F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – coach disputes / controversie allenatori (2017-2018) – fifa.com – atto non ufficiale – Decision of the Single Judge of the Players’ Status Committee passed in Zurich, Switzerland, 6 March 2018

Decision of the Single Judge

of the Players’ Status Committee

passed in Zurich, Switzerland, on 6 March 2018,

by

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 club,

Club C, Country D

as “Respondent”

regarding a contractual dispute arisen between the parties.

I. Facts of the case

1. On 12 January 2016, the coach of Country B, Coach A (hereinafter: the Claimant) and the club of Country D, Club C (hereinafter: the Respondent) signed 2 consecutive “Pre-contract[s] of Employment for Assistant Coach” (hereinafter: the contracts), valid, respectively, as from 1 February 2016 until 1 January 2017 and as from 1 February 2017 until 1 January 2018.

2. Pursuant to clause 3 of the contracts, the Claimant was entitled to receive, inter alia, a total remuneration of USD 150,000 per year, consisting of a monthly salary of USD 13,600 (USD 14,000 “on the 2nd month”), to be paid on the last working day of each month.

3. According to clause 6 of the contracts, “if the [Claimant] sign a contract with any other entity, company, club or sport association, covering the scope of the present Contract, including his image rights, or in case the [Claimant] unilaterally breach the present contract by any means, the [Claimant] shall pay the [Respondent] a compensation in the amount of US$ 300.000,00 (free of taxes of Country D)”.

4. According to clause 10, par 1(4) of the contracts, “in case of unilateral breach without just cause by the [Respondent], the [Claimant] will be entitled to receive the basic salary until the date of the end of the present contract, without any kind of deduction, including, but not limited to eventual salaries received by the [Claimant] by any title”.

5. Moreover, according to clause 13, par. 2, of the contracts, “in case of a dispute not solved by the Parties through fair and mutual conversation after 15 days from the event, the Parties agree in submit the dispute to the committee of the dispute resolution of the Football Association of Country D”.

6. On 14 March 2016, the Respondent addressed a correspondence to the Claimant, informing him that “it won’t be necessary come to work at the CLUB from now on until [Respondent]’s further notice”.

7. On 16 March 2016, the Respondent addressed a further correspondence to the Claimant, stating that “[it] admits [the Claimant] come back to Country B and wait in your residence. In respect to the further discussion related to your job, it will be discussed by our company and it will be noticed to you”.

8. The parties signed a termination agreement (hereinafter: the agreement), dated 15 April 2016, by means of which they “enter[ed] into a common understanding to breach those contracts amicably” in turn of a total amount of USD 212,728 to be paid by the Respondent to the Claimant on 30 April 2016.

9. By letter dated 7 April 2016, the Respondent requested the Claimant to pay USD 87,727 as compensation, explaining that he had breached clause 6 of the contracts, having been allegedly announced as assistant coach on the official website of the club of Country B, Club E on 31 March 2016. In this respect, the Respondent specified that, due to this fact, it was entitled to USD 300,000 but it was offsetting such amount with USD 212,728 it owed to the Claimant on the basis of the agreement. With the same correspondence, the Respondent further claimed that, on 16 March 2016, after a meeting with the Claimant, it was agreed that the contracts would be terminated as of 15 April 2016 and, therefore, they had to be considered valid until then.

10. By letters dated 11 and 15 April 2016, the Claimant replied to the Respondent, substantially arguing that he had not signed any contract with Club E and that, since he had been fired by the Respondent before the parties signed the above-mentioned agreement, the latter should be considered null and void. With the same two correspondences, the Claimant put the Respondent in default of payment of USD 300,000 as compensation for breach of contract without just cause.

11. By letter dated 25 April 2016, the Respondent replied that the Claimant was aware of the fact that their employment relationship was due to last until 15 April 2016 and that, therefore, he acted in breach of clause 6 of the contracts.

