Dentons: Appeal Costs and a £200,000 Payment [2026]

Detailed Assessment — 2026-05-21

In Dentons UK and Middle East LLP v SRA [2026] EWCA Civ 655, the Court of Appeal held that the regulator’s special first-instance costs protection does not extend to appeals. Dentons received 65% of its appeal costs, but only £200,000 on account against expenditure of £793,679.60.

Overview

Date: 21 May 2026

Judges: Bean LJ, Jeremy Baker LJ and Zacaroli LJ

Court: Court of Appeal, Civil Division

Citation: [2026] EWCA Civ 655

Nature of Proceedings: Costs judgment following Dentons' successful second appeal in Solicitors Disciplinary Tribunal proceedings

Key Issues:

Whether the SRA's protection from ordinary costs shifting before the SDT extends to appeals
The appropriate percentage order where Dentons substantially succeeded but the case was remitted
Estimating a payment on account where Dentons' costs greatly exceeded the SRA's
Distinguishing a party's freedom to instruct an expensive team from the amount reasonably imposed on an opponent

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The Decision

Dentons UK and Middle East LLP v Solicitors Regulation Authority Ltd, reported as [2026] EWCA Civ 655, confirms that the special costs protection afforded to a professional regulator before the Solicitors Disciplinary Tribunal does not follow it into the ordinary appellate courts.

Dentons had succeeded in a substantive appeal reported as [2026] EWCA Civ 508. The Court of Appeal quashed the SDT's decision and remitted the case for determination under a different legal test. This further judgment dealt with the costs of Dentons' appeal to Lang J and its second appeal to the Court of Appeal. Costs before the SDT itself were left for that tribunal.

The SRA was ordered to pay 65 per cent of Dentons' costs of both appeals, subject to detailed assessment if not agreed. Dentons had incurred £793,679.60 excluding VAT. Although 65 per cent produced £515,891.74, the Court of Appeal ordered only £200,000 on account because the total required a substantial discount when estimating likely recovery.

The judgment is significant both for regulatory appeals and for payments on account. It rejects a regulator's claimed immunity from normal costs shifting on appeal while applying close scrutiny to the successful party's exceptionally high expenditure.

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Why Dentons Received 65 Per Cent

Dentons was substantially the successful party across the two appeals. Its challenge resulted in the SDT's decision being quashed.

It had not, however, achieved a final disposal of the disciplinary case. The matter was remitted to the SDT to be considered again using the different test set out in the substantive Court of Appeal judgment.

The court balanced those two features by awarding Dentons 65 per cent of its costs in the High Court and Court of Appeal. The order recognised substantial appellate success without treating remittal as complete success on the underlying disciplinary allegations.

The court did not decide the costs before the SDT. Those remained reserved to the tribunal, where a different costs approach applies.

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Key Holdings

1. The SRA has special protection before the SDT

In Baxendale-Walker v Law Society, the Court of Appeal held that costs do not automatically follow the event when the Law Society, now the SRA, brings disciplinary proceedings in its regulatory capacity.

The regulator must be able to place properly justified complaints before the tribunal in the public interest. Exposure to adverse costs merely because a proper case failed could discourage the performance of that function. A successful solicitor before the SDT therefore has no presumption of a costs order in their favour.

That protection reflects the regulator's distinct public role at first instance. It does not amount to a general immunity in every later stage of the litigation.

2. Ordinary costs shifting applies on appeal

The SRA argued that the same principle should prevent an order against it for the appeals to Lang J and the Court of Appeal.

The court rejected that submission. Wingate v SRA establishes that parties entering the Administrative Court on an appeal from the SDT enter a costs-shifting regime. Subject to special circumstances, the losing party normally pays under CPR 44.2.

Earlier comments suggesting that the regulatory principle might also apply on appeal were not binding and did not displace Wingate.

The reason for protecting a regulator when deciding whether to bring a properly justified complaint does not apply in the same way once the SDT has made a determination and the SRA defends or challenges that result on appeal. In that setting, the SRA's position is much closer to that of an ordinary civil litigant.

Dentons was therefore entitled to its 65 per cent costs order despite the SRA's regulatory status.

