Labour Disputes
Texto da decisão
Decision of the Dispute Resolution Chamber
passed in Zurich, Switzerland, on 28 May 2010,
in the following composition:
Slim Aloulou (Tunisia), Chairman
Gerardo Movilla (Spain), member
David Mayebi (Cameroon), member
Essa M. Saleh Al-Housani (United Arab Emirates), member
Thilina Panditharatne (Sri Lanka), member
on the claim presented by the player,
M,
as Claimant
against the club,
FC V,
as Respondent
regarding an employment-related dispute
between the player and the club
I.
Facts of the case
1.
On 18 December 2005, the player M (hereinafter: player or Claimant) and the club FC
V (hereinafter: club or Respondent) signed a document bearing the title “Annex” and
valid as from 1 January 2006 until 30 June 2007.
2.
According to this “Annex”, the club was obliged to pay to the player for the first
season (“Period 01.01.2006 - 30.06.2006”) a lump amount of EUR 5,000 to be paid on
23 December 2005 at the latest and the amount of EUR 10,000 as salaries, to be paid in
five equal instalments as from 1 February 2006 until 30 June 2006.
3.
Additionally, with regard to the second season (“Period 01.07.2006 - 30.06.2007”), the
player was to receive from the club a lump amount of EUR 5,000 to be paid on 30 July
2006 at the latest and the amount of EUR 20,000 to be paid in ten equal instalments as
from 1 August 2006 to 30 May 2007.
4.
On 14 December 2006, the Claimant lodged a claim against the Respondent in front of
FIFA for breach of contract without just cause by the Respondent, claiming payment of
compensation amounting to EUR 40,000, i.e. the total contractual value. In addition,
he asked that the Respondent be ordered to pay the procedural costs.
5.
The Claimant explained that, on 10 January 2006, he attended a club reception with
other players and sponsors and he was presented to the press the following day. He
then started to train with his team.
6.
On 13 January 2006, the Claimant was informed by the Respondent that he was no
longer a member of the team and that he had to return to country P. The Respondent
refused to give him a written notice since it denied having signed any contract with
the Claimant.
7.
The Claimant further pointed out that he refused to leave and, during a meeting with
a club representative, he was told that the reason for the Respondent not to carry on
the contract would be that the club “did not like his performance as a football
player.” Having been pressured, he left country B to return to country P on 17 January
2006.
8.
The player submitted that a player’s performance does not constitute a just cause to
terminate an employment contract.
9.
In reply to the claim, the Respondent held that it never signed any contract with the
Claimant and that the document transmitted by the Claimant in support of his
position shall not be considered as a valid employment contract.
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10.
Additionally, the Respondent asserted that it did not register any contract involving
the Claimant with the B Football Federation, whereas this is a mandatory domestic
formality.
11.
The Respondent explained that the document presented by the Claimant is simply an
Annex to an employment contract, which contract has never been signed. The
Respondent highlighted that the said document clearly bears the title “Annex”, does
not bear any date and refers to an employment contract number which had remained
blank.
12.
According to the Respondent, this document cannot produce any effect without the
main agreement that it has to be annexed to and is consequently not valid from a
legal point of view.
13.
The Respondent mentioned that it fulfilled all the obligations it had towards the
player, including payment of all his expenses during his trial and the flight back to
country P, and did not coerce him to leave. On account of the above, the Respondent
considered that the player’s claim has no basis and has to be rejected.
14.
The Claimant, on the other hand, highlighted that the document referred to as
“Annex” contains all the required elements pertaining to a binding agreement, inter
alia, duration dates, parties, amounts, respective obligations, termination clauses.
Additionally, the Claimant pointed out that he even started to train with the team.
15.
Furthermore, the Claimant considered that the registration formalities which the
Respondent refers to is the club’s duty and not his and he reiterated that a player’s
skills or performance cannot constitute a valid reason to terminate an employment
contract.
16.
The Respondent, for its part, pointed out that after having met the player in country
P, a trial was accepted by both parties and the player insisted in signing a pre-contract,
i.e. the “Annex”. The club asserts that the signature of an employment contract was
depending on the results of the trial and the medical test, as provided in art. 14 of the
“Annex”.
17.
Additionally, the Respondent highlighted that the player himself provided evidence
extracted from the press from which it can be noted that:”Also became clear that FC V
refuses the four players who came for a trial. The managers of the P players (…) M (…)
claimed huge financial requests. The negotiations were stopped at the very same
moment.”
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18.