12. On 24 June 2016, the Claimant lodged a claim against the Respondent in front of FIFA requesting to be awarded the total amount of USD 300,000 “free of taxes of Country D” for the “unilaterally breach of the employment contract”, plus costs and fees “in the amount corresponding to 10%”.

13. More specifically, the Claimant argued that, with its letter dated 14 March 2016, the Respondent unilaterally breached the contract, subsequently ratifying its decision with its letter dated 16 March 2016. Furthermore, the Claimant claimed that the Respondent made him sign the termination agreement on the same day (i.e. 16 March 2016).

14. Moreover, the Claimant explained that, on 19 March 2016, he flew back to Country B and – after being asked by Club E on 30 March 2016 to give a hand in the players’ preparation – he agreed without signing any contract or receiving any retribution.

15. The Claimant, while repeating that he did not sign any contract with Club E, further highlighted that, even in case he had, the Respondent would not be entitled to ask for compensation, since neither the contract nor the agreement contained any clause authorising the Respondent to do so and because the latter had renounced his services since 14 March 2016.

16. In its reply, the Respondent asked for the rejection of the Claimant’s claim on procedural and factual grounds.

17. First of all, the Respondent contested the jurisdiction of the Players’ Status Committee (hereinafter: PSC), recalling clause 13 of the contracts and the statutes of the Professional football League of Country D. In this regard, the Respondent argued that the Claimant should address his complaint in first instance to the Consultative and Mediator Committee of the Professional football League of Country D and, in case of unsuccessful mediation, to an ordinary court of Country D.

18. In continuation, as to the merits, the Respondent explained that in its letters dated 14 and 16 March 2016 it did not express any intent to unilaterally terminate the contract with the Claimant. Moreover, the Respondent added that, on 16 March 2016, it allowed the Claimant to return to Country B because the latter had asked so after the former head Coach F, had resigned. The Respondent specified that, on the same day, the parties agreed to terminate the contract as of 15 April 2016.

19. The Respondent further argued that the Claimant knew he was bound to his employment contract with the Respondent until 15 April 2016, given that, on 7 April 2016, he declared that he “would never sign any contract until termination date of the contract with [the Respondent]”.

20. Moreover, the Respondent claimed that, according to their official website, the Claimant had joined Club E as coach and he was registered in such capacity in the official match “Club E vs. Club G” of the Tournament of Country B. The Respondent explained that the Claimant’s described behaviour was in contrast with clause 6 of the contracts and that, consequently, it was entitled to USD 300,000 as compensation. In light of the fact that it was willing to offset such amount with USD 212,728 it owed to the Claimant due to the agreement, the Respondent concluded that it was in credit of USD 87,272 with the Claimant.

21. In his replica, the Claimant held that the PSC has jurisdiction in the case at hand and pointed out that clause 13 of the contracts referred to the Football Association of Country D and not the Professional football League of Country D, the latter dealing only with domestic disputes. In this respect, the Claimant explained that he was not licensed with the Football Association of Country D but before the Federal Council of Physical Education of Country B and that art. 3-6.2 of the Football Association of Country D Statutes “acknowledge that only FIFA has jurisdiction on international disputes”.

22. The Claimant added that, in any case, clause 13 of the contracts should be considered null and void, in accordance with art. 4 of the Supplementary Provisions of the Arbitration Law of Country D. In this respect, he submitted an extract of such legislative provision – Law no. 138 of 2003, which, in art. 4, states that: “for the time being until otherwise enacted, any arbitration agreements concluded following the enforcement of this Law, the subject of which constitutes individual labour-related disputes […] that may arise in the future, shall be null and void”.

23. As to the merits, the Claimant maintained his previous arguments, highlighting that he did not sign any new employment contract before 1 May 2016 and he specified that, out of the USD 300,000 requested with his claim, USD 212,728 were to be considered in relation to the termination agreement and the rest as compensation for the alleged breach of contract.

