F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – coach disputes / controversie allenatori (2016-2017) – fifa.com – atto non ufficiale – Decision28 February 2017

Decision of the Single Judge of the Players’ Status Committee

passed in Zurich, Switzerland, on 28 February 2017,

by

Mr Geoff Thompson (England),

Single Judge of the Players’ Status Committee,

on the claim presented by the coach

Coach A, Country B

as “Claimant”

against

The Football Association of Country C

as “Respondent”

regarding an employment-related contractual dispute

arisen between the parties.

I. Facts

1. On 3 January 2014, the Coach of Country B, Coach A (hereinafter: the Claimant) and the Football Association of Country C (hereinafter: the Respondent) entered into an employment contract (hereinafter: the employment contract) valid from 20 February 2014 until 19 February 2017, under the terms of which the Claimant was entitled to receive from the Respondent the monthly salary of USD 17,500.

2. Pursuant to the employment contract, the Claimant was entitled to a “Suitable 3 bedroom apartment”, a suitable car provided by the Respondent, a return flight ticket each year “Country C - Country B” in Economy Class and bonuses in accordance with the “Bonus system World Championships 2016 Columbia”.

3. On 11 October 2016, the Claimant lodged a claim in front of FIFA against the Respondent, arguing that the latter had failed to comply with its contractual obligations.

4. In this regard, the Claimant explained that the Respondent had failed to pay the Claimant’s salaries and rent of the apartment for the months of March, April, May and part of June 2016 without any valid reason.

5. Furthermore, the Claimant explained to have tried to solve the matter amicably with the Respondent without success. In this regard, he maintained to have sent to the Respondent several reminders to fulfil its contractual obligations on 12 May, 4 June and 20 June 2016 respectively.

6. On 27 June 2016, the Claimant sent a letter of termination to the Respondent in which he stated inter alia that “[…] in view of your [i.e. the Respondent] reluctance to reply to my [i.e. the Claimant] previous letters and to comply with your contractual obligations, I [i.e. the Claimant] would like to inform you [i.e. the Respondent] that I hereby terminate with just cause the employment contract concluded on 3 January 2014 with your Association [i.e. the Respondent]”.

7. Consequently, the Claimant requested from the Respondent the following amounts:

- USD 17,500 plus 5% interest p.a. as from 1 April 2016 as outstanding remuneration of March 2016;

- USD 17,500 plus 5% interest p.a. as from 1 May 2016 as outstanding remuneration of April 2016;

- USD 17,500 plus 5% interest p.a. as from 1 June 2016 as outstanding remuneration of May 2016;

- USD 15,750 plus 5% interest p.a. as from 28 June 2016 as outstanding remuneration for part of June 2016;

- 64,000 plus 5% interest p.a. as from 1 April 2016 as outstanding rent for a suitable apartment;

- 64,000 plus 5% interest p.a. as from 1 May 2016 as outstanding rent for a suitable apartment;

- 64,000 plus 5% interest p.a. as from 1 June 2016 as outstanding rent for a suitable apartment;

- 55,925 plus 5% interest p.a. as from the date of departure to Country B, i.e. on 30 June 2016, as reimbursement of one return flight ticket;

- USD 135,333.25 plus 5% interest p.a. as from the date of claim, i.e. on 28 September 2016 as compensation for breach of contract.

8. In its reply to the claim lodged against it, the Respondent argued that the employment contract was not valid and binding upon between the parties. In this regard, the Respondent maintained that the employment contract was in contradiction with the Law of Country C and did not bear the seal of the Respondent. Moreover, the Respondent claimed that its committee should have approved such employment contract before President D could sign it, fact that did not happen.

9. In continuation, the Respondent alleged that the Claimant had illegally worked in Country C without having a work permit which could result in criminal charges against him.

10. Likewise, the Respondent, allegedly not being bound by the employment contract, deemed to have rightfully stopped fulfilling its contractual obligations and thus decided to propose a draft of a possible amendment of the employment contract. However, the Claimant refused to sign such proposal of a new employment contract.

11. Consequently, the Respondent deemed that the claim lodged by the coach should be rejected in its entirety.

***

II. Considerations of the Single Judge of the Players´ Status Committee

1. First of all, the Single Judge of the Players’ Status Committee (hereinafter also referred to as: the Single Judge) analysed whether he was competent to deal with the matter at hand. In this respect, he took note that the present matter was submitted to FIFA on 11 October 2016. Consequently, the Single Judge concluded that the 2015 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution (hereinafter: the Procedural Rules) is applicable to the matter in hand (cf. art. 21 of the Procedural Rules).

