F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2016-2017) – fifa.com – atto non ufficiale – Decision 3 November 2016

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 3 November 2016,

in the following composition:

Thomas Grimm (Switzerland), Deputy Chairman

Alejandro Marón (Argentina), member

Mario Gallavotti (Italy), member

Carlos González Puche (Colombia), member

Eirik Monsen (Norway), member

on the claim presented by the player,

Player A, Country B

as Claimant

against the club,

Club C, Country D

as Respondent

regarding an employment-related dispute between the parties

I. Facts of the case

1. In July 2015, the Player of Country B, Player A (hereinafter: the Claimant), born on 26 November 1985, and the Club of Country D, Club C (hereinafter: the Respondent) signed an employment contract (hereinafter: the contract) valid as from, according to the Claimant, 18 July 2015 until 31 May 2016.

2. In accordance with the contract, the Claimant was entitled inter alia to receive 10 monthly payments of 55,370.

3. Moreover, the contract provides that all payments are gross payments from which the Respondent shall deduct income tax and national insurance. In relation, the contract stipulated that it is an obligation of the Claimant not to demand and not to receive net payments from the Respondent, and that it is an obligation of the Respondent not to undertake and not to pay any net payments to the Claimant.

4. Furthermore, the contract established that the Respondent undertakes the obligation to insure the Claimant, starting from the day the contract begins and until the last day of its validity, including the official off-season following the end of the period of the contract, against personal accidents causing death and/or disability and/or the loss of the Claimant’s ability to work, in adequate amounts that shall not be less than that specified in the Law of Sports.

5. The contract also established that the Respondent is obliged to provide the Claimant with adequate medical care throughout the duration of the contract, “and should it be necessary and after adequate medical certificates have been presented, also after the period of the contract”.

6. According to art. 9 of the contract, “should it be decided by the Labor Court and/or any other authorized body, whether at the request of the [Respondent] or at the request of the [Claimant] or of any other body whatever in a contradictory suit, that…., the [Claimant] has additional rights as an employee, including dismissal compensation, then it is agreed between the parties, that the wage taken into account for the calculation of the [Claimant]’s rights will be the minimum wage, as will be publicized by the Minister of Labor and Welfare, as set out in Clause 6 of the Minimum Wage Law 5747-1987, at the time of the termination….”.

7. Moreover, art. 10 of the contract established that “The directives of this Agreement will become valid and obligate the parties, only after it has been presented before the Authority and has been approved therely. The [Respondent] undertakes to present this agreement to the Authority for confirmation when it has signed by both parties and this no later than 14 days after it has been signed by the [Claimant] as set out at the preface to this Agreement”.

8. On 26 January 2016, the Claimant lodged a claim against the Respondent before FIFA for breach of contract requesting the amount of USD 115,168, corresponding to salaries from July 2015 until February 2016, as well as 5% interest p.a. “as of expiry of the fixed time limit”.

9. According to the Claimant, before signing the contract, the Respondent requested a medical examination that was carried out on 17 July 2015.

10. The Claimant sustained that after he played a match for the club on 23 July 2015, he returned to City E in order to pack the rest of his belongings. The Claimant then stated that the Respondent provided him with a flight ticket back to Country D for 30 July 2015.

11. Subsequently, the Claimant declared that, on 29 July 2015, after he noticed “a change on the skin around the neck area”, he contacted his doctor, who then recommended him to be examined by a specialist in the hospital. The Claimant sustained that right after the examination, “he was diagnosed with cancer (Hodgkin’s Lymphoma)” and was advised to start treatment immediately.

12. Moreover, the Claimant held that he notified the Respondent of his diagnosis and of the doctor’s recommendation, both in writing and by telephone, and that the Respondent “did not object to the doctor’s suggestion to receive his treatment in Country B”.