Relying on the player’s skills and his financial wishes, the Respondent decided not to
sign any employment contract with the Claimant after the three days the player stayed
in country B. The Respondent stated that the Claimant left without any further protest
and it did not hear from him before it received the present claim.
19.
The Respondent reiterated that the “Annex” is simply a pre-contract which cannot
have any legal effect if it is not accompanied by an official contract, which was never
signed or ever requested by the Claimant. In this respect, the club referred to Swiss law
with respect to the definition of a “pre-contract”.
20.
The Respondent submitted that the pre-contract itself shall not be considered as a
valid and binding agreement, since its contents are not precise enough, it does not
bear any stamp from the club, which is mandatory, and never got executed by the
parties. It therefore cannot have any legal effects.
21.
The Respondent also reiterated that during his three days’ stay at the club’s premises,
the Claimant did not ask for the signature of an official contract, whereas he should
have done so after the signature of the pre-contract.
22.
In this respect, the Respondent refers to two decisions from the Dispute Resolution
Chamber (DRC) and an award from the Court of Arbitration for Sport (CAS).
23.
The Respondent further explained that, in case the “Annex” was considered as a valid
and binding employment contract, quod non, no evidence has been brought with
regard to a request for the signature of the official contract, from which the club
deduces that none of the parties were interested in the execution of the pre-contract
which is consequently void.
24.
Additionally, referring to Swiss law, the Respondent stated that the Claimant cannot
claim compensation since he did not suffer any loss, as he was rendering his services to
a country P club. In case the aforementioned element was not taken into account by
the DRC, the club asked for a set-off of the compensation claimed against the salaries
the player received from the said country P club over the relevant period of time.
25.
The Respondent concluded by asking the DRC to reject the Claimant’s claim.
26.
On 25 January 2006, the Claimant signed an employment contract with a country P
club valid as from 25 January 2006 until 30 June 2006, a copy of which was made
available by the Claimant.
II.
Considerations of the Dispute Resolution Chamber
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1.
First of all, the Dispute Resolution Chamber (hereinafter also referred to as
Chamber or DRC) analysed whether it was competent to deal with the case at
hand. In this respect, it took note that the present matter was submitted to FIFA
on 14 December 2006. Consequently, the Rules Governing the Procedures of the
Players’ Status Committee and the Dispute Resolution Chamber (edition 2005;
hereinafter: Procedural Rules) are applicable to the matter at hand (cf. article 21
par. 2 and 3 of the Procedural Rules, edition 2008, in combination with art. 18 par.
2 and 3 of the Procedural Rules).
2.
Subsequently, the members of the Chamber referred to art. 3 par. 1 of the
Procedural Rules and confirmed that in accordance with art. 24 par. 1 in
combination with art. 22 lit. b) of the Regulations on the Status and Transfer of
Players (edition 2009) 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 and a club.
3.
Furthermore, the Chamber analysed which regulations should be applicable as to
the substance of the matter. In this respect, it confirmed that in accordance with
art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players
(edition 2009), and considering that the present claim was lodged on 14 December
2006, the 2005 edition of the 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, the Chamber entered into the substance of the matter. In this respect,
the Chamber acknowledged that the Claimant and the Respondent undeniably
signed on the club’s letterhead a document referred to as “Annex” valid as from 1
January 2006 until 30 June 2007 and including an option for an additional season
as of 1 July 2007 until 30 June 2008.
5.
Furthermore, the Chamber noted that the Claimant, on the one hand, maintains
that the Respondent breached the said agreement by putting an end to the
contractual relation on 13 January 2006 on the basis of the fact that his football
skills were not satisfactory to the club. In this respect, the Chamber duly took into
account the player’s assertions in accordance with which a player’s lack of
performance does not constitute a just cause for unilaterally terminating an
employment contract and that by doing so, the club breached the said contract
without just cause.
6.
On the other hand, the members of the Chamber duly noted that the Respondent
maintains that the “Annex” cannot be considered a legally binding employment
contract and that the claim shall thus be rejected.
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7.
On account of the above, the Chamber came to the conclusion that the essence of
the matter at hand lies in the legal qualification to be given to the said “Annex”,
i.e. the Chamber shall firstly establish as to whether or not the parties were
contractually bound by means of the “Annex”. In the affirmative, the Chamber
shall subsequently have to determine whether such contract was breached and, if
so, which party is to be held liable for breach of contract and decide on the
consequences thereof.
8.
