Dispute Resolution Chamber
Texto da decisão
REF 20-01085
Decision of the
DRC Judge
passed on 10 March 2021,
regarding an employment-related dispute concerning the player Andrew Declan Keogh
BY:
Pavel Pivovarov (Russia), DRC Judge
CLAIMANT:
Andrew Declan Keogh, Ireland
Represented by Professional Footballers Australia
RESPONDENT:
Al Qadsiah FC, Saudi Arabia
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I. FACTS
1.
On 1 August 2019, the Irish player, Andrew Declan Keogh (hereinafter: the Player or Respondent)
and the Saudi club, Al-Qadsiah FC (hereinafter: the Club or Respondent) concluded an
employment contract, valid as of the date of signature until 30 June 2020 (hereinafter: the
Contract), according to which the club undertook to pay to the player a total remuneration of
USD 450,000.
2.
On 8 January 2020, the parties signed the “Termination Agreement” to amicably terminate the
contract. According to clause 2 of the agreement, the parties agreed upon the following:
“In consideration for the premature termination of the Employment Contract, as well as the overall
settlement of any issue arisen between the Parties as mentioned at point b) of the premises, the
Club undertakes to pay the Player monthly payments of January 2020 until the date of 30.06.2020
with a value of (30.606 USD) only Thirty thousand six hundred and six U.S Dollars for each month,
provided that the date of payment of these salaries be on 1st day of the month from today's date
onwards, and the monthly payments include value for the (Four) business class air flight ticket
from Dammam (Saudi Arabia) to Perth (Australia), at the Player's and his family earliest
convenience.”
3.
The agreement contained a penalty clause (clause 8):
“In case of breach of this clause 9), the defaulting party shall be liable to pay the non-defaulting
party a penalty in the amount of USD 100,000.00.”
4.
Pursuant to clause 9 of the agreement:
“The Parties execute the present Agreement in order to fully acknowledge and accept all its
provisions.”
5.
On 2 July 2020, the player put the club in default for the payment of the following amounts:
“(a) the monthly payment of USD 30,606 for May 2020, which was due and payable by 1 June
2020; and
(b) the monthly payment of USD 30,606 for June 2020, which was due and payable by 1 July
2020.
The Player provided the Club with 14 days’ notice to pay the full outstanding amount of USD
61,212 into his nominated bank account.”
6.
On 5 July 2020, the club acknowledged its debt towards the player and requested him to
postpone the payments for June 2020 and July 2020 to 1 November 2020 and 1 December 2020.
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7.
On 6 July 2020, the player refused the club’s proposal of 5 July 2020, and informed the latter that
the payment of the outstanding amounts remain due on or before 16 July 2020.
8.
On 13 July 2020, the club paid to the player the amount of USD 14,826.93.
9.
The player stated that following the payment of USD 14,826.93 made by the club, USD 46,385.07
remained “outstanding and payable” to him as follows:
“(a) USD 15,779.07 in respect of the payment for the month of May 2020; and
(b) USD 30,606 in respect of the payment for the month of June 2020.”
10.
Moreover, the player maintained that: “On account of the Club’s failure to comply with the
Agreement, and “fully acknowledge and accept all its provisions”, the Club – as the defaulting
party – is also liable to pay the Penalty Fee to the Player of USD 100,000.”
11.
On 28 July 2020, the Claimant lodged a claim against the Respondent in front of FIFA, claiming
the following:
a) “award the Player USD 46,385.07 as follows:
I.
USD 15,779.07 (plus 5% interest p.a. from 1 June 2020 until the date of effective
payment;) and
II.
USD 30,606 (plus 5% interest p.a. from 1 July 2020 until the date of effective
payment); and
b) award the Player USD 100,000 (plus 5% interest p.a. from 1 July 2020) as the Penalty Fee;
and
c) award any additional, further or other remedy that the DRC deems appropriate.”
12.
In its reply to the claim, the Respondent stated that it paid the claimed amount of USD 46,385.07
on 27 August 2020 and provided proof of payment in such regard.
13.
Moreover, the club requested, as consequence of its payment, the closure of the case.
14.
On 4 September 2020, the player acknowledged receipt of the payment amounting to USD
46,385.07.
15.
