Labour Disputes
Texto da decisão
Decision of the
Dispute Resolution Chamber
passed in Zurich, Switzerland, on 26 May 2016,
in the following composition:
Thomas Grimm (Switzerland), Deputy Chairman
Johan van Gaalen (South Africa), member
Eirik Monsen (Norway), member
Wouter Lambrecht (Belgium), member
Zola Percival Majavu (South Africa), member
on the claim presented by the player,
Player A, country B
as Claimant
against the club,
Club C, country D
as Respondent
regarding an employment-related dispute arisen between the parties
I.
Facts of the case
1.
On 27 January 2015, the club from country D, Club C (hereinafter: Respondent or
club), and the club from country B, Club E (hereinafter: Club E), concluded a
transfer agreement, by means of which the parties agreed, inter alia, that “for
the definitive buying the International Transfer Certificate (“ITC”) of the player,
the [club] shall pay to [Club E] the total amount of (Two Hundred Thousand US
Dollars) net, in three instalments as follows”:
- USD 50,000 on the date of the signature;
- USD 100,000 before the end of September 2015; and
- USD 50,000 before the end of January 2016.
2.
Clause 4 of the transfer agreement establishes that “The agreement is cancelled if
the [club] delayed on paying the amount agreed on. And the [club] is obligated to
return the player to [Club E]”.
3.
According to clause 5 of the transfer agreement, “The relationship between the
player and [Club E] in connection with the handing over of his International
Transfer Certificate will end after the payment of the second instalment”.
4.
On 28 January 2015, the player from country B, Player A (hereinbefore and
hereinafter: Claimant or player) and the Respondent concluded an employment
contract (hereinafter: contract), valid from 27 January 2015 until 27 July 2018.
5.
According to clause 4.4 of the contract, “The total value of the contract: (USD
420,000) of which (USD 60,000), divided as follows: (USD 30,000), submitted
divided held on the first three payments (USD 5,000) when signing and (USD
15,000) after the arrival of international card and (USD 10,000) after two weeks of
the arrival of international card. The remainder (USD 30,000) for the first six
months of contract salaries. The remainder (USD 360,000) is divided as follows
(USD 90,000) paid in three instalments of (USD 30,000) for each batch dated
08.15.2015 and 08.15.2016 and m 15.08.2017 and the remaining amount (USD
270,000) monthly salary for three years the last of the player by contract (USD
7,500) for each club to pay for each airline ticket back and forth to his season”.
6.
Clause 13.6 of the contract establishes that “The permanence of the player on the
team is associated with his physical performance and the satisfactions of the
coach. If there is any lacking in one of these conditions the club has the right to
cancel the contract and is committed to player the amount of 3 month’s salary.
the amount will set the club free from any financial obligation towards the player
and the player does not have the right to demand any other payment. The club
must notify the player before the cancelling in suitable time”.
In August 2015, the Respondent terminated the contract with the Claimant in
writing stating the following:
7.
Player A, country B / Club C, country D
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“Club C’s board would like to thank you for the period you have spent at the club,
doing your best and your effort with the team.
But because of the circumstances the club has faced, we are sorry to inform you of
the board’s decision of cancelling your contract with the club from 1st of August
8, 2015 and now you can back as a player in Club E according to your transfer
agreement.”
8.
On 26 August 2015, the Claimant lodged a claim before FIFA against the
Respondent for breach of contract, requesting the aggregate amount of USD
360,000, composed as follows:
- USD 90,000, corresponding to three equal instalments of USD 30,000 due,
respectively, on 15 August 2015, 15 August 2016 and 15 August 2017;
- USD 270,000 corresponding to 36 monthly salaries of USD 7,500 each for the
seasons 2015/2016, 2016/2017 and 2017/2018.
9.
According to the Claimant, the Respondent paid his salaries until the end of the
season 2014/2015, on 16 May 2015, when the Claimant departed to country B,
“hoping to come back for the 2015/2016 season sometime before August 2015 to
resume training”. Since he did not hear from the Respondent regarding the
return to training, the Claimant contacted the Respondent in writing, on 2 August
2015, requesting the flight ticket to join the club. The Respondent allegedly never
replied to such letter.
10.