13. The Claimant sustained that the Respondent, after learning about his medical condition, offered him a payment of one salary under the condition that “he terminates the contract”. Furthermore, the Claimant affirmed that the Respondent did not show any interest or concern for his well-being, as he was not contacted by the Respondent to check on him, which according to the Claimant “shows gross violation of FIFA’s principle of the fair play of the pitch time”.

14. In addition, the Claimant declared that before lodging his claim, he tried to resolve the dispute amicably with the Respondent by means of a letter titled “final notice before action”, dated 9 November 2015, in which the Claimant, via his legal representative, put the Respondent in default of payment of three outstanding salaries in the amount of USD 43,188, giving the Respondent a deadline to settle the alleged debt until 18 November 2015, and informing the Respondent that if no payment is received within the granted deadline, “I shall be compelled to advise my client to cancel the agreement and to submit the claim before FIFA…”.

15. In this regard, the Claimant held that he received a reply from the Respondent dated 16 November 2015, in which, according to the Claimant, he was informed that “[the Respondent] is not obliged under the Agreement to pay the [Claimant] the requested amount”.

16. The Claimant enclosed to his claim an email in reply to the Respondent’s answer dated 21 December 2015, in which the Claimant stated the arguments submitted in the present claim and highlighted that since, according to him, the contract is still in force, he requests the payment of alleged outstanding salaries in the amount USD 57,584, within the next 8 days from the receipt of the email. It is also stated that “he is happy to inform that the [Claimant] is feeling much better and that he will finish his treatment soon. After the treatment he wishes to continue playing for the [Respondent]”.

17. In its reply, the Respondent rejected the Claimant’s claim. First, it stated that the issue in the matter at hand is whether the circumstance whereby a player becomes gravely ill, is considered a just cause to terminate an employment contract. The Respondent sustained that in the alternative, the issue is whether a player, who is absent from the club’s activity, is entitled to receive salary for the period of absence. Moreover, the Respondent held that the Claimant believes it is his right to cease rendering his services due to his illness, while at the same time believing that he is entitled to compensation, as he was “upholding his end of the employment agreement and had not left the [Respondent]”.

18. The Respondent maintained that it is not obliged to pay compensation in the matter at hand since the Claimant was forced to “stay home and get medical treatment that would save his life”. In this regard, the Respondent held that the following special circumstances should be taken into consideration:

 The Claimant willingly left the Respondent;

 The Claimant never set foot in Country D;

 The contract never came into force, as the medical examination concluded that the player was ill “in no way related to football”, and since in accordance with art. 10 of the contract, the contract had never been reviewed and or authorized by the budget control authority;

 The Claimant chose and requested to receive his treatment in his home country;

 The Claimant’s illness is not the result of any football oriented circumstances;

 Due to the illness and its treatment, the Claimant is not in capacity to fulfil his obligations.

19. Furthermore, the Respondent held that the player arrived directly from Country B to its training camp in Country F, where he “had been feeling ill”. Subsequently, the Respondent sustained that the Claimant requested to go back to his homeland to undergo medical examination and confirmed that it gave him a flight ticket back to Country D. Subsequently, the Respondent declared that the Claimant notified it that due to the severe illness that he was diagnosed with, he would receive treatment back home and not participate during the 2015-2016 season with the Respondent. The Respondent maintained that it was understood and agreed that he was not planning to arrive or play football. The Respondent highlighted that no request for ITC was made and that the Claimant was never registered within The Football Association of Country D.

20. Moreover, the Respondent denied having proposed a financial offer to the Claimant and declared that after the Claimant’s notification, it signed another foreign player, in consequence, filling the foreign players’ quota.

21. The Respondent stated that it was surprised that it received a demand letter from the Claimant three and a half months later in November 2015, as up to that date, the Claimant did not show any intention to perform his part of the employment agreement, since he did not ask to join the Respondent, and did not arrive to Country D although he was provided with a flight ticket.

