Labour Disputes
Texto da decisão
REF FPSD-6567
Decision of the
Dispute Resolution Chamber
passed on 30 March 2023
regarding an employment-related dispute concerning
the player Jean Kevin Augustin
BY:
Frans DE WEGER (The Netherlands), Chairperson
Dana MOHAMED AL-NOAIMI (Qatar), member
Johan VAN GAALEN (South Africa), member
CLAIMANT:
Mr Jean-Kévin Augustin, France
Represented by Laffer Abogados
RESPONDENT:
Leeds United Football Club Limited, England
Represented by Seladore Legal (Mr Kevin Kilgour)
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I. Facts of the case
1.
On 9 July 2017, the French player Jean Kevin Augustin (hereinafter: the Player or the Claimant)
and the German club, Rasen Ballsport Leipzig (hereinafter: Leipzig) concluded an employment
contract valid as from the date of signature until 30 June 2022.
2.
On 30 August 2019, the Player’s services were transferred on loan from Leipzig to the
Monegasque club, AS Monaco (hereinafter: Monaco) on the basis of a loan agreement
(hereinafter: the Leipzig-Monaco loan agreement) that was initially valid until 30 June 2020.
3.
On 25 January 2020, the Player, Leipzig and the English club, Leeds United FC (hereinafter:
Leeds or the Respondent) concluded a loan agreement (hereinafter: the Leipzig-Leeds loan
agreement) valid as from 26 January 2020 until 30 June 2020.
4.
The Leipzig-Leeds loan agreement included the following buy-out option:
“9. Purchase Option: [the Respondent] shall be entitled (notwithstanding the case stipulated in
clause 10 when [the Respondent] shall be obliged) to permanently transfer the Player to [the
Respondent] with effect as of July 1, 2020 by unilateral, written declaration, which shall be
submitted to [Leipzig] by May 30, 2020 at the latest.
In this case, a transfer fee in the amount of €21,000,000 (in words: twenty-one million Euro) shall
become due. This amount shall be paid to [Leipzig] less any solidarity contribution due to any
other club(s) under Annex 5 of the FIFA RSTP (the “Deductions”) in three instalments as follows:
• € 7,000,000 (in words: seven million Euro) less any Deductions as of September 30, 2020
• € 7,000,000 (in words: seven million Euro) less any Deductions as of September 30, 2021
• € 7,000,000 (in words: seven million Euro) less any Deductions as of September 30, 2022.
(…)
“10. Purchase Obligation: The abovementioned Purchase Option according to Clause 9 shall be
considered to be automatically executed by [the Respondent] without a respective notice being
required, if and when the following condition precedent occurs:
The [Respondent] 1st men’s team is promoted to the Premier League at the end of the
2019/2020 season and thus qualifies for participation in the Premier League in the 2020/ 2021
season.
If the aforementioned condition precedent occurs, the Purchase Option shall be triggered
without any additional declaration and the Player shall be permanently transferred to [the
Respondent] with effect as of July 1, 2020.
In this case the transfer fee in the amount of € 21,000,000 (in words: twenty-one million Euro)
shall become due and shall be paid to [Leipzig] less any Deductions within the abovementioned
due dates.”
5.
Within this context, and following the information available in the Transfer Matching System
(TMS), on 25 August 2020, the Player, Leipzig and Monaco mutually agreed to terminate the
Leipzig-Monaco loan agreement.
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6.
On 27 January 2020, the Player’s registration returned from Monaco to Leipzig.
7.
On 26 January 2020, the Player and Leeds concluded, using the standard template of the
English Football League / Premier League, an employment agreement (hereinafter: the
standard employment contract), valid as from the date of signature until 30 June 2020 in
accordance with its schedule 2.
8.
According to schedule 2 of the standard employment contract, the Player was entitled to GBP
(British Pounds) 93,000 per week as basic wage.
9.
Furthermore, on 26 January 2020, the Player, Leeds, and the Player’s registered intermediary
concluded an agreement “to set out the terms on which [Leeds] shall employ the Player in the
event that the Player’s registration is permanently transferred” (hereinafter: the private
agreement).
10. The private agreement included the following “Conditions Precedent”:
“2. Conditions precedent
(a) [The Respondent]’s obligation to enter into an employment contract with the Player
following any Permanent Transfer shall be subject to the satisfaction in full of the following
conditions precedent on or before the 30 June 2020 (“Conditions Precedent”):
(i) [The Respondent] being promoted to the Premier League at the end of the 2019/20 season;
(ii) [The Respondent] and [Leipzig] agreeing to enter into a long-form transfer agreement in
connection with the Permanent Transfer;
(iii) the Player being registered with the [the Respondent] by the EFL and the FA; and
(iv) FIFA approving the Permanent Transfer and issuing an International Transfer Certificate in
connection with the Permanent Transfer.
