Labour Disputes
Texto da decisão
Decision of the
Dispute Resolution Chamber
passed in Zurich, Switzerland, on 18 August 2016,
in the following composition:
Thomas Grimm (Switzerland), Deputy Chairman
Joaquim Evangelista (Portugal), member
Johan van Gaalen (South Africa), member
Todd Durbin (USA), member
Zola 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 28 June 2013, the Player A from country B (hereinafter: the Claimant) and the Club C from
country D (hereinafter: the Respondent) signed an agreement valid “for the season 2013/2014”.
2.
The agreement provides that the Claimant is entitled to a monthly salary of EUR 10,000 for a
period of ten months. The agreement further provides that the Claimant is entitled to certain
amenities: a car, a furnished apartment and all the expenses for the apartment during the period
of the contract and medical insurance. Furthermore, the contract provides that the Claimant is
entitled to “flight tickets country B – country D – country B”.
3.
The agreement provides in its article 1 that “this agreement will be the base of terms included in
the agreement in budgetary control in Football Association of country D”. The agreement further
provides in its article 2 that “the player will come by loan for the year 2013/2014 from the club
Club E, country B”. The agreement’s article 6 provides that “this contract will be valid after the
player passes medical test successfully”.
4.
On 13 August 2013, the Respondent informed the Claimant via his agent in writing that he
should leave the apartment and return the keys and the car to the Respondent by no later than 24
August 2013, and that the Respondent will pay him for the relevant period “as a gesture of good
will and without admitting any obligation”. The Claimant was informed that his services were not
required due to professional reasons. This, in light of the fact that the agent allegedly informed
the Respondent that the Claimant was a “free player” when in fact he was not, as he was to be
transferred on a loan (and non-permanent) basis from Club E to the Respondent.
5.
On 1 September 2013, the Respondent informed the Claimant via his agent in writing that seeing
as the agent had presented the Claimant as being a “free player”, reiterating that the coach had
informed the Claimant that he was not interested in the services of the Claimant due to
professional reasons. This time the Respondent allowed the Claimant to return the keys to the
apartment and the car before 8 September 2013.
6.
On 16 September 2013, the Claimant put the club in default of EUR 47,695 on the basis that the
Respondent had breached the employment contract by not paying him and stating that the
Claimant only managed to mitigate his damages in part, as he had to accept a loan to Club F for a
total of USD 70,000.
7.
On 25 September 2013, the Respondent notified the Claimant that it considers that it has never
terminated the contract prematurely and that the coaching staff notified the Claimant that it was
unlikely he would get any playing time. It states that it had assured the Claimant that in spite of
the above, the contract could still be executed. The Respondent allegedly sought to reach an
amicable settlement with the Claimant, which he refused. It further states that it was the Claimant
who chose to leave the Respondent, and that from media reports it is contested that the value of
the new employment contract of the club was “only USD 70,000” but amounted to USD 90,000
or USD 100,000. The Respondent reasserts that it did not terminate the employment contract.
Player A, country B / Club C, country D
Page 2 of 9
8.
On 6 June 2014, the Claimant lodged a claim against the club in front of FIFA requesting to be
paid 552,970 plus 5% interest p.a. as follows:
a.
457,990 as the total amount due to the Claimant under contract with the Respondent,
i.e. 757,790 gross, minus the amounts made with his new club (cf. point I.6 above), i.e.
299,800 gross; plus 5% interest p.a. “from the day the club was in breach of
agreement”;
b. 29,980 as agent’s fees charged to him in light of having to sign a new contract with a
different club;
c. 65,000 as legal fees.
9.
The Claimant claims that on 4 August 2013, shortly after having begun training with the
Respondent, he was informed that he would be released and that he did not meet the
professional standards of the Respondent. He also states that he was not paid. He asserts that it
was obvious he was arriving to the Respondent “on loan” and that the Respondent had no just
cause to terminate the contract.
10.
In its reply to the claim, the Respondent first asserts that FIFA is not competent to deal with the
matter at hand on the basis that the Football Association of country D’s Regulations only allows
the Football Association of country D’s Arbitration Institute to hear the present dispute. In this
regard the Respondent only provided extracts of the “Rules and Regulations of the Arbitration
Institute” and of the “Rules and Regulations of the Supreme Court Amendment of Section 4.1 –
Authorities of the Presidency”, “Amendments of the Rules and Regulations of the Institute of
Arbitration” and the “Founding rules and Regulations Amendment of Section 16 D – Institute of
Arbitration”. It further claims that the article 1 to be found in point I.3 above is an exclusive
jurisdiction clause.
