F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – club vs club disputes / controversie tra società – (2019-2020) – fifa.com – atto non ufficiale – Decision 25 November 2019

Decision of the Single Judge

of the Players’ Status Committee

passed on 25 November 2019,

by

José Luis Andrade (Country G)

Single Judge of the Players’ Status Committee,

on the claim presented by the club

Club A, Country B

as “Claimant”

against the club

Club C, Country D

as “Respondent”

regarding a contractual dispute arisen between the parties

and relating to the player E.

I. Facts of the case

1. On 30 January 2018, the club of Country B, Club A (hereinafter: “Club A or the Claimant”) and the club of Country D, Club C (hereinafter: “Club C or the Respondent”) concluded a loan agreement (hereinafter: “the agreement”) for the transfer on a temporary basis of the Player of Country F, Player E (hereinafter: “the player”), from Club A to Club C.

2. Article 2 of the agreement read as follows: “[The player], (…) is hereby transferred temporarily from [Club A] to [Club C] from February 01, 2018 to June 30, 2018. The monthly salaries as well as the legal contributions are ruled in a separate working contract between the player and [Club C] during the loan period (…)”.

3. Moreover, article 4 of the agreement stipulated that:”The doctor of [Club C] will approach the medical department of [Club A] in the event of medical problem of the player and will announce to him, imperatively, under penalty of engaging its responsibility, any stop of work of more than 15 days, and this within 48 maximum hours as from the drafting of the stop”.

4. Article 8 of the agreement stated the following: “The Parties agree to enter the details of such transfer on the FIFA TMS system in accordance with applicable FIFA regulations.”

5. On 10 May 2018, Club C informed Club A about the injury of the player.

6. In this respect, on 15 May 2018, Club C suggested to Club A to mutually terminate the agreement, which has been refused by Club A on 18 May 2018.

7. On 8 June 2018, the parties exchanged further correspondence in order to mutually terminate the contract as the player expressed his wish to leave Club C.

8. On 11 June 2018, Club A informed Club C that it would send it an invoice amounting to EUR 150,000 due to the triggering of the clause, which Club C contested in reply thereto.

9. On 18 and 20 June 2018, Club C informed Club A about the absence of the player in the training sessions prior to the new season as well as its apparent registration with a new club in Country G. What is more, Club C threatened Club A of taking legal action due to the alleged breach of contract operated at Club C’s expenses.

10. After having rejected Club C’s allegations by letter dated 22 June 2018, Club A sent the aforementioned invoice on 17 July 2018, which Club C refused to pay on 23 July 2018 alluding again to the non-fulfilment of the conditions of the clause as the player “(…) has participated in all official matches of [Club C] in which it had been possible and accordingly, [the player] has not played only when this was not possible for reasons beyond [Club C], namely because of [the player]’s physical condition or overall attitude.”

11. On 7 August 2018, in its final request prior to “initiate any and all necessary proceedings to enforce [its] rights”, Club A urged Club C to pay EUR 150,000 “quickly”, however to no avail.

12. On 4 January 2019, Club A lodged a claim in front of FIFA for the outstanding loan fee/compensation due by Club C in accordance with the agreement and requested the payment of EUR 142,500 plus “late payment interest”. In his claim, Club A explained that it deducted from the amount of EUR 150,000 the amounts due in application of the solidarity mechanism rules.

13. Club A further requested to be compensated for the damages it suffered as well as the costs of the present proceedings and requested its own legal costs to be at Club C’s charge.

14. In its claim, Club A explained that during the relevant loan period of the player to Club C, said club allegedly took part in 20 official matches. Club A provided statistics available online.

15. In this respect, Club A deemed that, having been informed about the injury of the player by the Respondent, only 15 official matches have to be considered with as a consequence that the player had been fielded as “position-holder”, i.e. first-team player, in only 6 official matches which equals to 40% of Club C’s official matches.

16. As a consequence, said percentage being less than the 65% agreed between the parties, Club A deemed that the mechanism of the clause had been triggered and that it should be entitled to the agreed amount.

17. In view of the above, Club A reminded that the purpose of the agreement was mainly that the player could play a certain number of official matches, i.e. more than in Country B, in order to progress.

18. Furthermore, Club A deemed that the arguments provided by Club C as to the player’s fielding were contrary to the evidence provided.

19. Finally, Club A explained that all what had been alluded by Club C as to the permanent transfer of the player to a third club could not anyhow be linked to the present proceedings and should therefore be disregarded.

20. In its reply to the claim, Club C sustained firstly that it considered the clause to be null and void as, in order to fulfil the clause, the management of the club would have to interfere with the coach’s decision(s) to field or not the player with as a consequence that “it would have violated the integrity and independence of [Club C] and the rights of fair competition and equal treatment of the other players”.

