Labour Disputes
Texto da decisão
REF. FPSD-7154
Decision of the
Dispute Resolution Chamber
passed on 10 May 2023
regarding an employment-related dispute concerning
the player CAIO LUCAS FERNANDES
BY:
Elvis Chetty (Seychelles), Single Judge of the DRC
CLAIMANT:
Caio Lucas Fernandes, Brazil
Represented by Tannuri Ribeiro Advogados
RESPONDENT:
SL Benfica, Portugal
pg. 2
REF. FPSD-7154
I. Facts of the case
1.
On 3 July 2016, the Brazilian player, CAIO LUCAS FERNANDES (hereinafter: the Claimant or
the player) and the Emirati club, Al Ain FC (hereinafter: Al Ain), entered into an employment
contract, valid as from 1 July 2019 until 30 June 2019.
2.
On 8 January 2019, the player and the Portuguese club, Sport Lisboa e Benfica – Futebol,
SAD (hereinafter: the club or the Respondent) concluded an employment contract
(hereinafter: the contract), valid as from 1 July 2019 until 30 June 2023 in accordance with
art. 18 para. 3 of the Regulations on the Status and Transfer of Players (see point 9. infra).
3.
Clause 3 para. 2 of the contract stipulates the following: “It is hereby agreed between the
parties that the Player will be entitled to receive 25% (twenty five) percent of the value that SL
Benfica SAD will receive in a future definitive or temporary assignment of the Player’s sports
registration rights to another national or foreign sports entity. The payment of the amount
mentioned herein will be made under the same conditions as the ones envisaged in the definitive
or temporary assignment contract” (free translation from the original text in Portuguese –
translation provided by the Claimant).
4.
On 20 January 2020, the Respondent concluded an agreement (hereinafter: the loan
agreement) with the Emirati club, Sharjah FC (hereinafter: the new club) over the
temporary transfer of the player from the former to the latter for the period between 20
January 2020 and 30 June 2021 and against payment of a loan fee of EUR 1,500,000 net
within 30 days as from the date on which the player’s ITC was delivered to the Emirati FA.
5.
In addition, under clause 2 para. 5 of the relevant (loan) transfer agreement, the new club
undertook to pay to the Respondent a penalty of EUR 250,000 and a default interest of 5%
p.a. should the said club fail to pay the loan transfer fee to the Respondent by the agree
date.
6.
On 5 July 2021, the Respondent and the new club entered into an agreement amending the
nature of the transfer of the player from loan to permanent (hereinafter: the transfer
agreement).
7.
According to clause 2 of the transfer agreement, the new club undertook to pay to the
Respondent, inter alia, the following amounts:
-
EUR 1,500,000 as transfer compensation (solidarity contribution included),
payable in 2 instalments as follows:
-
EUR 750,000 by 15 July 2021;
-
EUR 750,000 by 4 January 2022.
pg. 3
REF. FPSD-7154
-
8.
9.
EUR 250,000 as contractual penalty should the new club not pay any of the
abovementioned instalments on their due dates; plus 5% interest p.a. on the
outstanding amount(s).
On 1 March 2022, the Respondent and the new club concluded a settlement agreement
(hereinafter: the settlement agreement – document on file), whereby the parties agreed
that the second instalment of the transfer compensation (EUR 750,000 – payable by 4
January 2022), would be paid as follows:
-
EUR 250,000 by 5 March 2022;
-
EUR 250,000 by 5 April 2022;
-
EUR 250,000 by 5 May 2022.
Art. 18 para. 3 of the Regulations on the Status and Transfer of Players (hereinafter: the
Regulations) reads as follows: “A club intending to conclude a contract with a professional
must inform the player’s current club in writing before entering into negotiations with him. A
professional shall only be free to conclude a contract with another club if his contract with his
present club has expired or is due to expire within six months. Any breach of this provision shall
be subject to appropriate sanction” (emphasis added).
10. By means of it email of 8 July 2021, the Respondent informed the Claimant about the
payment schedule regarding the transfer compensation as per the transfer agreement, i.e.
EUR 750,000 by 15 July 2021; and EUR 750,000 by 4 January 2022 – also informing the player
that it would proceed with the payment of the sell-on amounts upon receipt of the said
payments.
11. The first instalment of the transfer agreement was duly paid by the new club to the
Respondent, the latter proceeding with the payment of the sell-on due to the player in
connection therewith, i.e. EUR 187,500 (750,000*0.25 = 187,500) on 8 July 2021.
