What was the nature of the dispute in Oleksei v Olorun [2026] DIFC ARB 005 and what costs were at stake?
The dispute arose from an application by seven Claimants—Oleksei, Olesja, Oliff, Olexi, Olinijia, Olimipiana, and Olley—seeking injunctive relief against five Respondents: Olorun, Olov, Olumiji, Oluluaboe, and Olushegun. The core of the matter involved a challenge to the DIFC Court’s jurisdiction to grant the requested injunctions. Following a hearing on 26 January 2026, the Court determined that it lacked the necessary jurisdiction to grant the relief sought by the Claimants.
Consequently, the First and Fourth Respondents, having successfully resisted the application, sought the recovery of their legal costs. The Court was tasked with performing a summary assessment of these costs, which involved scrutinizing significant claims for solicitors' fees, counsel fees, and foreign legal expenses. The process highlighted the Court’s rigorous approach to ensuring that only costs reasonably incurred in connection with the proceedings are recoverable. As noted by the Court:
The First and Fourth Respondents succeeded at the Hearing and are prima facie entitled to their reasonable costs. I do not consider that this case is outside the norm so that there is no basis for an award of costs on the indemnity basis.
https://www.difccourts.ae/rules-decisions/judgments-orders/arbitration/arb-0052026-1-oleksei-2-olesja-3-oliff-4-olexi-5-olinijia-6-olimipiana-7-olley-v-1-olorun-2-olov-3-olumiji-4-oluluaboe-5-olusheg
Which judge presided over the costs assessment in Oleksei v Olorun [2026] DIFC ARB 005 and in which division was the matter heard?
The matter was heard before H.E. Justice Sir Jeremy Cooke, sitting in the Arbitration Division of the DIFC Court of First Instance. The hearing took place on 26 January 2026, with the subsequent Order with Reasons issued on 24 February 2026.
How did the First and Fourth Respondents justify their entitlement to costs in Oleksei v Olorun [2026] DIFC ARB 005?
The First and Fourth Respondents argued that as the successful parties in the jurisdictional challenge, they were entitled to the recovery of their legal costs. The Fourth Respondent, despite not being accused of any specific wrongdoing in the underlying application, was deemed entitled to costs because she had been served and successfully challenged the Court’s jurisdiction.
The First Respondent’s position was slightly more nuanced. Although they initially served a brief skeleton argument that did not expressly object to the orders sought, they pivoted during the hearing to support the Fourth Respondent’s jurisdictional arguments. The Court found this participation sufficient to warrant a costs award, stating:
The First Respondent served a 3 page skeleton in which it made no express objection to the orders sought but at the Hearing jumped on the Fourth Respondents’ bandwagon relating to jurisdiction and by counsel argued against the grant of the injunction on other grounds. It too is entitled to an order for costs.
What was the primary legal question regarding the recoverability of foreign legal fees under the Rules of the DIFC Courts?
The Court had to determine whether legal fees incurred by an unregistered foreign lawyer—specifically an Italian practitioner—could be recovered as part of the successful parties' costs. The doctrinal issue centered on the requirement for legal practitioners to be registered under Part 1 of the Rules of the DIFC Courts (RDC) to be recognized as providers of legal services whose fees are recoverable in a summary assessment. The Court had to decide if the "reasonable costs" principle could extend to fees paid to practitioners who do not hold the requisite standing within the DIFC jurisdiction.
How did H.E. Justice Sir Jeremy Cooke apply the principle of "reasonable costs" to the summary assessment in Oleksei v Olorun [2026] DIFC ARB 005?
Justice Cooke adopted a restrictive approach to the summary assessment, emphasizing that while successful parties are entitled to costs, those costs must be "reasonably incurred." The judge scrutinized the itemized claims, reducing solicitor fees where the scope of work was limited and disallowing entirely the fees of unregistered foreign counsel. The reasoning was clear: if a practitioner is not registered under Part 1, their fees cannot be considered a recoverable expense in the context of DIFC litigation. The Court explained:
(c) AED 90,000 is claimed in respect of an Italian lawyer’s fees who is not registered under Part 1 and are disallowed in total as not incurred reasonably in connection with the claim.
Which specific statutes and rules governed the costs assessment in Oleksei v Olorun [2026] DIFC ARB 005?
The assessment was governed by the Rules of the DIFC Courts (RDC), specifically those provisions relating to the summary assessment of costs and the regulation of legal practitioners. The Court relied on its inherent power to manage costs under the RDC to ensure that the amounts claimed were proportionate and reasonably incurred. Furthermore, the Court applied the regulatory framework requiring legal practitioners to be registered under Part 1 of the RDC to act for parties in the DIFC Courts, which served as the basis for disallowing the Italian lawyer's fees.
How did the Court treat the late submission of costs schedules in Oleksei v Olorun [2026] DIFC ARB 005?
The Court acknowledged that the schedules were submitted late but determined that this procedural lapse did not prejudice the Claimants. Because the Claimants were afforded an adequate opportunity to review and make submissions regarding the costs schedules, the Court proceeded with the assessment. The judge noted:
The lateness of the submission of costs schedules is borne in mind but no prejudice has been suffered by the Claimant who has had the opportunity to make submissions thereon.
What was the final disposition and the specific monetary relief awarded by the Court?
The Court ordered the Claimants to pay the First and Fourth Respondents specific sums, reflecting the Court's summary assessment and reductions. The First Respondent was awarded AED 92,000, while the Fourth Respondent was awarded AED 87,177.82. These amounts were calculated after the Court reduced the solicitors' fees for the First Respondent from the requested AED 85,500 to AED 60,000, and significantly reduced the Fourth Respondent’s total claim to AED 50,000 (inclusive of VAT), while allowing counsel fees in full.
The Claimant shall within 28 days of this Order pay the First Respondent the sum of AED 92,000.
What are the wider implications for DIFC practitioners regarding the recovery of legal costs?
This case serves as a stern reminder that the DIFC Court will not rubber-stamp costs claims, even for successful parties. Practitioners must ensure that all legal fees included in a statement of costs are incurred by individuals properly registered under Part 1 of the RDC. Failure to do so will result in the total disallowance of those fees. Furthermore, the Court’s willingness to reduce "excessive" claims highlights the necessity of providing detailed, justifiable breakdowns of work performed. For a broader discussion on the jurisdictional limits of the Court in similar matters, see the deep editorial analysis at: Oleksei v Olorun [2026] DIFC ARB 005: The Jurisdictional Limits of Precautionary Measures in Foreign-Seated Arbitrations.
Where can I read the full judgment in Oleksei v Olorun [2026] DIFC ARB 005?
The full judgment can be accessed via the DIFC Courts website at: https://www.difccourts.ae/rules-decisions/judgments-orders/arbitration/arb-0052026-1-oleksei-2-olesja-3-oliff-4-olexi-5-olinijia-6-olimipiana-7-olley-v-1-olorun-2-olov-3-olumiji-4-oluluaboe-5-olusheg
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| N/A | N/A | No external case law cited in this specific costs order. |
Legislation referenced:
- Rules of the DIFC Courts (RDC), Part 1 (Registration of Legal Practitioners)
- Rules of the DIFC Courts (RDC), Summary Assessment of Costs provisions