11.
The Respondent further argues that because the contract was not submitted by the Respondent to
the Football Association of country D, nor was it submitted to the Football Association of country
D’s Budgetary Control, the contract was never valid, is therefore void, and no claims for
compensation or reimbursement can be made on the basis of said contract. If the contract is not
valid, the Respondent argues it can not be terminated.
12.
Furthermore, the Respondent states that the Claimant’s agent had mislead the Respondent into
believing the Claimant was arriving as a “free player”, when he was in fact arriving under loan.
The Respondent allegedly “discovered” this and therefore considers it a valid reason to rescind the
initial agreement. In addition, it never received the release letter from the Claimant’s previous club.
13.
In its response relating to FIFA’s competence, the Claimant argues that the Football Association of
country D’s Arbitration Institute does not meet the requirements established by the FIFA
Regulations in relation to National Dispute Resolution Chambers.
14.
Furthermore, the Claimant reasserts that the contract was valid and had started being executed.
The Claimant states that it was made clear, and in writing, by the Respondent that it was no
longer interested in the Claimant’s services. He requests and additional EUR 50,000 as
compensation.
Player A, country B / Club C, country D
Page 3 of 9
15.
Having been given the opportunity to add comments the Respondent reasserts that FIFA’s DRC is
not competent, and that it did not terminate the employment contract as a valid one was never
concluded.
II.
Considerations of the Dispute Resolution Chamber
1.
First, the Dispute Resolution Chamber (hereinafter: the Chamber or the 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 6 June 2014. Consequently, the Rules Governing the Procedures
of the Players’ Status Committee and the Dispute Resolution Chamber (2012 edition; hereinafter:
the 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 (2016 edition) the Dispute Resolution Chamber
would, in principle, be competent to deal with the matter at stake which concerns and
employment related dispute with an international dimension between a player from country B and
a club from country D.
3.
The Chamber, however, acknowledged that the Respondent contested the competence of FIFA’s
deciding bodies on the basis that and independent arbitration tribunal in line with art. 22 lit. b) of
the Regulations on the Status and Transfer of Players in fine exists within the Football Association
of country D. In this regard, the Chamber noted that the Respondent referred to the Football
Association of country D’s Arbitration Institution Rules stating that disputes concerning a
contractual relationship between affiliates of the Football Association of country D must, by
obligation, be referred to the Arbitration Institution of the Football Association of country D. On
this basis, the Respondent considers that the matter should not be submitted to FIFA’s Dispute
Resolution Chamber.
4.
In this regard, the Chamber noted that the Claimant rejected such a position and insisted that FIFA
has jurisdiction to deal with the present matter.
5.
In analysing whether it was competent to hear with the present, the Chamber deemed it vital to
establish that one of the basic conditions that needs to be met in order to determine whether an
organ other than the DRC is competent to settle an employment-related dispute between a club
and a player of an international dimension, is that the jurisdiction of the of the relevant national
arbitration tribunal or national court derives from a clear reference in the employment contract.
6.
Therefore, the members of the Chamber first sought to establish whether the employment
contract at the basis of the dispute contained a clear jurisdiction clause. The DRC noted that the
Respondent argued that the clause to be found in point I.3 above is a clear jurisdiction clause,
which the Chamber unanimously rejected since it makes absolutely no reference to jurisdiction or
to any specific deciding body. Consequently, the Chamber concluded that it was clear from the
terms of the employment contract that no clear jurisdiction clause establishing a choice of
jurisdiction had been included in the contract.
Player A, country B / Club C, country D
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7.
In consideration of the above, the Chamber established that the Respondent’s challenge of FIFA’s
competence to deal with the present matter has to be rejected and that the Dispute Resolution
Chamber is competent on the basis of art. 22 lit. b) of the Regulations on the Status and Transfer
of Players to consider the substance of the present matter.
8.
Subsequently, the Chamber analysed which edition of the 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 (2016 edition), and considering that the
present claim was lodged on 6 June 2014, the 2012 edition of said regulations (hereinafter: the
Regulations) is applicable to the matter at hand as to the substance.
9.
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 aforementioned facts as well as the arguments and the documentation
submitted by the parties. The Chamber, however, 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.
10.