12. However, the new club failed to pay the second instalment to the Respondent by 4 January
2022, situation that was informed to the Claimant by the Respondent, the Claimant arguing
that it would proceed with the payment of the sell-on concerning the second instalment of
the transfer compensation as soon as the new club performed the relevant payment.
13. On 1 February 2022, the Claimant sent an email to the Respondent informing that the
player “would eventually accept to wait the receipt of said Sell-on Fee due since 4 January 2022,
if he also received the Sell-on Fee percentage corresponding to the penalty, as well as the default
interest indicated in the referenced clause 2 of the Transfer Agreement”.
pg. 4
REF. FPSD-7154
14. On 3 March 2022, the Respondent informed the Claimant that the Respondent and the new
club had entered into the settlement agreement, thereby postponing and splitting the
payment of the second instalment of the transfer compensation.
15. Thereto, the Claimant replied on the same date, stating that he “[disagrees with] the
unilateral decision of the Club to negotiate new terms and conditions for Al Sharjah F.C. to pay
the outstanding instalment, waiving, without any reason whatsoever, the receipt of the penalty
expressly agreed in the Transfer Agreement and the applicable default interest”.
16. By means of its notice dated 11 March 2022, the club replied to the player, stating that he
had no say in any arrangement concluded between the Respondent and the new club
concerning the payment of the transfer compensation.
17. Thereto the player replied on 4 April 2022, disagreeing with the interpretation of the
Respondent and holding that he has the right to claim a penalty and interest in connection
with the late payment of the sell-on payments, which due date was postponed by a
unilaterally agreement of the Respondent and the new club.
18. Subsequently, the Respondent proceeded with the payment of the sell-on due to the player
upon receipt of the amount of EUR 250,000, paid by the new club by 5 March 2022; the club
also proceeding with the relevant sell-on payments in connection with the amounts of EUR
250,000, paid by the new club by 5 April 2022 and 5 May 2022
II. Proceedings before FIFA
a. Position of the Claimant
19. On 22 August 2022, the Claimant lodged a claim against the Respondent in front of the
Football Tribunal, requesting to be awarded outstanding remuneration in the total amount
of EUR 75,000, plus 5% interest p.a. as from 5 January 2022, broken down by the Claimant
as follows:
-
EUR 62,500 corresponding to 25% of the penalty payable by the new club to the
Respondent upon the failure of the former to pay the second instalment of the
transfer compensation to the latter as agreed in the transfer agreement
(250,000*0.25 = 62,500);
-
EUR 12,500 as default interest, corresponding to 25% of the default interest payable
by the new club to the Respondent due to the late payment of the second instalment
of the transfer compensation agreed under the transfer agreement (note: calculated
by the Claimant himself).
pg. 5
REF. FPSD-7154
20. In his claim, the player held explained that the Respondent – without his consent – agreed
to enter into the settlement agreement with the new club, thereby postponing the payment
of the agreed transfer compensation and, subsequently, delaying the payment of the sellon fee due by the Respondent to the Claimant. On this note, the Claimant argued that the
Respondent “did not provide any further clarification or documentation whatsoever to the
Player regarding such amendment, except the referenced email simply communicating the new
due dates. For instance, the Club did not provide the reason for not only having accepted to
receive the outstanding amount through several instalments and much after the first due date,
but also without claiming the penalty and the default interest or any other compensation
whatsoever “.
21. In this regard, the Claimant held that the Respondent did not involve him in the
renegotiation of the terms of the transfer agreement, treating him as a third party and
delaying the payment of the sell-on fee payable, which – in the opinion of the Claimant –
caused him an economical damage. In this respect, the Claimant highlighted that “by rescheduling the referenced outstanding amount and as such, waiving the compensation de riving
from the penalty and default interest without any reasonable reason, the Club acted under
outraged bad faith towards the Player”.
22. In this respect, the Claimant stressed that he requested the Respondent to proceed with
the payment of 25% of the penalty fee included in the transfer agreement as compensation
for the delayed payment, as well as with the corresponding default interest, which the
player considered a reasonable compensation for the damages suffered by him, which was
declined by the Respondent. In this context, the Claimant held that “considering the refusal
of the Club to comply with the obligations assumed towards the Player, notably, to pay the
amount equivalent to the Sell-on Fee resulting from the penalty, as well as default interest, the
latter had no other option but to start the current proceedings in front of this FIFA PSC”.
b. Position of the Respondent
23. In its reply, the Respondent argued – inter alia – the following:
-
That upon maturity of the second instalment of the transfer compensation, the new
club requested the Respondent, on 7 February 2022, an additional deadline to fulfil
this payment, referring to “financial difficulties caused by lack of payment by their own
creditors”, the Respondent “understanding of club’s financial difficulties in this postpandemic time, agreed to such extension”.