Moreover, the Claimant held that, on 10 August 2015, the Respondent terminated
the contract via email enclosing a copy of an undated termination letter but
which letter indicates a termination as of 1st August 2015. The Claimant
highlighted that the email was sent on 10 August 2015 and the notice of
termination backdated to 1 August 2015, a day before the Claimant sent the
request for flight tickets.
11.
In addition, the Claimant held that, on 15 August 2015, the Respondent had to
pay USD 30,000 to the Claimant. According to the Claimant, the Respondent
wanted to avoid paying such amount.
12.
The Claimant stated that he contacted the Respondent on 12 August 2015,
rejecting the termination of the contract and offering to negotiate a mutual
termination, which remained unanswered by the Respondent.
13.
Finally, the Claimant held having contacted Club E, since the Respondent asked
him to return to the latter, but Club E explained that he could not return since he
was registered with the Respondent.
Player A, country B / Club C, country D
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14.
In reply to the claim, the Respondent held that the duration of the contract with
the Claimant depended on the execution of the transfer agreement it had signed
with Club E.
15.
In this respect, the Respondent maintained that, in accordance with clause 4 of
the transfer agreement, the agreement was actually a temporary transfer
agreement with an option for the definitive transfer of the player, considering
that the definitive transfer would only transpire in the event that the Respondent
paid the three contractual instalments.
16.
In this context, the Respondent stated having notified Club E, on 12 July 2015, of
the interruption of the transfer agreement and that it would return the ITC for
the player upon request.
17.
Subsequently, the Respondent allegedly informed the Claimant on 1 August 2015
that it did not wish to continue with the contract in accordance with its clause
13.6 and that he should return to Club E.
18.
In this regard, the Respondent held that it was advised by the assistant coach not
to continue with the contract with the Claimant due to his performance.
19.
The Respondent further asserted that, on 31 August 2015, it again notified the
Claimant of the reasons for the termination and informed him that three monthly
salaries were at his disposal as compensation.
20.
In conclusion, the Respondent held the following:
- that it is not responsible for any kind of unilateral breach of contract;
- that it properly cancelled the transfer agreement, notifying Club E;
- that it also properly notified the Claimant about the end of the contract;
- that it has no other obligation towards the Claimant than the payment of the
amount of USD 22,500, corresponding to three monthly salaries, as
established in the contract.
21.
The Respondent further asked that the Claimant bears any procedural costs
imposed.
22.
In his replica, the Claimant insisted on his claim and stated that the Respondent is
clearly trying to avoid the consequences of a contractual breach, only now
alleging that the contract was terminated due to alleged poor performance and
enclosing a statement of the assistant coach. The Respondent terminated the
contract due to circumstances it was facing, as clearly stated in the termination
letter, and the Respondent even thanked the Claimant for his efforts in said
letter.
Player A, country B / Club C, country D
Page 4 of 11
23.
The Claimant held that the Respondent damaged his career, terminating the
contract and leaving him with no chance to play for another club. Moreover, the
Claimant held that he rejected offers to have trials at other clubs.
24.
Moreover, according to the Claimant, the Respondent is also trying to justify the
termination on the basis of the transfer agreement to which the Claimant is not
even a party. The Claimant highlights that the disagreement between the
Respondent and Club E cannot harm the Claimant.
25.
In its duplica, the Respondent recalled its previous arguments and added that the
Claimant was aware, when he left in May 2015, that the Respondent did not want
to continue with the contract, reason why the Claimant was invited for a trial by
another club. Therefore, according to the Respondent, the Claimant had enough
time to either find a new club or return to Club E.
26.
According to the information contained in the Transfer Matching System (TMS),
the player signed an employment contract with the club from country B, Club F,
valid from 16 May 2016 until 31 October 2017, establishing a total remuneration
of 16,750.
II.
Considerations of the Dispute Resolution Chamber
1.
First of all, the Dispute Resolution Chamber (hereinafter also referred to as
Chamber or DRC) analysed whether it was competent to deal with the matter at
hand. In this respect, it took note that the present matter was submitted to FIFA
on 26 August 2015. Consequently, the Rules Governing the Procedures of the
Players’ Status Committee and the Dispute Resolution Chamber (edition 2015;
hereinafter: Procedural Rules) are applicable to the matter at hand (cf. art. 21 of
the Procedural Rules).
