Labour Disputes
Texto da decisão
Decision of the
Dispute Resolution Chamber
passed in Zurich, Switzerland, on 4 April 2007,
in the following composition:
Slim Aloulou (Tunisia), Chairman
Mario Gallavotti (Italy), Member
Ivan Gazidis (USA), Member
Theo van Seggelen (Netherlands), Member
Carlos Soto (Chile), Member
on the claim presented by
the club, B,
as Claimant
against
the player, A,
and
the club, C,
as Respondents
regarding compensation for contractual breach and inducement to contractual breach
I. Facts of the case
1. The player A, born on 23 April 1982, signed an employment contract with the club
B on 31 March 2001 and due to expire on 30 June 2005 which, on 1 July 2003, was
renewed until 30 June 2007.
2. The above-mentioned employment contract also provides, inter alia, that in the
event of an intentional failure of the club to fulfil the terms of the contract, the
player is entitled to give 14 days written notice to the club to terminate the
agreement.
3. A transfer compensation of 75,000 had been paid by B to the club Arbroath for A‘s
transfer.
4. On 9 August 2006 the player A signed a three-year employment contract with the
club, C, whereby a basic weekly wage of 10,000 is foreseen in favour of the player
for the season 2006/2007. A bonus of 3,000 or 1,500 would be paid to the player in
case he was named in the starting eleven or as a substitute, respectively.
5. The weekly salary would rise up to 11,000 in case the player was named in the
starting eleven in 12 league games. Should this be the case, a bonus of 4,000 or
2,000 would be paid to the player in case he was named in the starting eleven or as
a substitute, respectively.
6. If the player was named in the starting eleven in 20 league games, a bonus of 5,000
or 2,000 would be paid to him in case he was named in the starting eleven or as a
substitute, respectively.
7. The weekly salary would rise up to 12,000 as of 1 July 2007 in case the player was
named in the starting eleven in 25 league games.
8. On 9 August 2006 the C Football Association requested the international transfer
certificate (ITC) from the B Football Association for the player in question.
9. The Football Association replied in writing to this request stating that they cannot
issue the requested ITC since the player A is still under contract with their affiliated
club, B.
10. On 18 August 2006 the C Football Association turned to FIFA asking for the
authorisation to provisionally register the player concerned for its member club, C.
11. On 28 August 2006, at the request of FIFA, the B Football Association stated that it
was not in a position to comply with the ITC request, since the player A was still
under contract with their affiliated club, B.
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12. On 31 August 2006 the Single Judge of the Players’ Status Committee authorised
the C Football Association to provisionally register A with its affiliated club C with
immediate effect.
13. Whereas the matter of the player’s provisional registration has been decided upon,
the dispute at stake lies on the substance of the contractual dispute between the
player and the club and, in particular, on the conditions of the contractual
termination.
14. In January 2007 A was transferred to the club Y on a loan basis until the end of the
season.
B’s position:
15. In November 2006 B contacted FIFA claiming compensation for breach of contract in
the amount of 5,037,311 against Mr A as well as against C, for having induced the
aforementioned breach.
16. The claimant also asks for the player to be ineligible to take part in any official
matches for a period of two months, in compliance with Article 17.3 of the FIFA
Regulations for the Status and Transfer of Players (hereafter, the Regulations), and
for C to be banned from registering any new player for one registration period, in
compliance with Article 17.4 of the FIFA Regulations.
17. According to the club, the relationship with A, until then one of the team’s
bedrocks, deteriorated when the player refused to extend the contract eighteen
months before its expiry. It is clear, in the club’s view, that Mr A was already then
seeking a more lucrative contract and, to this effect, planning to walk out of his
contract.
18. Subsequently, Mr A first notified B that he would terminate his contract for just
cause with a 14-day notice from 4 May 2006 under clause 18 of the employment
contract. Such termination notice would then be withdrawn by the player on 7 July
2006.
19. Then, the player notified the club in writing on 26 May 2006 of his intention to
terminate the employment contract in accordance with the provision contained in
Article 17.3 of the Regulations, i.e. allegedly outside of the Protected Period and
within 15 days following the last match of the Season.
20. After having rejected B’s proposals for an extension of the contract, Mr A
addressed, through his agent, Mr , a fax to approximately fifty clubs, stating that
the player had terminated his contract with the club, that no sanctions would apply
as a result of this termination and that compensation would be fixed by FIFA at
200,000.
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21. It is clear that Mr A breached the contract without just cause utterly disregarding
the principles set out in the Regulations for the maintenance of the contractual
stability, but whereas the first notice of termination will not be taken into account,
the second notice of termination raises the most relevant issues.
22. To this effect, the club asserts that, according to point 9) of the Definitions of the
Regulations, the Season ends with the last Official Match of the relevant national
league championship. As the last match of the national league championship, i.e.
the Premier League, for the Season 2005/2006 was on 7 May 2006, the notice of
termination dated 26 May 2006 was not issued within 15 days following the last
match of the Season under the purpose of Article 17.3 of the Regulations.