(b) The Player and the [Respondent] agree that, at any time prior to 30 June 2020 and in any
case upon the satisfaction of the Conditions Precedent, they shall replace this agreement with a
full contract of employment on the same commercial terms as set out herein, provided that this
agreement shall remain binding unless and until it is replaced by the full contract of
employment.
(c) The Parties agree that this Agreement is valid and binding on the Parties upon signature.”
11. Following the private agreement, the Player’s financial entitlements were set as follows:
“The following terms shall only apply in the event that [the Respondent] is promoted to the
Premier League at the end of the 2019/20 season and, upon satisfaction of the Conditions
Precedent, such terms shall take effect upon signature of the Permanent Playing Contract:
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(i) The Player shall be employed by the [Respondent] on a Premier League contract from 1st
July 2020 until 30th June 2025.
Basic Salary £93,000 (gross) per week”.
12. In addition, the private agreement stipulated that the Player was entitled to the following:
“a gross signing-on fee of £500,000 in each year of the contract, which is payable regardless of
whether he is or is not in service of the [Respondent] on the due date for payment, payable as
follows:
£500,000 (gross) payable on 1st September 2020
£500,000 (gross) payable on 1st September 2021
£500,000 (gross) payable on 1st September 2022
£500,000 (gross) payable on 1st September 2023
£500,000 (gross) payable on 1st September 2024
It is further acknowledged and agreed that the Player shall be entitled to be paid any unpaid
instalments of the signing-on fee in the event his registration is transferred by the request of the
[Respondent] prior to all such instalments having been paid as per EFL
Regulation 63.14. These payments will be guaranteed, unconditional payments and will
therefore be paid in full to the Player in the event that that the contract is terminated or cancelled
before 30th June 2024 (unless otherwise agreed by the Player at the time of the
termination/cancellation).
The Player shall receive the following loyalty payments. In order to receive these payments the
Player must still be in the service of the [Respondent] on the due date:
£225,000 (gross) payable on 1st February 2021
£225,000 (gross) payable on 1st February 2022
£225,000 (gross) payable on 1st February 2023
£225,000 (gross) payable on 1st February 2024”;
13. The private agreement included the following stipulation:
“5 (f) This Agreement shall be construed in accordance with the FIFA Statutes and the FIFA
Regulations on the Status and Transfer of Players. Disputes arising out of this Agreement shall
be subject to the jurisdiction of the relevant competent body of FIFA pursuant to the FIFA
Regulations on the Status and Transfer of Players. In accordance with the FIFA Regulations on
the Status and Transfer of Players, appeals against the decision of such body of FIFA shall be
submitted for settlement to the Court of Arbitration for Sport (“CAS”) in Lausanne, Switzerland
in accordance with the arbitration rules of CAS. The parties agree that the CAS arbitration panel
shall consist of three members and the language of any proceedings shall be English. This
Agreement shall be governed by, and construed and interpreted in accordance with, FIFA
Regulations and the law of England and Wales. In the event that FIFA and/or the Court of
Arbitration for Sport shall have no jurisdiction to hear any dispute arising hereunder the parties
shall submit to the exclusive jurisdiction of the courts of England and Wales”.
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14. According to the information contained in the TMS, the Player was registered in England on
27 January 2020.
15. On 13 March 2020, all football competitions in England were suspended due to COVID-19.
16. On 12 June 2020, the director of Leeds sent a correspondence to the Player, requesting him
to train alone.
17. On 13 June 2020, the Player replied as follows, quoted verbatim:
“I cannot accept the decision made by the club to continue with my individual training program
from home.
(…)
The real reason behind the Coach decision is that he does not want me to continue in the team
next season 2020/2021 so the [Respondent] is looking for legal arguments to avoid the
Purchase Obligation to be triggered and automatically executed.”
18. Thereafter, on the same date of 13 June 2020, Leeds sent an email to Leipzig indicating that it
would not execute the purchase obligation that was included in the Leipzig-Leeds loan
agreement, due to the following:
“[Leeds] will therefore not be purchasing the Player under the existing terms of the [LeipzigLeeds loan agreement]. Promotion will not have been achieved by 1 July 2020 and further it
would be impossible for [Leeds] to complete any transfer by 1 July given the English transfer
window will not open until 25 July at the earliest. Any right or requirement to purchase the Player
is therefore voided as a result of not being able to effect the transfer by 1 July.”
19. On 16 June 2020, the Player sent the following correspondence to Leeds:
“According to the [Leipzig-Leeds loan agreement], the terms of my employment [standard
employment contract] and the FIFA Circulars 1714 and 1720, you have the obligation to extend
the loan until the end of the season 2019-2020 and you have also a Purchase Obligation
according to Clause 10 of the Loan agreement when [Leeds] 1st men’s team is promoted to the
Premier League at the end of the 2019/2020 season and thus qualifies for participation in the
Premier League in the 2020/2021 season.
In case that the Purchase Obligation condition is triggered it will come into force automatically
the [private agreement]”.