In this regard, the members wished to recall that as a general legal principle, the
legal qualification to be given to a convention or an agreement shall not depend
on the title the parties decided to give to the said convention or agreement. On
the contrary, the exact qualification to be given to a document has to ultimately
derive from the parties’ intention and an objective analysis of its general balance
and provisions.
9.
In addition to the foregoing, the Chamber wished to highlight that in order for a
document to be considered as a valid and binding employment contract, apart
from the signature of both the employer, i.e. the club, and the employee, i.e. the
player, 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 and the remuneration payable by the club to the player in exchange
of his services.
10.
By analysing the contents of the Annex, it could firstly be established that the
document clearly contains the respective identity of the parties, i.e. the player’s
and the club’s details and addresses and bears the signature of both the player and
the club’s Executive Director and President.
11.
Moreover, the Annex clearly sets forth the salary and other remuneration payable
by the club to the player in exchange of his services.
12.
Furthermore, the Annex stipulates a certain duration, based on the sporting
seasons dates, i.e. the sporting seasons 2005/06, 2006/07 and potentially 2007/08.
13.
In addition to the aforementioned, the Chamber noted that, in particular, the
Annex contains a detailed provision with regard to the circumstances under which
the employment relation can be terminated.
14.
Finally, the Chamber also noted that the Annex does not contain any reference
whatsoever to the fact that its validity shall depend on the signature by the parties
of another contract.
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15.
On account of the above, the Chamber concluded that all the above-mentioned
essential elements are included in the pertinent Annex. Consequently, the
members of the Chamber decided to reject the Respondent’s argument in this
respect.
16.
The Chamber then turned to the Respondent’s argument in accordance with which
an employment contract can only be valid if it was duly registered with B Football
Federation. In this regard, the Chamber considered relevant to recall its
longstanding jurisprudence in accordance with which administrative formalities,
such as, but not limited to, the issuance of a work permit or the registration of the
employment contract with the national football association falls within the sole
responsibility of the club. Having said this, the Chamber deemed that the validity
of an employment contract cannot be linked to the willingness of the club to have
such contract registered. In this context, the Chamber emphasized that, as a
general rule, the registration of an employment contract at a federation does not
constitute a condition for its validity. For these reasons, the members of the
Chamber decided to reject the Respondent’s arguments in this regard.
17.
Furthermore, and for the sake of good order, the Chamber deemed important to
point out that the decision that the club is referring to in support of its position
with regard to the registration of an employment contract (cf. point I./22. above)
cannot relevantly apply to the matter at hand since, inter alia, the document at
stake does not contain any article or reference to a mandatory registration
formality to be complied with.
18.
On account of all the above, the members of the Chamber unanimously decided
that the Annex was to be considered as a valid employment contract legally
binding the club and the player.
19.
In light of this conclusion, the members of the Chamber subsequently analysed the
circumstances surrounding the termination of the employment contract in January
2006.
20.
In this regard, the members of the Chamber deemed relevant to remind that in
response to the player’s claim, the Respondent itself acknowledged having put an
end to the player’s services on the basis of the fact that the player’s skills did not
meet the club’s expectations. Furthermore, the Chamber took into account that
the Respondent had not contested the Claimant’s allegation that such termination
occurred on 13 January 2006.
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21.
In this context, the Chamber referred to its longstanding jurisprudence in
accordance with which unsatisfactory physical or technical skills cannot be
considered a valid reason for terminating an employment contract.
22.
Consequently, on the basis of the aforementioned considerations, the Chamber
established that the Respondent has terminated the employment contract without
just cause on 13 January 2006.
23.
Having established that the Respondent is to be held liable for the early
termination of the employment contract without just cause, the Chamber focussed
its attention on the consequences of such breach of contract. Taking into
consideration art. 17 par. 1 of the Regulations, the Chamber decided that the
Claimant is entitled to receive from the Respondent an amount of money as
compensation for breach of contract in addition to outstanding payments, if any,
on the basis of the relevant contract.
24.
With regard to the question of outstanding remuneration at the time of the early
contract termination, i.e. 13 January 2006, the Chamber reverted to the
contractual terms and, in particular, to art. 1 of the Annex which clearly stipulates
that the club would pay to the player the amount of EUR 5,000 on 23 December
2005 at the latest and that the first salary would fall due on 1 February 2006.
25.
In view of the fact that the club terminated the employment contract on 13
January 2006, it appeared to the members of the Chamber that at the time of the
unlawful termination of the contract, solely the said amount of EUR 5,000 was
outstanding. On account of the above, the Chamber decided that the club was
liable to pay the player EUR 5,000 as outstanding remuneration.
