F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – solidarity contribution/ contributo di solidarietà – (2016-2017) – fifa.com – atto non ufficiale – Decision 19 January 2017

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 19 January 2017,

in the following composition:

Geoff Thompson (England), Chairman

Johan van Gaalen (South Africa), member

Wouter Lambrecht (Belgium), member

on the claim presented by the club,

Player A, Country B,

as Claimant / Counter-Respondent

against the club,

Club C, Country D,

as Respondent / Counter-Claimant

and the club,

Club E, Country F

as Intervening party

regarding an employment-related dispute between the parties

I. Facts of the case

1. On 6 August 2013, the Player of Country B, Player A (hereinafter: Claimant / Counter-Respondent or the player), and the Club of Country D, Club C (hereinafter: the Respondent / Counter-Claimant or the club), signed an employment contract valid from 6 August 2013 until 31 May 2016.

2. In accordance with the contract, the player was entitled to receive the following remuneration and amenities:

a. EUR 158,000 for the 2013/2014 season, as follows:

i. EUR 30,000 to be paid upon signature of the contract;

ii. EUR 60,000 to be paid in three cheques of EUR 20,000 on 30 September 2013, 31 October 2013 and 30 November 2013;

iii. EUR 68,000 to be “paid per match”, i.e. 34 matches x EUR 2,000.

b. EUR 183,000 for the 2014/15 season, as follows:

i. EUR 35,000 to be paid on 2 August 2014;

ii. EUR 70,000 to be paid in three cheques: a cheque of EUR 20,000 on 30 September 2014, a cheque of EUR 25,000 on 31 October 2014 and a cheque of EUR 25,000 on 30 November 2014;

iii. EUR 78,000 to be “paid per match”, i.e. 34 matches x EUR 2,294.

c. EUR 208,000 for the 2015/2016 season, as follows:

i. EUR 40,000 to be paid on 2 August 2015;

ii. EUR 82,000 payable in three cheques: a cheque of EUR 27,000 payable on 30 September 2015, a cheque of EUR 27,000 payable on 31 October 2015, a cheque of EUR 28,000 payable on 30 November 2015;

iii. EUR 86,000 to be “paid per match”, i.e. 34 matches x EUR 2,529.

d. Four “round trip tickets to City G per season”;

e. “provided with a rent-a-car”;

f. “the player shall reside at the hotel”;

g. “paid per match” payments are to be paid 100% if the player has started the match, paid 75% if the player enters the field as a substitute, and 50% if the player is on the bench but does not participate in the game.

3. The contract also provides that “the club shall be entitled to terminate this contract unilaterally in the event that the club degrades to a lower division”.

4. On 9 July 2014, the player put the club in default of its obligation to allow the player to train with the first team within the following forty-eight hours. In addition, the player notes that the club’s intention was to terminate the contract.

5. On 10 July 2014, the club replied to the default notice stating that the player is a registered member of the team but that it is the coach’s decision as to whether he will be part of the team for the upcoming season. It attached a letter dated 9 July 2014 stating that the attachment was a “training program” which in fact states that the player is invited to preseason training on 10 July 2014.

6. On 25 July 2014, the player put the club in default of fees allegedly due to the player’s agent in the amount of “17,500”. In addition, he put the club in default of the provision of a rent-a-car and a reminder that the instalment of EUR 35,000 falls due on 2 August 2014.

7. On 6 August 2014, the player put the club in default of its obligations to let the player train with the first team, to provide him with accommodation and a car, to refund the price of the flight ticket from City G to Country D and to pay the instalment of EUR 35,000 which fell due on 2 August 2014.

