F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – coach disputes / controversie allenatori (2019-2020) – fifa.com – atto non ufficiale – Decision 24 July 2019

Decision of the Single Judge

of the Players’ Status Committee

passed in Zurich, Switzerland, on 24 July 2019,

by

Roy Vermeer (The Netherlands)

Single Judge of the Players’ Status Committee,

on the claim presented by

Mr Daniel Reguera Correales

represented by Mr Juan de Dios Crespo Pérez

as “Claimant”

against the club

Tianjin Quanjian Football Club, China

represented by Mr Tomas Pereda

as “Respondent”

regarding a contractual dispute arisen between the parties.

I. Facts of the case

1. On 23 November 2017, Mr Daniel Reguera Correales (hereinafter: the Claimant) and the Chinese club Tianjin Quanjian Football Club (hereinafter: the Respondent) concluded an employment contract (hereinafter: the contract) valid from 1 January 2018 until 31 December 2019, by means of which the Claimant was hired as “First Team Physiotherapist” and was inter alia entitled to receive from the Respondent a yearly net salary of EUR 130,000, payable in “12 monthly instalments (..) at the latest the last day of each month. The salary will be paid after all usual deductions for tax and all other deductions required by law” (note: copy on file).

2. Art. 6.1. of the contract stipulates that “if the withholding taxes applied to the monthly payments or others are less than the annual income tax to be paid before the Chinese Tax Office, The Club shall bear that additional tax amount so that the First Team Physiotherapist receives always net the agreed salary”.

3. Equally, “the salary will be paid after all usual deductions for tax and all other deductions required by law” (cf. Art. 6.2. of the contract).

4. In accordance with the contract the “First Team Physiotherapist shall serve the Club [i.e. the Respondent] as the Coach of the First Team and will be responsible to the Management. (..) (cf. 3.1. of the contract)”.

5. “3.2. During the Appointment the First Team Physiotherapist shall (..) perform the following duties:

(a) The supervision and direction of all First Team Playing Staff;

(b) The selection of the First Team for the matches;

(c) Attendance at meetings of the Board as may be required by the Management;

(…).

6. 3.3. the Board will inform the First Team Physiotherapist prior to the commencement of any transfer window of the level of funds available in respect of transfer fees, salaries, signing-on bonuses and any other associated costs of registering new players to the Club and will attempt to agree with the First Team Prevention Specialist a nominative, quantified list of potential outgoing and incoming players at that time (..)”

7. In accordance with art. 9 of the contract, the Respondent had to additionally pay to the Claimant “a maximum of 10,000 RMB per month during the Appointment in order to cover all costs incurred by him in maintaining a residence within 25 miles of the Club’s Training Ground (the “Residence Expenses”), including all taxes that may arise from that amount.”

8. Art. 19.1. of the contract clarified the following: ”This agreement is directly bound to the First Coach Agreement under the same timing terms. In case of termination of the First Coach Agreement this [STAFF] agreement is also terminated.”

9. In the same context, as per art. 19.2. of the contract (hereinafter: the termination clause), the Respondent could terminate its contractual relationship with the Claimant “in the event that the team fails to win any match for six consecutive games, or, at the end of the first season, finishes after the 4th position in the league, (..)”. In such a situation, the club would then have to pay to the coach “as as compensation to the [STAFF], a lump sum payment for the 50% balance remaining from this Agreement.”

10. The “sum mentioned in clauses 19.1. is a genuine pre-estimate of the losses the First Team Physiotherapist is likely to suffer due to the early termination of this Agreement” (cf. art. 19.3. of the contract) whereas the Claimant had “to mitigate his losses in the event that the Club wish to exercise their right under clause 19.1.” (cf. 19.4. of the contract).

11. The contract does not include a clause related to the payment of compensation in case the Claimant terminated the contract without just cause.

12. Finally, art. 27.1 of the contract provided for “FIFA Regulations” and “Subsidiary Swiss Law” to be applicable to “this agreement and any dispute or claim arising out of it or in connection with it or its subject matter or formation (including non-contractual disputes or claims)”.

13. By means of a document dated 4 October 2018 and entitled “Notice of Unilateral Termination” (hereinafter: the termination letter), the Respondent terminated its contractual relationship with Mr Paulo Manuel Carvalho De Souza as well as ten other members of the coaching staff (note: the termination letter is on file).