24. In its final position, the Respondent insisted on its previous statements of defence and recalled once more clause 13 of the contracts in support of its argumentation on procedural grounds. In this regard, the Respondent replied that art. 3-6.2 of the Football Association of Country D Statutes mentioned by the Claimant refers to disputes of international dimension whereas the one at hand is to be considered an internal dispute, since the Claimant had a contract with a club belonging to the Football Association of Country D and performed his duties under a contract which was provided to, and registered by, the Football Association of Country D.

25. Furthermore, the Respondent disputed the applicability of art. 4 of the Supplementary Provisions of the Arbitration Law of Country D to the matter at hand. In this respect, the Respondent held that the Claimant’s contract is not a labour contract but rather an “outsourcing contract”, and – as such – subtracted to the realm of said legislation. According to the Respondent, the Claimant’s duties and type of occupation do not meet the criteria established by the “Labor Standards Law” in order to be considered a ‘worker’ rather than a ‘business owner’.

26. Upon being invited to do so, the Claimant informed FIFA that he was employed with Club E as from May 2016 until August 2016, for a remuneration of 25,000 in the currency of Country B. The Claimant further informed FIFA that as from August 2016 until February 2017 he was unemployed and that he was employed again with the club of Country B, Club H, as from March 2017 until August 2017, for a remuneration of 35,000 in the currency of Country B. The Claimant added that both these contracts were mutually terminated before their natural expiry.

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 24 June 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 Chamber (hereinafter: the Procedural Rules) is applicable to the matter at 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 Regulations on the Status and Transfer of Players (edition 2018), he would, in principle, be competent to deal with the matter at stake, which concerns an employment–related dispute with an international dimension between a coach of Country B and a club of Country D.

3. However, the Single Judge acknowledged that the Respondent contested the competence of FIFA’s deciding bodies on the basis of clause 13 par. 2 of the contracts and the statutes of the Professional football League of Country D. In particular, the Respondent held that the Claimant should have addressed his complaint to the Consultative and Mediator Committee of the Professional football League of Country D and, in case of unsuccessful mediation, to an ordinary court of Country D.

4. In this regard, the Single Judge noted that the Claimant rejected such position and insisted on the fact that FIFA has jurisdiction to deal with the present matter.

5. In relation to the above, the Single Judge deemed it vital to outline that one of the basic conditions that needs to be met in order to establish that another organ than the PSC or its Single Judge is competent to settle an employment-related dispute between a coach and a player of an international dimension, is that the jurisdiction of the relevant national arbitration tribunal or national court derives from a clear reference in the employment contract.

6. Therefore, while analysing whether he was competent to hear the present matter, the Single Judge considered that he should, first and foremost, analyse whether the contract(s) at the basis of the present dispute contain a clear jurisdiction clause.

7. In this respect, the Single Judge recalled that clause 13 par. 2 of the contracts stipulates that “in case of a dispute not solved by the Parties through fair and mutual conversation after 15 days from the event, the Parties agree in submit the dispute to the committee of the dispute resolution of the Football Association of Country D”.

8. Having examined the relevant provision, the Single Judge concluded that such clause is not exclusive and does not refer to the deciding bodies invoked by the Respondent, i.e. the Consultative and Mediator Committee of the Professional football League of Country D, in relation with which the Respondent presented further documentation and arguments, and the ordinary court of Country D. What is more, the Single Judge noted that no documents relating to the deciding body mentioned in clause 13 par. 2 had been presented by the Respondent.

9. In addition, the Single Judge took into account that the termination agreement, which is at the basis of the present matter, does not include any jurisdiction clause.

10. Having established the above, the Single Judge deemed that there was no need to address the further arguments presented by the Respondent in support of its allegations relating to competence.

11. On account of the above, the Single Judge established that the Respondent’s objection towards the competence of FIFA to deal with the present matter has to be rejected and that he is competent, on the basis of art. 23 par. 1 and 4 in combination with art. 22 lit. c) of the Regulations on the Status and Transfer of Players (edition 2018), to consider the present matter as to the substance.