2.
Subsequently, the members of the Chamber referred to art. 3 par. 1 of the
Procedural Rules and confirmed that in accordance with art. 24 par. 1 in
combination with art. 22 lit. b of the Regulations on the Status and Transfer of
Players (edition 2015) the Dispute Resolution Chamber is competent to deal with
the matter at stake, which concerns an employment-related dispute with an
international dimension between a player from country B and a club from country
D.
3.
Furthermore, the Chamber analysed which regulations should be applicable as to
the substance of the matter. In this respect, it confirmed that in accordance with
art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players
(edition 2015), and considering that the present claim was lodged on 26 August
Player A, country B / Club C, country D
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2015, the 2015 edition of said regulations (hereinafter: Regulations) is applicable
to the matter at hand as to the substance.
4.
The competence of the Chamber and the applicable regulations having been
established, the Chamber entered into the substance of the matter. In this respect,
the Chamber started by acknowledging all the above-mentioned facts as well as
the arguments and the documentation submitted by the parties. However, the
Chamber emphasised that in the following considerations it will refer only to the
facts, arguments and documentary evidence, which it considered pertinent for the
assessment of the matter at hand. In addition, the Chamber recalled that in
accordance with art. 6 par. 3 of Annexe 3 of the Regulations, FIFA may use, within
the scope of proceedings pertaining to the application of the Regulations, any
documentation or evidence generated or contained in the Transfer Matching
System (TMS).
5.
In this respect, the DRC acknowledged that the Claimant and the Respondent
signed a contract on 28 January 2015, valid from 27 January 2015 until 27 July
2018. Furthermore, the DRC took note that previously, on 27 January 2015, the
Respondent had signed a transfer agreement with Club E for the transfer of the
Claimant to the Respondent.
6.
In this context, the Chamber took note that the Claimant lodged a claim against
the Respondent for breach of contract, requesting compensation in the total
amount of USD 360,000, corresponding to the residual value of the contract until
27 July 2018. More specifically, the Claimant indicated that, on 10 August 2015,
the Respondent terminated the contract in writing without just cause, which he
promptly rejected on 12 August 2015.
7.
The DRC took note that the Respondent, for its part, denied that it terminated
the contract without just cause, but accepted to pay USD 22,500 as compensation
in accordance with clause 13.6 of the contract. The Respondent further argued,
inter alia, that it had properly notified the Claimant of the termination of the
contract and Club E of the termination of the transfer agreement, which,
according to the Respondent, in fact was an agreement for the temporary
transfer of the player only.
8.
Having established the aforementioned, the Chamber deemed that the
underlying issue in this dispute, considering the claim of the Claimant and the
allegations of both parties, was to determine whether the employment contract
had been unilaterally terminated with or without just cause by the Respondent.
The DRC also underlined that, subsequently, if it were found that the employment
contract was terminated without just cause, it would be necessary to determine
the consequences for the party that was responsible for the early termination of
the contractual relation without just cause.
Player A, country B / Club C, country D
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9.
In this respect, the Chamber acknowledged that the Respondent held that
although it was established in the contract that it was valid until 27 July 2018, its
duration depended on the execution of the transfer agreement. In particular, the
DRC took note of the Respondent’s argument that the transfer agreement
concluded with the Claimant’s former club, Club E, was actually a temporary
transfer with an option for the definitive transfer of the player in accordance with
clause 4 of the transfer agreement, which option was not exercised by the
Respondent by not paying the instalments agreed in the transfer agreement.
10.
Considering the argument of the Respondent regarding the duration of the
contract, the members of the DRC reverted to the transfer agreement and in
particular, to clause 4, which establishes that “The agreement is cancelled if the
[club] delayed on paying the amount agreed on. And the [club] is obligated to
return the player to [Club E]”. In this regard, the members of the DRC concluded
that, contrary to the position of the Respondent, the transfer agreement is in fact
in relation to a definitive transfer of the player with a clause that would entitle
the former club to cancel the agreement if the amount agreed upon is not paid in
a timely manner.
11.