In continuation, the Chamber took note that the Claimant claimed that the Respondent had
breached the employment contract signed by the parties on 28 June 2013 by notifying the
Claimant of the termination of said contract on 13 August 2013. Consequently, the Claimant
asserts he is entitled to compensation for breach which is to be paid by the Respondent. The
Claimant requested 552,970 on the basis of the total value of the contract minus amounts earned
with his subsequent club, alleged third party fees as well as legal fees. The Claimant also
requested EUR 50,000 as additional compensation (cf. point I.14 above).
11.
The members of the Chamber equally noted the response provided by the Respondent, which
states that the Claimant cannot initiate a dispute on the basis of the contract as the Respondent
had never presented it to the budgetary control of the Football Association of country D,
rendering said contract void and unenforceable. The DRC also noted that the Respondent argued
that because it was allegedly not aware that the Claimant was arriving on loan, this constitutes a
lack of consideration for the contract, which therefore equally renders the contract void and
unenforceable, meaning there is allegedly no contractual basis on which to claim.
12.
At this point, the Dispute Resolution Chamber considered it relevant to recall its jurisprudence in
accordance with which the validity of an employment contract cannot be conditioned by the
execution of administrative formalities such as, but not limited to, the registration procedure of an
employment contract with the relevant Association in relation to an international transfer of a
player or budgetary control which remains the sole responsibility of a club, and on which a player
has no influence. With regard to the matter at stake, the Respondent acknowledged that as it had
not submitted the employment contract to the budgetary control of the Football Association of
country D in order to validate the contract. In view of the above, the Chamber considered that the
argument of the Respondent had to be rejected, noting that the Respondent had not performed
its obligations regarding the registration of the employment contract.
Player A, country B / Club C, country D
Page 5 of 9
13.
The Chamber further recalled that the Respondent considered the contract to be null and void as
the Respondent did not know that the Claimant was arriving on loan when the parties had signed
the employment contract. In this regard, the DRC noted that the contract provides in its article 2
that “the player will come by loan for the year 2013/2014 from the Club E, country B” (cf. point
I.3 above). Consequently, it appears clear that the Respondent was fully aware that the Claimant
was signing an employment contract on the basis of a loan agreement, and the DRC therefore
rejected the Respondent’s argument in this regard.
14.
Furthermore, the Chamber recalled that in order for an employment contract to be considered as
valid and binding, apart from the signature of both the employer and the employee, it should
contain the essentialia negotii of an employment contract, such as the parties to the contract and
their role, the duration of the employment relationship, the remuneration. Considering the terms
of the contract concluded between the parties on 28 June 2013, the Chamber concluded that it
did contain all the essentialia negotii and was, therefore, to be considered as valid and binding for
both signing parties.
15.
In continuation, the Chamber took note of the allegation of the Respondent, according to which it
did not terminate the employment contract with the Claimant (cf. point I.7 above). In this respect,
the Chamber noted that from the documentary evidence provided by the Claimant, namely the
Respondent’s letters dated 13 August 2013 and 1 September 2013, it is clear that the
employment relationship was terminated by the club as from 13 August 2013. Thus, the Chamber
found this argument of the Respondent as being unsustainable.
16.
At this point, the Chamber recalled that only a breach or misconduct of a certain severity justifies
the termination of an employment contract. In other words, only when there are objective criteria
which do not reasonably permit either party to expect continuation of the employment
relationship, a contract may be terminated prematurely. Hence, if there are more lenient measures
which can be taken in order for an employer to ensure the employee’s fulfilment of his contractual
duties, such measures must be taken before terminating an employment contract. A premature
termination of an employment contract can only ever be an ultima ratio measure.
17.
In continuation, having taken note of the content of the notification of the termination by the
Respondent to the Claimant which merely states that the club is no longer interested in the
player’s services and that he was not a free player as he was being transferred on loan, the DRC
deemed that the Respondent had not presented any valid reason, nor did it provide any
corroborating evidence, for refusing the services of the Claimant on 13 August 2013.
18.
On account of the above, in particular by not carrying out the relevant formalities for the
registration of the employment contract, in addition to notifying the Claimant of the unilateral
termination of the employment contract just over one month after the signing of the contract on
the basis of arguments which have been rejected by the DRC, the Respondent was deemed by the
DRC to have refused the Claimant’s services and terminated the employment contract without any
valid reason. Such conduct constitutes in the Chamber’s view, a clear breach of contract without
just cause. Accordingly, the Chamber concurred that the Respondent is to be held liable for the
early termination of the employment contract without just cause.