20. On 18 June 2020, Leeds replied to the Player by insisting that his contractual relationship with
Leeds would expire on 30 June 2020.
21. On 22 June 2020, the English Football League resumed its activities.
22. On the same date of 22 June 2020, Leeds sent to the Player a “Notification of Requirement to
Continue Training at Home”, indicating the following:
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“Contrary to what you have stated in your letter, [Leeds] has no obligation to extend your loan
beyond 30 June 2020 until the end of the 2019/20 season, nor is it automatically extended for
any reason (…).
Therefore, your loan will come to an end on 30 June 2020 and you will return to [Leipzig] at that
point.”
23. On 19 July 2020, the legal representative of the Player, sent an email to Leeds with the
following contents:
“we will intimate [Leeds] to execute the [private agreement] once the season 2019-2020 has
finished and it could be considered that [Leeds] has been promoted so the conditions and
obligation to buy [the Player] has been triggered according to the [Leipzig-Leeds loan
agreement].”
24. On 21 July 2020, Leeds replied to the legal representative of the Player, and insisted that it was
not obliged to execute the permanent transfer of the Player.
25. On 24 September 2020, the legal representative of the Player sent an additional notice to
Leeds, granting a deadline until 25 September 2020 to proceed with the permanent
registration of the Player.
26. On 4 October 2020, the legal representative of the Player sent a new correspondence,
indicating that he has the intention to seek for a new club and requested to send a written
notification if it is opposed to such intention.
27. On 5 October 2020, the legal representative of Leeds replied to the Player’s last letter,
indicating that the agreed “conditions precedents” were not met on or before 30 June 2020
and that, as a result, Leeds is not the Player’s employer nor has such an obligation. According
to Leeds, it would be up to Leipzig to consent or to oppose to the Player’s registration with a
new club.
28. On 5 October 2020, the French club, FC Nantes (hereinafter: Nantes), sent a correspondence
to Leeds, expressing that it was willing to recruit the Player on the same date.
29. On the same day, Leeds replied to Nantes by indicating that the Player “is not a Leeds player
(…) and will not seek any fees from Nantes”.
30. According to the information contained in the TMS, and following a transfer “out of contract”
from Leeds, on 5 October 2020, the Player concluded an employment contract with Nantes,
valid as from the date of signature and for two seasons. In this respect, the Player was entitled
to a monthly gross salary of EUR 100,000.
31. Also, in accordance with the information available in TMS, and following a transfer “out of
contract” from Nantes, on 18 June 2022 the Player signed an employment contract with the
Swiss club, FC Basel (hereinafter: Basel), valid as from 1 July 2022 until 30 June 2025 (i.e., 3
years). In this respect, the relevant transfer instruction contains a document confirming that
the contract with Nantes ended on 30 June 2022.
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32. Accordingly, the Player was entitled to a monthly salary of CHF (Swiss francs) 27,500, which
may be increased upon the following conditions:
“ (i) by CHF 7’500.00 to CHF 35’000.00 (…) in the event that the Player appears in 25 national or
international competitive and compulsory games for the first team of [Basel].
(ii) by CHF 10’000 00 to CHF 45’000 00 (…) in the event that the Player appears in 50 national or
international competitive and compulsory games for the first team of [Basel]”.
33. In addition, the Player was entitled to the following sign-on fees:
a.
CHF 125,000 for the season 2022/2023;
b.
CHF 100,000 for the season 2023/2024;
c.
CHF 100,000 for the season 2024/2025.
34. In summary and based on the foregoing, it can be estimated that the Player would have
earned the following in line with his respective contracts with Nantes and Basel:
a.
From Nantes: EUR 2,100,000 (i.e., EUR 100,000 * 21, from October 2020 until 30 June
2022), equivalent to approx. GBP 1,865,000);
b.
From Basel: CHF 1,315,000 (i.e., CHF 27,500 * 36 [standard salary] + CHF 325,000 (sign on
fee), from 1 July 2022 until 30 June 2025), equivalent to approx. GBP 1,180,000).
35. On 1 June 2021, following a claim lodged by Leipzig against Leeds concerning the Leipzig-Leeds
loan agreement, the Single Judge of the FIFA Players’ Status Committee ruled inter alia that
Leeds must pay to Leipzig EUR 6,740,174 as transfer fee plus 5% interest p.a. as from 1 October
2020 until the date of effective payment (hereinafter: the PSC Decision).
36. In particular, the Single Judge stated the following elements in the motivated decision:
“III. 52 the Single Judge acknowledged that his task was to establish whether the conditions set
by the parties in order to activate [the Purchase Obligation] have effectively occurred and
whether [Leipzig] shall be entitled to receive the corresponding transfer fee.