23. In all cases, as the player breached the employment contract without just cause, he
shall pay compensation. The latter should be calculated in accordance with the
criteria established by Article 17 of the Regulations, yet bearing in mind that the
relevant list is not exhaustive, as already pointed out by the Dispute Resolution
Chamber itself in its previous decisions.
24. In particular, national law, in casu National Law, should also assist in the calculation
of the amount due as compensation by the player and/or the new club. This is
confirmed by the parties’ intention, expressed in clause 26 of the employment
contract, to have the rules of the Football Association and of the Premier League
govern any issue pertaining to the suspension and termination of the contract. The
rules of the Football Association and of the Premier League are governed by the
law of , where the contract was performed and where both parties were domiciled.
25. According to National Law, remedies for the breach of contract are based on the
restitutio in integrum, which attempts to return the injured party to the same
position it would have been in had the breach not occurred. Hence, B request to be
awarded an amount, which would return the club in the position it would have
been in had A not committed breach of contract without just cause.
26. According to National Law, it should also be taken into account the lucrum cessans
suffered by the club, insomuch as Mr A and C should be condemned to pay 1%
default interest until such time as B receive the full payment of the amount due as
compensation.
27. As regards the loss of opportunity to receive a transfer compensation (lucrum
cessans) for the transfer of the player, the claimant requests that the Chamber apply
the same principle that it applied in one of their precedents (Auxerre Football Club,
France v Player Philippe Mexes, France and AS Roma, Italy), the damage suffered by
the club being analogous to the one for which the French club was appropriately
restored.
28. Mr A was in fact one of the best players for the club, and a leading player for the
national team. B would have received at least 3 million for the player’s transfer,
had he not unilaterally terminated the contract. The second division club X made
an offer of 1.5 million on 21 June 2006, which was rejected since it was deemed
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considerably below the player’s real value. A number of top division clubs would
have been ready to pay significantly more for the player’s transfer and some of
them, Blackburn Rovers among the others, expressed their genuine interest in the
player.
29. This would be corroborated by the fact that in the top division the amount paid for
the transfer of a player of a similar pedigree to A would have been between 3
million and 5 million. The claimant further resorts to an expertise according to
which, in comparison with a number of players sharing the same age and ability
with A, the latter’s market value at the last transfer window would be of 5 million.
30. The club invested a lot of money and resources in the player’s training and
education. Between salary, appearance bonuses, other bonuses and sign-on fee, B
as from 1 July 2003 invested on A the amount total of 709,137, also taking into
account the amount that the player would have earned for the last season of
contract.
31. By means of a further submission received by FIFA after the investigation was
officially closed, B amended the above-mentioned figure, through the witness
statement of the club’s secretary, whereby the total amount paid to the player in
the five years spent with the club as from 31 March 2001 is of 1,004,346.
32. On account of the fact that the compensation should also take into consideration
the remuneration and other benefits due to the player under the new contract, the
claimant reckons that the difference between the last season of contract with them
and the first season of contract with C amounts to 717,335.
33. The costs of a replacement player to be paid by the claimant should also be taken
into account by the Chamber, in accordance with its previous jurisprudence. Yet
again, the price for a player of A’s calibre would be between 3 million and 5
million.
34. Mr A’s unilateral termination of contract deprived the claimant of a very valuable
player and, as a consequence, the club suffered a competitive and commercial loss,
the player being very popular among the supporters. The shirt sales and other
commercial revenues, which could have been generated are quantified by the
claimant in 70,000.
35. B further maintain that they should be entitled to receive a reimbursement of
50,000 incurred in as legal expenses.
36. The claimant, B, request the Dispute Resolution Chamber to condemn Mr A and C to
pay the total amount of 5,037,311 corresponding to 4 million as loss of opportunity
to receive a transfer compensation (lucrum cessans) for the transfer of the player,
199,976 as the remaining value of the player’s employment contract with the
claimant, 717,335 as the difference between the last season of contract with the
claimant and the first season of contract with C, 50,000 as legal expenses, 70,000 as
commercial loss following the player’s unilateral termination.
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37. Finally, B request that Mr A be declared ineligible to take part in any official
matches for a period of two months, in compliance with Article 17.3 of the
Regulations, for having breached the contract without just cause and failed to give
notice in due time. The fact that the player attempted to breach the contract twice
should be taken into account by the Chamber as an aggravating circumstance.
38. B also request that C be banned from registering any new player for one
registration period, in compliance with Article 17.4 of the Regulations, for having
induced the contractual breach and failed to contact the claimant with regard to
the player’s contractual position before signing him.
Mr A’s position:
39. Mr A firstly states that he was an ever present in the B’s first team in seasons
2003/04, 2004/05 and until 7 February 2006 of the 2005/06 season. He was widely
acknowledged as one of B’s best and most consistent players. Despite having
approximately one and a half years left to run on the contract, he was being
pressured by B into entering into a new playing contract to extend his term at the
club, on terms that were not acceptable to him. Following his refusal to enter into
a new playing contract on such terms, on 7 February 2006, he was dropped from the
side for which he had featured in every minute of every match from the start of the
2005/06 season. This began a course of non-selection by B of Mr A.