21. Moreover, Club C explained that even if the clause would be considered as valid, there were valid reasons, all beyond the club’s will, for the failure of participation of the player in the required percentage as per the clause, such as: the player’s injury, it’s poor sporting performances considered as insufficient as well as his negative behaviour as to the skipping of training sessions.

22. Furthermore, Club C deemed that the “indemnity” quoted in the clause should be considered in reality as a “compensation for damage or loss” which, in the present, has not been proved by Club A and its award would constitute an unjust enrichment.

23. In addition, in Club C’s opinion, Club A did not intend to benefit from the player’s skills seen its subsequent feeless transfer to a third club, prior to the end of the present agreement and, finally, by contributing to induce the player to leave Club C.

24. What is more, in the alternative, Club C sustained the amount of the clause to be excessive in comparison with the player’s monthly salaries, i.e. EUR 15,000, as well as, with the total amounts paid to the player during the 5 months contract, i.e. EUR 75,000.

25. In continuation, Club C underlined that should the player have played 10%, 40% or even 60%, Club A would still have requested the same amount, i.e. EUR 142,500, which clearly proves that, assuming it was due, said amount should be lowered.

26. Moreover, Club C also underlined that, in its opinion, the breach of contract operated by the player had been the result of the inducement conducted by its former club, Club A, as well as its new club, Club H and, as a consequence, both clubs should therefore be “summoned to the present case as third parties”.

27. Finally, Club C requested the claim to be rejected entirely, or, alternatively, to consider the due amount to be excessive and as a consequence to be lowered to EUR 15,000 as well as any costs of proceedings to be at Club A’s charge. In addition, Club C requested all the relevant sanctions and consequences to be taken in consideration of the above-mentioned alleged breach of contract.

28. FIFA administration informed the parties, i.e. as to Club C’s additional requests, that said eventual requests should be lodged in a separate claim against the relevant parties in front of the competent body.

29. In its replica, Club A firstly referred to the principle of “pacta sunt servanda” in order to remind that the content of the clause had been mutually agreed with Club C from the beginning with no possibility to review its essence during the current proceedings.

30. Moreover, Club A sustained that the purpose of the clause was clearly meant to be a certain number of matches to be played by the player, with as only situation impacting the triggering of the clause, his medical situation.

31. In this respect, Club A rejected Club C’s arguments as to any interference of the clause’s effects in its management as well as the allegations as to the wording of the clause and its consequences.

32. Furthermore, in Club A’s opinion, all the reasons listed by Club C on top of the player’s injury should not be considered as Club A could not be held responsible of such contingencies and they do not impact the validity of the clause.

33. What is more, Club A reminded that it wanted the player to progress and underlined that such progress would have benefited Club A in both ways: either by re-joining the club of Country B b and/or by being transferred to any club willing to acquire the player against the payment of a transfer fee, the player having been transferred to Country G without a fixed transfer fee clearly proves Club A’s initial intentions.

34. As to Club C’s request to lower the due amount in the alternative, Club A reminded that the parties did not provide such possibility when signing the agreement and, as a consequence, the requested amount should be therefore awarded in full.

35. In continuation, in Club A’s opinion, the amount in the clause would have equalled the value of the player should he have performed with Club C during the whole length of the agreement.

36. Finally, Club A amended its claim as follows:

i. It requested late payment interest at a rate of 5% p.a. as from 17 July 2018 (being the date on which its initial payment request was sent to Club C);

ii. It required the payment of the amount in dispute, i.e. EUR 142,500, to be made by no later than 30 days;

iii. It asked for a penalty amounting to EUR 5,000 per day to be paid by Club C should the principal amount have not been paid on time.

37. In its duplica, Club C reiterated its position as to the invalidity of the clause alleging, in contrary to Club A’s position, that “the consent of both of the parties to sign a null and void clause does not redeem its invalidity in any way”.

38. In this respect, Club C also reiterated its previous position as to the interference of the clause in the club’s management by explaining that “if a condition is agreed and if its occurrence depends, to a certain extent, on the will of one of the parties on which the contract imposes obligations, this party does not have in principle an entire freedom to refuse this occurrence and to be freed, in that way, of its contractual obligations”. Club C referred to the award CAS 2010/A/2168.

39. Moreover, Club C rejected Club A’s argumentation as to the sum of EUR 150,000 having been determined by the parties as it would have represented the player’s value at the end of the agreement, as said amount’s calculation remained unclear and based on unproven and unjustified statements.

40. Finally, Club C reiterated its previous arguments entirely as expressed in its reply to the claim.

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

1. First of all, the Single Judge of the Player’s Status Committee (hereinafter: “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 4 January 2019. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2018; hereinafter: “the Procedural Rules”) are applicable to the matter at hand (cf. art. 21 of the Procedural Rules).