22. Subsequently, the Respondent held that even if it is decided that the contract came into force, it should be decided that it was mutually terminated by the parties as the Claimant informed that he would not arrive to Country D and join the club and the Respondent accepted this.

23. Furthermore, the Respondent held that even if it is decided that the contract came into force, and that it was not mutually terminated, it should be decided that it was the Claimant who unilaterally terminated the contract. In this regard, the Respondent sustained that although the Claimant had a just cause to terminate the contract due to his illness, this still does not entitle him to receive compensation, due to the special circumstance where it should be considered more of a “force majeure” or “frustration of contract” and the Respondent should not be held liable under such circumstance. The Respondent remarked that the Claimant made no effort to come back to Country D and play for it.

24. The Respondent further argued that since the Claimant was absent from the Respondent’s activities, it was entitled to withhold payment to him, since the Claimant did not render his services.

25. Moreover, the Respondent claimed that if somehow it is decided that it terminated the contract, “it is only expected that the unfortunate circumstances in which the [Claimant] cannot perform due to radiation and chemotherapy treatment, constitute just cause for the [Respondent]”.

26. Finally, the Respondent questioned if it would have been possible to fulfil the contract due to the Claimant’s illness, since “it is not all positive that such attempt would be a good idea physically for the [Claimant]” and that it “would not want to and should not take the responsibility for the [Claimant]’s medical state in the event anything would have happened”.

27. Moreover, the Respondent submitted unsolicited comments stating that it was informed that the Claimant had joined the Club of Country B, Club G, in February 2016.

28. The Claimant submitted his replica, in which he reiterated his position. Additionally, the Claimant held that the Respondent agreed to his treatment in Country B as he was not insured by the Respondent in accordance with art. 4 of the contract, and therefore, he had to cover his medical expenses as he was insured back in Country B.

29. Moreover, the Claimant held that the Respondent offered him the payment of two outstanding salaries under the condition that he signed a mutual termination. The Claimant sustained that he refused to sign the document offered to him as he was willing to resume his activity with the Respondent right after the treatment.

30. The Claimant claimed that in accordance with his email dated 21 December 2015, it is not true that he had no interest in playing with the Respondent after the treatment. The Claimant insisted that the contract had come into force, as contracts may not be made subject to a successful medical examination, while referring to art. 18 par. 4 of FIFA’s Regulations on the Status and Transfer of Players.

31. The Claimant sustained that the agreement had been valid until 9 March 2016, date on which he terminated the contract due to “[the Respondent’s] breach of contractual obligations”.

32. Furthermore, the Claimant amended his claim requesting the total amount of USD 158,356 corresponding to the amount of USD 115,168, as outstanding remuneration from July 2015 until February 2016, in the net amount of USD 14,396, each and USD 43,188 corresponding to compensation for breach of contract in respect to the salaries for March, April and May, all 2016. The Claimant requested that the Respondent has to pay these amounts “within 15 days from the date of notification of this decision” and requested 5% interest p.a. on the above mentioned amounts “as of expiry of the fixed time limit”.

33. The Respondent submitted its duplica, in which it reiterated its position. The Respondent further argued that the Claimant did not address the legal points raised by it in its reply to the claim.

34. The Respondent argued that, in reference to art. 18 par. 4 of FIFA’s Regulations on the Status and Transfer of Players, said article is not applicable to the matter at hand, as according to it, the mentioned article is only applicable in the event that a club seeks to renounce to an agreement to which it is a party, by claiming that the agreement is subject to medical examinations. In this regard, the club held that there is no clause in the contract suggesting that the agreement is subject to passing medical examinations and that it was the Claimant who had claimed that he could not fulfil his obligations. Moreover, the Respondent held that this article “is not intended to legitimize a situation whereby a player informs his employer that he is not fit and by doing so shall be granted automatic and unlimited protection of his employment contract”.

35. Finally, the Respondent acknowledged that it made a financial offer to the player “out of good will and good faith” to assist him financially and then part ways. The Respondent then sustained that this offer “no longer stands, since the [Claimant] had dragged it into unnecessary and expensive legal proceedings”.