40. Mr A considers that he was dropped from the B’s team due to his refusal to sign a
new contract and that the decision taken to consistently drop him was based on
non-sporting reasons, and taken by the majority shareholder, Vladimir Romanov,
rather than by the manager of B.
41. Mr A sought legal advice from the Professional Footballers Association (“SPFA”),
which advised him that the course of unfair treatment, culminating in the very
public and unwarranted criticism of him and his family constituted a complete
breakdown of mutual trust and confidence and thus gave him a legal right to
terminate the contract for just cause.
42. It was also considered that Mr A could terminate the contract under the Regulations
on the grounds of sporting just cause due to his sudden non-selection from the
team after having been an ever present for purely non-sporting reasons. This nonselection also resulted in him losing his place in the national team. The SPFA
considered that such a situation should fall within the definition of sporting just
cause under Article 15 of the Regulations, particularly as Mr A had been told that he
would not play again for the remainder of the contract (i.e. that this non-selection
would continue throughout the 2006/07 season).
43. Mr A therefore served notice on B to terminate his contract for just cause with a 14day notice from 4 May 2006 under clause 18 of the employment contract. The SPFA
advised Mr A that this process may take some time as the procedure and possible
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appeals process that may follow, could be lengthy. This could damage his prospects
of securing a contract with another club before the end of the next registration
period in August. The SPFA therefore also advised Mr A of his rights to terminate
the contract under Article 17.3 of the Regulations which would present a more
expedient route.
44. Mr A resolved to proceed with a termination under Article 17.3 of the Regulations
and served a notice on B to this effect on 26 May 2006. This decision was based on
procedural reasons to ensure a swift resolution to his contractual relationship with
the club and was not an acceptance that he did not have grounds to terminate for
just cause.
45. Mr A therefore reiterates his right to terminate the contract for just cause and
sporting just cause as well as under Article 17.3 of the Regulations and requests that
the Dispute Resolution Chamber make a pronouncement on these grounds before
considering the termination under Article 17.3 and the issues of compensation and
sanctions.
46. Mr A contends that he should not be liable for any sanctions or compensation in
this case as he had just cause and sporting just cause to terminate the contract. If
this is not accepted, then Mr A makes the following points with regard to any
sanctions and compensation that the Dispute Resolution Chamber decides to award.
47. Mr A, unlike B, has acted properly throughout this process and in principle, it is the
club that should be liable to pay damages to Mr A. Mr A was badly treated due to
the simple fact that he would not extend his contract with B. He was dropped from
the team for non playing reasons and then suffered the ultimate punishment when
he was left out of the team for the Cup Final.
48. However, to reduce the damages that B would have otherwise been liable to pay,
Mr A did his utmost to find a new club in due time. As he was successful in
obtaining a new job at C, there is no direct financial damage for the player and
there was no need for him to claim damages from B.
49. The misconduct of B leading to this conflict could instead justify a referral to the
FIFA Disciplinary Committee.
50. The contract was terminated in accordance with Article 17.3 of the Regulations
outside of the Protected Period by the unilateral action of the player. Mr A signed
the contract at the age of 21 and served 3 full seasons under it and was thus
entitled to utilise “the Article 17.3 procedure”. The fact that Mr A has been allowed
to play for his new club underlines this, and no sporting sanctions can be applied to
Mr A in this case.
51. Mr A wants to emphasise that it was his own decision to terminate the contract.
There was no club involved that induced this termination, nor did his agent. Mr A
refers the Dispute Resolution Chamber to the witness statement of the agent which
confirms that Mr A’s new club, C, only became involved in this case on 10 July 2006
following receipt of a fax from Mr A’s agent. C therefore had no involvement in the
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contract termination. As such, there is no justifiable reason to hold his new club, C,
responsible for the consequences of his termination.
52. Mr A also wishes to state that he terminated the contract within 15 days of the last
game of the season that his club played, i.e. the Cup Final on 13 May 2006 which is
the premier cup competition in and is organised and controlled by the Football
Association. The winner of this trophy gains automatic entry into the UEFA Cup for
the following season.
53. Mr A notes that the Cup Final is an “Official Match” under the Regulations and he
therefore understood that the 15 day notice period would run from this game. In
this respect, it is noted that under Article 15 of the Regulations when terminating
for sporting just cause, the notice is to be sent within 15 days of the last “Official
Match”.
54. It is therefore contended that Mr A’s actions of sending the letter under Article 17.3
of the Regulations, which was aimed at avoiding disruption to B before the Cup
Final, are justifiable and in line with the principle behind the notice period of
Article 17.3 of the Regulations.
55. Even if the Dispute Resolution Chamber does not accept that the end of the season
was the Cup Final on 13 May 2006, then Mr A would state that his notice to
terminate on 26 May 2006 was only 4 days outside the 15-day period after the last
league fixture (7 May 2006) and therefore caused no prejudice to B.
