Introduction:

On 25 August 2025, the Supreme Court of India (SC) in Glencore International AG v Shree Ganesh Metals (Glencore) delivered a significant judgment pertaining to the enforceability of unsigned arbitration agreements. The Court decided a petition challenging the orders of the Delhi High Court that rejected the invocation of arbitration proceedings despite the existence of an arbitration agreement in the matter. The agreement was at the centre of the dispute owing to the lack of signature of one party, thereby raising doubts about its enforceability and the arbitration clause that accompanied it. Allowing the petition, the SC held the arbitration clause to be valid and enforceable and declared the parties to be bound by it. This piece examines the law reinforced in Glencore regarding the role of the existence of a written, unsigned agreement and the role of conduct on the enforceability of the agreement by understanding the backdrop of the case and the judgment, followed by the dissection of the legal regime. The blog also discusses the foreign trends on the issue and examines the practicality of the Indian approach.

Background of the Case

The dispute arose from a metal supply-purchase agreement between Glencore International AG (Petitioner) and Shree Ganesh Metals (Respondent), which followed a series of similar agreements executed by the parties in earlier years. Under these agreements, the Petitioner undertook to supply the agreed quantity of zinc metal, while the Respondent was required to maintain Standby Letters of Credit (SLCs). The earlier contracts were duly performed, reflecting the parties’ mutual trust and the continuity of their commercial relationship, which eventually materialised in the 2016 agreement (2016 Agreement). The deliberations on the 2016 Agreement categorically echoed the parties’ intention to adopt all the terms of the last contract entered into in 2012, with one exception related to the time period regarding the rate of the metal supplied. This modification, introduced by the Respondent, was duly accepted by the Petitioner, who then sent the final signed contract. The bone of contention lay in the fact that while the Respondent had signed the 2016 Agreement, the Petitioner never did. 

The performance of the contract was vitiated by the Petitioner’s default in maintaining the SLCs from July and August 2016 onwards, followed by the failure to procure the left-over contractually mandated quantity of the metal. While the Petitioner initially assured to hold its end of the bargain, it failed to do so later on when it again defaulted in maintaining the SLC for September 2016. This forced the Petitioner to encash the SLCs. While the encashment was initially met with no protest and the Respondent wished to continue the procurement, the Respondent later filed a civil suit in the Delhi High Court against the Petitioner, challenging the encashment of the SLCs. During the pendency of the case, the Respondent moved an interim application for the invocation of arbitration under the arbitration clause of the 2016 agreement. The same was rejected by the single-judge bench, followed by the dismissal before the Division bench of the Delhi High Court, which led to the petition being presented before the SC.  

The Judgement

The Supreme Court held that the 2016 Agreement was binding and enforceable, even though it lacked the Petitioner’s signature. Upon analysis, the Court’s reasoning can be segregated into two pillars: implied acceptance and partial performance. Regarding implied acceptance, the Court noted that Glencore had manifested an intention to adopt the terms of the earlier 2012 agreement, save for the modified pricing condition. The Respondent’s act of forwarding the 2016 Agreement was treated as both acceptance of this variation and as signalling the commencement of a new contractual arrangement.

On partial performance, the Court emphasised that the conduct of both parties reflected substantial compliance, leaving little room to deny the agreement’s existence. Deliveries of zinc were duly made by the Respondent until the dispute over payments arose. Meanwhile, Respondent had initially furnished SLCs and, through subsequent communications, expressed its willingness to revive the contract despite an earlier lapse. However, by failing to honour its obligations and instituting a civil suit, Respondent effectively sought to both affirm and repudiate the same contract. The Court, therefore, concluded that the 2016 Agreement stood established by conduct.

Validity of the Arbitration Clause?

It is remarkable to note that the arbitration clauses in the 2016 Agreement and the one entered into in 2012 were worded differently. However, the SC did not find any material difference between the two, as both of them prescribed the same route to arbitration in essence. Thus, the difference in wording did not create a bar to the existence of the arbitration agreement between the parties. Importantly, it was the acceptance of the arbitration clause in the 2016 Agreement that mattered. This raises the question of whether the absence of a signature has any negative effect on the validity of the arbitration agreement. 