14. In the termination letter the Respondent stated the following: “Tianjiin Quanjian Football Club has decided the early termination of the Contract of Employment concluded by you and the Club in advance of Termination Date. The Club hereby notifies you that the Contract of Employment ceases, as follows: 1. The Contract of Employment concluded by you and the Club, as consequence of a unilateral decision of the Club, is officially terminated as on date when this Notice is served. 2. Notwithstanding your rights under the Employment Contract, The Club hereby asks all the parties to cooperate with each other in the process of properly handing over the First Team, and also to avoid any comment to public which will probably damage the reputation of the other Party. We sincerely and deeply appreciate for your kindly long-term contribution to the Club and also our best regards to all of you and we shall honor [sic] our obligations towards you.”

15. On 7 December 2018, the Claimant lodged a claim against the Respondent for breach of contract and requested from the latter the payment of the total amount of EUR 468,171.76 as follows:

- EUR 10,833.33 as outstanding salary, corresponding to the month of September 2018;

- EUR 8,863.63 as “extra amount (..) representing the 45% gross-up due to the tax rate applicable in Spain”;

- EUR 162,500 as compensation “for the remaining salaries”;

- EUR 132,954.54 as “extra amount (..) representing the 45% gross-up due to the tax rate applicable in Spain”;

- EUR 19,156.98 “as per the accommodation costs”;

- EUR 15,681.47 as “extra amount (..) representing the 45% gross-up due to the tax rate applicable in Spain”;

- EUR 65,000 “as per Article 17.1.ii of the FIFA RSTP and specificity of sport”;

- EUR 53,181.81 as “extra amount (..) representing the 45% gross-up due to the tax rate applicable in Spain”;

16. In addition, the Claimant requested the payment of 5% interests p.a. as follows:

- on the sums of EUR 10,833.33, EUR 8,863.63, EUR 162,500, EUR 132,954.54, EUR 19,156.98 and EUR 15,681.47 as from 4 October 2018;

- on the sum of EUR 65,000 “starting upon the notification of the decision in question”;

- on the sum of EUR 53,181.81 “starting upon the notification of the decision in question”.

17. Finally, the Claimant requested the payment of CHF 20,000 as contribution for the costs incurred in connection with the dispute at stake and asked FIFA to impose a ban on the club “from registering any new players, either nationally or internationally, for two entire consecutive registration periods”.

18. To begin with, the Claimant argued FIFA’s competence to decide in the matter at stake on the basis of art. 23 par. 1 of the Regulations on the Status and Transfer of Players (hereinafter: the Regulations).

19. According to the Claimant, “besides the fact that the contract has not been signed as “head coach” or “assistant coach” due to internal formalities requested by the club (..) the whole coach team was hired as a unique team in charge of all matters related to the first team of the Club and the assistant coaches-whatever the final title of the Contract – were assisting the head coach on the daily business without a specific task.”

20. From the Claimant’s point of view “as FIFA has instructed in countless occasions (..) a contract shall be considered as per the real intention of the Parties and the provisions stipulated o it and, in our case, it is abundantly clear that having functions as “the selection of the First Team for all matches”, “attending at meeting of the Board” or, among others “be involved in the potential players to be acquired by the club [cf point 5 above]” are tasks that clearly differ from the title given to the Contract and therefore, FIFA shall consider this party as a coach and be competent to hear this specific case”.

21. In continuation, the coach accused the Respondent of having failed to pay his September 2018 salary and deemed therefore being entitled to request from the latter the payment of the outstanding sum of EUR 10,833.33.

22. The Claimant further accused the club of having terminated the contract without just cause and contested the validity of the termination clause (cf. point 8 above) for being contrary to “the general principle of proportionality and (..) of equal treatment of the parties since it provides benefits only towards the Club and in no way the contractual freedom of the Parties can go against the referred principles of proportionality and equal treatment”.

23. The Claimant also argued the nullity of the termination clause in accordance with “the well-established jurisprudence of the PSC” which, in his opinion, does not accept the absence of sporting results as a valid reason to terminate a contractual relationship between a coach and a club.

24. Additionally, from the Claimant’s point of view, the principle of in dubio contra stipulatorem was applicable to the dispute at stake as “Article 19 is ambiguous and not distinctive in its meaning”.