(…)
the Single Judge is of the opinion that the content of art. 10 of the [Leipzig-Leeds loan
agreement] is in fact very clear; the second paragraph of art. 10 clearly specifies only one
condition precedent for the permanent transfer of the [Player] to [Leeds] and that is the
Respondent’s promotion to the Premier League at the end of the 2019/2020 season.”
37. Subsequently, Leeds appealed the PSC Decision to the Court of Arbitration for Sport (CAS).
38. On 4 November 2022, CAS rendered an Award in the matter ref. CAS 2021/A/8229, by means
of which it dismissed the appeal of Leeds and confirmed the PSC Decision (hereinafter: the CAS
Award).
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II. Proceedings before FIFA
a. The claim of the Claimant
39. On 30 June 2022, the Player lodged a claim against the Respondent before FIFA for breach
of contract without just cause and requested the payment of the total amount of EUR
28,556,434 as compensation, plus 5% interest p.a. as from the date of the decision.
40. The Player calculated the payable compensation as follows:
a.
GBP 27,580,000, equivalent to EUR 31,958,285, corresponding to the residual value of the
contract with Leeds, considering the private agreement;
b.
Minus EUR 2,100,000, corresponding to the Player’s salary with Nantes;
c.
Minus CHF 1,315,000, equivalent to EUR 1,301,851, corresponding to the Player’s salary
with Basel.
41. In this respect, the Player considered that the private agreement is a proper employment
contract.
42. In relation to its period of validity, the Player explained that it referred to 30 June 2020
since this was the usual date of end of the English Premier league, but that at the moment
of its signature, the parties could not foresee that the season would be extended due to
the outbreak of the COVID-19 pandemic. The Player considered that the interpretation of
the private agreement cannot favour the one who drafted it.
43. The Player also considered that all the conditions precedent of the private agreement were
fulfilled and considered that Leeds’ actions express its bad faith.
b. The reply of the Respondent
44. In its reply, the Respondent considered the claim to be time-barred, since the “the event
giving rise to this dispute is the promotion of [Leeds] to the Premier League following the end
of season 2019/2020 which took place on 17 July 2020.”
45. Additionally, Leeds considered that the claim is inadmissible as it was “brought in the wrong
language (Spanish), against a non-existent legal entity (Leeds United Football Club) and in the
wrong currency (Euros)”. Leeds argued that, although it is true that the Procedural Rules
Governing the football Tribunal allow the submission of claims in Spanish, “that is only the
case when the parties have not agreed to the contrary”.
46. The Respondent further stated that it will file an appeal against the CAS Award before the
Swiss Federal Tribunal (SFT). According to Leeds, CAS itself acknowledged that the Player’s
contract with Leipzig resumed after 30 June 2020.
c.
The rejoinder of the Claimant
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47. In his rejoinder, the Claimant underlined that his claim is closely related to the previous
procedure decided by the PSC Decision. As a result, he underlined that his claim is a logical
consequence of the claim lodged by Leipzig.
48. According to the Claimant, the Dispute Resolution Chamber does not need to re-examine
whether the condition concerning the promotion of Leeds was fulfilled since this was
already established by the PSC Decision as well as by the CAS Award.
49. In addition, the Claimant underlined that all the procedural issues presented by the
Respondent are not relevant.
50. In the opinion of the Player, both the Leipzig-Leeds loan agreement and the private
agreement are part of the same business, and therefore must be analysed altogether. The
Player insisted that the private agreement is a proper employment agreement.
d. The final comments of the Respondent
51. In its final comments, the Respondent insisted that the claim is inadmissible due to the
following reasons:
a.
The Claim is time-barred;
b.
The language of proceedings;
c.
The Claim is brought against a non-legal entity;
d.
The DRC cannot grant relief in Euros.
52. As to the substance, the Respondent considered that the claim shall be dismissed in that
in the opinion of the Respondent, the Football Tribunal is not bound by the CAS Award.
53. Leeds argued that contrary to the Player’s contention, clause 2(a)(i) of the private
agreement (“Conditions Precedent”) must be interpreted in accordance with the law of
England and Wales. Leeds considered that the Player’s arguments are a “legal heresy”
since, in accordance with English law and quoting English jurisprudence, at the time of
signing said agreement, a “like any other contract, [it] must be interpreted objectively by
asking what a reasonable person, with all the background knowledge which would reasonably
have been available to the parties when they entered into the contract”. Hence, the
Respondent insisted that the relevant condition precedent had to be satisfied “on or before
30 June 2020”, since that is what clause 2(a)(i) says.
54. In the alternative, Leeds argued that the condition precedent was not fulfilled either in
accordance with Swiss law, since the Respondent was not promoted to the Premier
League.
55. Besides, and without prejudice of its other arguments, Leeds considered that the Player’s
compensation shall be reduced to nil, particularly since he entered into new contracts with
Nantes and Basel.