As per the SC, it does not affect validity, finding a written but unsigned agreement enough to constitute a valid and enforceable arbitration agreement. Under the Arbitration and Conciliation Act, 1940, the SC in Jugal Kishore Rameshwardas v Goolbai Hormusji held that the arbitration agreement was deemed to be incorporated even if it was unsigned, given that it was reduced to writing. This interpretation ensured that commercial dealings, often structured around standard form contracts and repeated arrangements, would not stand defunct merely on technical grounds. This observation was repeated in Caravel Shipping Services (P) Ltd. v Premier Sea Foods Exim (P) Ltd. (Caravel Shipping), where an unsigned bill of lading was recognised to incorporate a valid arbitration clause. The SC in Caravel Shipping has recognised the power of unsigned agreements to constitute valid arbitration agreements under Section 7(3) of the Arbitration and Conciliation Act, 1996 (the Act), where agreements “in writing” need not be signed to be valid. Thus, the same reasoning applied to Glencore.

The Evidentiary Role of Conduct 

The law laid down by the SC in the aforementioned cases recognises the enforceability of unsigned arbitration agreements by virtue of their existence in written form. However, while Section 7(3) does not expressly recognise the role of conduct, in practice, though, the conduct of the parties toward the obligations under the main agreement would be demonstrated by performance, which serves as powerful evidence of an intention to be bound. This raises an important question: can such conduct bridge the gap left by the absence of a signature and validate an unsigned arbitration agreement?

The answer to this question was given by the SC in Govind Rubber Ltd. v Louis Dreyfus Commodities Asia (P) Ltd., where the Court recognised prima facie conduct of the parties to be sufficient to bind the parties to the arbitration agreement. In this case, the arbitration agreement was found to prima facie exist due to the conduct, which included acceptance of the modification of the terms of the contract, similar to the fact of Glencore. The SC also appreciated the role of conduct in Section 7(4) of the Act, which realises the existence of an arbitration agreement through communications of the parties providing a record of the agreement. Thus, the conduct of the parties shows an ad idem intention to be bound by the means of the arbitration agreement if discernible through communications and actions. 

Insights From Foreign Jurisdictions

The international perspective on the recognition of an unsigned agreement incorporates a mixed view. Foreign jurisdictions, in usual practice, do not allow the plain rule of existence of an unsigned agreement to be held enough for binding the parties. The English Commercial Court, in the decision of Reveille Independent LLC v Anotech International (UK) Ltd, pointed out that the actions of the parties that signal commitment towards the completion of contractual performance may not be enough to establish the contract by conduct, but it does show a strong consensus to be bound by the terms of the agreement. Long-term activities that do not seem to arise but for the contract are a sign of concurrence to the existence of the contract. This existence cannot be said to be altered merely by the absence of a signature on the agreement. 

The Singapore High Court has echoed the importance of conduct more than the mere existence of a written agreement in the case of Jiangsu Overseas Group Co Ltd v Concord Energy Pte Ltd, where it was approached to set aside arbitral awards on the grounds of a non-existent arbitration agreement because it was not signed despite being written. The Court upheld the existence of the arbitration agreement, relying on the parties’ affirmative conduct that clearly reflected their intention to resolve disputes through arbitration.

However, the position in the United Arab Emirates is starkly opposite. In April 2025, the Dubai Court of Cassation overturned the Court of Appeal’s judgment, which had validated an unsigned arbitration agreement. The Court reasoned that arbitration agreements waive the right to utilise litigation as a dispute resolution mechanism. Therefore, arbitration agreements must be agreed to in writing through signatures. It further noted that merely stamping an annexure containing an arbitration clause or referring to it in the main contract was insufficient to establish the arbitration agreement between the parties. Accordingly, neither conduct nor a written agreement was sufficient to enforce an unsigned agreement. Evidently, international jurisprudence does not reveal a unidirectional approach to recognising unsigned arbitration agreements. 

The Path Ahead

The judgment in Glencore reinforces the idea that the need for signatures in a commercial document is increasingly becoming redundant in the present world, where the intention to be bound in agreement is proved through conduct. The same is applicable to the arbitration agreement nestled within the main agreement. Gone are the days when people considered signing the pay receipt after using Credit or Debit cards; regardless of the signature, they would find themselves as party to the Terms and Conditions. Public policy of this time, where digital contracts are continuously executed solely based on conduct of the parties without signature(s) or witness, requires recognition of an unsigned agreement as the need of the hour. While foreign jurisdictions reflect a variation, from Singapore’s emphasis on conduct, to England’s cautious recognition, to the UAE’s insistence on signatures, India’s approach in Glencore aligns with the more progressive strand that privileges substance over form. Thus, the existence of an unsigned agreement coupled with the actions of the parties is and should be sufficient to establish the legal relationship that could be arbitrated.