56. In the circumstances, and for the reasons set out, Mr A respectfully requests that he
should not face any disciplinary measures under Article 17.3 of the Regulations. It is
also clear that there can be no ‘sporting sanctions’ in this case as the termination
came outside the Protected Period.
57. In this regard, Mr A would request the Dispute Resolution Chamber to note that he
has already been out of football for some time due to his non-selection at B and
subsequent lack of match fitness whereby he did not play during the period from
April to October 2006 at either club or international level.
58. In the event that Mr A is held liable for damages to B he would like to point out
that these damages must be limited to the residual value of the contract.
59. As the termination of contract occurred outside of the Protected Period there is no
factor available to increase the amount of this residual value although B uses a lot
of paperwork to state otherwise. In the view of the player it is not possible that the
breach of a contract between two parties with a certain value (the salary of the
player) would lead to a compensation that exceeds this amount many times. In
previous Dispute Resolution Chamber cases the residual value of the contract has
been the guideline for the settlement of the compensation. In this case there is no
justified reason to deviate from that guideline.
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60. The residual value of the contract is in fact the only applicable factor for calculating
the compensation as it is obvious that the said value represents the value of the
contract between the two parties. The fact that the termination of the contract
took place outside of the stability period is a mitigating factor.
61. In the Regulations and Dispute Resolution Chamber’s jurisprudence there is no
foundation for the position of B that the compensation shall be calculated on the
basis of an alleged “market value” of a player. In any case B failed to substantiate
this.
62. Of course it is possible that parties come to a mutual agreement that exceeds the
residual value of the contract, but this is not the position here.
63. Moreover, from the submission of B can be learnt that an offer of 1.5 million (10
times the residual value of the contract) was turned down. It should be noted that
this bid came after A had terminated the contract. So even if B were minded to
accept the bid it was not in a position to do so as A had already terminated the
contract.
64. Furthermore, B seem to forget that at the end of the contract on 1 July 2007 – if it
were not terminated – A could have left the club without any compensation at all.
65. To this effect, Mr A has also noted the detailed response of C to B‘s claim for
compensation and confirms that he fully concurs with these submissions and
requests that the Dispute Resolution Chamber also take them into account when
assessing any compensation that may be payable by him in this case.
66. Finally, and as far as B‘s latest submission is concerned, whereby they propose a
calculation of the amount paid to the player during the course of his contracts, Mr
A maintains that the club has had two previous opportunities to submit any
evidence regarding this case. Therefore, according to the procedures set out by FIFA
to govern the manner in which these proceedings are conducted, any evidence
produced by the club within its latest submission is out of time and cannot be relied
upon. In any case the evidence produced does not offer any new insight into the
case and is not relevant to the facts of the case.
67. However, if the Dispute Resolution Chamber does choose to allow this new
evidence, Mr A would like to state that the club has chosen to outline salary figures
it maintains were paid to him for a period of five seasons from 2001 until 2006.
These figures cannot contribute to the calculation of any compensation that may be
payable to B, as it can only be the residual value of the contract that can be taken
into consideration by the Chamber.
68. Furthermore, within the club’s own schedule of payments the amounts for the
seasons 2001/02 and 2002/03 relate to a previous contract concluded between the
parties and are therefore completely irrelevant, whereas for the seasons 2003/04,
2004/05 and 2005/06 the club has of course had a return for these payments by way
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of having Mr A play for them during this period. Again these figures are irrelevant
to the case.
69. It is interesting however to note that B, in submitting this as evidence, are clearly
acknowledging that the player’s contract is indeed the only relevant factor with
regard to the calculation of any compensation. This is a change from the club’s
previous submissions where its position was based around purely subjective views of
the player’s transfer market value.
70. A would like to stress once more that it can only be the residual value of the final
year of his contract that can be taken as relevant, and the club appears indeed to
agree with this view by means of its latest submission. The new evidence does not in
any case contribute to the facts of the matter.
71. For the reasons set out above, Mr A hereby requests the dismissal of the claims of B
against him. Mr A submits he had just cause and sporting just cause to terminate
the contract. Furthermore, the player acted entirely properly in terminating the
contract under Article 17.3 of the Regulations and no sporting sanctions or
disciplinary measures can be imposed against him. Finally, any compensation
deemed payable to B, must be limited to the residual value of the contract.
C’s position:
72. C’s recollection of the facts reflect that of the player.
73. C maintain in their position that the employment contract between the player, Mr
A, and B was unilaterally terminated by the earlier outside the Protected Period.
The employment contract at stake was in fact concluded on 1 July 2003 and is due
to expire on 30 June 2007. Therefore, the Protected Period has come to an end with
the end of the third season, i.e. on 7 May 2006.