Furthermore, the player explained that in his claim, he also requested the payment of USD
100,000 as penalty fee, and that such amount remained outstanding since the club failed to pay
it.
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16.
Finally, the player stated that “in the absence of such payment [USD 100,000], the Player seek a
determination by the DRC as to the relief sought at paragraph 19(b) of the Claim.”
II. CONSIDERATIONS OF THE DRC JUDGE
1.
First of all, the Dispute Resolution Chamber (DRC) Judge (hereinafter also referred to as DRC
Judge) analysed whether he was competent to deal with the case at hand. In this respect, it took
note that the present matter was submitted to FIFA on 28 July 2020. Taking into account the
wording of art. 21 of the January 2021 edition of the Rules Governing the Procedures of the
Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural
Rules), the aforementioned edition of the Procedural Rules is applicable to the matter at hand.
2.
Subsequently, the DRC Judge referred to art. 3 par. 1 of the Procedural Rules and confirmed that
in accordance with art. 24 par. 1 in combination with art. 22 lit. b) of the Regulations on the
Status and Transfer of Players (edition February 2021), the Dispute Resolution Chamber is
competent to deal with the matter at stake. The matter concerns an employment-related dispute
with an international dimension between an Irish player and a Saudi club, and the competence is
not disputed by the parties.
3.
In continuation, the DRC Judge analysed which regulations should be applicable as to the
substance of the matter. In this respect, the DRC Judge confirmed that in accordance with art. 26
par. 1 and 2 of the Regulations on the Status and Transfer of Players (edition February 2021), and
considering that the claim was lodged on 28 July 2020, the June 2020 edition of the
aforementioned regulations (hereinafter: the Regulations) is applicable to the matter at hand as
to the substance.
4.
The competence of the DRC Judge and the applicable regulations having been established, the
DRC Judge entered into the substance of the matter. In this respect, the DRC Judge started by
acknowledging all the above-mentioned facts as well as the arguments and the documentation
submitted by the parties. However, the DRC 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.
5.
First and foremost, the DRC Judge acknowledged that the parties – after having concluded an
employment agreement for the period between 1 August 2019 and 30 June 2020 - had
terminated their employment relation by mutual consent by entering into the termination
agreement on 8 January 2020. In accordance with the agreement, the Respondent undertook to
pay to the Claimant an amount of USD 183,636, payable in 6 monthly instalments of USD 30,606
each, the first instalment on January 2020, to be paid “on 1st day of the month from today's
date onwards (…)”.
6.
The DRC Judge further acknowledged that the parties had agreed upon a penalty clause of USD
100,000 in case of breach of clause 9 of the agreement, clause 9, which reads as follows: “The
Parties execute the present Agreement in order to fully acknowledge and accept all its provisions.”
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7.
In continuation, the DRC Judge noted that the Respondent had paid the claimed amount of USD
46,385.07 on 27 August 2020, but failed, according to the Claimant, to remit him the amount of
USD 100,000 as penalty fee in accordance with clause 8 of the agreement.
8.
The DRC Judge took into account that the Respondent, for its part, did not explicitly contest the
player’s claim concerning the requested penalty fee, but it limited its defence by informing about
the payment of the claimed amount of USD 46,385.07 and by requesting the closure of the case.
9.
Taking into account the aforementioned circumstances, the DRC Judge noted that the main
amount of USD 46,385.07 has been paid, but it seems that the parties only have dissenting
opinions as to the applicability of the penalty clause of USD 100,000, contained in clause 8 of the
termination agreement.
10. In view of the dissenting viewpoint of the parties with respect to the applicability of the penalty
fee, the DRC Judge, to start with, focussed his attention on said contractual clause.
11. In this regard, the DRC Judge concluded that penalty clauses may be freely entered into by the
contractual parties and may be considered acceptable, in the event that the pertinent written
clause meets certain criteria such as proportionality and reasonableness. In this respect, the DRC
Judge highlighted that in order to determine as to whether a penalty clause is to be considered
acceptable, the specific circumstances of the relevant case brought before it shall also be taken
into consideration.
12. Having clarified the above, the DRC Judge recalled the jurisprudence of the DRC, in accordance
with which penalties will be considered disproportionate when they constitute an amount that
represents more than 50% of the principal outstanding amount. .