3. Dentons' costs required a substantial discount

Dentons' costs schedules totalled £793,679.60 excluding VAT, which was not claimed because the firm was VAT registered. The breakdown was:

£355,778.98 in the High Court.
£437,900.62 in the Court of Appeal.

The figure was nearly 4.5 times the SRA's expenditure. The SRA recorded £90,358.54 in the High Court and £89,479.13 in the Court of Appeal.

Applying the 65 per cent order to Dentons' total produced £515,891.74. That arithmetic did not establish what should be paid before assessment.

4. The payment on account had to reflect likely recovery

The purpose of a payment on account is not to conduct a summary assessment. The court must estimate the likely amount recoverable on detailed assessment and then allow a margin for error.

The appeal was undoubtedly important to Dentons. The relevant inter partes question was nevertheless not whether Dentons was entitled to choose expensive solicitors and counsel. It was whether the resulting cost could reasonably be imposed on the SRA.

The High Court hearing lasted one day. The Court of Appeal hearing lasted less than two days and substantially repeated the same arguments. Against that procedural scale, Dentons' total was described as enormous.

The court therefore applied a substantial discount when estimating likely recovery and ordered £200,000 on account, payable within 21 days. The remaining entitlement was left for agreement or detailed assessment.

The £200,000 was not a finding that Dentons' recoverable costs were limited to that sum. Equally, the 65 per cent order did not guarantee recovery of 65 per cent of every amount actually spent.

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Practical Implications

For Regulatory Appeals

1. Separate the tribunal and appeal regimes. The regulator's protection from ordinary costs shifting applies before the SDT because of its public disciplinary function. Appeals in the Administrative Court and Court of Appeal ordinarily engage CPR 44.2.

2. Regulatory status is not appellate immunity. Once the regulator defends or pursues an appeal from an existing tribunal decision, it stands much closer to an ordinary litigant for costs purposes.

3. Remittal can justify a percentage order. Quashing the decision made Dentons substantially successful, but the unresolved disciplinary proceedings prevented treatment of the result as a complete victory.

4. Keep tribunal costs separate. An appellate costs order may leave the costs of the original disciplinary proceedings entirely to the specialist tribunal.

For Costs Lawyers

1. Do not calculate the payment from the percentage alone. Applying 65 per cent to the incurred total produced £515,891.74, but the safe estimate of likely recovery was only £200,000.

2. Use the opponent's expenditure as a comparator. A large disparity is not determinative, but nearly 4.5 times the SRA's costs gave the court a clear reason to scrutinise Dentons' figure.

3. Match the estimate to the work actually required. The length of the hearings, repetition between appellate stages and complexity of the issues all informed the margin applied.

4. Distinguish client choice from inter partes reasonableness. A party may reasonably decide to buy the strongest available representation. It does not follow that the whole price is reasonable to impose on the opponent.

5. Treat the payment as a floor, not a final assessment. The receiving party obtains cash pending assessment, while both sides retain their arguments about the ultimate amount.

For Solicitors and Clients

1. Budget for adverse appeal costs even in regulatory litigation. The special first-instance approach does not remove ordinary appellate risk.

2. Reassess proportionality at each appeal stage. Substantially repeating a case with an expensive team may create a large gap between the bill paid and inter partes recovery.

3. Record why the chosen team and work were required. Importance to the client is relevant context, but detailed assessment will focus on what was reasonable and proportionate for the opponent to bear.

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Conclusion

Dentons v SRA draws a clear boundary around the regulator's special protection from adverse costs. The SRA may bring properly justified disciplinary proceedings before the SDT without the ordinary presumption that costs follow the event. Once the dispute reaches the appellate courts, the normal costs-shifting regime applies.

Dentons was substantially successful and recovered 65 per cent of its costs of two appeals. Its actual expenditure of £793,679.60 was, however, nearly 4.5 times the SRA's. For hearings lasting one day and less than two days, with substantial repetition, the court estimated a much lower safe recovery and ordered £200,000 on account.

The decision is a useful warning against treating success percentages as payment percentages. The costs order defines the share of reasonable costs recoverable. Detailed assessment still determines what those reasonable costs are.

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Citation: Dentons UK and Middle East LLP v Solicitors Regulation Authority Ltd [2026] EWCA Civ 655

Full judgment available at: The National Archives

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