Labour Disputes
Texto da decisão
Decision of the
Dispute Resolution Chamber
passed in Zurich, Switzerland, on 15 October 2015,
in the following composition:
Geoff Thompson (England), Chairman
Joaquim Evangelista (Portugal), member
Eirik Monsen (Norway), member
Theodore Giannikos (Greece), member
Taku Nomiya (Japan), member
on the matter between the player,
Player A, country B
as Claimant / Counter-Respondent
and the club,
Club C, country D
as Respondent / Counter-Claimant
and the club,
Club E, country F
as Intervening Party
regarding an employment-related dispute arisen between the parties
I.
Facts of the case
1.
On 25 June 2014, in the framework of a loan, the player from country B, Player A
(hereinafter: the player or Claimant / Counter-Respondent), and the club from
country D, Club C (hereinafter: the club or Respondent / Counter-Claimant),
entered into an employment contract (hereinafter: the contract) valid as from 1
July 2014 until 30 June 2015.
2.
In accordance with the contract, the player was entitled to the total amount of
EUR 2,700,000, payable as follows:
-
3.
EUR 800,000 as an advance payment, to be paid after passing the medical
examination;
EUR 1,900,000 divided in 12 monthly salaries of EUR 158,333.
On 19 March 2015, the player and club signed an “Memorandum of
Understanding” (hereinafter: the MOU) which reads:
“1 -The First Party [the club] shall pay to the Second Party [the player] the sum of
[EUR 400,000] which represents fifty per cent (50%) of the Second Party’s
entitlements upon the signature of this MOU and the Second Party hereby accepts
and agrees to such payment. In addition, one month’s salary of [EUR 158,000] will
be payable at the time of signature of this MOU.
2.- The remaining balance shall be payable following the opening of the bank
account of the Second Party/First Party.”
4.
From 15 until 18 May 2015, the players of the club were granted holidays.
5.
On 15 May 2015, the player sent a fax and an e-mail to the club putting the latter
in default for the amount of EUR 1,388,719. By means of said correspondence, the
player requested the club’s official position and to proceed with the payment of
the due amount within 72 hours of receipt of the e-mail or fax.
6.
On 19 May 2015, the player sent another fax and e-mail to the club stating that
the notification of 15 May 2015 remained unanswered. As a result, he gave the
club a final time limit of 24 hours to pay the due amount, “failing which judicial
measures shall be taken.”
7.
On 19 May 2015, the club replied to the player’s correspondence “dated 15 May
2015 received by the club and the Football Association of country D on the same
day of 19 May.” The club stressed that by signing the MOU, the player recognised
to wait for the overdue payments until the club would be authorized by the
Minister of Finance to open a new bank account or to reactivate its frozen
Player A, country B / Club C, country D / Club E, country F
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account. The club also outlined that it did not receive at a later stage any
complaints regarding a delay of payment and stressed that a default notice is one
of two conditions to terminate a contract with just cause. The club further added
that “as consequence, and in accordance with the new Rules of the Football
Association of country D as well as the permission to open a new bank account is
still pending, the presence of the player is crucial to receive a check from the
Sponsor League, on the name of the player (...)”. Finally, the club requested the
player to join the team within the next 72 hours to settle this dispute “by
receiving a check on his name for the performance from the Sponsor or to retake
his work.”
8.
On 20 May 2015, the player acknowledged receipt of the club’s letter and email
“sent on 20 May 2015”, outlining the situation and advising the club that he shall
terminate the contract on 20 May 2015. Another letter was sent the same day, by
means of which the player terminated the contract.
9.
On 21 May 2015, the club replied to the player’s letter dated 20 May 2015,
contesting its content and stressing that the fax of 15 May 2015 had only been
sent on 19 May 2015 “with a posterior date”.
10.
On 25 May 2015, the player lodged a claim against the club for breach of contract,
asserting that he had terminated the contract with just cause as an amount equal
to 6 salaries was outstanding. In particular, the player requested the following:
-
11.