74. To this effect, C are eager to point out that the player gave the club even two
notices of termination, one on 4 May 2006 on the grounds of just cause, and the
second on 26 May 2006, in compliance with the provision contained in Article 17 of
the Regulations, i.e. outside of the Protected Period and within 15 days following
the last match of the Season. This second notice was not, however, a withdrawal of
the underlying allegations that support the player’s right to terminate the contract
for just cause.
75. According to the club, the first contact between Mr A and C occurred on 10 July
2006, i.e. six weeks after the termination of contract performed by the player. As a
matter of law, there is no causative link between C and the termination of the
contract, as a consequence of which, the club cannot be deemed liable for any
damage arising from such a breach.
76. As regards B‘s request to be awarded an amount, which would return the club in
the position it would have been in had A not committed breach of contract without
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just cause, it is not so obvious that the club is the damaged party in this case,
especially taking into account that their behaviour led the player to terminate the
contract.
77. Furthermore, the club appears to request a “transfer fee”, which not only is not
provided for in the Regulations, but what is more is not included in the criteria
listed in Article 17 of the Regulations to assess the amount of compensation due for
breach of contract.
78. The club also points out that the offer made by X occurred after the player had
terminated the contract and, therefore, cannot be taken into consideration as loss
of opportunity, apart from the fact that the evaluation X give of the player is
subjective and cannot be regarded as a proof of the player’s actual value. In fact, all
the club’s allegation with respect to the player’s value are entirely arbitrary and
hypothetical.
79. As regards B‘s calculation of the compensation due, when it comes to the remaining
value of the contract, only the salary and sign-on fee and no other bonuses should
be taken into account. Therefore, the residual value of Mr A’s contract with B
should not exceed 149,976.
80. Also the projection for the player’s future salary made by the claimant is totally
ungrounded, since no sign-on fee is provided for under the new contract and,
taking into account that the player earns 10,000 per week, a likely figure as yearly
salary is 450,000 plus approximately 33,000 as appearance bonus.
81. For the record, the player only featured in a small number of matches for C and is
now on loan to the club Y.
82. As far as B‘s request for A to be imposed disciplinary sanctions is concerned, C’s
position reflects that of the player.
83. Finally, and as far as B‘s latest submission concerning the player’s salaries is
concerned, C’s position again reflects that of the player, especially under the
procedural point of view, i.e. the latest evidence was produced out of time and
should not be taken into consideration.
84. However, if the Dispute Resolution Chamber does choose to allow this new
evidence, it has to be noted that the amounts for the seasons 2001/02 and 2002/03
are completely irrelevant, since they relate to a previous different contract, which
was superseded by the one signed on 1 July 2003.
85. In any case, Article 17.1 of the Regulations refers to “benefits due to the player
under the existing contract”, i.e. the sums that have not yet been paid to him.
Therefore, what has been paid by the club is totally irrelevant. Plus, that club has
largely benefited from the services of the player, who played 239 games with them.
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86. It is also worth emphasising that the figures of the latest submission are greater
than those presented by means of the claimant’s submission.
87. To conclude with, C request the Dispute Resolution Chamber that all requests filed
by B be rejected.
88. The Dispute Resolution Chamber is asked to rule upon the breach of contract, as
well as on the possible consequences.
Players’ Agent:
89. The Dispute Resolution Chamber is also asked to pronounce itself on the relevance
of the role played by Mr A’s agent in the affair at stake.
II. Considerations of the Dispute Resolution Chamber
1. First of all, the Dispute Resolution Chamber analysed whether it was competent to
deal with the matter at stake. In this respect, it referred to art. 18 par. 2 and 3 of
the Rules Governing the Procedures of the Players’ Status Committee and the
Dispute Resolution Chamber. The present matter was submitted to FIFA in
November 2006, as a consequence the Chamber concluded that the revised Rules
Governing Procedures (edition 2005) on matters pending before the decision
making bodies of FIFA apply to the matter at hand.
2. With regard to the competence of the Chamber, art. 3 par. 1 of the abovementioned Rules states that the Dispute Resolution Chamber shall examine its
jurisdiction in the light of articles 22 to 24 of the current version of the Regulations
(edition 2005). In accordance with art. 24 par. 1 in connection with art. 22 (a) of the
aforementioned Regulations, the Dispute Resolution Chamber shall adjudicate on
employment-related disputes between a club and a player in relation to the
maintenance of contractual stability if there has been an ITC request and if there is
a claim from an interested party in relation to such ITC request, in particular
regarding its issuance, regarding sporting sanctions or regarding compensation for
breach of contract.
3. As a consequence, the Dispute Resolution Chamber is the competent body to decide
on the present litigation regarding a dispute in relation to the maintenance of
contractual stability arisen following the issuance of an ITC regarding compensation
for breach of contract.
4. Subsequently, the members of the Chamber analysed which edition of the
Regulations should be applicable as to the substance of the matter. In this respect,
the Chamber referred, on the one hand, to art. 26 par. 1 and 2 of the Regulations
(edition 2005) and, on the other hand, to the fact that the relevant contract at the
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basis of this dispute was signed on 1 July 2003 and that this claim was lodged at
FIFA by B in November 2006. In view of the aforementioned circumstances, the
Chamber concluded that the current FIFA Regulations for the Status and Transfer of
Players apply to the case at hand as to the substance.