12. 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 referred, on the one hand, to art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players (edition 2018), and on the other hand, to the fact that the present claim was lodged with FIFA on 24 June 2016. In view of the foregoing, the Single Judge 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.

13. 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. The Single Judge, however, 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.

14. In this respect and first of all, the Single Judge acknowledged that, on 12 January 2016, the Claimant and the Respondent had concluded two employment contracts of identical content with subsequent validity, respectively, as from 1 February 2016 until 1 January 2017 and as from 1 February 2017 until 1 January 2018 and according to which the Claimant was entitled to receive, inter alia, a total remuneration of USD 150,000 per year.

15. In continuation, the Single Judge noted that the parties signed a termination agreement, dated 15 April 2016, by means of which they “enter[ed] into a common understanding to breach those contracts amicably” in turn of a total amount of USD 212,728 to be paid by the Respondent to the Claimant on 30 April 2016.

16. Moreover, the Single Judge observed that such agreement does not contain any relevant provision concerning the parties’ duties other than the obligation of the Respondent to pay the Claimant USD 212,728 on 30 April 2016 as a consequence of the premature termination of the employment relationship.

17. Subsequently, the Single Judge took note that the Claimant argued that the Respondent had unilaterally breached the employment contract with its letter dated 14 March 2016, in which he had been asked to immediately stop rendering his services to the Respondent, and by making him sign the termination agreement two days after. However, the Single Judge took also note that, with his replica, the Claimant specified that, out of the USD 300,000 requested, USD 212,728 were based on the termination agreement he had signed and which the Respondent had never paid and that the remainder was requested as compensation for breach of contract.

18. In continuation, the Single Judge observed that, as to the merits, the Respondent claimed that, by having allegedly joined Club E prior to 15 April 2016 the Claimant owes the amount of USD 300,000 to the Respondent in accordance with clause 6 of the contracts. In this respect, the Single Judge took further note that the Respondent, without lodging a counterclaim, argued that it thus has a credit of USD 87,272 towards the Claimant, given that – although allegedly entitled to USD 300,000 – it was willing to offset such amount with the USD 212,728 it owed to the Claimant in accordance with the agreement.

19. Having said that, the Single Judge remarked that, according to the termination agreement, the Respondent undertook to pay the Claimant a total amount of USD 212,728 on 30 April 2016, as the result of a “common understanding to breach [the above-mentioned] contracts amicably”.

20. Consequently, the Single Judge underlined that, by signing said agreement, the Claimant and the Respondent unambiguously stipulated that their employment relationship had come to an end, and so did the underlying employment contracts signed on 12 January 2016. In other words, the Single Judge highlighted that the termination agreement signed by the parties replaced the contracts in regulating their rights and obligations.

21. Furthermore, the Single Judge deemed important to point out from the start that the chronology of the events, as well as the parties’ submissions, suggested that the termination agreement had been effectively signed sometime in March 2016 and post-dated 15 April 2016. Indeed, the Single Judge firstly noted that, on 16 March 2016, the Respondent gave the Claimant, who held that he was asked to sign the termination agreement on that day, the instruction to move back to Country B and, on 7 April 2016, informed him that he had breached the contracts having been allegedly announced as assistant coach on Club E’s official website. What is more, the Single Judge observed that, with said correspondence the Respondent requested the Claimant to pay only USD 87,272 (instead of the USD 300,000 provided for in the contracts) due to the amount the Respondent acknowledged it owed him as a consequence of the termination agreement, which, however, the parties supposedly still had to sign.

22. Moreover, the Respondent itself admitted that, on 16 March 2016, the parties had agreed to terminate the contracts. However, the Single Judge could not uphold the Respondent’s argument that the parties had agreed to keep the validity of the contracts in place until 15 April 2016. In this respect, in fact, the Single Judge observed that there is no indication whatsoever of said alleged intention in the agreement and having post-dated it could not suffice to that end. If this was its will, the Single Judge noted, the Respondent had the option to either not sign the termination agreement in the first place or have the validity of the contracts of 12 January 2016, or any of the clauses contained therein, explicitly excluded from its legal effects until 15 April 2016.

