DRC Overdue Payables
Texto da decisão
REF FPSD-3154
Decision of the
Dispute Resolution Chamber
passed on 08 October 2021
regarding an employment-related dispute concerning the player Giedrius
Arlauskis
BY:
HENDEL, Clifford J., Deputy Chairperson
DE JONG, Daan (The Netherlands), member
KASALO, Tomislav (Croatia), member
CLAIMANT:
Player Giedrius Arlauskis, Lithuania
Represented by Josep F. Vandellos Alamilla
RESPONDENT:
Al Shabab, Saudi Arabia
Represented by ADP Law
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I.
Facts of the case
1.
On 5 February 2021, the Lithuanian player, Mr Giedrius Arlauskis (hereinafter: the player or
the Claimant), and the Saudi club, Al Shabab (hereinafter: the club or the Respondent) signed
a termination agreement related to the employment relationship previously initiated between
them (hereinafter: the termination agreement).
2.
In accordance with the clause 2 of the termination agreement, the club undertook to pay the
player the following amounts:
a. EUR 400,000 net by 5 February 2021;
b. EUR 200,000 net by 1 March 2021;
c. EUR 2,218,470 net in 10 equal monthly instalments of EUR 221,847 net, payable “on
or before the first day of each month” starting on 1 April 2021 and finishing on 1
January 2022. Only in regard to this amount, clause 2, lit. d) of the termination
agreement established that the club “shall benefit from a grace period of 30 calendar
days”.
3.
Clause 3 of the termination agreement stipulated the following: “All amounts that the player
is entitled to receive from the club as aforementioned shall be paid by the club to the player
within the due dates as mentioned in clause 2. The amounts in letter c) above may be subject
to reduction should the player sign a new employment contract with a third club. Such
reduction would be the difference between the monthly instalments agreed in letter c) above
and the amount the player will earn as per his new employment contract with a third club on
a monthly basis”.
4.
Finally, clause 13 of the termination agreement read as follows: “If any of the deadlines
mentioned in clause 2 of this termination agreement is not respected by the club i.e. any
amount is not paid by the club within the due dates, for any reason, all amounts due under
this termination agreement i.e. the settled amount shall become due immediately, without
reduction of any nature whatsoever (even if the player would have already signed a contract
with a third club) wherein the club shall be liable to immediately pay the full settled amount
to the player at an interest rate of 5% p.a.”.
5.
On 28 February 2021, the club made a partial payment to the player amounting to EUR
100,000. On the same date, the player put the club in default and requested the outstanding
payment of EUR 100,000 to be made until 22 March 2021 under penalty of triggering clause
13 of the termination agreement.
6.
On an unspecified date, the player signed a new employment agreement with the
Romanian club, Fotbal Club CFR 1907 (hereinafter: FC CFR 1907), valid as from 3 March
until 30 May 2021. According to said contract the player was entitled to a fixed remuneration
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of EUR 15,000 net, payable in monthly instalments of EUR 5,000 each. The contract was
subsequently extended by the parties for the period between 1 June and 31 December
2021, with the same conditions.
7.
On 8 July 2021, the player sent the club a second default notice requesting payment of the
instalments of the transfer agreement due by May, June and July 2021 within the following
10 days.
8.
Between 17 and 20 July 2021, the parties exchanged e-mails and templates regarding a
possible amendment to the termination agreement and, specifically, involving a new payment
schedule. Nevertheless, the parties could not reach an amicable solution and no (new)
agreement was concluded between them.
II. Proceedings before FIFA
9.
On 27 July 2021, the player filed the claim at hand before FIFA. A brief summary of the
position of the parties is detailed in continuation.
a. Position of the Claimant
10. In accordance with the player, the club breached its financial duties under the termination
agreement by repetitively failing to deliver the remuneration established therein. As such, the
player claimed that clause 13 of the termination agreement was triggered, so that the club
should be liable to pay the remaining value of the contract, without any deduction.
11. As to the calculation of the remuneration sought, the player clarified that the global
remuneration under the termination agreement equalled to EUR 2,818,470 and that the club
had only paid the total of EUR 821,847, corresponding to the instalments due by February
(EUR 400,000), March (EUR 200,000) and April 2021 (EUR 221,847).
12. Consequently, the player claimed that the difference of EUR 1,996,623 should be paid by the
club accrued by 5% interest p.a. as from the date of default (i.e. 2 May 2021) or “alternatively
from the date of the filing of this claim”.