36. After being requested by FIFA, the Claimant confirmed that, on 1 July 2016, he signed a contract with the Club of Country B, Club G, valid until 31 December 2017, according to which he is entitled to receive a monthly salary of 30,000. Moreover, according to the information contained in the TMS, the Claimant signed an employment contract with said Club of Country B, on 17 March 2016, valid from 1 April 2016 until 30 June 2016, according to which he is entitled to receive a monthly salary of 3,120.

II. Considerations of the Dispute Resolution Chamber

1. First, the Dispute Resolution Chamber (hereinafter also referred to as 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 26 January 2016. Consequently, the 2015 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules) are applicable to the matter at hand (cf. art. 21 of the 2015 edition of the Procedural Rules).

2. Subsequently, the members of the Chamber referred to art. 3 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 in combination with art. 22 lit. b of the Regulations on the Status and Transfer of Players (edition 2016) 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 and a Club of Country D.

3. The competence of the Chamber having been established, the Chamber 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, it confirmed that, in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players (editions 2015 and 2016), and considering that the present matter was submitted to FIFA on 26 January 2016, the 2015 edition of the aforementioned 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 above-mentioned facts as well as the arguments and the documentation submitted by the parties. However, the Chamber emphasised that in the following considerations it will refer only to the facts, arguments and documentary evidence, which it considered pertinent for the assessment of the matter at hand. In particular, the Chamber recalled that in accordance with art. 6 par. 3 of Annexe 3 of the Regulations, FIFA may use, within the scope of proceedings pertaining to the application of the Regulations, any documentation or evidence generated or contained in the Transfer Matching System (TMS).

5. The members of the Chamber acknowledged that the parties were contractually bound by means of an employment contract, which according to the Claimant, was valid as from 18 July 2016 - assertion that was not disputed by the Respondent - until 31 May 2016.

6. The Claimant, on the one hand, maintained that as the contract had duly entered into force, the Respondent had failed to comply with its contractual obligations by not paying his receivables, and that in consequence, the Respondent shall be held liable to pay compensation to him.

7. The Chamber noted that the Respondent, on the other hand, rejected the claim put forward by the Claimant, as according to the Respondent, the contract had not entered into force. Subsidiary, the Respondent held that if the Chamber considers that the contract had come into force, it should not be held liable to pay compensation to the Claimant, due to the specific circumstances of the case.

8. First of all, the members of the Chamber highlighted that the underlying issue in this dispute, considering the diverging position of the parties, was to determine as to whether the contract had been breached by either of the parties.

9. In this regard, the Chamber also underlined that in order to assess if indeed the contract was breached by one of the parties, it would need to first establish if the contract was executed or not.

10. As to the latter question, the members of the Chamber firstly recalled that the contract between the parties was never registered within the Football Association of Country D. The DRC also confirmed that according to the information contained in the TMS, the corresponding International Transfer Certificate (ITC) was not requested by the new association.

11. Moreover, the Chamber further observed that it remains uncontested that the Claimant left a few days only after joining the Respondent for a pre-season training camp in Country F.

12. Furthermore, the Chamber duly noted that the Claimant held that he played a match for the Respondent on 23 July 2015. In this respect, the DRC recalled the contents of art. 12 par. 3 of the Procedural Rules, according to which any party claiming a right on the basis of an alleged fact shall carry the burden of proof and took note that the Claimant did not submit any evidence supporting its allegation. Therefore, the members of the Chamber had to conclude that the Claimant had never rendered his services as a professional football player with the Respondent.

13. With the above mentioned considerations in mind, the Chamber was of the unanimous opinion that the contract signed between the parties never entered into force.

14. Subsequently, for the sake of completeness, the Chamber stressed that the termination of the contract by the Claimant on 9 March 2016 (cf. point I.31 above) is rendered moot, as the contract did not enter into force.