23. Therefore, it was clear to the Single Judge that the termination agreement was already valid and binding on the parties on or about 16 March 2016. Consequently, the Claimant could not be held responsible of any breach of the contracts, since these had been already terminated.

24. Having established the foregoing, the Single Judge further highlighted that the agreement, with regards to the rights and obligations of the parties, solely provided for the Claimant’s financial entitlement resulting from the premature termination of the employment relationship, without establishing any duty of fidelity on the Claimant towards the Respondent.

25. Moreover, the Single Judge was eager to emphasise, bearing in mind art. 12 par. 3 of the Procedural Rules, in accordance with which any party claiming a right on the basis of an alleged fact shall carry the burden of proof, that, in any case, the Respondent had not presented sufficient and convincing documentation which would demonstrate that the Claimant signed a new employment contract while still contractually bound to the Respondent.

26. With all the foregoing in mind, the Single Judge concluded that the only legally relevant circumstance in the matter at hand was that the parties had signed a valid and binding agreement in order to terminate their employment relationship by mutual consent and that, in violation of the contractual obligation undertaken in such agreement, the Respondent failed to remit the Claimant the related amount of USD 212,728.

27. On account of the aforementioned considerations, as well as the legal principle of pacta sunt servanda, which in essence means that agreements must be respected by the parties in good faith, the Single Judge resolved that the Respondent has to pay to the Claimant the outstanding amount of USD 212,728.

28. In continuation, considering the above, the Single Judge decided that the Claimant’s claim for compensation for breach of contract must be rejected.

29. The Single Judge concluded that any further claim of the Claimant is rejected.

30. 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 and the 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 and are normally to be paid by the unsuccessful party.

31. In this respect, the Single Judge highlighted that the claim of the Claimant is partially accepted and that the Respondent is the party at fault. Therefore, the Single Judge decided that the Claimant and the Respondent have to bear the costs of the current proceedings in front of FIFA.

32. 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 higher than CHF 200,001, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to CHF 25,000.

33. In conclusion and in view of the numerous submissions that had to be analysed in the present matter as well as considering that a number of factual complexities had to be addressed, but taking into account that the present decision was taken by the Single Judge and not by the Players’ Status Committee in corpore, the Single Judge determined the costs of the current proceedings to the amount of CHF 20,000.

34. Consequently, the Claimant has to pay the amount of CHF 5,000 and the Respondent the amount of CHF 15,000 in order to cover the costs of the present proceedings.

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

1. The claim of the Claimant, Coach A, is admissible.

2. The claim of the Claimant is partially accepted.

3. The Respondent, Club C, has to pay to the Claimant the amount of USD 212,728 within 30 days as from the date of notification of this decision.

4. If the aforementioned amount is not paid by the Respondent within the stated time limit, interest at the rate of 5% p.a. will fall due as of expiry of the aforementioned time limit and the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee for consideration and a formal decision.

5. Any further claim lodged by the Claimant is rejected.

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

6.1 CHF 15,000 by the Respondent to FIFA to the following bank account with reference to case no. XXX:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

6.2 CHF 5,000 by the Claimant to FIFA. Given that the Claimant has already paid the amount of CHF 5,000 as advance of costs at the start of the present proceedings, the Claimant does not have to pay an additional amount as costs of the proceedings.

7. The Claimant is directed to inform the Respondent immediately and directly of the account number to which the remittance under point 2 above is 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 (CAS)

Avenue de Beaumont 2

CH-1012 Lausanne

Switzerland

Tel: +41 21 613 50 00

Fax: +41 21 613 50 01

e-mail: info@tas-cas.org

For the Single Judge of the

Players’ Status Committee

Omar Ongaro

Football Regulatory Director

Encl.: CAS directives