13. Finally, the club requested sporting sanctions to be imposed on the club under art. 12bis of
the FIFA RSTP.
b. Position of the Respondent
14. In its reply, the club did not dispute its default but held that the new employment agreement
signed between the player and FC CFR 1907, should be taken into consideration for the sake
of mitigation (cf. clause 3 of the termination agreement).
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15. Furthermore, the club stated that it “has at all times agreed to make the payments to the
claimant, however the club has requested a structured payment plan that would be beneficial
to its finances as there has been a return of sponsors over the past month and potential
increases in income due to the resumption of football over the next few months”.
16. At the end, the club requested the player’s claim to be entirely rejected, as well as the
payment schedule proposed during the exchange of notifications between the parties to be
enforced, with due consideration of the new employment found by the player.
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
17. 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 presented to FIFA on 27 July 2021 and submitted for decision on
8 October 2021. Taking into account the wording of art. 34 of the October 2021 edition of
the Procedural Rules Governing the Football Tribunal (hereinafter: the Procedural Rules), the
aforementioned edition of the Procedural Rules is applicable to the matter at hand.
18. Subsequently, the members of the Chamber referred to art. 2 par. 1 of the Procedural Rules
and observed that in accordance with art. 23 par. 1 in combination with art. 22 lit. b) of the
Regulations on the Status and Transfer of Players (August 2021 edition), 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 Lithuanian player
and a Saudi club.
19. Subsequently, 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 Player (August 2021 edition), and
considering that the present claim was lodged on 27 July 2021, the February 2021 edition of
said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the
substance.
b. Burden of proof
20. The Chamber recalled the basic principle of burden of proof, as stipulated in art. 13 par. 5 of
the Procedural Rules, according to which a party claiming a right on the basis of an alleged
fact shall carry the respective burden of proof. Likewise, the Chamber stressed the wording
of art. 13 par. 4 of the Procedural Rules, pursuant to which it may consider evidence not filed
by the parties, including without limitation the evidence generated by or within the Transfer
Matching System (TMS).
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c. Merits of the dispute
21. Its competence and the applicable regulations having been established, the Chamber entered
into the merits of the dispute. In this respect, the Chamber started by acknowledging all the
above-mentioned facts as well as the arguments and the documentation on 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.
i. Main legal discussion and considerations
22. The foregoing having been established, the Chamber moved to the substance of the matter,
and took note that the case at stake pertains a claim for outstanding remuneration only, in
the context of a termination agreement concluded between the parties on 5 February 2021.
23. Having analysed the documentation on file, the DRC acknowledged that it remained
undisputed that, at the time the claim was lodged by the player, the club had already failed
proceed the payment of 3 instalments under the termination agreement (i.e. from May 2021
to July 2021). In this respect, the club requested a new payment schedule to be enforced by
FIFA, as well as the new employment agreement signed by the player to be taken into
consideration for mitigation purposes (cf. clause 3 of the termination agreement).
24. To this extent, the Chamber observed that the club did not provide any evidence capable of
demonstrating that an amendment to the transfer agreement was ever concluded between
the parties. What is more, the DRC was also mindful that the club failed to prove any consent
given by the player to the new payment schedule suggested.
25. Therefore, the Chamber referred to the general legal principle of pacta sunt servanda, and
concluded that the club did not have the right to unilaterally vary the conditions previously
negotiated with the player. Likewise, the DRC deemed that the club should be liable to pay
the player his remuneration as described in the termination agreement.
26. As to the mitigation claimed by the club, the DRC turned its attention to the wording of
clauses 2, 3 and 13 of the termination agreement. In doing so, the Chamber was of the
position that the wording of said provisions are clear and unequivocal and thus does not need
any interpretation (in claris non fit interpretatio). In particular, the Chamber concluded that,
by repetitively failing to perform the payment of the amounts due to the player, the
acceleration clause (i.e. clause 13 of the termination agreement) was triggered and the club
became liable to the payment of the residual value of the contract without any reduction –
including a potential mitigation.
27. In light of the foregoing, the members of the DRC unanimously decided that the player should
be entitled to receive from the club the total amount of EUR 1,996,623, corresponding to the
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9 remaining instalments of the termination agreement (i.e. from May 2021 until January
2022).
28. As to the interest, the DRC wished to recall art. 18, par. 6 of the Regulations, which sets
forth, inter alia, that “contractual clauses granting the club additional time to pay to the
professional amounts that have fallen due under the terms of the contract (so-called “grace
periods”) shall not be recognised”. Therefore, the DRC deemed that the grace period
described in clause 2, lit. d) of the termination agreement should be disregarded, hence, that
the outstanding remuneration granted to the player should be accrued by 5% interest p.a.
as from the first default date, namely 2 May 2021.
ii. Art. 12bis of the Regulations
29. In continuation, the DRC referred to art. 12bis par. 2 of the Regulations, which stipulates that
any club found to have delayed a due payment for more than 30 days without a prima facie
contractual basis may be sanctioned in accordance with art. 12bis par. 4 of the Regulations.