The player held that he had only received the amount of EUR 1,311,281.87 from
the club, as follows:
-
12.
EUR 413,573.28 regarding the unpaid advance payment;
EUR 975,145.85 corresponding to the unpaid monthly salaries;
EUR 1,350,000 or any other sum for the specificity of sport;
5% interest as from the due dates;
CHF 15,000 as legal costs;
Sporting sanctions to be imposed.
EUR 158,333 in July 2014 in cash;
EUR 453,985.35 on 23 December 2014;
EUR 154,162.89 on 23 March 2015;
EUR 386,426.72 on 24 March 2015 “regarding an anticipation of 50% that
should have been of EUR 400,000 and paid in July 2014”;
EUR 158,373.91 on 30 April 2015.
In its reply to the claim, the club stated that there was no valid reason for the
player to terminate the contract since i) the parties had agreed to defer the
payments as stipulated in the MOU, ii) the player did not provide adequate
Player A, country B / Club C, country D / Club E, country F
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notice, and iii) in the alternative, late payment on its own does not justify the
unilateral termination of the contract.
13.
In relation to the MOU, the club held that the reason behind the renegotiation of
the payments dates was the club’s bank issues, in particular, the club could only
pay the player once it was authorized by the Minister of Finance to open a new
bank account or to reactivate its frozen account. The player was made aware of
the foregoing and agreed to defer the payment dates pending the resolution of
the bank account issue. At the time of the termination, the club had not yet
resolved this issue with the Minister of Finance but had been working towards a
solution so that it could fulfil the terms of the agreement. This was also the
reason why the club requested the player to return to the club since, apart from
having to play the semi-final in the cup on 31 May 2015, the club intended to
settle the matter amicably.
14.
As regard the notifications, the club held that the player did not give sufficient
warning in advance. In particular, the club underlined that the fax dated 15 May
2015:
- Did not mention that the player intended to terminate the contract; the 72
hour deadline merely referred to a request from the club to reply;
- The club replied to the fax asking the player to return;
- The fax was not delivered on 15 May 2015 but rather on 18 May 2015 “as
clearly indicated in the top left hand corner of the third page of the letter”.
In this respect, the club submitted the fax it apparently received which
stipulates “MAY-18-2015 17:18” in the top left corner;
- Since the fax was only sent on 18 May 2015, 17:18 time of country B, it was
delivered to the club on 18 May 2015, 23:18 time of country D. As a result,
the fax was only seen by the club on 19 May 2015, i.e. after the 72 hour
deadline had expired.
- Upon receipt, the club immediately wrote back to the club asking for the
player’s return (cf. par. I./7. above), however he terminated the contract on
20 May 2015.
15.
On account of all of the above, the club deemed that the player terminated the
contract without just cause and lodged a counterclaim against the player. In
particular, the club claims the amount of EUR 290,276 plus interest and EUR
10,000 in legal costs.
16.
In his replica, and as to the notifications, the player insisted that:
i)
On 15 May 2015, it also notified the club by email, as it also did on 19 and
“21” May 2015.
ii) On 21 May 2015, the club replied by email to the email-address from which
the player’s emails were sent. Page 4 of the club’s email of 21 May 2015 even
Player A, country B / Club C, country D / Club E, country F
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contains the player’s email of 15 May 2015. Therefore it is evident that the
club received the e-mail of 15 May 2015.
iii) Even if the notification of 15 May 2015 was delivered on a later date, on 19
May 2015, a new notification was sent.
iv) In any case, the club was already aware of its debt since it signed the MOU in
March 2015.
v) The termination letter of 20 May 2015 was sent at 1:20 PM (time of country
B), i.e. before the club’s reply to the notification. The club’s reply was dated
19 May 2015 but actually received by the player on 20 May 2015 at 1:48 PM
only. The player submitted the receipt document of the club’s fax dated 19
May 2015, the top left corner of which reads: “5/20/2015 1:48 GMT+3 (…)”.
According to the player, at the time the club requested his return, he was
already on his way to country B, due to the club’s breach of contract.