8. On 8 August 2014, the club replied to the default of the player by stating that the player’s presence in the first team was not a contractual obligation of the club, that in light of Football Regulations of Country D the club had decided that it would not register the player as a foreigner for the upcoming season all-the-while continuing to perform its obligations towards the player. It further states that the player will train with the supervision of a trainer, and that he would be allowed to train with the under 21s team during the season. It acknowledges a delay in the payment of the EUR 35,000 due on 2 August 2014, which it asserts does not constitute an essential breach of contract. It also claims that the player’s allegations regarding accommodation are false, recalling that the club’s facilities were under reconstruction and the club organised that the player would be in a hotel. The club states that “all the hotel costs belong to us and will be paid by our club”, adding that the player has to provide payment receipts in order to be reimbursed. In this letter, the club offered an immediate and mutual termination where the club would pay the player EUR 50,000 which includes the EUR 35,000 due on 2 August 2014, as compensation for the premature termination.

9. On 11 August 2014, the player referred to the letter of the club dated 8 “July” 2014 and formally terminated his employment contract on the basis that the club is in irremediable breach of contract.

10. On 8 August 2014, the player lodged a claim before FIFA against the club asking that he be paid the total amount of EUR 392,500, plus 5% interest p.a. from the due date until the date of effective payment, pertaining to:

a. EUR 36,500 as outstanding remuneration corresponding to the instalment of EUR 35,000 due on 2 August 2014 and a “per match” payment of EUR 1,500 (i.e. 75% of EUR 2,000 as the player only partially participated in the match);

b. EUR 356,000 as compensation for breach of contract by the club pertaining to the residual value of the contract; and,

c. the imposition of sporting sanctions.

11. In this regard, the player claims that he was informed by telephone on an unspecified date that his services would no longer be required for the following season. The player alleges he was then made to buy his own flight ticket in the amount of EUR 180 from City G in order to join the team for preseason training which was due to start on 8 July 2014, as was mentioned on the club’s website. The player claims he was never informed of the starting date of preseason and that upon arrival at the club he was informed once again that his services were no longer required.

12. In this regard, and as to the attachment of the club’s letter of 10 July 2014, the player notes that said attachment was not a “training program” but a convocation, and that the address was not that of the club’s training facility. Additionally he claims that when he did turn up to training, he was made to train alone, some of the time without a coach.

13. The player alleges that after having put the club in default a second time the club’s only reaction was allegedly to change the locks of the flat whilst the player was at training. The player was eventually allowed to return to the flat with a member of the club’s staff to recuperate his things, but was told he had to find his own accommodation. In this regard, the player stayed in a hotel in which he had stayed with the team, at his own expense.

14. The player also claims that on the 5th and 6th of August 2014 he trained alone, which is contrary to the obligations deriving from the professional contract of a football player.

15. The player notes that the club’s website indicated on 17 July 2014 that “in line with the decision taken by the board of directors of the club Director H, Director J, Director K, [the player] e Director L we will have to resolve the contract and we will have to part ways”.

16. The player therefore considers that from all the elements he has presented, it is undoubtable that the club has failed in its obligations towards him, has allegedly acknowledged them all, and it therefore breached the contract without just cause, in particular as this breach occurred during the preparation phase of the upcoming season. Consequently, the player asserts he left Country D on 12 August 2014.

17. In its reply, the club asserted that the Football Federation of Country D (hereinafter: the Football Federation M) had imposed foreign player quotas on all clubs participating in the League N for the 2014/15 season and it therefore decided on the basis of “a sporting decision” made by the coach and the technical staff, to not register the player. It claims to have invited the player to preseason training on 9 July 2014 and claims that the allegations of the player’s alleged reply to said notification were false and that it explained to the player that despite not playing for the first team, its contractual obligations would be respected.

18. The club further states that the claim was lodged before the player had even formally terminated his employment contract and claims that the termination was made without just cause on 11 August 2014. In addition, it claims to have acted in good faith in offering the player a mutual termination option, thereby demonstrating its good faith.

