovery under the Rules of the DIFC Courts (RDC). The Court specifically referenced the hourly rates set out in Registrars Practice Direction No. 1 of 2023 as the benchmark for determining the reasonableness of the rates charged by the Claimant’s fee earners. While the Court accepted that the rates themselves were compliant with the Practice Direction, it found that the total hours claimed were not justified by the output produced.
How did the Court treat the Defendants' objection regarding travel time in the absence of a physical hearing?
The Defendants challenged one hour of time claimed for "travelling/waiting," noting that no hearing had taken place for the Renewed Application for Permission to Appeal. The Claimant clarified that this time was spent travelling to attend upon the client. The Court accepted this explanation, noting:
In reply submissions, the claimant has stated that the time was spent travelling in order to attend upon the client.
The Court found no reason to doubt this assertion and consequently rejected this specific ground of objection, demonstrating that while the Court will scrutinize the utility of legal work, it will not second-guess the necessity of client-facing activities if they are adequately explained.
What was the final disposition and the specific monetary relief ordered by the Court?
The Court ultimately reduced the Claimant’s requested costs from USD 20,226 to USD 14,000. In his order, Chief Justice Martin concluded that the amount claimed was excessive given the brevity and limited utility of the skeleton argument filed. The Court ordered the Defendants to pay the Claimant the assessed sum of USD 14,000, effectively trimming the claim by over 30% to reflect the Court's assessment of the work's actual value.
The final order stated:
I assess the Claimant’s costs of the Renewed Application for Permission to Appeal in the amount of USD 14,000.
What are the wider implications for DIFC practitioners regarding the preparation of skeleton arguments and cost claims?
This case serves as a stern reminder that the DIFC Courts will rigorously assess the quality and utility of written submissions when determining costs. Practitioners must anticipate that simply logging hours—even at approved hourly rates—will not guarantee recovery if the resulting work product is of limited assistance to the Court.
The decision highlights that "conclusory" arguments or repetitive content in skeleton arguments can lead to significant reductions in recoverable costs. Furthermore, while the Court respects the internal staffing decisions of law firms, it will not allow the costs of inefficient work to be passed on to the opposing party. Litigants should ensure that their written submissions are substantive and focused, as the Court is increasingly willing to penalize parties for "excessive" claims that do not correlate with the actual value provided to the judicial process.
Where can I read the full judgment in Anastasiia Denisova v Aleksei Galtcev [2026] DIFC CFI 041?
The full order can be accessed via the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0412024-anastasiia-denisova-v-1-aleksei-galtcev-2-realiste-holding-ltd-5
CDN link: https://littdb.sfo2.cdn.digitaloceanspaces.com/litt/AE/DIFC/judgments/court-first-instance/DIFC_CFI-041-2024_20260224.txt
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| N/A | N/A | No specific case law precedents were cited in this costs order. |
Legislation referenced:
- Registrars Practice Direction No. 1 of 2023 (Hourly rates)
- Rules of the DIFC Courts (RDC) (General costs assessment principles)