17.
Furthermore, the player indicated that, upon return in country B, he was
informed by his colleagues that the club had invaded his home and that it was
clear that no amicable settlement would be possible. Also, the player underlined
that the club acted abusive in many other cases, e.g. by retaining passports, and
that he feared that the same would happen to him.
18.
Finally, the player stressed that:
i)
He indeed initially accepted the late payment of his salaries, which
demonstrates his extreme good faith and willingness.
ii) The MOU dated 19 March 2015 stipulates that once the club’s account was
reopened, he would receive the amounts due. However, surprisingly, during
March and April 2015, the club made several payments by bank transfer. This
demonstrates that the club’s bank issues had been solved as from 23 March
2015.
iii) By May 2015, the situation became unbearable as he had not received his
remuneration equal to approximately 6 salaries and he was living in a
foreign country where he could not rely on his family and with not enough
money to cover his expenses.
19.
In sum, the player holds that the late salaries of EUR 1,388,719 are substantial and
that he duly notified the club of its debt, therefore having a just cause to
terminate the contract.
20.
Having been requested to provide its final position, the club indicated that it did
not wish to make any further comments.
21.
Although have been invited to do so, Club E did not provide its position in the
present matter.
Player A, country B / Club C, country D / Club E, country F
Page 5 of 11
22.
Upon request of FIFA, the player indicated that he did not receive any
remuneration from another club in May and June 2015; the loan agreement
between the club and Club E was valid until 30 June 2015 and Club E was
therefore not obliged to register him or pay his salary.
II.
Considerations of the Dispute Resolution Chamber
1.
First of all, the Dispute Resolution Chamber (hereinafter also referred to as DRC or
Chamber) analysed whether it was competent to deal with the case at hand. In
this respect, the Chamber took note that the present matter was submitted to
FIFA on 25 May 2015. Consequently, the 2015 edition of the Rules Governing the
Procedures of the Players’ Status Committee and the Dispute Resolution Chamber
(hereinafter: the Procedural Rules) is 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 and par. 2
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, with the involvement of a club from country F.
3.
Furthermore, the Chamber analysed which edition of the Regulations on the
Status and Transfer of Players 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 in front of FIFA on 25 May 2015,
the 2015 edition of said regulations (hereinafter: the 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, and entering into the substance of the matter, the Chamber started
by acknowledging the above-mentioned facts as well as the documentation
contained in the file. 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.
5.
First of all, the members of the Chamber acknowledged that, on 25 June 2014, the
player and the club concluded an employment contract valid as from 1 July 2014
until 30 June 2015 in accordance with which the player was entitled to a monthly
salary of EUR 158,333, as well as an advance payment of EUR 800,000.
Player A, country B / Club C, country D / Club E, country F
Page 6 of 11
6.
Furthermore, the Chamber acknowledged that on 19 March 2015 the player and
the club signed the MOU by means of which they agreed upon a payment plan
for the apparent outstanding remuneration.
7.
The Chamber further observed that the player held that he had terminated the
contract on 21 May 2015 with just cause, since the club had failed to pay him the
amount of EUR 1,388,719. On the other hand, the Chamber duly noted that the
club held that the player had terminated the contract without just cause on 21
May 2015 since i) the parties had agreed to defer the payments as stipulated in
the MOU, ii) the player did not provide adequate notice, and iii) late payment on
its own does not justify the unilateral termination of the contract.
8.
On account of the above, the Chamber duly noted that it had to examine whether
or not the decision of the player to terminate the contract with the club on 21
May 2015 was with or without just cause.
9.
In this context, the Chamber first of all analysed the entitlements of the player
under the contract until 21 May 2015. The Chamber notes that by 21 May 2015,
the player should have received 10 monthly salary payments (i.e. July 2014 until
April 2015) in the total amount of EUR 1,583,330 as well as the advance payment
of EUR 800,000. It is therefore that the player on 21 May 2015 was supposed to
have received from the club the total amount of EUR 2,383,330. Yet, the player
asserted that he only received the amount of EUR 1,311,281.87, leaving a balance
of EUR 1,072,048.13.