5. Before entering the substance of the matter, the Chairman of the Dispute
Resolution Chamber addressed the issue raised by B, that challenged one of the
members, Mr Theo van Seggelen, and asked the Chamber to reconsider the
constitution of the panel.
6. In this context, B drew FIFA’s attention to the article that appeared on the website
of FIFPro, the General Secretary of which is Mr Theo van Seggelen himself, under
the title: “A case, step forwards in the freedom of players”. This report contained
some statements suggestive of the decision that the Dispute Resolution Chamber
would have reached in the case at hand.
7. The club therefore questioned the presence of a FIFPro member (what is more, its
General Secretary) in the case at stake and, in particular, challenged Mr Theo van
Seggelen and sought its replacement on the grounds of lack of impartiality.
8. In this respect, Mr Theo van Seggelen pointed out that the above-said article
represents an independent opinion expressed by an individual operating outside
FIFPro and that, either in this one or in any other case in which he has been involved
in his quality of member of the Dispute Resolution Chamber, he has never made any
comment either before or after a decision, always abiding by the duty of
confidentiality.
9. The Chairman was then eager to emphasise that the Chamber is an impartial
deciding authority composed by an equal number of members chosen amongst
representatives of clubs and representatives of players, of which FIFPro is the
leading organisation at international level. It was also underlined that the
aforementioned composition has always allowed a fair resolution of the footballrelated disputes.
10. None of the members, the Chairman assured, has ever represented the interests of
either the players or the clubs, but always taken care of the exclusive interest of the
Dispute Resolution Chamber itself.
11. Consequently, and in view of the concerned person’s above explanations, the
Chairman along with all the remaining members concluded that the request for the
dismissal of Mr Theo van Seggelen shall be rejected.
12. In continuation, and entering into the substance of the matter, the Chamber
acknowledged the documentation contained in the file and focussed its attention
on the fact that the player A and the club B signed an employment contract on 31
March 2001 due to expire on 30 June 2005 which, on 1 July 2003, was renewed until
30 June 2007.
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13. The Chamber also noted that, on 9 August 2006, A signed a three-year employment
contract with the club, C and that, whereas the subsequent matter of the player’s
provisional registration had been decided upon by the FIFA competent authority,
the dispute at stake lay on the substance of the contractual dispute between the
player and the club and, in particular, on the conditions of the contractual
termination.
14. To this effect, the Chamber took note of the fact that, on 26 May 2006, Mr A served
notice of termination on B and, in this regard, the members had to ascertain
whether or not the said notice of termination, and the subsequent unilateral
termination of the contract, occurred in compliance with the provisions established
under Article 17.3 of the Regulations, i.e. outside of the Protected Period and within
15 days following the last match of the Season.
15. It was observed that, on account of the fact that the employment contract between
the player and the club was concluded on 1 July 2003 and due to expire on 30 June
2007, the unilateral termination undeniably occurred after three seasons, i.e.
outside of the Protected Period, as indicated under point 7) of the Definitions
section of the Regulations.
16. This being established, the Chamber stated that it had to assess the unavoidable
consequences of this unilateral termination, in accordance with the provisions
provided for by Articles 13 ff. of the Regulations.
17. The deciding authority incidentally noticed that Mr A had firstly served notice on B
to terminate his contract for just cause with a 14-day notice from 4 May 2006 under
clause 18 of the employment contract whereby, in the event of an intentional
failure of the club to fulfil the terms of the contract, the player would be entitled to
give a 14-day written notice to the club to terminate the agreement.
18. However, it was also noted that Mr A had been advised that this process may have
taken some time as the procedure and possible appeals process that may have
followed, could have been lengthy and that this could have damaged his prospects
of securing a contract with another club before the end of the next registration
period in August. Mr A then resolved to proceed with a termination under Article
17.3 of the Regulations and served a further notice on B to this effect on 26 May
2006. This decision was based on procedural reasons to ensure a swift resolution to
his contractual relationship with the club and, according to the player, was not an
acceptance that he did not have grounds to terminate for just cause.
19. In this context, and whilst not discounting the difficulties that the player and the
club may have been faced with in the final part of their contractual relationship, the
Chamber was left with no other choice than to regard the termination that the
player actually performed on 26 May 2006, on the basis of Article 17.3 of the
Regulations as the only valid one, for the purpose of this procedure.
20. In continuation, and for the sake of good order, the Chamber deemed it essential to
state that also the termination of the contract for sporting just cause, which the
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player appears to invoke, at least on a subsidiary basis, could not be further
considered. In fact, a player intending to make use of this possibility, would have to
proceed by serving notice on the club that he is registered with and call upon the
relevant sporting just cause in the fifteen days following the last Official Match of
the Season (cf. Article 15 of the Regulations). Undisputedly, the player had never
served such a notice. Yet, on 7 July 2006 the player withdrew his first termination
notice.