19. In continuation, the club explained that the player’s assertion that a coach cannot exclude a player from the first team is false and “against the nature of football”, adding that it is not a contractual obligation. The club also asserts that because of the Football Federation M foreign player quota it is sportingly impossible for a player who is not eligible to play a whole season to train with the first team. The club denies that the player trained alone, and that the post on the website was actually made on 16 August 2014, at which time the player had already terminated his employment contract and left the country. It denies having expelled the player from his and that the player had been lodging in a hotel at the club’s expense claiming that its correspondence of 8 August 2014 confirms that the situation was temporary. The club claims that three days after the letter of 8 August 2014, the player terminated the contract at a time where the club was not in breach of its contractual obligations.

20. The club stated that the letter of 8 August 2014 explained to the player that the delay in the payment due on 2 August 2014 was due to a temporary and minor cash-flow problem. Furthermore, it claims that had the player accepted the mutual termination offer, he would have been paid EUR 15,000 upfront, instead he terminated the employment contract. Additionally, the club states that a nine day delay in payment does not constitute just cause to terminate an employment contract.

21. The club continued by stating that any claim for compensation pertaining to “per match” payments should be rejected as the entitlement would only be due if the player had played. The club explained that in his first season, he had only played in eleven of thirty-four matches. In addition, it claims that solely because of the unjust termination, no compensation should be due.

22. On account of all the above, the club lodged a counterclaim against the player, on the basis that the player had terminated the contract without just cause. It claims that because the player unilaterally terminated the contract, and was subsequently able to find a new club there is no doubt that had the player been transferred it would have received compensation for the transfer and therefore claims EUR 100,000 from the player.

23. In spite of having been invited to do so, the player did not respond to the club’s counterclaim.

24. Upon FIFA’s request, Club E, stated that it was aware of the contractual dispute between the player and the club lodged before FIFA. It had been given copies of letters on file. It states that it was made aware of the situation in December 2014, and eventually offered the player a contract in January 2015. The ITC request was rejected by the Football Association of Country D, and Club E considers that the PSC single judge awarded the club the right to provisionally register the player on the basis of the merits of the case lodged in front of the DRC. It also stated that the player and Club E had mutually terminated the employment relationship between them on 30 June 2015.

25. In response to FIFA’s pertinent request, the player informed FIFA that he had signed the following employment contracts:

a. on 15 January 2015 valid until 30 June 2017 with Club E (Country F) which was terminated by mutual consent on 30 June 2015. During this period the player was entitled to EUR 5,200 per month payable on the 15th day of “the next calendar month”;

b. on 16 July 2015 valid until 1 June 2018, with Club O (Country B) during which time the player would be entitled to EUR 800 per month.

II. Considerations of the Dispute Resolution Chamber

1. First, the Dispute Resolution Chamber (hereinafter also referred to as the Chamber or DRC) analysed whether it was competent to deal with the matter at hand. In this respect, it took note that the present matter was submitted to FIFA on 8 August 2014. Consequently, the Rules governing the procedures of the Players’ Status Committee and the Dispute Resolution Chamber (2014 edition; hereinafter: the Procedural Rules).

2. Subsequently, the members of the Chamber referred to art. 3 par. 1 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 and par. 2 in combination with art. 22 lit. b) of the Regulations on the Status and Transfer of Players (2016 edition) the Dispute Resolution Chamber is competent to deal with the matter at stake, which concerns an employment-related dispute with an international dimension between a Player of Country B, a Club of Country D and a Club of Country F.

3. Furthermore, the Chamber analysed which regulations should be applicable as to the substance of the matter. In this respect, it confirmed that in accordance with art. 26 paras. 1 and 2 of the Regulations on the Status and Transfer of Players (2016 edition), and considering that the present claim was lodged on 8 August 2014, the 2014 edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

4. The competence of the Chamber and the applicable regulations having been established, the Chamber entered into the substance of the matter. In this respect, the Chamber started by acknowledging all the aforementioned facts as well as the arguments and the documentation submitted by the parties. The Chamber, however, emphasised that in the following considerations it will only refer to the facts, arguments and documentary evidence which it considered pertinent for the assessment of the matter at hand.

