Labour Disputes
Texto da decisão
REF. FPSD-11367
Decision of the
Dispute Resolution Chamber
passed on 25 October 2023
regarding an employment-related dispute concerning
the player Emilio Jose Zelaya
BY:
Roy Vermeer (The Netherlands), Single Judge
CLAIMANT:
Emilio Jose Zelaya, Argentina
Represented by Loizos Hadjidemetriou
RESPONDENT:
Ohod, Saudi Arabia
Represented by Global Sport Consulting
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REF. FPSD-11367
I. Facts of the case
1.
On 9 January 2023, the Argentinian player Emilio Jose Zelaya (hereinafter: the Claimant) and
the Saudi club Ohod (hereinafter: the Respondent) concluded an employment contract to
valid as from said date until 8 July 2023.
2.
On 17 May 2023, the Claimant unilaterally terminated the employment contract.
3.
On 1 June 2023, the Parties stipulated a settlement agreement (hereinafter: the Agreement),
by means of which the Respondent undertook to pay the Claimant a total of USD 153,333
broken down as follows:
-
4.
(a) USD 35,000 until 30/07/2023
(b) USD 35,000 until 30/09/2023
(c) USD 17,500 until 30/10/2023
(d) USD 66,333 until 30/12/2023
In accordance with clause 4 of the Agreement:
“Should the [Respondent] fail to timely and fully comply with any one of the instalments:
(a)
The [Agreement] would be immediately terminated, and all remaining amounts
would become immediately due and payable and
(b)
The [Respondent] would have to pay legal interest of 5% p.a. on all remaining
amounts from 25/05/2023 until full settlement and
(c)
The [Respondent]would pay a one-off penalty equal to the 35% of all remaining
amounts and
(d)
The [Respondent] would pay the [Claimant] an additional amount of EUR 5,000 as
contribution to his legal expenses.”
5.
Finally, under clause 8 of the Agreement, the Parties stipulated that “Should a dispute arise,
all amounts would be considered as due from 25/05/2023 and the [Claimant] would have the
right to initiate a 12bis proceeding without first having to put the Respondent in default for 10
days (…)”.
6.
On 10 August 2023, the Respondent paid to the Claimant a total of USD 59,335.
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REF. FPSD-11367
II. Proceedings before FIFA
7.
On 16 August 2023 the Claimant 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
8.
According to the Claimant, the Respondent failed to comply in a timely manner with its
financial obligations as set under clause 4 of the Agreement, hence this shall be deemed
as terminated on 1 August 2023 and the Respondent should pay the relevant penalty fee
corresponding to 35% of the amounts stipulated thereto in addition to the respective
interest running as from 25 May 2023 as well as a contribution to the legal expenses
incurred by the Claimant.
9.
Notwithstanding the above, the Claimant confirmed having received a payment of USD
59,335 on 10 August 2023, hence he requested to deduct such amount from the
outstanding debt carried by the Respondent.
10. The requests for relief of the Claimant were the following:
-
USD 93,998 as outstanding amount plus 5% interest p.a. as from 25 May 2023;
-
USD 53,666.55 as penalty fee;
-
USD 5,000 as outstanding legal fees under the settlement agreement.
b. Position of the Respondent
11. In its reply, the Respondent alleged having suffered financial difficulties and acknowledged
outstanding sums in favor of the Claimant for a total of USD 93,998.
12. Conversely, regarding the claimed penalty fee, the Respondent objected to its
proportionality in respect to the residual outstanding amount, thus arguing that said fee
shall be reduced by FIFA because it currently corresponds to more than 50% of the sum
due to the Claimant.
13. Finally, the Respondent did not contest the Claimant’s demand for contribution to his legal
expenses in the amount of USD 5,000 based on clause 4 of the Agreement.
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III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
14. First of all, the Single Judge of the Dispute Resolution Chamber (hereinafter also referred
to as the Single Judge) analysed whether he was competent to deal with the case at hand.
In this respect, it took note that the present matter was presented to FIFA on 16 August
2023 and submitted for decision on 25 October 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.
15. 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 (May 2023 edition), the Single judge of
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 Argentina and a club from Saudi Arabia.
16. Subsequently, the Single Judge 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 (May 2023 edition), and
considering that the present claim was lodged on 16 August 2023, the aforementioned
edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand
as to the substance.
b. Burden of proof
17. 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
18. The 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
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REF. FPSD-11367
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
19. The foregoing having been established, the Single Judge moved to the substance of the
matter, and took note of the Agreement signed by the parties on 1 June 2023, by means of
which the Respondent undertook to pay the Claimant a total of USD 153,333.
20. In this context, the Single Judge noted that the Claimant alleged having only received the
amount of USD 59,335 by the Respondent, whereas a total of USD 93,998 would remain
unpaid. The Single Judge emphasised that this fact was confirmed by the Respondent, who
alleged having suffered financial difficulties to justify the lack of compliance with its
contractual obligations.
21. Moreover, the Singe Judge observed that the Respondent did not contest the Claimant’s
request for contribution to his legal expenses in the amount of USD 5,000 as stipulated by
the parties under clause 4 of the Agreement.