10.
In this respect, the Chamber wished to underline that the club did not contest
that, until 21 May 2015, it had only paid the player the amount of EUR
1,311,281.87, as follows:
- EUR 158,333
- EUR 453,985.35
- EUR 154,162.89
- EUR 386,426.72
- EUR 158,373.91
in July 2014 in cash;
on 23 December 2014;
on 23 March 2015;
on 24 March 2015
on 30 April 2015.
11.
Having established the above, the Chamber however observes that one of the
arguments raised by the club is that the parties, by signing the MOU, agreed to
defer the payments.
12.
Having analysed the content of the MOU, the Chamber finds that the parties
agreed that the club would pay the player an amount of EUR 583,333 upon
signature of the MOU and that the remaining outstanding balance would be paid
“following the opening of the bank account of the Second Party/First Party.” In
this context, the Chamber finds it essential to stress that the club did not contest
that it made payments to the player on 23 and 24 March as well as on 30 April
Player A, country B / Club C, country D / Club E, country F
Page 7 of 11
2015. From such payments, the Chamber derives that the bank issues of the club
had in fact been solved – at the least as from 23 March 2015 - and that thus the
remaining balance should have been paid immediately by the club to the player.
13.
As to the argument of the club that the player did not provide adequate notice,
the Chamber refers to the player’s replica, in particular, to the documentation
submitted in relation to the emails sent by the player to the club on 15, 19 and 20
May 2015. The Chamber further observes that the Respondent did not contest in
its duplica having received such emails. What is more, the Chamber is of the
opinion that the club was well aware of its lack of fulfillment of the contract in
view of the fact that it signed the MOU and in view of the fact that the amount
of outstanding remuneration was significant, i.e. EUR 1,072,048.13, which
corresponds to almost 7 monthly salaries.
14.
The Chamber deems it important to point out that, thus, until 21 May 2015, the
player should have received the amount of EUR 2,383,330 from the club
corresponding to 10 monthly salaries of EUR 158,333 and the advance payment of
EUR 800,000. Yet, the club recognised having only paid the player the amount of
EUR 1,311,281.87. Furthermore, the club recognised having been aware of its
outstanding obligations as it signed the MOU and did not dispute that it received
the emails of the player dated 15, 19 and 20 May 2015.
15.
Having taken into account all the previous considerations, the Chamber decided
that it could be established that the club had seriously neglected its contractual
obligations towards the player in a continuous and constant manner, i.e. the club
had failed to remunerate the player for a substantial period of time and for a
significant amount of money, without providing any valid reasons. Therefore, the
Chamber considered that the club was found to be in breach of the employment
contract and that the breach was of such seriousness that, in line with the
Chamber’s long-standing and well-established jurisprudence, the player had a just
cause to unilaterally terminate the contractual relationship with the club on 21
May 2015, having previously put the club in default of payment of outstanding
amounts.
16.
On account of all the above, the Chamber established that the player had
terminated the employment contract with just cause on 21 May 2015 and that,
consequently, the club is to be held liable for the early termination of the
employment contact with just cause by the player.
17.
Bearing in mind the previous considerations, the Chamber went on to deal with
the consequences of the early termination of the employment contract with just
cause by the player.
18.
First of all, the members of the Chamber concurred that the club must fulfill its
obligations as per employment contract in accordance with the general legal
Player A, country B / Club C, country D / Club E, country F
Page 8 of 11
principle of “pacta sunt servanda”. Consequently, the Chamber decided that the
club is liable to pay to the player the remuneration that was outstanding at the
time of the termination i.e. the amount of EUR 1,072,048.13.
19.
Furthermore, and considering the player’s claim for interest, the Chamber ruled
that the club must pay 5% interest on the amount of EUR 1,072,048.13 as from
the respective due dates as indicated by the player, these indications having
remained undisputed by the club.