5. In this respect, the Chamber acknowledged that the player and the club signed an employment contract valid from 6 August 2013 until 31 May 2016.

6. Subsequently, the members of the DRC noted that, on the one hand, the player asserts that the Respondent has breached the contractual relationship without just cause by failing to pay the instalment due on 2 August 2014 and outstanding “per match” payments as well as excluding him from training with the club’s first team. In this regard, the Chamber acknowledged the documentation provided by the Claimant consisting of default notices dated 9 July 2014, 25 July 2014 and 6 August 2014 as well as the relevant replies of the club. The Chamber noted that the player terminated his employment contract on 11 August 2014 after having received the document dated 8 August 2014 from the club, in which it informs the player inter alia that he would not be able to be registered for the team in light of Football Federation M foreign player quotas, that he would be trained by a personal trainer and would not be allowed to train with the first team. In light of all of the above, the player claims that he had just cause to terminate the contract.

7. On the other hand, the DRC noted that in reply to the player’s claim, the club claims that in light of the Football Federation M quotas on foreign players, it made the “sporting decision” to not register the player. The club further argues that since the player was not registered, it was not possible for him to train with the first team. The Chamber further noted that the club acknowledged the delay in payment of the instalment of 2 August 2014, and indicated that a short delay in payment does not constitute just cause to terminate an employment contract and that “per match” payments should not all be due in the calculation of any potential compensation since the player did not participate in all the club’s matches.

8. In continuation, the members of the Chamber took due note that the club lodged a counterclaim against the player, to which he did not reply, and his new club, Club E, on the basis that he had terminated the employment contract without just cause and the club requested compensation of EUR 100,000 since the player was able to find employment elsewhere, thereby indicating that the club would have received compensation for the transfer of the player.

9. Furthermore, the members of the Chamber took note that Club E, in reply to the counterclaim of the club, asserted that it had been made aware of the ongoing dispute between the player and the club, and considered that on the basis of the documentation provided to it in December 2014, it offered a contract to the player in January 2015. The DRC further noted that Club E considered this justified on the basis that the Players’ Status Committee single judge had awarded Club E the right to provisionally register the player.

10. In light of all of the above, the Chamber deemed that the underlying issue concerning this dispute was to determine whether the player had just cause to prematurely terminate the contractual relationship in light of the club’s alleged breach. Consequently, the Chamber underlined that should a party be found to have been in breach of its obligations without just cause, it would be necessary for the DRC to determine the consequences for the party that caused the unjust breach of the relevant employment contract.

11. In view of the above, the DRC first noted that the player inter alia based his unilateral termination on the fact that he was excluded from first team training and had previously put the club in default multiple times. He equally argued that the club acknowledged having excluded him from training with the club’s first team on the basis of the “sporting decision” not to register him and acknowledged that the instalment due on 2 August 2014 had remained outstanding in its reply to the player of 8 August 2014. In this regard, the Chamber took note that the club acknowledged having not registered the player for the 2014/2015 season in its reply to the claim, on the basis of a “sporting decision”.

12. In this regard, the members of the Chamber acknowledged the club’s argument that because the player was not registered on the basis of a “sporting decision” it was impossible for him to train with the first team.

13. With the above in mind, the Chamber considered it important to first recall, as has been previously sustained by the Dispute Resolution Chamber, that amongst a player’s fundamental rights under an employment contract is not only his right to a timely payment of his remuneration, but also his right to access training and to be given the possibility to compete with his fellow team mates in the team’s official matches.

14. In continuation, with regard to the argument of the club that it was a “sporting decision” club to not register the player, the Chamber noted that a decision not to select a player for a particular match is typically of a technical nature, resulting in the fact that the manager considers other players to be in a better position at that specific moment to help the team reach its goals falls within the context of the nature of football. To the contrary, the Chamber deemed that in the present matter, by not registering the player for the relevant season, the club effectively barred, in an absolute manner, the potential access of a player to competition, and as such is violating one of the fundamental rights of a football player.