25. Considering that the relevant clause had been drafted by the Respondent, its “understanding must be in favour of the other party (the Coach)”.

26. In continuation and notwithstanding the aforementioned, the Claimant recalled that the termination letter did not even refer to the termination clause and argued that, therefore, such provision could anyway not be taken into account.

27. In view of all of the aforementioned, the Claimant was of the opinion that the compensation payable by the Respondent for having terminated the contract without just cause had to be calculated on the basis of “Article 17 of the FIFA RSTP, i.e. according to the remaining salaries until the moment in which the Contract would have expired naturally, deducing any amounts owed by the Coach during such period (..) in perfect line with the so-called principle of the positive interest that FIFA and CAS apply when calculating the compensation (..)” as well as in accordance with Swiss Law.

28. Hence, the Claimant deemed being entitled to claim from the Respondent the sum of EUR 162,500 as compensation.

29. The Claimant also considered being additionally entitled to claim from the Respondent, in accordance with art. “17.2. of the FIFA RSTP”, the “extra amount” of EUR 65,000, corresponding to 6 monthly salaries, due to the latter’s “bad faith strategy” which had left him unemployed.

30. Nevertheless and in case “FIFA (..) considers that “no egregious circumstances” occurred in our case”, the Claimant alternatively requested the payment of “an amount equal to three months salaries amounting to NET EUR 32,500 (..) in perfect line to the well-established principle of the specificity of football, established by Article 17 of the FIFA RSTP”.

31. Subsequently, the Claimant referred to art. 9 of the contract and requested the payment of the additional sum of EUR 19,156.98 as compensation, corresponding to the “residence expenses” payable by the club.

32. The Claimant calculated the amount in question as follows:

“RMB 10,000 X 15 remaining months = 150,000 RMB

Exchange rate RMB – EUR 0,127741 (..)

RMB 150,000 x 0,127741 = 19,156.98 EUR NET (..)”.

33. Equally, the Claimant recalled that, in accordance with the contract, all amounts due by the Respondent were net amounts and added that he had always received his salary on his Spanish bank account.

34. As a result and in view of the content of art. 6 of the contract (cf. point 2 and 3 above), the Claimant deemed being additionally entitled to receive from the Respondent an amount equal to the taxes payable in Spain over the amount claimed, i.e. 45% of the relevant sum.

35. On 14 January 2019, FIFA referred the Claimant to art. 22 lit. c) of the Regulations as well as to art. 6 par. 1 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber and reminded the latter that only employment related disputes between a club or an association and a coach fall under the jurisprudence and competence of FIFA.

36. As a result of the aforementioned, FIFA requested the Claimant to provide evidence indicating that he had been hired by the Respondent as assistant coach.

37. In response thereto, the Claimant argued that in accordance with the content of art. 3 of the contract he had clearly been hired and “acted“ as the Coach of the First Team”.”

38. Equally, the Claimant recalled that the contract did not “specify any function to be done as “First Team Physiotherapist” making clear that the Claimant acted as coach in the meaning of art. 6 par. 1 of the Procedural Rules, not acting as mere First team Physiotherapist”.

39. As further alleged by the Claimant “the reason why the Employment Contract refers to “First team Physiotherapist” is to acquiesce a Respondent’s request, alleging that it was a necessary requisite so to submit the Employment contract to the CFA.”

40. From the Claimant’s point of view “said wording (..) cannot prevail over the real intention of the parties” which was “aimed to regulate the employment associated with a coaching role.”

41. The Claimant added that in accordance with the principle of in dubio contra stipulatorem, Swiss Law and CAS jurisprudence, and because the contract had been drafted by the Respondent “any lack of clarity therein must be construed against the Club.”

42. Equally, the Claimant pointed out that he had been “has been developing its services in the professional football and it exclusively dedicated to this area. The Claimant has been exclusively dedicated to the professional football since he joined Watford FC in 2015 and in 2016 he joined Mr Paulo Sousa coach team rendering his service exclusively for the latter since then” (note: The coach provided a statement of Mr Sousa inter alia stating that “the Claimant in the present procedure (…) was acting as one of my assistant coaches and was assisting me in the daily issues of the team”).