20.
In continuation, the Chamber decided that, taking into consideration art. 17 par.
1 of the Regulations, the player is entitled to receive from the club compensation
for breach of contract in addition to any outstanding remuneration on the basis
of the relevant employment contract.
21.
In this context, the Chamber outlined that, in accordance with said provision, 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
player 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.
22.
In application of the relevant provision, the Chamber held that it first of all had to
clarify whether the pertinent employment contract contained any clause, by
means of which the parties had beforehand agreed upon a 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.
23.
Having recalled the aforementioned, and in order to evaluate the compensation
to be paid by the club, the members of the Chamber took into account the
remuneration due to the player in accordance with the employment contract as
well as the time remaining on the same contract, along with the professional
situation of the player after the early termination occurred. In this respect, the
Chamber concluded that the remaining value of the contract as from its early
termination by the player until the regular expiry of the contract amounts to EUR
316,666 and that such amount shall serve as the basis for the final determination
of the amount of compensation for breach of contract.
24.
In continuation, the Chamber remarked that the player had not received any
remuneration in the months of May and June 2015 and equally took into account
that the employment relationship with the club was the consequence of a loan
agreement between the club and Club E.
Player A, country B / Club C, country D / Club E, country F
Page 9 of 11
25.
In view of all of the above, the Chamber decided that the club must pay the
amount of EUR 316,666 to the player as compensation for breach of contract,
which is considered by the Chamber to be a reasonable and justified amount as
compensation for breach of contract.
26.
In addition, taking into account the player’s request, the Chamber decided that
the club must pay to the player interest of 5% p.a. on the amount of
compensation for breach of contract as of the date on which the claim was
lodged, i.e. 25 May 2015, until the date of effective payment.
27.
Moreover, the Dispute Resolution Chamber decided to reject the player’s claim
pertaining to legal costs in accordance with art. 18 par. 4 of the Procedural Rules
and the Chamber’s respective longstanding jurisprudence in this regard.
28.
The DRC concluded its deliberations in the present matter by establishing that any
further claim lodged by the player is rejected and that the counterclaim of the
club is rejected too.
*****
III.
Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant / Counter-Respondent, Player A, is partially accepted.
2.
The claim of the Respondent / Counter-Claimant, Club C, is rejected.
3.
The Respondent / Counter-Claimant has to pay to the Claimant / CounterRespondent, within 30 days as from the date of notification of the present
decision, outstanding remuneration in the amount of EUR 1,072,048.13 plus 5%
interest p.a. until the date of effective payment as follows:
-
4.
5% p.a. as of 2 July 2014 on the amount of EUR 413,573.28;
5% p.a. as of 1 January 2015 on the amount of EUR 25,142.85;
5% p.a. as of 1 February 2015 on the amount of EUR 158,333;
5% p.a. as of 1 March 2015 on the amount of EUR 158,333;
5% p.a. as of 1 April 2015 on the amount of EUR 158,333;
5% p.a. as of 1 May 2015 on the amount of EUR 158,333.
The Respondent / Counter-Claimant has to pay to the Claimant / CounterRespondent, within 30 days as from the date of notification of the present
decision, compensation for breach of contract in the amount of EUR 316,666 plus
5% interest p.a. on said amount as from 25 May 2015 until the date of effective
payment.
Player A, country B / Club C, country D / Club E, country F
Page 10 of 11
5.
In the event that the amounts due to the Claimant / Counter-Respondent in
accordance with the above-mentioned numbers 3. and 4. are not paid by the
Respondent / Counter-Claimant within the stated time limits, the present matter
shall be submitted, upon request, to the FIFA Disciplinary Committee for
consideration and a formal decision.
6.
Any further claim lodged by the Claimant / Counter-Respondent is rejected.
7.
The Claimant / Counter-Respondent is directed to inform the Respondent /
Counter-Claimant 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. 67 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:
Markus Kattner
Acting Secretary General
Encl. CAS directives
Player A, country B / Club C, country D / Club E, country F
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