21. However, as far as the timeliness of the notice of termination of 26 May 2006 is
concerned, it has to be noted that, according to point 9) of the Definitions section
of the Regulations, the Season ends with the last Official Match of the relevant
national league championship. As the last match of the national league
championship, i.e. the Premier League, for the Season 2005/2006 occurred on 7 May
2006, the notice of termination dated 26 May 2006 does not appear to have been
issued within 15 days following the last match of the Season for the purpose of
Article 17.3 of the Regulations.
22. In this respect, the members of the Chamber understood that Mr A terminated the
contract within 15 days of the last game of the season that his club actually played,
i.e. the Cup Final on 13 May 2006, and that such a match is to be regarded as an
“Official Match” under the FIFA Statutes and Regulations (cf., in particular, point 5)
of the Definitions section of the Regulations) and he therefore understood that the
15-day notice period would run from this game.
23. However, point 9) of the Definitions section of the Regulations is unambiguous in
stating that the Season ends with the last Official Match of the relevant national
league championship and, therefore, any notice of termination served after
fifteen days of the last Official Match of the Season may result in the application of
disciplinary measures, in accordance with Article 17.3 of the Regulations.
24. The deciding authority emphasised the relevance of the strict implementation of
this rule, and of the consequent adoption of disciplinary measures, so as to enhance
the legal certainty in the contractual relationships between players and clubs.
25. Nonetheless, the Chamber took also into consideration that, in any case, the notice
was notified nineteen days after the last Official Match of the Season, i.e. four days
only beyond the fifteen days required by Article 17.3 of the Regulations.
26. In light of the above, the Dispute Resolution Chamber decided that Mr A failed to
give B due notice of termination on time as provided for under Article 17.3 of the
Regulations, and, as a consequence, the player will not be eligible to participate in
any official football match for a period of two weeks as from the beginning of the
next national league championship of the club for which he will be registered.
27. After the consequences of the failure to give B due notice of termination on time
were thus established, the Chamber went on to consider the consequences of
terminating the employment contract without just cause.
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28. In this respect, the deciding body first and foremost laid emphasis on the primacy of
the principle of the maintenance of contractual stability, which represents the
backbone of the agreement between FIFA/UEFA and the European Commission
signed in March 2001. This agreement and its pillars represent the core of the
former (edition 2001) as well as of the current version of the Regulations.
29. In particular, the Chamber was eager to point out that the measures provided for by
the above Regulations concerning compensation for breach of contract without just
cause serve as a deterrent and that a lack of a firm response by the competent
deciding authorities would represent an inappropriate example towards all the
football actors, especially in view of the particular attention that this case arouses in
the world of football.
30. Above all, it was underscored that the criteria contained in Article 17 of the
Regulations are applied on the principle of reciprocity for clubs and players,
signifying that both clubs and professionals who are seen to have committed a
breach of contract without just cause will in all cases be subject to pay
compensation and, under specific circumstances, also subject to the imposition of
sporting sanctions.
31. In this respect, awarding compensation in favour of the damaged party (either the
player or the club, as the case may be) has proven to be an efficient means and has
always found a widespread acceptance since it guarantees that the fundamental
principle of the respect of the contracts is duly taken care of.
32. As it was observed, Article 17 of the Regulations, far from stipulating the right of a
contractual party to terminate the employment contract, affirms that in all cases the
party in breach of contract shall pay compensation.
33. This notwithstanding, the members of the Chamber were also unanimously keen to
emphasise that the breach of contract without just cause committed by Mr A
outside of the Protected Period cannot result in the imposition of sporting
sanctions, in compliance with the applicable Regulations (cf. Article 17 of the
Regulations).
34. Consistently with the above, and in conformity with the relevant Regulations, the
player’s new club, the C, shall not suffer sporting sanctions for inducing the
contractual breach and its responsibility shall be limited to being jointly and
severally liable for the payment of any amount of compensation for breach of
contract that Mr A will be ordered to pay (cf. Article 17.3 and 17.2 of the
Regulations). In this respect, the Chamber was eager to point out that the joint
liability of the player’s new club is independent from the question of a possible
inducement to contractual breach.
35. Moreover, and with respect to a possible responsibility of the club for having
entered into negotiations with A during the course of his contract and for having
failed to inform B in writing in accordance with Article 18.3 of the Regulations, the
Dispute Resolution Chamber underlined that there is no evidence in support of the
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fact that the club contacted the player any time before the unilateral termination
of the contract with the club.
36. On the contrary, the time elapsed between the notice of termination, dated 26 May
2006, and the conclusion of the contract between C and A on 9 August 2006 led the
Chamber to conclude that there is no causative link between C and the termination
of the contract by the player and, therefore, to rule out any wrongdoing by the
club.
37. In continuation, according to the members of the Chamber a careful reading of the
applicable provision, i.e. Article 17.1 of the Regulations, provides the key to assess
the amount of compensation due by the player to the club.