43. In addition, the Claimant mentioned that should FIFA declare itself not competent to hear his claim “it would deprive [him] from his legitimate right to be heard before the FIFA courts. This is particularly harmful considering that the Coach would not only lose a judicial body and therefore and [sic] appeal instance, but also that he should have to bear the financial consequences of being party of a proceedings before the Chinese ordinary courts, when FIFA PSC proceedings are free of charge (including the reimbursement of the advance of costs) in case of a decision without grounds.”

44. Finally, the Claimant informed FIFA that he did not conclude a new employment contract and remains unemployed up to this date.

45. The Respondent contested FIFA’s competence to decide on the dispute at stake arguing that the coach had been hired as “First Team Physiotherapist” and therefore as member of the medical team and not as member of the coaching team.

46. In this context and with regard to the Claimant’s allegation that the contract described his duties as those of a coach, the Respondent clarified that all employment contracts concluded with the coaching team of Mr Sousa had been drafted on the same template “irrespective of the real position of each member of the coaching team”.

47. The Respondent further pointed out that, while applying for his working visa, the Claimant had “expressly declared that he was employed (..) as “First Team Physiotherapist”” and that he had “previously worked as physiotherapist in ACF Fiorentina and Qatar Football Association and that, as academic background, he held majors in Ortophedic Manual Therapy and Physiotherapy” (note: the club provided two documents allegedly signed by the coach and dated 28 January 2018).

48. In view of the aforementioned, the Respondent deemed that the claim of the Claimant should be declared inadmissible.

49. Nevertheless and in the event that “the PSC would deem the Claim admissible, quod non”, the respondent rejected the relevant claim as to the substance arguing that the contract had been terminated with just cause in line with the termination clause.

50. In continuation, the Respondent argued that the termination clause had been “freely, consciously and voluntarily signed [by the parties]” and that the Claimant had “never pleaded to have either been misrepresented or under any fundamental error in relation to the understanding and effects of the Employment Contract”.

51. In view of the aforementioned and because its team had not won “the last six official matches played”, the club deemed having terminated the contract with just cause on the basis of the termination clause.

52. In continuation, the Respondent argued that the termination clause had been “freely, consciously and voluntarily signed [by the parties]” and that the Claimant had “never pleaded to have either been misrepresented or under any fundamental error in relation to the understanding and effects of the Employment Contract”.

53. In view of the aforementioned and because its team had not won “the last six official matches played”, the Respondent deemed having terminated the contract with just cause on the basis of the termination clause.

54. Additionally, the Respondent emphasized that the Claimant and his team had never argued nor challenged before the termination of the contract “and/or the validity of art. 19 (..). On the contrary, the Coach (..) expressly acknowledged the termination and the validity of Article 19 (..)” (note: the club provided a correspondence dated 18 October 2018, allegedly received by the legal representative of the coach as evidence).

55. Similarly, the Respondent maintained that “contractual clauses allowing a party or one of the parties to terminate the relationship based on a bad sporting results” were not be considered “invalid per se” and that, in line with CAS jurisprudence, “the parties to an employment contract may agree to provide a party with the right or an option to terminate linked to sporting achievement and that, if the language in the contract specifies so, that clause shall be deemed valid.”

56. As a result of the aforementioned, the Respondent deemed that the parties had “validly agreed to provide the Club with the option to terminate the Employment Contract in exchange for a fixed amount in case of negative sporting results and, being the contractual language of Article 19.2. strict and unambiguous, such clause shall be deemed valid.”

57. As a consequence, the Respondent believed that the Claimant could only claim the amounts established in the termination clause and that “any remuneration received by the coach under a new employment relationship shall be taken into account.”

58. Alternatively and in case FIFA “considers that Article 19.2. Is not valid and that the Respondent terminated the Employment Contract without just cause, quod non, the compensation to be awarded to the Coach shall be calculated in accordance with art. 19.3.”, i.e. the latter shall receive 50% of his remaining salaries, whereas such compensation “shall be reduced by any amount that the [coach] earned by any employment contract after the termination with the Club”.

59. The Respondent emphasized that clause 19.3. of the contract had been drafted in accordance with Swiss Law and was therefore to be considered valid and enforceable. The club contested in this regard the allegations of the Claimant as to the “lack of reciprocity and disproportionality” of the relevant clause.