26.
In continuation, the Chamber focussed its attention on the calculation of the
amount of compensation for breach of contract in the case at stake.
27.
In doing so, the members of the Chamber firstly recapitulated that, in accordance
with art. 17 par. 1 of the Regulations, the amount of compensation shall be
calculated, in particular and unless otherwise provided for in the contract at the
basis of the dispute, with due consideration for the law of the country concerned,
the specificity of sport and further objective criteria, including, in particular, the
remuneration and other benefits due to the Claimant under the existing contract
and/or the new contract, the time remaining on the existing contract up to a
maximum of five years, and depending on whether the contractual breach falls
within the protected period.
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28.
In application of the relevant provision, the Chamber held that it first of all had to
clarify as to whether the pertinent employment contract contains a provision by
which the parties had beforehand agreed upon an amount of compensation
payable by either contractual party in the event of breach of contract. In this
respect, the members of the Chamber established that no such compensation
clause was included in the employment contract at the basis of the matter at stake.
29.
As a consequence, the members of the Chamber determined that the amount of
compensation payable by the Respondent to the Claimant had to be assessed in
application of the other parameters set out in art. 17 par. 1 of the Regulations. The
Chamber recalled that the said provision provides for a non-exhaustive
enumeration of criteria to be taken into consideration when calculating the
amount of compensation payable. Therefore, other objective criteria may be taken
into account at the discretion of the deciding body.
30.
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 as from
the moment when the breach occurred until and including 30 June 2007 in
accordance with the employment contract as well as the professional situation of
the Claimant after the early termination occurred.
31.
In fact, the Claimant appears to have signed an employment contract with another
club, valid as from 25 January 2006 until 30 June 2006 and providing, inter alia, a
total remuneration of EUR 3,845.
32.
Additionally, the Chamber took into account that the Claimant, for his part, claims
the amount of EUR 40,000 as compensation for breach of contract, which amount,
in fact, reflects the theoretical total value of the pertinent employment contract.
33.
However, and taking into account its previous considerations related to
outstanding salaries (cf. point II./24./25. above) the Chamber concluded that the
EUR 5,000 awarded to the player as outstanding remuneration had to be excluded
from the scope of the calculation of compensation for breach of contract.
34.
In light of the above, the members of the Chamber considered that the amount of
EUR 35,000, i.e. the remaining value of the employment contract as of the moment
on which the breach occurred, was the actual basis for the final determination of
the amount of compensation for breach of contract to be paid by the Respondent
to the Claimant.
35.
In addition to the foregoing, the Chamber took into account the fact that the
Claimant found employment with a country P club, as from 25 January 2006 until
30 June 2006. In accordance with the pertinent employment contract, which has
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been made available by the Claimant, the Claimant was entitled to receive EUR
3,845 and therewith enabled to reduce his loss of income. Consequently, according
to the constant practice of the Dispute Resolution Chamber, such remuneration
under the new employment contract shall be taken into account in the calculation
of the amount of compensation for breach of contract.
36.
Consequently, on account of all the above-mentioned considerations and the
specificities of the case at hand, the Chamber decided that the Respondent must
pay the amount of EUR 31,155 to the Claimant as compensation for breach of
contract.
37.
Finally, the Dispute Resolution Chamber decided that the Claimant’s claim relating
legal costs is rejected in accordance with art. 15 par. 3 of the Procedural Rules and
the Chamber’s respective longstanding jurisprudence.
38.
The Chamber concluded its deliberations in the present matter by deciding that
the Respondent is liable to pay the total amount of EUR 36,155 to the Claimant,
consisting of EUR 5,000 relating to outstanding remuneration and EUR 31,155 as
compensation for breach of contract.
III.
Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, M, is partially accepted.
2.
The Respondent, FC V, has to pay to the Claimant the amount of EUR 36,155
within 30 days as from the date of notification of this decision.
3.
In the event that the aforementioned amount is not paid by the Respondent
within the stated time limit, 5% interest p.a. will fall due as of expiry of the fixed
time limit and the present matter shall be submitted, upon request, to the FIFA
Disciplinary Committee for consideration and decision.
4.
Any further request filed by the Claimant is rejected.
5.
The Claimant is directed to inform the Respondent immediately and directly of the
bank account number to which the remittance is to be made and to notify the
Dispute Resolution Chamber of every payment received.
*****
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Note relating to the motivated decision (legal remedy):
According to art. 63 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:
_____________________
Jérôme Valcke
Secretary General
Encl: CAS directives
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