15. Furthermore, the Chamber wished to clarify that the decision of an Association imposing an obligation on its affiliated clubs to respect quotas for foreign players cannot be held against the player, notably since a player has no possible way influencing the respect of this administrative formality. The members of the Chamber therefore noted that the club, in casu, cannot use the Decision of the Football Federation M relating to foreign player quotas to justify the non-registration of a player. Nevertheless, referring to art. 12 par. 3 of the Procedural Rules, the Chamber also took due note that the club had failed to submit any documentary evidence relating to the allegation that the Decision of the Football Federation M meant the club could not register the player.

16. From all of the above, the Chamber established that the non-registration of the player for the relevant season constitutes a material breach of contract since it de facto prevents a player from being eligible to play for his club. The members of the Chamber agreed that in light of this consideration and the club’s acknowledgement that it had not registered the player, the player had just cause to terminate the employment contract due to the breach of the club.

17. At this point, the Chamber recalled that the club had lodged a counterclaim against the player on the basis that he did not have just cause to terminate the employment contract. Bearing the aforementioned considerations in mind, in particular those established in point II.14 above, the Chamber was of the opinion that it must reject the counterclaim of the club.

18. In continuation, having established that the club is to be held liable for the early termination of the employment contract with just cause by the player, the Chamber focussed its attention on the consequences of such termination. Taking into consideration art. 17 par. 1 of the Regulations, the Chamber decided that the player is entitled to receive an amount of money from the club as compensation for the termination of the contract with just cause in addition to any outstanding payments on the basis of the relevant employment contract.

19. In this regard, the members of the Chamber recalled that the player claimed that the instalment due on 2 August 2014 had remained outstanding as well as his “per match” payments due for the 2013/2014 season. In addition, the DRC noted that the club had acknowledged in its correspondence dated 8 August 2014 and in its reply to the claim that the instalment in the amount of EUR 35,000 due on 2 August 2014 had indeed remained unpaid. The Chamber further noted that it had remained undisputed by the club that the player was entitled to his “per match” payment in the amount of EUR1,500 as claimed as outstanding remuneration.

20. In view of all of the above, in particular taking into account that the club did not contest that either amount were due and had remained unpaid, the Chamber decided that in accordance with the general legal principle of pacta sunt servanda, the club must fulfil its contractual obligations towards the player and is therefore to be held liable to pay the player the total amount of EUR 36,500 as outstanding remuneration.

21. In addition, taking into consideration the player’s claim, the Chamber decided to award the player interest at a rate of 5% p.a. on the total amount of USD 36,500 as of the day following the day on which both amounts fell due.

22. In continuation, the Chamber focused its attention on the calculation of the amount of compensation for breach of contract in the case at stake. In doing so, the members of the Chamber first recapitulated that in accordance with art. 17 par. 1 of the Regulations, the amount of compensation shall be calculated, in particular and unless otherwise provided for in the contract at the basis of the dispute, with due consideration for the law of the country concerned, the specificity of sport and further objective criteria, including, in particular, the remuneration and other benefits due to the Claimant under the existing contract and/or the new contract, the time remaining on the existing contract up to a maximum of five years, and depending on whether the contractual breach falls within the protected period.

23. In application of the relevant provision, the Chamber held that it first had to clarify as to whether the pertinent employment contract contains a provision by means of which the parties had beforehand agreed upon an amount of compensation payable by the contractual parties in the event of breach of contract. In this regard, the Chamber established that no such compensation clause was included in the employment contract at the basis of the matter at stake.