Player A, country B / Club C, country D
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19.
Bearing the previous considerations in mind, the Chamber went on to deal with the consequences
of the early termination of the employment contract without just cause by the Respondent.
20.
First, the members of the Chamber concurred that the Respondent must fulfil its obligations
deriving from the employment contract until the date of its termination in accordance with the
general legal principle of pacta sunt servanda. Consequently, the Chamber decided that the
Respondent is liable to pay the Claimant the remuneration that was outstanding at the time the
termination was made, i.e. the amount of EUR 10,000 pertaining to the month of July 2013.
21.
In addition, taking into consideration the Claimant’s claim, the Chamber decided to award the
Claimant interest at the rate of 5% p.a. on the amount of EUR 10,000 as of the day following the
day on which said instalment had fallen due, i.e. 1 August 2016.
22.
In continuation, the Chamber decided that taking into consideration the content of art. 17 par. 1
of the Regulations, the Claimant is entitled to receive from the Respondent compensation for
breach of contract in addition to any outstanding salaries on the basis of the relevant employment
contract.
23.
In this context, the Chamber outlined that in accordance with said provision, the amount of
compensation due 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, and depending on whether the
contractual breach falls within the protected period.
24.
In application of the relevant provision, the Chamber first held that it had to clarify whether the
pertinent employment contract contained any clause by means of which the parties had
beforehand agreed on 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 employment contract at the basis of the matter at stake.
25.
Subsequently, and in order to evaluate the compensation to be paid by the Respondent, the
members of the Chamber took into account the remuneration due to the Claimant in accordance
with the employment contract as well as the time remaining of said contract. In this respect, the
Chamber pointed out that at the time of the termination of the employment contract on 13
August 2013, the contract provided that the Claimant would still have been owed the residual
value of EUR 90,000 had the contract reached its term. Consequently, and taking into account the
financial terms of the contract, the Chamber concluded that the remaining value of the contract
from its early termination by the Respondent until the regular expiry of the contract amounts to
EUR 90,000 and that such an amount shall serve as the basis for the final determination of the
amount of compensation due for breach of contract.
26.
In continuation, the Chamber remarked that following the early termination of the employment
contract at the basis of the present dispute, the Claimant had found new employment with a club
from country D. In this regard, the Dispute Resolution Chamber noted that the Claimant had
Player A, country B / Club C, country D
Page 7 of 9
signed a contract with Club F valid from 16 September 2013 until 31 May 2014. The contract
provides that the player would be remunerated with a total of 299,880 (equivalent to
approximately EUR 63,000). Consequently, in accordance with the Claimant’s general obligation
to mitigate his damages, such remuneration under the new employment contract shall be taken
into account in the calculation of the amount of compensation due for breach of contract.
27.
In view of all of the above, the Chamber decided that the Respondent must pay the amount of
EUR 27,000 to the Claimant as compensation for breach of contract without just cause, which is
considered by the Chamber to be a reasonable and justified amount as compensation.
28.
In addition, taking into consideration the Claimant’s request, the Chamber decided that the
Respondent must pay to the Claimant interest of 5% p.a. on the amount of compensation as of
the date on which the claim was lodged, i.e. 6 June 2014, until the date of effective payment.
29.
In conclusion, the DRC decided that the Respondent is liable to pay the total amount of EUR
37,000 to the Claimant, consisting of the amount of EUR 10,000 corresponding to the Claimant’s
remuneration at the time of the unilateral termination of the contract without just cause by the
Respondent and the amount of EUR 27,000 corresponding to compensation for breach of
contract without just cause.
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 admissible.
2.
The claim of the Claimant is partially accepted.
3.
The Respondent, Club C, has to pay to the Claimant within 30 days from the date of notification
of this decision, outstanding remuneration in the amount of EUR 10,000 plus 5% interest p.a.
from 1 August 2013 until the date of effective payment.
4.
The Respondent has to pay to the Claimant compensation for breach of contract within 30 days
from the date of notification of this decision in the amount of EUR 27,000 plus 5% interest p.a.
from 6 June 2014 until the date of effective payment.
5.
In the event that the amounts due to the Claimant in accordance with the aforementioned
numbers 3. and 4. are not paid by the Respondent within the stated time limit, 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
Page 8 of 9
6.
Any further claim lodged by the Claimant is rejected.
7.
The Claimant is directed to inform the Respondent immediately and directly of the account
number to which the remittances are 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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