Moreover, in any case, the members of the DRC were eager to emphasise that the
transfer agreement and the employment contract are two separate agreements,
independent from one another, which carry separate obligations that need to be
fulfilled by the different contractual parties. Accordingly, the Chamber
highlighted that the employment relation between the Respondent and the
Claimant was governed by the employment contract, the obligations of which
were to be respected by the respective contractual parties independently from the
transfer agreement.
12.
On account of the above, the Chamber agreed that the Respondent’s
argumentation regarding the transfer agreement could not be upheld and
concluded that the contract signed by and between the Claimant and the
Respondent was valid until 27 July 2018.
13.
In continuation, the DRC reverted to the Respondent’s argument that it decided
to cease the employment relationship with the Claimant due to his performance
and that it had notified the Claimant accordingly.
14.
In this respect, the Claimant alleged that the Respondent was trying to avoid the
consequences of the contractual breach, raising arguments before FIFA that were
not invoked before, in particular on the occasion of the termination of the
contract. The Claimant highlighted that the Respondent terminated the contract
Player A, country B / Club C, country D
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due to circumstances the club was facing at that moment and even thanked the
player for his efforts.
15.
In this context, the Chamber was keen to emphasize that, in accordance with its
longstanding and well-established jurisprudence, the unsatisfactory performance
of a player does not constitute a just cause for a club to prematurely terminate
the employment relationship, as this judgement is subjective and unmeasurable.
Thus, due to the subjective and arbitrary nature of such grounds for dismissal, the
Chamber concluded that this argument of the Respondent in order to justify the
unilateral termination of the contract could not be sustained.
16.
In addition, the Chamber took note of the Claimant’s argument that the
Respondent had neither invoked the transfer agreement nor his performance as
reasons for his dismissal on the occasion of the termination of the contract.
17.
At this point, the DRC acknowledged that, in the termination letter issued by the
Respondent to the Claimant, the Respondent stated that it “would like to thank
you for the period you have spent at the club, doing your best and your effort
with the team.
But because of the circumstances the club has faced, we are sorry to inform you of
the board’s decision of cancelling your contract with the club from 1st of August
8, 2015 and now you can back as a player in Club E according to your transfer
agreement.”
18.
Therefore, the members of the DRC considered that, indeed, the Respondent had
not invoked any of the aforementioned reasons when proceeding with the
termination of the contract with the Claimant, merely referring to
”circumstances” faced by the Respondent in its notice of termination.
19.
On account of all the above, the members of the Chamber decided that the
Respondent terminated the contract without just cause on 10 August 2015, date
on which the termination was notified to the Claimant. In this respect, the
Chamber took into account that in his letter of 12 August 2015 addressed to the
Respondent the Claimant refers to the receipt of the Respondent’s notice of
termination on 10 August 2015. The Chamber further took into account that the
Respondent had not presented convincing documentation corroborating its
allegation that the notice of termination was sent to the Claimant on 1 August
2015.
20.
In continuation, prior to establishing the consequences of the breach of contract
without just cause by the Respondent in accordance with art. 17 par. 1 of the
Regulations, the Chamber took note that there was no unpaid remuneration at
the moment when the contract was terminated by the Respondent.
Player A, country B / Club C, country D
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21.
Having established the above, the Chamber turned its attention to the question
of the consequences of the termination of the contract by the Respondent
without just cause on 10 August 2015.
22.
The members of the Chamber firstly recapitulated that, in accordance with art. 17
par. 1 of the Regulations, the amount of compensation shall be calculated, in
particular and unless otherwise provided for in the contract at the basis of the
dispute, with due consideration for the law of the country concerned, the
specificity of sport and further objective criteria, including, in particular, the
remuneration and other benefits due to the Claimant under the existing contract
and/or the new contract, the time remaining on the existing contract up to a
maximum of five years.
23.
In application of the relevant provision, the Chamber held that it first of all had to
clarify as to whether the contract at the basis of the present dispute contains a
provision by means of which the parties had beforehand agreed upon an amount
of compensation payable by the contractual parties in the event of breach of
contract. In this regard, the Chamber established that no such compensation
clause was included in the contract at the basis of the matter at stake.
24.