24. As a consequence, the members of the Chamber determined that the amount of compensation payable by the Respondent to the Claimant had to be assessed in application of the other parameters set out in art. 17 par. 1 of the Regulations. The Chamber recalled that said provision provides for a non-exhaustive enumeration of criteria to be taken into consideration when calculating the amount of compensation payable. Therefore, other objective criteria may be taken into account at the discretion of the deciding body.

25. The members of the Chamber then turned their attention to the remuneration and other benefits due to the Claimant under the existing contract and/or the new contract, which criterion was considered by the Chamber to be essential. The members of the Chamber deemed it important to emphasise that the wording of art. 17 par. 1 of the Regulations allows the Chamber to take into account both the existing contract and the new contract in the calculation of the amount of compensation.

26. Bearing the foregoing in mind, the Chamber proceeded with the calculation of the monies payable to the player under the terms of the employment contract as from its date of termination with just cause by the player, i.e. 11 August 2014, until the original expiry of the employment contract on 31 May 2016. The Chamber concluded that the player would have received a total of EUR 192,000 as fixed remuneration had the contract been executed until its original expiry date. The members of the Chamber were eager to point out that the contractually provided for “per match” payments could not be included in the calculation of compensation for breach since said payments are linked to matches to be played in the future, i.e. after the termination of the relevant contract, and, therefore, are fully hypothetical. Therefore, the Chamber decided to reject this portion of the claim. Consequently, the Chamber concluded that the amount of EUR 192,000 serves as the basis for the final determination of the amount of compensation due for breach of contract in the case at hand.

27. In continuation, the Chamber 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 DRC, 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 player’s general obligation to mitigate his damages.

28. The Chamber recalled that on 15 January 2015 the player signed an employment contract with Club E, in accordance with which he would be entitled to EUR 5,200 per month. The Chamber noted that both the player and Club E had indicated that the contract was terminated by mutual consent on 30 June 2015. Furthermore, the DRC noted that on 16 July 2015, the player had signed an employment contract with Club O, valid until 1 June 2018, which provides for the monthly salary of EUR 800. These employment contracts enabled the player to earn income of, and therefore mitigate his damages by, the amount of EUR 40,000.

29. Consequently, on account of all the aforementioned considerations and the specificities of the case at hand, as well as the player’s general obligation to mitigate his damage, the Chamber decided the club was to pay to the player EUR 152,000, which was considered reasonable and proportionate as compensation for breach of contract in the case at hand.

30. In addition, taking into account the player’s request, the Chamber decided that the club must pay to the Claimant interest of 5% p.a. on the amount of compensation due as of the date on which the claim was lodged, i.e. 8 August 2014, until the date of effective payment.

31. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claim lodged by the Claimant is rejected, and that in light of all of the above, the counterclaim of the club is rejected.

III. Decision of the Dispute Resolution Chamber

1. The claim of the Claimant/Counter-Respondent, Player A, is partially accepted.

2. The Respondent/Counter-Claimant, Club C, has to pay to the Claimant/Counter-Respondent, within 30 days as from the notification of the present decision outstanding remuneration in the amount of EUR 36,500 plus 5% interest p.a. until the date of effective payment as follows:

a. 5% p.a. as of 1 June 2014 on the amount of EUR 1,500;

b. 5% p.a. as of 3 August 2014 on the amount of EUR 35,000.

3. The Respondent/Counter-Claimant has to pay to the Claimant/Counter-Respondent, within 30 days as from the date of notification of this decision, compensation for breach of contract amounting to EUR 152,000 plus 5% interest p.a. as from 8 August 2014.

4. In the event that the aforementioned sums plus interest are not paid within the stated time limits, 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/Counter-Respondent is rejected.

6. The counterclaim of the Respondent/Counter-Claimant is rejected.

7. The Claimant/Counter-Respondent is directed to inform the Respondent/Counter-Claimant immediately and directly of the account number to which the remittances are to be made and to notify Dispute Resolution Chamber 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

For the Dispute Resolution Chamber:

Marco Villiger

Deputy Secretary General

Encl. CAS directives