2. Subsequently, the Single Judge analysed which regulations should be applicable as to the substance of the matter. In this respect, the Single Judge concluded that in accordance with art. 26 par. 1 and par. 2 of the June 2018 edition of the Regulations on the Status and Transfer of Players, and considering that the present claim was lodged on 4 January 2019, the June 2018 edition of said regulations (hereinafter: ”the Regulations”) is applicable to the matter at hand as to the substance.

3. Furthermore, the Single Judge confirmed that, based on art. 3 par. 1 and 2 of the Procedural Rules in connection with art. 23 par. 1 and 4 as well as art. 22 lit. f) of the Regulations, he was competent to deal with the present matter since it concerns a dispute between clubs affiliated to two different associations.

4. The competence of the Single Judge and the applicable regulations having been established, the Single Judge entered into the substance of the matter. 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 considerations he will refer only to the facts, arguments and documentary evidence, which he considered pertinent for the assessment of the matter at hand.

5. In doing so and to begin with, the Single Judge noted that on 30 January 2018 the Claimant and the Respondent concluded the agreement by means of which the player was transferred on loan to the Respondent for the period from 1 February 2018 until 30 June 2018.

6. The Single Judge underlined that the present dispute is focussed on the interpretation of the clause of the agreement.

7. On the one hand, the Claimant deemed that the pre-requisites established in the clause to receive the amount of EUR 150,000 (i.e. less than 65% official matches played as selected position-holder) were met and therefore Club A is entitled to receive said amount.

8. On the other hand, the Respondent argued, inter alia, that the clause is null and void and that there were valid reasons for the failure of participation of the player in 65% of the official matches, i.e. injury, poor performance and negative behaviour. The Respondent further argued that if the deciding body decides to apply the clause the amount of EUR 150,000 should be reduced since it is excessive taking into account the player´s monthly salary.

9. At this stage, the Single Judge underlined that it is undisputed by the parties that on 10 May 2018 the Respondent informed the Claimant about the player’s injury and that the player has been selected as position-holder in 6 of Club C’s 15 official matches during the relevant loan period, i.e. as from 1 February until 10 May 2018.

10. In this regard, the Single Judge specified that the player´s participation equals to 40%, i.e. less than 65% which in principle triggers the application of the clause.

11. In continuation, the Single Judge took note that the Respondent claimed that the clause was invalid, as a consequence, the Single Judge focussed his attention to said clause to determine whether or not it is null and void.

12. In this respect, the Single Judge was keen to underline that the wording of the clause is clear and specific and even contains definitions in order to avoid misunderstandings between the parties regarding its interpretation. Moreover, the Single Judge emphasised that the clause was agreed by the parties under the principle of contractual freedom.

13. The Single Judge pointed out that from the wording of the clause it can be concluded that the real intention of the parties was to incentive the participation of the player in Club C´s official matches, in other words, to incentive the player to play.

14. In this context, the Single Judge was keen to emphasize that the clause does not contravene the personality rights of the player.

15. In continuation, the Single Judge focused its attention to the Respondent´s allegation that the clause is excessive taking into account the player´s monthly wage of EUR 15,000, as well as, the total amount of remuneration paid to the player during the loan amounting to EUR 75,000.

16. In this regard, the Single Judge took note that the Claimant and the Respondent at the moment of negotiating the temporary transfer of the player did not establish an amount of compensation for such transfer, in other words, a loan fee.

17. Therefore, the Single Judge reiterated that in his view the clause was agreed by the clubs to incentive the participation of the player in official matches and if the requirement of 65% would have been fulfilled by the Respondent would have had the player “for free”, i.e. only paying his monthly salary but no any additional compensation.

18. The Single Judge reiterated that the clause does not contravene the personality rights of the player and in addition, the 65% of official matches should apply only on matches considered, excluding the matches in which the player was injured.

19. In view of the above, the Single Judge concluded that the clause is valid and binding between the parties and reasonable.

20. Therefore, the Single Judge underlined that in accordance with the basic legal principle of pacta sunt servanda, which in essence means that agreements must be respected by the parties in good faith, the Claimant is entitled to receive from the Respondent the amount of EUR 142,500 as “indemnity” in accordance with the clause of the contract.

21. In addition, the Single Judge took note of the Claimant´s request for 5% annual interest to apply on EUR 142,500 as from 17 July 2018 until the date of effective payment. The Single Judge decided to grant the requested interest.

22. Furthermore, the Single Judge noted that the Claimant requested a daily penalty amounting to EUR 5,000 to be paid by Respondent. In this respect, the Single Judge was keen to emphasise that the requested penalty was not contractually agreed by the parties. Therefore, the Single Judge decided to reject such claim taking into account that it lacks legal basis.