15. Once establishing that the contract, in fact, did not enter into force, the Chamber focused on addressing if either of the parties could be responsible for the non-execution of the contract.

16. In this respect, the Chamber considered extremely important to highlight that the Claimant’s health situation, confirmed by his medical examination after leaving the Respondent, is, evidently, none of the parties’ fault.

17. In consequence, after a thorough analysis of the exceptional circumstances that surround the matter at hand, the Chamber determined that the non-execution of the contract cannot be attributed to any of the parties and therefore, it cannot be established that either of the parties breached the contract.

18. Subsequently, the Chamber considered that it would need to address if the Claimant is entitled to compensation for the non-execution of the contract.

19. In this regard, it has been the practice and the opinion of the Chamber that in such circumstances the club continues to bear a certain financial responsibility towards the player. It was also underlined that an adequate way to discharge this burden is for a club to secure a respective insurance coverage, and then a third party would cover the financial harm suffered by the player.

20. Indeed, in the case at stake, the topic of insurance was included in the relevant contract (cf. point I.4 above), however, at the most, it only refers to insurance in the specific scenario of personal accidents and not of an illness. Therefore, the members of the Chamber determined that the relevant contract does not provide for a clause to which the parties can fall back to in case of an illness, which is the situation that arose in the matter at hand, and that it appears, consequently that the respondent did not have such insurance coverage.

21. In view of the above, the Chamber concluded that the Respondent has to bear the consequences of having failed to secure an insurance coverage applicable in case of illness, and therefore, it must pay compensation to the Claimant.

22. In continuation, the Chamber tackled the issue of the amount of compensation payable to the Claimant, and recalled its discretion to establish said amount. In this regard, the Chamber recalled that the circumstances surrounding the case are very specific and that these had to be duly taken into account in order to establish the amount of compensation payable by the Respondent to the Claimant.

23. In this regard, the Chamber recalled that, as established before, despite the parties having signed a valid employment contract, the execution of the contract never started.

24. Moreover, the DRC pointed out that the Claimant did not remain without remuneration for the entire duration of the contract as he signed an employment contract with the Club of Country B, Club G, before the date of the natural expiry of the contract with the Respondent, information that was duly contained in the TMS. Furthermore, the Chamber emphasized that in the matter at hand, the Claimant did not face a permanent disability, as in fact, he appears to have recovered from his illness and to have signed a new employment contract, therefore mitigating his damage resulting from the non-execution of the contract with the Respondent.

25. On account of all the above, and the specificities of the case at hand, the members of the Chamber deemed that a final compensation of 183,400, has to be considered reasonable and proportionate as compensation to be paid by the club in the specific case at hand.

26. Consequently, the Chamber decided to partially accept the player’s claim and decided that the club – in the specific case at hand - must pay the amount of 183,400 to the Claimant as a result of the unilateral termination of the contract.

27. In addition, taking into account the player’s request as well as the constant practice of the Dispute Resolution Chamber in this regard, the Chamber decided that the Respondent must pay to the player interest of 5% p.a. on the amount of compensation, i.e. 183,400 as of the date of the claim, i.e. 26 January 2016 until the date of effective payment.

28. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further request filed by the Claimant is rejected.

III. Decision of the Dispute Resolution Chamber

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

2. The Respondent, Club C, has to pay to the Claimant, within 30 days as from the date of notification of this decision, the amount of 183,400, plus 5% interest p.a. on said amount as from 26 January 2016 until the date of effective payment.

3. In the event that the amount due to the Claimant in accordance with the above-mentioned number 2. is not paid by the Respondent within the stated time limit, the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee for consideration and a formal decision.

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

5. The Claimant is directed to inform the Respondent immediately and directly of the account number to which the remittance is to be made and to notify the Dispute Resolution Chamber of every payment received.

*****

Note relating to the motivated decision (legal remedy):

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, 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