-
“Consequently, on 1 March 2022, the parties to the Transfer Agreement (only Al Sharjah
FC and the Respondent, not the Player) entered into an amendment to the Transfer
Agreement (“the Amendment”), by which they modified their previous agreement
regarding payment of the second instalment, which would now be paid on 3 instalments
do on 5 March, 5 April, and 5 May 20225”.
pg. 6
REF. FPSD-7154
-
That “throughout the Statement of Claim, the Claimant implies that SL Benfica should
have requested his authorization in order to enter into the Amendment, and that failure
to do so somehow entitles him to collect a percentage over a penalty that was never paid.
This suggestion lacks any legal basis and should accordingly be disregarded”.
-
That “there is no rule in the Regulations that makes it mandatory for a player to sign the
transfer agreement for the transfer of his own registration between two clubs. The
requirement is only for the player to consent to the transfer, and this consent can be
expressed in multiple ways, one of which is the signing of a new employment agreement
with the new club, as has happened in this case. In such way, in the event that the player’s
consent was lacking, the transfer agreement would be rendered ex tunc null and void.
This provision is included in par. 1.a of clause 3 of the Transfer Agreement”.
-
That “all 3 instalments agreed upon on the Amendment were paid by Al Sharjah FC, and
all corresponding sell-on fees were also diligently paid to the Claimant, as recognized in
the Statement of Claim. Therefore, obviously no penalty of any kind, in connection to par.
5 of clause 2 of the Transfer Agreement, was ever requested by SL Benfica or paid by Al
Sharjah FC”.
-
That the Claimant is requesting to receive a penalty and interest from a delay in
payment that was not motivated by the Respondent but by the financial difficulties
of the new club, the Respondent not benefitting at all from the said delay but acting
in good faith towards the new club. In this respect, the Claimant stressed that “the
Claimant is requesting payment of a sell-on clause over an amount that was never
received by the Respondent (…)”. In this regard, the Respondent held that “demanding
or claiming for payment of the penalty of par. 5 of clause 2 of the Transfer Agreement is
an exclusive right of the Respondent. Neither SL Benfica nor any person or entity is legally
forced to exercise its rights vis-à-vis another, and the Claimant’s suggestion to the
contrary, or its implication that SL Benfica needed its permission to renegotiate the
Transfer Agreement is absolutely misplaced”.
-
The above being said, the Respondent requested the claim of the Claimant be
rejected, with imposition of procedural costs on the latter.
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
24. First of all, the Single Judge of the Dispute Resolution Chamber (hereinafter referred to as
the Single Judge) analysed whether he was competent to deal with the case at hand. In this
respect, he took note that the present matter was presented to FIFA on 22 August 2022
pg. 7
REF. FPSD-7154
and submitted for decision on 10 May 2023. Taking into account the wording of art. 34 of
the March 2023 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.
25. Subsequently, the Single Judge 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 (March 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 player from Brazil
and a club from Portugal.
26. Subsequently, the Single Judge analysed which regulations should be applicable as to the
substance of the matter. In this respect, he confirmed that, in accordance with art. 26 par.
1 and 2 of the Regulations on the Status and Transfer of Players (March 2023 edition) and
considering that the present claim was lodged on 22 August 2022, the July 2022 edition of
said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the
substance.
b. Burden of proof
27. The Single Judge 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 Single Judge
stressed the wording of art. 13 par. 4 of the Procedural Rules, pursuant to which he may
consider evidence not filed by the parties, including without limitation the evidence
generated by or within the Transfer Matching System (TMS).
c. Merits of the dispute
28. His competence and the applicable regulations having been established, the Single Judge
entered into the merits of the dispute. In this respect, the Single Judge started by
acknowledging all the above-mentioned facts as well as the arguments and the
documentation on file. However, the Single Judge emphasised that, in the following
considerations, he will refer only to the facts, arguments and documentary evidence, which
he considered pertinent for the assessment of the matter at hand.
i. Main legal discussion and considerations
29. The foregoing having been established, the Single Judge moved to the substance of the
matter, and took note of the fact that the Claimant argues being entitled to a monetary
compensation due to the delay in the payment of the amounts due by the Respondent to
the Claimant cf. clause 3 para. 2 of the contract, insofar as the Respondent committed – via
pg. 8
REF. FPSD-7154
its e-mail of 8 July 2021 – to proceed with the respective sell-on payments on the dates
specified under point 7 supra and failed to do so when agreeing to grant the new club an
extension of the deadline to perform the relevant payments of the transfer compensation
due as per the transfer agreement.