2. Subsequently, the Single Judge referred to art. 3 par. 1 and 2 of the Procedural Rules and confirmed that in accordance with art. 23 par. 1 and 4 in combination with art. 22 lit. c) of the 2015 and 2016 editions of the Regulations on the Status and Transfer of Players, he would be, in principle, competent to deal with employment-related disputes between a club or an association and a coach of an international dimension.

3. In continuation, the Single Judge analysed which edition of the Regulations on the Status and Transfer of Players should be applicable as to the substance of the matter. In this respect, he recalled that the claim was submitted to FIFA on 11 October 2016 and concluded that the 2016 edition of the Regulations on the Status and Transfer of Players (hereinafter: the Regulations) is applicable to the case at hand as to the substance (cf. art. 26 par. 1 and 2 of the Regulations).

4. His competence and the applicable regulations having been established, and entering into the substance of the matter, the Single Judge started his analysis by acknowledging the facts of the case and the arguments of the parties as well as the documents contained in the file. However, the Single Judge emphasised that in the following considerations he will only refer to the facts, arguments and documentary evidence, which he considered pertinent for the assessment of the matter at hand.

5. In doing so and to begin with, the Single Judge acknowledged that, on 3 January 2014, the Claimant and the Respondent had concluded an employment contract valid from 20 February 2014 until 19 February 2017, under the terms of which the Claimant was entitled to receive from the Respondent the monthly salary of USD 17,500, a “Suitable 3 bedroom apartment”, a suitable car provided by the Association and a return flight ticket each year “Country C-Country B” in Economy Class as well as bonuses in accordance with the “Bonus system World Championships 2016 Columbia”.

6. In continuation, the Single Judge observed that, on the one hand, the Claimant had argued that the Respondent clearly breached the employment contract by not paying his salaries and rent for more than three months and by not replying to his attempts to solve the matter amicably. Consequently, the Claimant requested from the Respondent the payment of USD 68,250 and of 192,000 as outstanding remuneration, of 55,925 as reimbursement of flight ticket and of USD 135,333.25 as compensation of compensation for the breach of contract as well as the relevant interests at a rate of 5% per year.

7. On the other hand, the Single Judge remarked that, for its part, the Respondent deemed to have rightfully stopped fulfilling its contractual obligations as per the employment contract since said employment contract was allegedly not valid and binding upon between the parties as it was in contradiction with the Law of Country C, did not bear the seal of the Respondent and was not approved by its committee. Furthermore, the Single Judge took note that the Respondent argued that the Claimant had apparently illegally worked in Country C without a valid work permit.

8. In light of the above, the Single Judge deemed that he had to address the question whether the premature termination of the employment contract by the Claimant on 27 June 2016 had occurred with or without just cause.

9. In continuation, the Single Judge also underlined that, subsequently, if it were found that the contract was breached by one of the parties without just cause, it would be necessary to determine the consequences for the party that caused the unjust breach of the relevant contract.

10. In view of the above, the Single Judge went on to deliberate as to whether the circumstances surrounding the premature termination of the employment contract by the Claimant can be considered as a just cause for the Claimant.

11. In doing so, the Single Judge remarked that the Respondent had never contested having stopped fulfilling its contractual obligations stipulated in the employment contract and that the salaries as well as the rent for the months of March, April, May and part of June 2016 were not paid to the Claimant.

12. In this regard, the Single Judge recalled that the Respondent had put forward arguments against the validity of the employment contract such as i) its contradiction with the Law of Country C, ii) it did not bear the seal of the Respondent and iii) it was not approved by the Respondent’s committee as well as iiii) the Claimant allegedly worked without a valid permit.

13. In this context, the Single Judge decided that the aforementioned arguments of the Respondent cannot be sustained. First, the Single Judge considered that, whilst referring to art. 12 par. 3 of the Procedural Rules which stipulates that any party claiming a right on the basis of an alleged fact shall carry the burden of proof, the Respondent failed to present any evidence which would demonstrate that the employment contract was in contradiction with the Law of Country C.

14. What is more, the Single Judge further wished to point out that when deciding a dispute before FIFA, FIFA’s regulations prevail over any national law. In this regard, the Single Judge emphasised that the main objective of the FIFA regulations is to create a standard set of rules to which all the actors within the football community are subject to and can rely on. This objective would not be achievable if the decision making-bodies of FIFA, in casu the Single Judge, would have to apply the national law of a specific party on every dispute brought to him. As a consequence, the Single Judge decided to dismiss the argument of the Respondent as to the applicability of the Law of Country C.