60. Equally, the Respondent contested the applicability of art. 17 par. 1 and 4. of the Regulations on the matter at stake and the request of the Claimant related to the payment as per art. 9 of the contract, arguing that the relevant fees had been “established “in order to cover all costs incurred by the [Coach] in maintaining a residence” during his stay in the club. However, after the termination, the Coach did not incur any of the costs he attempts to claim (..).”

61. To sum up, the Respondent requested FIFA to declare the claim of the Claimant inadmissible “due to the lack of jurisprudence of the FIFA PSC in the case at hand”.

62. “As an alternative, in case the FIFA PSC would deem the Claim admissible”, the Claimant concluded that the contract had been terminated with just cause in line with art. 19.2. of the contract and that therefore, the Claimant was only entitled to receive “an amount equal to the 50% of the remaining value of the Employment contract, from the date of termination, i.e. from 4 October 2018, until 31 December 2019” whereas such amount “shall be mitigated with the remuneration under any employment agreement entered into after the termination with the Club.”

63. “As an alternative, in case [FIFA] would deem that the Club terminated the Employment Contract without just cause”, the latter requested for the compensation payable to the Claimant to be “equal to a maximum amount of 50% of the remaining salaries from the date of the termination, i.e. from 4 October 2018, until 31 December 2019, as per Article 19.3. of the Employment Contract” whereas such amount “shall be mitigated with the remuneration under the new employment agreement entered into after the termination with the Club”.

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 and to begin with, the Single Judge recalled that in accordance with art. 3 par. 1 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules) in combination with art. 23 par. 1 and art. 22 lit. c) of the Regulations on the Status and Transfer of Players (hereinafter: the Regulations) he is, in principle, competent to deal with employment-related disputes between a club or an association and a coach of an international dimension.

2. Furthermore, the Single Judge recalled that, as established in art. 6 par. 1 of the Procedural Rules, edition 2018, only members of FIFA, clubs, players, coaches or licensed match agents are admitted as parties in front of the relevant decision-making bodies of FIFA.

3. With the aforementioned considerations in mind, the Single Judge turned his attention to the content of the agreement concluded between the Claimant and the Respondent on 23 November 2017 and noticed that in accordance with the document in question, the Claimant had been hired as “First Team Physiotherapist” of the Respondent.

4. In addition, the Single Judge observed that the Claimant had lodged his claim against the Respondent together with 10 other members of the same coaching staff and that all contracts brought to his attention within the scope of the different proceedings included the exact same description of duties that were to be carried out for the Respondent by each one of the relevant claimants.

5. From the Single Judge’s point of view, it seemed very unlikely that one club would hire one head coach and ten different assistant coaches. The Single Judge was therefore of the opinion that, in order to establish the actual function of each one of the members of the staff hired by the Respondent on 23 November 2017, the denomination included in every single agreement was to be considered of relevance.

6. In this context, the Single Judge recalled that, as per the agreement, the Claimant had been hired by the Respondent as First Team Physiotherapist.

7. In addition and for the sake of good order, the Single Judge deemed it appropriate to refer to the principle of burden of proof reflected in art. 12 par. 3 of the Procedural Rules, according to which a party claiming a certain right bears the burden of proving its entitlement to it. The Single Judge pointed out in this regard that, from his point of view, the Claimant had failed to provide concrete evidence in support of the allegation that he would have been hired as assistant coach.

8. Bearing in mind all of the foregoing, the Single Judge concluded that the Claimant has not been hired as assistant coach but rather, only as a physiotherapist.

9. In view of the above-mentioned, the Single Judge referred once again to art. 6 par. 1 of the Procedural Rules and art. 22 c) of the Regulations and pointed out that neither of those two provisions nor any other article in any of FIFA’s regulations included a basis to establish FIFA’s competence to hear disputes involving the analyst of a club.

10. In view of all the aforementioned and in particular taking into account the content of art. 6 par. 1 of the Procedural Rules in combination with art. 22 c) of the Regulations as well as bearing in mind that the Claimant had not been hired

by the Respondent as coach, the Single Judge ruled that the claim of the Claimant had to be considered inadmissible as the latter could not be viewed as a party who is entitled to seek redress in front of the decision-making bodies of FIFA.

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

The claim of the Claimant, Daniel Reguera Correales, is inadmissible.

*****

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). 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. 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

For the Single Judge of the

Players’ Status Committee

Emilio García Silvero

Chief Legal & Compliance Officer