30. In this regard, the Single Judge observed that, in the opinion of the Claimant, a reasonable
method to calculate the damages suffered by the latter is to recognize his entitlement to
receive a sell-on of 25% (in coherence with what was agreed under clause 3 para. 2 of the
contract) on the penalty clause and default interest agreed between the Respondent and
the new club under clause 2 of the transfer agreement, on which the Respondent
unilaterally give up without the consent of the Claimant, which counted on the
performance of the relevant payment on the initially agreed due dates.
31. On the other hand, the Single Judge acknowledged that, on its part, the Respondent argued
that it could freely entered into the settlement agreement with the new club without the
Claimant being a part to such agreement, insofar as it only concerned a reschedule of the
payment plan of the transfer compensation and not the transfer of the player. In addition,
continued the Single Judge, the Respondent argued having acted in good faith, since the
new club could not perform the payments initially agreed under the transfer agreement
and that – in any case – the Respondent did not benefit from the late payment of the
transfer compensation and duly proceeded with the payments of the sell-on amounts due
as per the contract upon receipt of the pertinent payments from the new club.
32. In this context, the Single Judge deemed it vital to formulate the following questions:
A.) Is the Claimant entitled to the amounts claimed? Why?
33. In this regard, the Single Judge underscored that the right of the Claimant to participate in
the payments received by the Respondent from the new club is exclusively agreed under
clause 3 para. 2 of the contract, which stipulates that the Claimant will receive “25% (twenty
five) percent of the value that SL Benfica SAD will receive in a future definitive or temporary
assignment of the Player’s sports registration rights to another national or foreign sports entity.
The payment of the amount mentioned herein will be made under the same conditions as the
ones envisaged in the definitive or temporary assignment contract”. In view of the above, the
Single Judge determined that it is clear that the said clause allows the Claimant to receive
25% of the transfer compensation payable by the new club to the Respondent. In casu, the
Respondent duly proceeded with the payment of 25% of the transfer compensation
ultimately received by the latter, which is not disputed.
34. The key issue of the case at hand, continued the Single Judge, is whether the legitimate
expectation created on the Claimant upon notification of the initial due dates for payment
of the transfer compensation enables the Claimant to receive a compensation for damages
upon the Respondent’s unilateral decision to accept the new payment schedule of the new
club.
pg. 9
REF. FPSD-7154
35. In this respect, the Single Judge concluded that the argumentation of the Respondent must
be followed: clause 3 para. 2 is clear when stating that the sell-on percentage would only
apply on the amounts received by the Respondent from the new club and the Respondent
only received from the new club the relevant transfer compensation and not any penalty
or default interest. Thus, should the Respondent have received the penalty / default
interest agreed under clause 2 of the transfer agreement, the Claimant would be entitled
to also receive 25% thereof, but – in the case at hand – such amount(s) were not paid to
the Respondent, which, in good faith, renegotiated the financial terms of the transfer in
order to facilitate the payment due by the new club.
36. What is more, continued the Single Judge, the contract does not stipulate that the Claimant
had to be included in any negotiation of the transfer compensation payable by the new
club to the Respondent and it must be noted that the Respondent duly proceeded with the
sell-on payments due upon receipt of the different instalments in which the transfer
compensation was finally paid (in accordance with the terms of the settlement agreement).
ii. Consequences
37. In view of all of the abovementioned considerations, not only in view of the wording of
clause 3 para. 2 of the contract, but also after the interpretation of the said clause and
considering the good faith demonstrated by the Respondent, the Single Judge decided that
the claim of the Claimant must be rejected.
d. Costs
38. The Single Judge 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 Single Judge decided that no procedural costs were to be
imposed on the parties.
39. Likewise, and for the sake of completeness, the Single Judge 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 Single Judge concluded its deliberations by rejecting any other requests for relief
made by any of the parties.
pg. 10
REF. FPSD-7154
IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, CAIO LUCAS FERNANDES, is rejected.
2.
This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
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 Governing the Football
Tribunal).
CONTACT INFORMATION
Fédération Internationale de Football Association
FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland
www.fifa.com | legal.fifa.com | [email protected] | T: +41 (0)43 222 7777
pg. 11