15. As to the second and third argument, contrary to the allegations of the Respondent, the Single Judge was eager to emphasise that the non-compliance of purely formalities cannot not per se affect the validity of a contract as long as the essentialia negotii are contained in the relevant contract which is the case in the employment contract at the dispute. Therefore, such arguments brought by the Respondent has to be rejected.

16. Likewise, as to argument put forward by the Respondent related to the alleged Claimant’s work in Country C without work permit, the Single Judge, referring again to the content of art. 12 par. 3 of the Procedural Rules, remarked that the Respondent failed to provide any proof which would have indicated that the Claimant worked without a valid permit.

17. Furthermore, the Single Judge further declared that the Claimant, before the premature termination of the employment contract on 27 June 2016, had already been working for more than two years for the Respondent and found it evident that the Claimant had been able to do so only with a valid work permit.

18. Having established all of the above, the Single Judge was eager to underscore that only a breach or misconduct which is of a certain severity might justify the termination of a contract without prior warning. In other words, only when there are objective criteria which do not reasonably permit to expect a continuation of the employment relationship between the parties, a contract may be terminated prematurely. The Single Judge was also keen to emphasise that a premature termination of an employment contract can always only be an ultima ratio.

19. In view of all the above, the Single Judge considered that at the time the Claimant had prematurely terminated the employment contract, i.e. on 27 June 2016, the Claimant had good reasons to believe that the Respondent was not interested in continuing the working relationship with the Claimant. In particular, considering that the Respondent clearly stopped fulfilling its contractual obligations by not paying any salaries and rent to the Claimant as of March 2016.

20. In light of the aforementioned, the Single Judge came to the conclusion that the Claimant had terminated the contract with just cause on 27 June 2016.

21. Having established that the Respondent is to be held liable for the premature termination of the employment contract as of 27 June 2016, the Single Judge went on to consider the financial consequences following the unjustified termination of the employment contract.

22. In doing so, the Single Judge first held that the Respondent must fulfill its obligations as per the employment contract in accordance with the general legal principle of pacta sunt servanda, which in essence means that contract must be respected. Consequently, the Single Judge decided that the Respondent is liable to pay to the Claimant the remuneration that was outstanding at the time of the termination, i.e. USD 68,500 and 192,000 as well as 5% interest per year as of the relevant due dates.

23. Furthermore, with regard to the requested reimbursement of the flight ticket amounting to 55,925 that the Claimant had allegedly paid to come back to his country, the Single Judge remarked that such contractual obligation to pay a return ticket in Economy Class for the route “Country C-Country B” was contained in the employment contract. The Single Judge also noted that the Claimant had provided evidence of having paid such sum for a return flight ticket in accordance with art. 12 par. 3 of the Procedural Rules. Therefore, the Single held that the Claimant’s request for the reimbursement of a return flight ticket is accepted and that the Respondent has to pay to the Claimant the amount of 55,925.

24. Having established the above, the Single Judge took note, upon a careful examination of the employment contract concluded between the Claimant and the Respondent that said contract did not contain a specific clause in case of termination of such employment contract by one of the contractual parties.

25. As a consequence of the above, the Single Judge concluded that the amount of compensation due to the Claimant had to be assessed in accordance with other criteria a taking into consideration the residual value of the contract according to the longstanding jurisprudence of the Players’ Status Committee.

26. Bearing in mind the above, and taking into account that the contract was valid until 19 February 2017, the Single Judge of the Players’ Status Committee decided that the Claimant was entitled to the remaining value of his salary as compensation for the unilateral termination of the contract without just cause. Consequently, the Single Judge concluded that the amount of USD 135,333, corresponding to the salaries from 28 June 2016 until 19 February 2017, serves as the basis for the final determination of the amount of compensation for breach of contract.

27. In continuation, the Single Judge verified as to whether the Claimant 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 Players’ Status Committee, 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 coach’s general obligation to mitigate his damages.

28. The Single Judge noted that, according to the Claimant, he concluded an employment contract on 2 February 2017 with the Football Association of Country E, valid from the date of signature until 31 December 2017 for a monthly salary of USD 11,500. Consequently, the Single Judge concurred that the amount received from 2 February until 19 February 2017 under the new employment contract shall be taken into consideration in the calculation of the amount of compensation for breach of contract in the case at stake, i.e. USD 7,667.