56. Leeds argued that if the Player has suffered any loss or damage (quod non), such loss or
damage has been caused as a result of his own election not to resume his employment
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contract with Leipzig, not as a result of any alleged action by Leeds.
e. Additional submissions
57. On 30 January 2023, the FIFA general secretariat notified the parties that the submissionphase of the matter was closed and that no further submissions from the parties will be
admitted on the file, in line with art. 23 par. 1 of the Procedural Rules Governing the
Football Tribunal.
58. On 23 February and 10 March 2023, the Respondent submitted additional unsolicited
comments.
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
59. 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 30 June 2022 and submitted
for decision on 30 March 2023. Taking into account the wording of art. 34 of the October
2022 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.
60. 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 (October 2022 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
French player and an English club.
61. 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 Players (October 2022 edition),
and considering that the present claim was lodged on 30 June 2022, the March 2022
edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand
as to the substance.
b. Burden of proof
62. 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 TMS.
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c.
Admissibility
63. At this point, the Chamber referred to art. 23 par. 3 of the Regulations, which stipulates
that the decision-making bodies of FIFA shall not hear any dispute if more than two years
have elapsed since the facts leading to the dispute arose. The application of this time limit
shall be examined ex officio in each individual case.
64. In this context, the Chamber recalled that the present claim was lodged in front of FIFA on
30 June 2022, whereas the event giving rise to the dispute occurred on 21 July 2020, when
Leeds notified to the legal representative of the Player that it is not obliged to execute the
permanent transfer of the Player. According to the Respondent, “the event giving rise to this
dispute is the promotion of [Leeds] to the Premier League following the end of season
2019/2020 which took place on 17 July 2020.”
65. Under any circumstance, and even if 17 July 2020 is taken as the event giving rise to the
dispute, the Chamber found that the claim was lodged within the 2-year limit, and as such,
it is not time-barred.
66. The Chamber then noted that Respondent further argued that the claim was inadmissible
since the Claimant submitted it in Spanish, which was in violation of the private agreement
that stipulated English as the language of proceedings.
67. Nevertheless, the Chamber explained that the aforementioned clause only refers to the
language of proceedings before the CAS and not FIFA. Furthermore, according to art. 13
par. 1 of the Procedural rules, “Any submission to FIFA shall be made in English, Spanish, or
French.”
68. The Chamber underlined in relation to said rule that the possibility to submit
documentation in any of the three aforementioned languages is a procedural right that is
conferred to any party acting before the FIFA Football Tribunal. As such, it is of a nonderogable nature and is not subject to modification or waiver by contractual agreement.
69. In fact, the Chamber underlined that the private agreement stipulated in its clause 5 (f)
that it shall be construed in accordance with the FIFA Statutes and the FIFA Regulations on
the Status and Transfer of Players. Thus, given the explicit reference to the FIFA regulatory
framework, the Chamber understood that the parties contractually acknowledged the
application of the FIFA procedural languages, i.e., English, Spanish or French.
70. The Chamber thus concluded that the Claimant is entitled to submit his petitions and
correspondence in Spanish, and the Respondent’s argument regarding the inadmissibility
of the claim based on language is without merit.
71. The Chamber further analysed the Respondent’s third argument as to the admissibility,
according to which the legal entity of Leeds, against whom the claim was brought. The
Respondent argued that the claim was brought against a non-existent legal entity, which
is contradictory since Leeds provided a full reply.
72. The Chamber clarified in this respect that the FIFA Football Tribunal does not examine the
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legal structure of football clubs but is primarily concerned with their affiliation to a
Member Association. In this case, it is evident that Leeds is affiliated to The Football
Association, and hence, the argument of the Respondent regarding the legal entity could
only be dismissed.
73. For the sake of completeness, the DRC outlined that irrespective of the corporate structure
that the Respondent may adopt interna corporis, it is affiliated to the Football Association
and thus meets the definition of a “club” enshrined in article 9 of the Procedural Rules, i.e.
a club playing association football. Likewise, the DRC observed that, in order to determine
the outcome of the proceedings at hand, it does not need to enter into the matter of the
company structure of Leeds, as it is irrelevant whether it has a parent company/controller
under the same or a different name, given that the services of the Player and the dispute
at hand concern, undoubtedly, the Respondent, against which the claim was directed, and
whom the legal consequences of the private agreement inevitably give respect to.
74. Finally, the Chamber also noted that the Respondent argued that the Claimant requested
compensation in a different currency (EUR instead of GBP), which the Respondent
considered to be a valid reason for the inadmissibility of the claim. In the view of the
Chamber, the mere fact that a claim is made in a different currency does not necessarily
invalidate the claim, particularly if the difference in currency does not alter the nature or
substance of the claim itself.
75. Thus, the Chamber deemed the argument of the Respondent in this regard to be
excessively formalistic, as it would undermine the fundamental principle of access to
justice. The Chamber thus establish that it is not a valid ground for the inadmissibility of
the claim. In fact, the Chamber highlighted that if the request for relief is to be granted,
the corresponding currency is a matter of substance of the dispute and has no effect on
whether a claim is admissible or not.