22. At this stage, the Single Judge further acknowledged that, in addition, the Claimant had
requested the payment of a penalty fee amounting to USD 53,666.55 as well as an annual
interest at a rate of 5% as from 25 May 2023 until the date of effective payment on the total
outstanding amount based on clause 4 of the Agreement.
23. On the other hand, the Single Judge acknowledged the Respondent´s position and pointed
out that the latter had requested a reduction of the relevant penalty fee as corresponding
to over 50% of the outstanding amount due to the Claimant, hence in the Respondent’s
view said penalty should be considered excessive.
24. In this context, the Single Judge wished to recall the wording of clause 4 of the Agreement,
according to which: “Should the [Respondent] fail to timely and fully comply with any one of
the instalments (…) the [Agreement] would be immediately terminated, and all remaining
amounts would become immediately due and payable and (...) The [Respondent] would pay a
one-off penalty equal to the 35% of all remaining amounts (...)”.
25. In this respect, the Single Judge underlined that it remained undisputed that the
Respondent was in default of payment of the first instalment under the Agreement, hence
the conditions set by the said document to trigger the penalty fee had been met. However,
the Single Judge noticed that it remained to be established whether the percentage
indicated therein as penalty should apply to the sole amount remained outstanding, as
maintained by the Respondent, or to the entirety of the original Claimant’s remuneration
as sustained by the latter.
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26. That said, the Single Judge focused his attention on the mentioned penalty clause and
considered appropriate to preliminary remark, on a general level, 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 Single Judge highlighted that, in order to determine
whether a penalty clause is to be considered acceptable, the specific circumstances of the
relevant case brought before him shall also be taken into consideration.
27. In the specific case at hand, the Single Judge moved to analyse the literal tenor of clause 4
of the Agreement as principal mean of interpretation in order to assess the will of the
parties when they drafted it. Therefore, the Single Judge deemed it worth to recall the text
of the said clause, which reads “The [Respondent] would pay a one-off penalty equal to the
35% of all remaining amounts (...)”.
28. Against this particular wording of the Agreement, the Single Judge pointed out that, by
explicitly indicating that the penalty would correspond to “35% of all the remaining amounts”,
the parties’ intention could only have been to refer it to the entirety of the amount overdue,
which in casu was EUR 153,333 and irrespective of any potential late payment realized by
the Respondent after the relevant default, as the latter had already failed to pay the first
instalment within the deadline set out in the Agreement, thus triggering the acceleration
clause thereto contained.
29. In other words, the Single Judge emphasized that the fact that the Respondent paid a total
of USD 59,335 to the Claimant on 10 August 2023, i.e., after the relevant deadline for
complying with the first instalment had been expired, would not subsequently entitle the
Respondent to reduce the amount of the penalty fee stipulated under the Agreement,
otherwise the said fee would be completely deprived of its rationale.
30. Consequently, the Single Judge concluded that the sum of USD 53,666.55 claimed as
penalty fee by the Claimant appears congruent with the percentage agreed by the parties
as effectively corresponding to 35% of the entire remuneration originally outstanding in
favour of the Claimant and that such a penalty fee – which the parties contractually agreed
upon in the context of the Agreement – is both proportionate and reasonable and, thus,
valid and applicable.
31. In light of the above, the Single Judge decided that based on clause 4 of the Agreement and
in accordance with the general legal principle of pacta sunt servanda, the Respondent is
liable to pay to the Claimant (i) the amount of USD 93,998 as outstanding remuneration, (ii)
the amount of USD 5,000 as participation to the Claimant’s legal expenses, which were
unequivocally contractually agreed upon, as well as (iii) a total of USD 53,666.55 as penalty
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REF. FPSD-11367
fee, in light of the Respondent’s failure to comply with the terms indicated in the agreement
in a timely manner.
32. In addition, taking into consideration the Claimant’s request as well as the constant practice
of the Football Tribunal in this regard, the Single Judge decided to award the Claimant
interest at the rate of 5% p.a. on the outstanding amount of USD 93,998 as from the
relevant due date until the date of effective payment. The Single Judge clarified to this end
that no interest shall apply on the penalty per the principle ne bis in idem. By the same
token, in that no interest has been claimed by the Claimant over the USD 5,000 as attorney
fees, these shall not be awarded in line with the principle ne ultra petita.
ii. Compliance with monetary decisions
33. Finally, taking into account the applicable Regulations, the Single Judge 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.
34. In this regard, the Single Judge 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.
35. Therefore, bearing in mind the above, the Single Judge 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.
36. 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.
37. The Single Judge 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.
d. Costs
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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.
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REF. FPSD-11367
IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, Emilio Jose Zelaya, is accepted.
2.
The Respondent, Ohod, must pay to the Claimant the following amount(s):
USD 93,998 as outstanding remuneration plus 5% interest p.a. as from 25 May 2023
until the date of effective payment;
USD 5,000 as outstanding amount;
USD 53,666.55 as contractual penalty fee.
3.
Full payment (including all applicable interest) shall be made to the bank account indicated
in the enclosed Bank Account Registration Form.
4.
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.
5.
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.
6.
This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
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REF. FPSD-11367
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
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