In the sphere of cross-border commercial dispute resolution, the interplay between court proceedings and arbitration is often delicate. When parties dispute whether an arbitration agreement is valid – for instance, because the signatory lacked authority – that challenge will inevitably raise procedural and strategic questions. The recent ruling in Orange v Shein [2025] EWHC 2966 (KB) clarifies key aspects of that interplay under English law, confirming that a defendant may contest jurisdiction and seek a stay in favour of arbitration under section 9 of the Arbitration Act 1996, without needing a separate filing under Part 11 of the Civil Procedure Rules (CPR). The decision reinforces the pro-arbitration stance of English courts and provides practical guidance for structuring jurisdictional challenges.
Context
The dispute arose from a service agreement (SA) allegedly executed in October 2021 between the claimant companies (collectively “Orange”) and the defendant (Shein Distribution UK Ltd, “Shein”). The SA contained an ICC arbitration clause. After the business relationship broke down in early 2025, both sides initiated proceedings against each other: Shein sought repayment of alleged overpayments made to Orange, while Orange and a related entity invoked claims for fraud, misrepresentation, breach of contract, unjust enrichment and other wrongdoing. Orange denied that it had entered into the SA – or that the individual who signed it on its behalf had authority to do so. Shein, for its part, relied on the SA’s arbitration clause to challenge the High Court’s jurisdiction.
Procedural Battle: CPR Part 11 vs Section 9 Stay
One central issue was whether Shein needed to file a separate Part 11 application under the CPR to dispute the court’s jurisdiction, or whether a timely stay application under section 9 of the Arbitration Act, accompanied by an acknowledgment of service contesting jurisdiction, sufficed. The High Court held that where a defendant clearly indicates – at the time of acknowledgment of service – that it intends to challenge jurisdiction and promptly files a section 9 stay application (in compliance with CPR Part 62), a separate Part 11 application is unnecessary. Requiring both would be duplicative and inefficient.
In doing so, the Court also recognized that, even if Part 11 were strictly required, its omission could be corrected under CPR 3.10: the substance of Defendant’s filings made clear its intention to contest jurisdiction. That aligns with recent authorities that allow for procedural flexibility where the intention is manifest.
Who Decides Jurisdiction When Authority Is Disputed?
Beyond procedural formality, the case raised a fundamental substantive question: whether the court or the arbitral tribunal should determine who has authority to bind a company to an arbitration agreement. Here, the alleged signatory’s authority was contested, and the documentary record was incomplete. The Court found that these issues could not be resolved on the papers. In view of the principle of separability (arbitration clause treated as independent from the main contract) and the doctrine of Kompetenz-Kompetenz (tribunal’s competence to decide its own jurisdiction under section 30 of the Arbitration Act), the Court deemed it appropriate for the sole arbitrator already appointed to decide on validity and authority first.
Accordingly, the High Court granted an interim stay of Orange’s and any related claims under its inherent case-management powers (CPR 3.1(2)(g)), allowing arbitration to proceed without interference and preventing parallel court litigation – a result that reduces the risk of inconsistent decisions, duplication, and inefficiency.
Implications for Practitioners and Contract Drafters
The Orange v Shein judgment carries important lessons for practitioners involved in international commercial and arbitration matters. First, it confirms that a straightforward, procedurally correct section 9 stay application – combined with a clear indication of intention to contest jurisdiction on acknowledgment of service – remains the most efficient route to protect an arbitration agreement. Parties may thus avoid the “belt and braces” cost and delays associated with duplicative Part 11 filings, although some may continue to use both approaches to avoid arguments about waiver.
Second, when an arbitration agreement is challenged on the ground of signatory authority – particularly where actual or ostensible authority is disputed – the English High Court continues to defer to tribunals as the first instance to determine their own jurisdiction. That reinforces the separability doctrine’s practical strength and underscores the respect afforded to parties’ choice of arbitration. In practice, this means that counsel should anticipate and prepare for early tribunal jurisdictional hearings and should ensure that all relevant documentary or witness evidence relating to authority is gathered and submitted promptly.
Finally, for those drafting international contracts, the case highlights the importance of clear, well-documented internal authorization processes when companies enter into arbitration agreements. A signature alone may not suffice if authority is contested later. Including board resolutions, corporate signatory lists, or explicit delegation authorizations can be critical to avoid jurisdictional dispute and potential delays.
For more information, please visit:
https://caselaw.nationalarchives.gov.uk/ewhc/kb/2025/2966?query=Orange+Shein+%5B2025%5D+EWHC+2966+%28KB%29