13. In the specific case at hand, the DRC Judge deemed that the penalty fee of USD 100,000, which
the parties contractually agreed upon in the context of terminating the employment relation, is –
taken into account the DRC’s jurisprudence in this respect – representing more than 50% of the
outstanding amount and, therefore, it is to be considered disproportionate and not reasonable in
the case at hand.
14. In addition, the DRC Judge recalled that the Respondent had already paid the amount originally
claimed by the Claimant of USD 46,385.07.
15. On account of all of the above, the DRC Judge decided that said contractual penalty fee agreed
between the parties shall be reduce to 50% of the outstanding amount initially claimed by the
Claimant, resulting to an amount of USD 23,193 (i.e. USD 46,385.07 / 2).
16. Consequently, the Chamber decided that the Respondent is liable to pay to the Claimant the
amount of USD 23,193 as penalty.
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17. Finally, the DRC Judge outlined that no interest on the abovementioned amount of USD 23,193
as penalty shall be awarded as this would constitute a double penalty for the Respondent.
Therefore, the DRC Judge decided to reject this part of the Claimant’s claim.
18. The DRC Judge concluded his deliberations in the present matter by partially accepting the
Claimant’s claim and by stating that any further request filed by the Claimant are rejected.
19. Furthermore, taking into account the consideration under number II./3. above, the DRC Judge
referred to par. 1 and 2 of art. 24bis 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.
20. In this regard, the DRC Judge pointed out 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 amount is paid and for the maximum duration
of three entire and consecutive registration periods.
21. Therefore, bearing in mind the above, the DRC Judge decided that, in the event that the
Respondent does not pay the amount due to the Claimant within 45 days as from the moment in
which the Claimant, following the notification of the present decision, communicates the relevant
bank details to the Respondent, a ban from registering any new players, either nationally or
internationally, for the maximum duration of three entire and consecutive registration periods
shall become effective on the Respondent in accordance with art. 24bis par. 2 and 4 of the
Regulations.
22. The DRC Judge recalled that the above-mentioned ban will be lifted immediately and prior to its
complete serving upon payment of the due amount, in accordance with art. 24bis par. 3 of the
Regulations.
23. The DRC Judge referred to article 18 par. 2 of the Procedural Rules, according to which “DRC
proceedings relating to disputes between clubs and players in relation to the maintenance of
contractual stability as well as international employment related disputes between a club and a
player are free of charge”. Accordingly, the DRC Judge decided that no procedural costs were to
be imposed on the parties.
24. Likewise and for the sake of completeness, the DRC Judge recalled the contents of art. 18 par. 4
of the Procedural Rules, and decided that no procedural compensation shall be awarded in these
proceedings.
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III. DECISION OF THE DRC JUDGE
1.
The claim of the Claimant, Andrew Declan Keogh, is partially accepted.
2.
The Respondent, Al Qadsiah FC, has to pay to the Claimant, the following amount:
- USD 23,193 as penalty.
3.
Any further claims of the Claimant are rejected.
4.
The Claimant is directed to immediately and directly inform the Respondent of the relevant bank
account to which the Respondent must pay the due amount.
5.
The Respondent shall provide evidence of payment of the due amount in accordance with this
decision to [email protected], duly translated, if applicable, into one of the official FIFA languages
(English, French, German, Spanish).
6.
In the event that the amount due, plus interest as established above is not paid by the Respondent
within 45 days, as from the notification by the Claimant of the relevant bank details to the
Respondent, the following consequences shall arise:
1. The Respondent shall be banned from registering any new players, either nationally or
internationally, up until the due amount is paid and for the maximum duration of three
entire and consecutive registration periods. The aforementioned ban mentioned will be
lifted immediately and prior to its complete serving, once the due amount is paid.
(cf. art. 24bis of the Regulations on the Status and Transfer of Players).
2. In the event that the payable amount as per in this decision is still not paid by the end of
the ban of three entire and consecutive registration periods, the present matter shall be
submitted, upon request, to the FIFA Disciplinary Committee.
7. This decision is rendered without costs.
For the DRC Judge:
Emilio García Silvero
Chief Legal & Compliance Officer
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NOTE RELATED TO THE APPEAL PROCEDURE:
According to article 58 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 20 of the Procedural Rules).
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
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