As a consequence, the members of the Chamber determined that the amount of
compensation payable by the Respondent to the Claimant had to be assessed in
application of the other parameters set out in art. 17 par. 1 of the Regulations.
The Chamber recalled that said provision provides for a non-exhaustive
enumeration of criteria to be taken into consideration when calculating the
amount of compensation payable. Therefore, other objective criteria may be
taken into account at the discretion of the deciding body. In this regard, the
Dispute Resolution Chamber emphasised beforehand that each request for
compensation for contractual breach has to be assessed by the Chamber on a
case-by-case basis taking into account all specific circumstances of the respective
matter.
25.
In order to estimate the amount of compensation due to the Claimant in the
present case, the members of the Chamber first turned their attention to the
remuneration and other benefits due to the Claimant under the existing contract
and/or the new contract, which criterion was considered by the Chamber to be
essential. The members of the Chamber deemed it important to emphasise that
the wording of art. 17 par. 1 of the Regulations allows the Chamber to take into
account both the existing contract and the new contract, if any, in the calculation
of the amount of compensation.
26.
On the basis of the contract signed by the Claimant and the Respondent, which
was to run for three years more, i.e. until 27 July 2018, after the breach of
contract occurred, the Chamber concluded that the amount of USD 360,000 (3
Player A, country B / Club C, country D
Page 9 of 11
instalments of USD 30,000 each for each season and 36 monthly salaries of USD
7,500 each for the seasons 2015/2016, 2016/2017 and 2017/2018) serves as the
basis for the final determination of the amount of compensation for breach of
contract.
27.
In continuation, the Chamber verified as to whether the Claimant had signed an
employment contract with another club during the relevant period of time, by
means of which he would have been able to reduce his loss of income. According
to the constant practice of the DRC, such remuneration under a new employment
contract shall be taken into account in the calculation of the amount of
compensation for breach of contract in connection with the player’s general
obligation to mitigate his damages.
28.
The Chamber noted that, according to the information in the TMS, he signed an
employment contract with Club F, valid from 16 May 2016 until 31 October 2017,
establishing a total remuneration of 16,750, which corresponds approximately to
USD 4,400.
29.
Consequently, on account of all of the above-mentioned considerations and the
specificities of the case at hand, the Chamber decided to partially accept the
Claimant’s claim and that the Respondent must pay the amount of USD 355,600 to
the Claimant as compensation for breach of contract in the case at hand.
30.
The Dispute Resolution Chamber concluded its deliberations in the present matter
by establishing that any further claim lodged by the Claimant is rejected.
III.
Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, Player A, is partially accepted.
2.
The Respondent, Club C, has to pay to the Claimant compensation for breach of
contract in the amount of USD 355,600, within 30 days as from the date of
notification of this decision.
3.
In the event that the amount due to the Claimant is not paid by the Respondent
within the stated time limit, interest at the rate of 5% p.a. will fall due as of
expiry of the aforementioned time limit and the present matter shall be
submitted, upon request, to the FIFA Disciplinary Committee for consideration
and a formal decision.
Player A, country B / Club C, country D
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4.
Any further claim lodged by the Claimant is rejected.
5.
The Claimant is directed to inform the Respondent immediately and directly of
the account number to which the remittance is to be made and to notify the
Dispute Resolution Chamber of every payment received.
*****
Note relating to the motivated decision (legal remedy):
According to art. 58 par. 1 of the FIFA Statutes, this decision may be appealed against
before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to
the CAS directly within 21 days of receipt of notification of this decision and shall
contain all the elements in accordance with point 2 of the directives issued by the CAS, a
copy of which we enclose hereto. Within another 10 days following the expiry of the
time limit for filing the statement of appeal, the appellant shall file a brief stating the
facts and legal arguments giving rise to the appeal with the CAS (cf. point 4 of the
directives).
The full address and contact numbers of the CAS are the following:
Court of Arbitration for Sport
Avenue de Beaumont 2
1012 Lausanne
Switzerland
Tel: +41 21 613 50 00
Fax: +41 21 613 50 01
e-mail: [email protected]
www.tas-cas.org
For the Dispute Resolution Chamber:
Marco Villiger
Deputy Secretary General
Encl: CAS directives
Player A, country B / Club C, country D
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