30. To this end, the Chamber confirmed that the player put the club in default of payment of the
amounts sought, which had fallen due form more than 30 days, and granted the club with
10 days to cure such breach of contract.
31. The members of the DRC further established that by virtue of art. 12bis par. 4 of the
Regulations it has competence to impose sanctions on the club. On account of the above and
bearing in mind that this is the second offense by the club within the last two years, the
Chamber decided to impose a reprimand on the club in accordance with art. 12bis par. 4 lit.
b) of the Regulations.
32. In this connection, the DRC wished to highlight that a repeated offence will be considered as
an aggravating circumstance and lead to more severe penalty in accordance with art. 12bis
par. 6 of the Regulations.
iii. Compliance with monetary decisions
33. Finally, taking into account the applicable Regulations, the Chamber referred to art. 24bis
par. 1 and 2 of the Regulations, which stipulate that, with its decision, the pertinent FIFA
deciding body shall also rule on the consequences deriving from the failure of the concerned
party to pay the relevant amounts of outstanding remuneration and/or compensation in due
time.
34. In this regard, the DRC highlighted that, against clubs, the consequence of the failure to pay
the relevant amounts in due time shall consist of a ban from registering any new players,
either nationally or internationally, up until the due amounts are paid. The overall maximum
duration of the registration ban shall be of up to three entire and consecutive registration
periods.
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35. Therefore, bearing in mind the above, the DRC decided that the club must pay the full amount
due (including all applicable interest) to the player within 45 days of notification of the
decision, failing which, at the request of the player, a ban from registering any new players,
either nationally or internationally, for the maximum duration of three entire and consecutive
registration periods shall become immediately effective on the club in accordance with art.
24bis par. 2, 4, and 7 of the Regulations.
36. The club shall make full payment (including all applicable interest) to the bank account
provided by the player in the Bank Account Registration Form, which is attached to the
present decision.
37. The DRC recalled that the above-mentioned ban will be lifted immediately and prior to its
complete serving upon payment of the due amounts, in accordance with art. 24bis par. 8 of
the Regulations.
d. Costs
38. The Chamber referred to art. 25 par. 1 of the Procedural Rules, according to which
“Procedures are free of charge where at least one of the parties is a player, coach, football
agent, or match agent”. Accordingly, the Chamber decided that no procedural costs were to
be imposed on the parties.
39. Likewise and for the sake of completeness, the Chamber recalled the contents of art. 25 par.
8 of the Procedural Rules, and decided that no procedural compensation shall be awarded in
these proceedings.
40. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made by
any of the parties.
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IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, Giedrius Arlauskis, is accepted.
2.
The Respondent, Al Shabab, has to pay to the Claimant, the following amount:
- EUR 1,996,623 as outstanding remuneration plus 5% interest p.a. as from 2 May 2021 until
the date of effective payment.
3.
A reprimand is imposed on the Respondent.
4.
Full payment (including all applicable interest) shall be made to the bank account indicated in
the enclosed Bank Account Registration Form.
5.
Pursuant to art. 24bis of the Regulations on the Status and Transfer of Players if full payment
(including all applicable interest) is not made within 45 days of notification of this decision,
the following consequences shall apply:
1. The Respondent shall be banned from registering any new players, either nationally or
internationally, up until the due amount is paid. The maximum duration the ban shall
be of three entire and consecutive registration periods.
2. The present matter shall be submitted, upon request, to the FIFA Disciplinary
Committee in the event that full payment (including all applicable interest) is still not
made by the end of the three entire and consecutive registration periods.
6. The consequences shall only be enforced at the request of the Claimant in accordance
with art. 24bis par. 7 and 8 and art. 24ter of the Regulations on the Status and Transfer of
Players.
7. This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
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NOTE RELATED TO THE APPEAL PROCEDURE:
According to article 57 par. 1 of the FIFA Statutes, this decision may be appealed against before
the Court of Arbitration for Sport (CAS) within 21 days of receipt of the notification of this
decision.
NOTE RELATED TO THE PUBLICATION:
FIFA may publish this decision. For reasons of confidentiality, FIFA may decide, at the request of a
party within five days of the notification of the motivated decision, to publish an anonymised or a
redacted version (cf. article 17 of the Procedural Rules).
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