76. In conclusion, the Chamber found the claim brought by the Claimant against the
Respondent to be admissible, and the arguments put forth by the Respondent regarding
the statute of limitations, language, legal entity, and currency could only be dismissed. The
claim of the Claimant is fully admissible.
77. Moreover, the Chamber also noted that, on 30 January 2023, that the FIFA general
secretariat notified the parties about the closure of the submission-phase of the present
matter, in line with art. 23 par. 1 of the Procedural Rules. In this respect, the Chamber was
aware that Leeds submitted unsolicited correspondence after said date. Accordingly, the
Chamber referred to art. 23 par. 1 of said rules, according to which “After such notification,
the parties may not supplement or amend their submissions or requests for relief or produce
new evidence.” The Chamber therefore underlined that it could not consider the
correspondence sent after said date.
d. Merits of the dispute
78. 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
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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
79. The foregoing having been established, the Chamber moved to the substance of the
matter.
80. In this respect, the Chamber noted that the present dispute fundamentally revolves
around the transfer of the Player from Leipzig to Leeds and, in particular, in relation to the
employment relationship that was agreed between the Player and Leeds within the
context of said transfer. The Chamber recalled that the transfer from the Player from
Leipzig to Leeds was initially made on a temporary basis, but that it included a purchase
obligation that would be automatically executed by Leeds if they met a series of conditions
precedent related to the promotion to the Premier League.
81. On this note, the Chamber wished to recall the relevance of the principle of “in dubio contra
proferentem”, which states that any ambiguity or doubt in a contract or legal document
should be interpreted against the party that drafted the document. In employment law,
this principle is generally interpreted in favour of the employee (i.e., the player) since
employees typically have less bargaining power and are often at a disadvantage when
negotiating contracts or other employment-related documents.
82. Therefore, if there is any dispute or disagreement between the parties regarding the
interpretation of the transfer agreement, the principle of “in dubio contra proferentem”
would suggest that any ambiguity or doubt should be resolved against Leeds, the party
that undisputedly drafted the agreement.
83. The Chamber also considered that the purchase obligation is a contractual provision that
primarily serves to safeguard the interests of the Respondent, by releasing this club from
the obligation to employ the Player in the event of its failure to secure promotion to the
Premier League. Therefore, the Chamber understood that this purchase obligation
provided Leeds with a notable level of certainty and flexibility. The Chamber remarked
that the CAS Award followed a similar reasoning on 4 November 2022, as it noted that the
purchase obligation serves the interests of the Respondent to a large extent.
84. Besides, the Chamber wished to remark that, accordance with the jurisprudence of FIFA
and CAS, promotion and relegation clauses in football contracts are generally a legally
valid means to safeguard the interests of both parties to a contract. Such provisions offer
a level of financial and career protection to parties affected by the event of promotion,
thereby ensuring a degree of stability and predictability in their respective roles.
85. The Chamber also noted that, following a claim from Leipzig, on 1 June 2021, the Single
Judge of the Players’ Status Committee decided that the conditions set by the parties in
order to activate the purchase obligation of the Player were met since Leeds was
promoted to the Premier League at the end of the 2019/2020 season.
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86. With this contextual information in the background, the Chamber noted that Leeds and
the Player initially signed a standard employment contract on 26 January 2020 and valid
until 30 June 2020. In addition, the parties to the present dispute also signed a private
agreement on the same date, establishing the terms for the Player’s permanent
employment in the event of a definitive transfer.
87. The Chamber thus focused on the main point of dissent existing between the Player and
Leeds, which is regarding the potential validity of the private agreement signed on 26
January 2020.
88. In analysing the legal nature of said agreement, the Chamber first recalled that said
contract defines itself as a legal instrument to “set out the terms on which the club shall
employ the player in the event that the player’s registration is permanently transferred”.
89. The Chamber deemed it to be pertinent in this context to recall the essential provision of
the contract in this regard, which was drafted as follows:
“(a) [The Respondent]’s obligation to enter into an employment contract with the player
following any permanent transfer shall be subject to the satisfaction in full of the following
conditions precedent on or before the 30 June 2020 (“conditions precedent”)”.
90. The Chamber thus confirmed that the validity of the private agreement was dependent
upon the satisfaction of specific conditions precedent. In particular, the Chamber noted
that the contract in question enumerated the following cumulative conditions:
“2. Conditions precedent
(a) [The Respondent]’s obligation to enter into an employment contract with the Player
following any Permanent Transfer shall be subject to the satisfaction in full of the following
conditions precedent on or before the 30 June 2020 (“Conditions Precedent”):
(i) [The Respondent] being promoted to the Premier League at the end of the 2019/20 season;
(ii) [The Respondent] and [Leipzig] agreeing to enter into a long-form transfer agreement in
connection with the Permanent Transfer;
(iii) the Player being registered with the [the Respondent] by the EFL and the FA; and
(iv) FIFA approving the Permanent Transfer and issuing an International Transfer Certificate in
connection with the Permanent Transfer.
