Select Demo application >> "Tree View" -> "Drag & Drop". Focus on the left treeview.
1. Click on the node "Drafts";
2. Press Shift button and click on the "Outbox" node;
3. Release shift button;
4. Press left mouse button on the "Outbox" node and start dragging;
5. Drop selected nodes after node "Large Mail".

You can see that order of nodes was changed.
Before: "Drafts", "Inbox" and "Outbox"
After: "Outbox", "Drafts" and "Inbox"

Possible workaround: http://www.telerik.com/forums/nodes-order-after-drag-drop#5bbz6cBDEUeHLyLU5zkfDQ