38. The Chamber stated that the criteria listed therein are, however, not exhaustive and
that each request for compensation for breach of contract has to be assessed on a
case-by-case basis, leaving to the deciding body the faculty to decide ex aequo et
bono, where appropriate.
39. The members thus stated that it falls under their responsibility to estimate the
prejudice suffered by B in the case at hand, not only in accordance with the abovestated criteria, but also with their specific knowledge of the world of football, as
well as with the experience the Chamber itself has gained throughout the years.
40. In the calculation of the amount of compensation due by A, at first the Chamber
turned its attention on the remuneration and other benefits due to the player
under the existing contract and under the new contract.
41. According to the documentation provided by B to FIFA, it appears that the
remaining value of the player’s employment contract with the club can be
calculated in the amount of 199,976.
42. As regards the financial conditions of the employment contract concluded between
A and C, the Chamber acknowledged the fact that the player would receive a basic
weekly wage of 10,000 for the season 2006/2007, plus a number of appearance
bonuses.
43. In addition to that, transfer compensation of 75,000 had also been paid by B to the
club Arbroath for A‘s transfer. According to Article 17.1 of the Regulations, this
amount shall be amortised over the term of the relevant employment contract.
44. The deciding body concluded its analysis of the objective criteria listed in Article
17.1 of the Regulations, by recalling that the contractual breach occurred outside
the Protected Period and pointing out that, at the time when the contract was
breached, A was still bound to B by one further year of contract only.
45. As a matter of fact, the five seasons A spent with B shall also play a chief role in
determining the amount of compensation due for contractual breach.
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46. Likewise, the deciding authority observed that another crucial factor to be taken
into account is the way B have greatly contributed to the steady improvement of a
player, A, who joined the club at the age of nineteen and, throughout the course of
his spell with the side, has become a high-profile footballer, deserving a constant
presence in the national team and arousing the interest of top-flight clubs both in
the and in the Premiership, as the events revealed. According to the Chamber, such
a stance demonstrates the real interest the club had always had in the services of
the player.
47. Once again, emphasis was placed on the fact that Article 17.1, while listing certain
factors to be included in the Chamber’s consideration in the calculation of the
amount of compensation payable, does not purport to limit the factors that may be
considered by the Chamber in any individual case. These factors may include, in
addition to local law and the specificity of sport, “any other objective criteria”,
including those specifically listed in Article 17.1.
48. The aforementioned considerations led the deciding authority to the conclusion
that limiting the compensation for breach of contract to the residual value of the
contract not only is not in line with the jurisprudence of the Dispute Resolution
Chamber, but would also undermine the principle of maintenance of contractual
stability, reducing to a mere formula the legitimate right of the damaged party to
receive compensation.
49. In this respect, it was declared that, as a general rule, a player cannot, at any time
and under any circumstances, “buy out” an employment contract by simply paying
to his club the remaining value of his contract.
50. In light of all the above-exposed circumstances, and after a careful analysis of the
documentation at its disposal, the specificities of the case at hand, as well as of all
the parties’ respective positions, the Chamber decided that A must pay the amount
of 625,000 to B as compensation for breach of contract.
51. To conclude with, the members of the Dispute Resolution Chamber were of the
unanimous opinion that, under the light of the facts of this dispute, the role played
by the players’ agent in the breach of contract requires further investigation by the
competent authorities.
52. Therefore, in compliance with Article 21.1 in connection with Article 14 c) of the
Players’ Agents Regulations and 17.5 of the Regulations, the matter will be
forwarded to the Players’ Status Committee for investigation and decision.
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III. Decision of the Dispute Resolution Chamber
1. The claim of the club, B, is partially accepted.
2. The player, A, has unilaterally breached the employment contract with B without
just cause outside the Protected Period.
3. Mr A has to pay the amount of 625,000 to B within 30 days of notification of this
decision.
4. If this amount is not paid within the aforementioned deadline, a 5% interest rate
per annum as from the expiry of the aforementioned deadline will apply, and the
present matter will be submitted to the FIFA’s Disciplinary Committee, so that the
necessary disciplinary sanctions may be imposed.
5. The club C is jointly and severally liable for the aforementioned payment.
6. Any other request filed by B is rejected.
7. B is directed to inform Mr A and C immediately of the account number to which the
remittance is to be made, and to notify the Dispute Resolution Chamber of any
payment received.
8. Mr A failed to give B due notice of termination.
9. Mr A is not eligible to participate in any official football match for a period of two
weeks as from the beginning of the next national league championship for which
he will be registered.
10. The matter concerning the role played by the players’ agent in the breach of
contract, will be forwarded to the Players’ Status Committee for investigation and
decision.
11. According to art. 61 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:
Château de Béthusy
19
Avenue de Beaumont 2
1012 Lausanne
Switzerland
Tel: +41 21 613 50 00, Fax: +41 21 613 50 01
[email protected], www.tas-cas.org
For the Dispute Resolution Chamber:
Urs Linsi
General Secretary
Encl. CAS directives
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