(b) The Player and the [Respondent] agree that, at any time prior to 30 June 2020 and in any
case upon the satisfaction of the Conditions Precedent, they shall replace this agreement with a
full contract of employment on the same commercial terms as set out herein, provided that this
agreement shall remain binding unless and until it is replaced by the full contract of
employment.
(c) The Parties agree that this Agreement is valid and binding on the Parties upon signature.”
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91. Consequently, the Chamber regarded its primary duty was analysing each condition
precedent individually to determine whether they were genuinely fulfilled.
92. First and foremost, the Chamber examined the exact meaning of the date (30 June 2020)
quoted in the aforementioned contract.
93. In relation to this date, the Chamber acknowledged that while the conditions precedent
were not fulfilled on or before 30 June 2020, this was due to the outbreak of the COVID-19
pandemic, which caused the season in England to be delayed.
94. In the view of the Chamber, and although the contract explicitly specifies the date of 30
June 2020, it is reasonable to assume that this date was originally chosen simply because
it coincided with the usual season end date in England. Yet, it is also reasonable to assume
that when the relevant contract was signed, none of the parties could contemplate the
possibility of a delay of the season end date due to a global pandemic.
95. However, as with most football leagues around the world, the COVID-19 pandemic
ultimately required a delay in the season (until 4 August 2020, according to TMS).
96. Indeed, the Chamber was of the unanimous view that, when the private agreement was
signed on 26 January 2020, the parties could not have reasonably foreseen the
unprecedented impact of the pandemic and the potential postponement of the season’s
end date. Yet, the Chamber also observed that the none of the parties tried to negotiate
after the outbreak of the pandemic as to the potential impact of the delay of the season
in relation to this condition precedent.
97. In the Chamber’s view, this lack of communication and failure to modify the agreement in
the light of the unprecedented circumstances arisen by the pandemic can be interpreted
as evidence that the parties intended to adhere to the original intention of the agreement,
which required the fulfilment of the prerequisites before the expected end of the 20192020 season in England.
98. Subsequently, and as to the following condition precedent (i), the Chamber verified
whether Leeds was promoted to the Premier League at the end of the 2019/20 season.
The Chamber confirmed that it is undisputed that Leeds was promoted at the end of the
relevant season. Therefore, the Chamber validated the fulfilment of this condition.
99. The Chamber also considered the following condition precedent (ii), namely the
requirement that Leeds and Leipzig agreeing to enter into a long-form transfer agreement
in connection with the permanent transfer. In this regard, the Chamber noted that, since
25 January 2020, Leipzig and Leeds were bound by a transfer contract that included an
automatic purchase option, an option that was confirmed also to be binding in line with
the PSC Decision and the CAS Award. Therefore, the Chamber confirmed that this
condition was fulfilled.
100. The Chamber then noted that the Player was registered in England on 27 January 2020.
Therefore, this registration requirements, i.e., condition precedent (iii), included in the
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private agreement was also satisfied.
101. The Chamber then noted that next condition precedent (iv) was FIFA approving the
permanent transfer and issuing an international transfer certificate (ITC) in connection
with the permanent transfer. The Player was registered in England on 27 January 2020
following the delivery of the pertinent ITC. Therefore, the Chamber validated that this
condition was fulfilled.
102. As to the condition (b), the Chamber verified the legal nature of the private agreement.
103. In this respect, the Chamber observed that in the condition (b) the parties agreed that the
private agreement would be replaced with a full contract of employment upon the
satisfaction of the conditions precedent. Following the relevant clause, the parties
committed to ultimately replace the private agreement with a formal employment
contract. At the same time, the Chamber considered that this clause also implies that the
private contract remains binding. In addition, the Chamber recalled that an employment
contract need only contain the following four essentialia negotii to be valid: duration of the
agreement, subordination of the employee to the employer, personal performance, and
wages. The Chamber verified that all of these elements were already present in the private
agreement. Therefore, the Chamber remarked that the possible finalization of a “formal”
contract does not affect the validity of the private agreement a binding contract.
104. After careful consideration, the Chamber concluded that all conditions precedent have
been satisfied, thereby rendering the private agreement a fully valid and binding
employment contract, to which both parties are legally obligated. Leeds’ explicit statement
of non-execution addressed to the Player on 21 July 2020 represents an unjustified breach
of contract, and as such, the Player is entitled to compensation.
ii. Consequences
105. Having stated the above, the members of the Chamber turned their attention to the
question of the consequences of such unjustified breach of contract committed by the
Respondent.
106. Having stated the above, the Chamber turned to the calculation of the amount of
compensation payable to the Claimant by the Respondent in the case at stake. In doing
so, 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 Player under the
existing contract and/or the new contract, the time remaining on the existing contract up
to a maximum of five years, and depending on whether the contractual breach falls within
the protected period.