23. Subsequently, the Single Judge focussed his attention to the Claimant´s request for legal expenses. In this regard, the Single Judge referred to art. 18 par. 4 of the Procedural Rules which provides “No procedural compensation shall be awarded in proceedings of the Players´ Status Committee and the DRC”.

24. The Single Judge decided that such request for legal costs should be rejected in accordance with art. 18 par. 4 of the Procedural Rules as well as the Players’ Status Committee longstanding jurisprudence.

25. In view of all the above-mentioned considerations, the Single Judge decided that the claim of the Claimant is partially accepted and that the Respondent has to pay to the Claimant the amount of EUR 142,500 plus an annual interest of 5% as from 17 July 2018 until the date of effective payment.

26. Finally, 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 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.

27. In this regard, the Single Judge underlined that failure to fulfil with the terms established in the agreement can be attributed to the Respondent and that the claim was partially accepted, the Single Judge concluded that both parties have to bear the costs of the current proceedings before FIFA.

28. 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. The amount in dispute to be taken into consideration in the present proceedings is of EUR 142,500. Therefore, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to 20,000.

29. In conclusion, and in view of the specific circumstances of the present matter, the Single Judge determined the costs of the current proceeding to the amount of 14,000.

30. In conclusion, the Single Judge decided that the amount of 14,000 has to be paid by both parties as follows: 4,000 by the Claimant and 10,000 by the Respondent to cover the costs of the present proceedings.

31. Furthermore, taking into account the consideration under number II./3. above, the Single Judge referred to par. 1 and 2 of art. 24bis of the Regulations, which stipulate that, with its decision, the pertinent FIFA deciding body shall also rule on the consequences deriving from the failure of the concerned party to pay the relevant amounts of outstanding remuneration and/or compensation in due time.

32. In this regard, the Single Judge pointed out that, against clubs, the consequence of the failure to pay the relevant amounts in due time shall consist of a ban from registering any new players, either nationally or internationally, up until the due amounts are paid and for the maximum duration of three entire and consecutive registration periods.

33. Therefore, bearing in mind the above, the SJ PSC decided that, in the event that the Respondent does not pay the amounts due to the Claimant within 45 days as from the moment in which the Claimant, following the notification of the present decision, communicates the relevant bank details to the Respondent, a ban from registering any new players, either nationally or internationally, for the maximum duration of three entire and consecutive registration periods shall become effective on the Respondent in accordance with art. 24bis par. 2 and 4 of the Regulations.

34. Lastly, 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. 24bis par. 3 of the Regulations.

35. Finally, the Single Judged concluded his deliberations by stating that any other claims lodged by the Claimant are rejected.

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

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

2. The Respondent, Club C, has to pay to the Claimant the amount of EUR 142,500, plus interest at the rate of 5% p.a. as from 17 July 2018 until the date of effective payment.

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

4. The Claimant is directed to inform the Respondent, immediately and directly, of the relevant bank account to which the Respondent must pay the amount mentioned under point 2. above.

5. The Respondent shall provide evidence of payment of the due amount in accordance with point 2. above to FIFA to the e-mail address psdfifa@fifa.org, duly translated, if need be, into one of the official FIFA languages (English, French, German, Spanish).

6. In the event that the amount due plus interest in accordance with point 2. above is not paid by the Respondent within 45 days as from the notification by the Claimant of the relevant bank details to the Respondent, the Respondent shall be banned from registering any new players, either nationally or internationally, up until the due amount is paid and for the maximum duration of three entire and consecutive registration periods (cf. art. 24bis of the Regulations on the Status and Transfer of Players).

7. The ban mentioned in point 6. above will be lifted immediately and prior to its complete serving, once the due amount is paid.

8. In the event that the aforementioned sum plus interest is still not paid by the end of the ban of three entire and consecutive registration periods, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision.

9. The final costs of the proceedings in the amount of 14,000 are to be paid by both parties within 45 days as from the date of notification of this decision, as follows:

9.1 The amount of 10,000 has to be paid by the Respondent directly to FIFA to the following bank account with reference to case nr. xxxx:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

9.2 The amount of 4,000 has to be paid by the Claimant to FIFA. Given that the Claimant has already paid the amount of 4,000 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.

10. In the event that the aforementioned amount of costs is not paid within the stated time limit, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision.

*****

Note related to the publication:

The FIFA administration may publish decisions issued by the Players’ Status Committee or the DRC. Where such decisions contain confidential information, FIFA may decide, at the request of a party within five days of the notification of the motivated decision, to publish an anonymised or a redacted version (cf. article 20 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber).

Note relating to the appeal procedure:

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. 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

Emilio García Silvero

Chief Legal & Compliance Officer