29. Consequently, on account of all the above-mentioned considerations and the specificities of the case at hand, the Single Judge decided to partially accept the Claimant’s claim and that the Respondent must pay the amount of USD 127,666 as compensation for breach of contract in the case at hand.

30. Therefore, on account of all of the above-mentioned considerations and the specificities of the case at hand, the Single Judge decided that the Respondent must pay the amount of USD 127,666 as compensation for breach of contract as well as 5% interest per year on the said amount from 28 September 2016 until the date of effective payment.

31. Lastly, the Single Judge referred to art. 25 par. 2 of the Regulations in combination with art. 18 par. 1 of the Procedural Rules, according to which, in the proceedings before the Players’ Status Committee, including its Single Judge, costs in the maximum amount of CHF 25,000 are levied. The costs are to be borne in consideration of the parties’ degree of success in the proceedings (cf. art. 18 par. 1 of the Procedural Rules).

32. In respect of the above, and taking into account that the Claimant’s claim was partially accepted as well as considering that the Respondent was the party at fault, the Single Judge concluded that the Respondent has to bear the costs of the current proceedings before FIFA.

33. Furthermore and according to Annexe A of the Procedural Rules, the costs of the proceedings are to be levied on the basis of the amount in dispute. Consequently and taking into account that the total amount at dispute in the present matter is over CHF 200,001 the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to CHF 25,000.

34. In conclusion, and considering the particularities of the present matter, the Single Judge determined the costs of the current proceedings to the amount of CHF 20,000 has to be paid by the Respondent.

III. Decision of the Single Judge of the Players’ Status Committee

1. The claim of the Claimant, Coach A, is partially accepted.

2. The Respondent, The Football Association of Country C, has to pay to the Claimant, Coach A, within 30 days as from the date of notification of this decision, the amount of USD 68,250 and of 192,000 as outstanding remuneration, plus interest as follows:

- 5% p.a. over the amount of USD 17,500 as from 1 April 2016 until the date of effective payment;

- 5% p.a. over the amount of BHT 64,000 as from 1 April 2016 until the date of effective payment;

- 5% p.a. over the amount of USD 17,500 as from 1 May 2016 until the date of effective payment;

- 5% p.a. over the amount of 64,000 as from 1 May 2016 until the date of effective payment;

- 5% p.a. over the amount of USD 17,500 as from 1 June 2016 until the date of effective payment;

- 5% p.a. over the amount of 64,000 as from 1 June 2016 until the date of effective payment;

- 5% p.a. over the amount of USD 15,750 as from 28 June 2016 until the date of effective payment.

3. The Respondent, The Football Association of Country C, has to pay to the Claimant, Coach A, within 30 days as from the date of notification of this decision, the sum of 55,925 as reimbursement of flight ticket as well as the total amount of USD 127,666 as compensation, plus 5% interest p.a. on the said amount as from 28 September 2016 until the date of effective payment.

4. If the aforementioned sums plus interest are not paid within the aforementioned deadline the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee, for consideration and a formal decision.

5. Any further claim lodged by the Claimant, Coach A, is rejected.

6. The final costs of the proceedings in the amount of CHF 20,000 are to be paid by the Respondent, The Football Association of Country C, within 30 days as from the notification of the present decision as follows:

6.1 The amount of CHF 16,000 has to be paid directly to FIFA to the following bank account with reference to case nr. XXX:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

6.2 The amount of CHF 4,000 has to be paid directly to the Claimant, Coach A.

7. The Claimant, Coach A, is directed to inform the Respondent, The Football Association of Country C, immediately and directly of the account number to which the remittances under points 2., 3. and 6.2 above are to be made and to notify the Players’ Status Committee of every payment received.

*****

Note relating to the motivated decision (legal remedy):

According to art. 58 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS directly within 21 days of receipt of notification of this decision and shall contain all the elements in accordance with point 2 of the directives issued by the CAS, a copy of which we enclose hereto. Within another 10 days following the expiry of the time limit for filing the statement of appeal, the appellant shall file a brief stating the facts and legal arguments giving rise to the appeal with the CAS (cf. point 4 of the directives).

The full address and contact numbers of the CAS are the following:

Court of Arbitration for Sport, Avenue de Beaumont 2, 1012 Lausanne, Switzerland

Tel: +41 21 613 50 00 / Fax: +41 21 613 50 01 / e-mail: info@tas-cas.org / www.tas-cas.org

11

Coach A, Country B / The Football Association of Country C

For the Single Judge of the

Players’ Status Committee:

Omar Ongaro

Football Regulatory Director