107. In application of the relevant provision, the Chamber held that it first of all had to clarify
as to whether the pertinent employment contract contained a provision by means of
which the parties had beforehand agreed upon an amount of compensation payable by
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the contractual parties in the event of breach of contract. In this regard, the Chamber
established that no such compensation clause was included in the employment contract
at the basis of the matter at stake.
108. 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 said provision provides for a non-exhaustive enumeration of
criteria to be taken into consideration when calculating the amount of compensation
payable.
109. Bearing in mind the foregoing as well as the claim of the Player, the Chamber proceeded
with the calculation of the monies payable to the Player under the terms of the private
agreement from the date of its unilateral termination until its end date.
110. In particular, the Chamber noted that the contract in question was a five-year agreement
that would have been effective from 1 July 2020 until 30 June 2025, covering a total of 260
weeks. As per the contract terms, the Player would have received a basic salary of GBP
93,000 per week, which would have resulted in a total of GBP 24,180,000 over the five-year
period (i.e., GBP 93,000 * 260).
111. Additionally, the Player was entitled to a sign-on fee of GBP 500,000 (payable on 1
September of each year from 2020 to 2024, resulting in a total sign-on fee of GBP
2,500,000. (i.e., GPB 500,000 * 5, for the years 2020, 2021, 2022, 2023 and 2024). The
Chamber also observed that the contract in question also included loyalty payments, with
the Player receiving GBP 225,000 (gross) on 1 February of each year from 2021 to 2024,
which would have amounted to a total of GBP 900,000 over the relevant term (i.e., GBP
225,000 * 4, for the years 2021, 2022, 2023 and 2024).
112. Therefore, the Chamber determined that the total value of the private agreement, taking
into account the basic salary, sign-on fee, and loyalty payments, corresponds to GBP
27,580,000 (GBP 24,180,000 + GBP 2,500,000 + GBP 900,000).
113. Consequently, the Chamber concluded that the amount of GBP 27,580,000 serves as the
basis for the determination of the amount of compensation for breach of contract.
114. In continuation, the Chamber verified as to whether the Player had signed an employment
contract with another club during the relevant period of time, by means of which he would
have been enabled to reduce his loss of income. According to the constant practice of the
DRC as well as art. 17 par. 1 lit. ii) of the Regulations, such remuneration under a new
employment contract shall be taken into account in the calculation of the amount of
compensation for breach of contract in connection with the Player’s general obligation to
mitigate his damages.
115. Indeed, the Player found employment with Nantes, and then with Basel. In sum, the
Chamber recalled, as mentioned in the previous section, that the Player would have
earned a total of approximately GBP 3,045,000 (GBP 1,865,000 from Nantes and GBP
1,180,000 from Basel) from his subsequent employers, covering the period from October
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2020 until 30 June 2025. The Chamber established that this amount corresponds to the
mitigation of damages that the Player has incurred as a result of the breach of contract by
Leeds.
116. Consequently, on account of all of the above-mentioned considerations and the
specificities of the case at hand, the Chamber decided that the Respondent must pay the
amount of GBP 24,535,000 to the Player (i.e., GBP 27,580,000 minus GBP 3,045,000), which
was to be considered a reasonable and justified amount of compensation for breach of
contract in the present matter in the light of the applicable Regulations.
117. Lastly, taking into consideration the Player’s request, the Chamber decided to award the
Player interest on said compensation at the rate of 5% p.a. as from the date of the decision
until the date of effective payment.
iii. Compliance with monetary decisions
118. Finally, taking into account the applicable Regulations, the Chamber referred to art. 24 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.
119. 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.
120. Therefore, bearing in mind the above, the DRC decided that the Respondent must pay the
full amount due (including all applicable interest) to the Claimant within 45 days of
notification of the decision, failing which, at the request of the Claimant, 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 Respondent in accordance with art. 24 par. 2, 4, and 7 of the Regulations.
121. The Respondent shall make full payment (including all applicable interest) to the bank
account provided by the Claimant in the Bank Account Registration Form, which is
attached to the present decision.
122. 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. 24 par. 8 of
the Regulations.
e. Costs
123. 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
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to be imposed on the parties.
124. 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.
125. 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, Jean Kevin Augustin, is partially accepted.
2.
The Respondent, Leeds United Football Club Limited, has to pay to the Claimant, the amount
of GBP 24,535,000 (twenty-four million five hundred thirty-five thousand British
Pounds) as compensation for breach of contract without just cause plus 5% interest p.a.
as from 30 March 2023 until the date of effective payment.
3.
Any further claims of the Claimant are rejected.
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. 24 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 of the ban shall
be of up to 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. 24 par. 7 and 8 and art. 25 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).
CONTACT INFORMATION
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FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland
www.fifa.com | legal.fifa.com | [email protected] | T: +41 (0)43 222 7777
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