F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2017-2018) – fifa.com – atto non ufficiale – Decision 17 May 2018

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 17 May 2018,

in the following composition:

Geoff Thompson (England), Chairman

John Bramhall (England), member

Stijn Boeykens (Belgium), member

Philippe Diallo (France), member

Jérôme Perlemuter (France), 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. On 1 February 2015, the player from Country B, Player A (hereinafter: the Claimant) and the club from Country D, Club C (hereinafter: the Respondent), signed an employment contract, valid as from the date of signature until 30 June 2017.

2. On 31 March 2016, the Claimant and the Respondent signed a new “Football Player’s Employment Contract” (hereinafter: the contract), valid from 4 April 2016 until 30 June 2017.

3. According to clause 9.1 of the contract, the Claimant was entitled to receive a monthly salary of EUR 6,000 net “= currency of Country D 26,760 net”.

4. Clause 9.2 stipulated that the Claimant will “receive a bonus according the Regulation of Internal Order”.

5. In accordance with clause 9.3, the Claimant will receive EUR 200 a month “at the exchange rate for the rent”.

6. As per clause 9.5, the salary is paid monthly on the 25th of the following month. “The payment is made in currency of Country D (…), at the official course of the National Bank of Country D for the day of payment”.

7. Clause 11.1(f) held that in case the Claimant suffers an accident during training or competition, the Respondent compels itself to the former his contractual rights.

8. Clause 11.1 (k) read: the Respondent “has to ensure, through medical specialized staff the medical assistance during training and official and friendly competitions, as well as first aid, specialty treatment for player’s recovery in case he suffers an accident”.

9. On 21 November 2016, the Claimant informed the Respondent via fax that per 25 November 2016 the amount of EUR 43,410 (or 200,514 in the currency of Country D) is still due to the Claimant as outstanding remuneration, as follows:

10. This fax also included the following: “[The Respondent] wants to terminate the contract with [the Claimant] due to the insolvency proceeding, which [the Respondent] is currently facing. Despite to the validity of the contract (…), you offered to him a prematurely withdrawal of the contract only for the debt per 31 December 2016 and a settlement schedule in 24 instalments within the next 2 years. [The Claimant] denied this offer. (…) [The Claimant] is offering you a counter-proposal for a prematurely termination of his contract for the total amount of EUR 49,410 net per 31 December 2016, payable on the day of termination in one lump sum. Nevertheless, despite to the counter-proposal, [the Claimant] is still interested to continue his career with [the Respondent] in case that you (…) settle a part of the due amount of at least 3 monthly salaries within the next 14 days. Therefore you are urged to pay (…) EUR 18,000 within 14 days upon the day of notification”.

11. On 7 December 2016, the Claimant sent another fax to the Respondent, holding that the EUR 18,000 had not been paid. Consequently, the Claimant now granted the Respondent “the very last term” until 21 December 2016 to pay the Claimant the amount of EUR 43,410. Furthermore, the Claimant informed the Respondent that he is reserving his right to terminate the contract unilaterally upon the expiration of this deadline.

12. On 22 December 2016, the Claimant terminated his employment contract with the Respondent. In his termination letter, the Claimant wrote that his reminders and new granted terms had remained unfulfilled and unanswered.

13. On 30 May 2017, the Claimant lodged a claim in front of FIFA and requested:

a) EUR 43,410 as outstanding remuneration relating to the unpaid salaries of June – October 2016; match bonuses; and surgery & recovery costs plus 5% interest p.a. “from the due dates until the day of effective payment”.

b) EUR 42,000 as compensation for the breach of contract by the Respondent plus 5% interest p.a. “from the due dates until the day of effective payment”.

c) That disciplinary sanctions are imposed on the Respondent in accordance with Article 17.4 FIFA RSTP.

14. On 12 December 2017, the Claimant amended his claim and requested:

a) “To uphold that the contract was unilaterally breached without just cause by [the Respondent]”;

b) To confirm that the Claimant terminated the contract with just cause;

c) EUR 41,875 as outstanding remuneration plus 5% interest p.a. from the due dates until the day of effective payment as follows:

d) EUR 49,600 as compensation for the breach of contract by the Respondent plus 5% interest p.a. “from the due dates until the day of effective payment” (i.e. November 2016 – June 2017 = 8 x EUR 6,000 + 8 x EUR 200).

e) That disciplinary sanctions are imposed on the Respondent in accordance with Article 17.4 FIFA RSTP.

15. The Claimant further held that for the months of April and May 2016, the Respondent paid him EUR 6,300 on 14 July 2016 and EUR 6,257 on 9 August 2016 respectively as monthly salary and rent contribution. Thus, the Claimant admitted that he received EUR 157 more than what was due to him.

16. Moreover, on 24 November 2016, two further payments were made to the Claimant of currency of Country D 1,579 and currency of Country D 4,500 respectively, which, according to the Claimant, was equal to EUR 354 and EUR 1,009 respectively.

17. Finally, the Claimant indicated that on 2 December 2016 an amount of currency of Country D 4,516 was transferred to him, which, according to the Claimant, was equal to EUR 1,013.

18. The Claimant therefore concluded that the amounts of EUR 157, EUR 353, EUR 1,009, and EUR 1,013 can be subtracted from the “June salary”. As a result, according to the Claimant, EUR 3,465 was still outstanding for June 2016.

19. The Claimant referred to the reminders and settlement offers sent to the Respondent on 21 November 2016 and 7 December 2016 respectively (cf. I.9 and I.11), in which he indicated that EUR 43,410 was outstanding, but now remarked: “The amount of EUR 41,875 is exact, according to the exchange rates per day of payment”.

20. As regards bonuses, the Claimant argued that until 31 December 2016, he had played 19 out of a possible 21 matches.

21. The Claimant further stated that “the surgery and recovery costs resulted to EUR 7,810 and were fully paid by [the Claimant] instead of [the Respondent]”.

22. On 23 February 2018, the Football Federation of Country D informed FIFA that the Respondent is still an affiliated member of the Football Federation of Country D. The Federation further stated that the Respondent is currently participating in “the League 2, organized by the Professional Football League in Country D”.

23. According to the information found in the Transfer Matching System (TMS), on 11 January 2017 the Claimant signed an employment contract with the Club F from Country E, valid from 1 February 2017 until 31 December 2017. According to clause

5 of the employment contract, the Claimant would obtain USD 170,000 net as a fixed annual salary. Moreover, Club F committed itself to pay the Claimant USD 50,000 net as signing fee “no later than 31 January 2017”.

24. Despite being invited to provide a reply to the Claimant’s claim, the Respondent failed to provide its reply.

II. Considerations of the Dispute Resolution Chamber

1. First of all, the Dispute Resolution Chamber (hereinafter also referred to as Chamber or DRC) analysed whether it was competent to deal with the case at hand. In this respect, it took note that the present matter was submitted to FIFA on 30 May 2017. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2017; hereinafter: Procedural Rules) are applicable to the matter at hand (cf. article 21 of the 2017 and 2018 editions of 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 in combination with art. 22 lit. b) of the Regulations on the Status and Transfer of Players (edition 2018) the Dispute Resolution Chamber shall adjudicate on an employment-related dispute with an international dimension, between a player from Country B and a club from Country D.

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 par. 1 and 2 of the Regulations on the Status and Transfer of Players (editions 2016 and 2018), and considering that the present claim was lodged on 30 May 2017, the 2016 edition of said regulations (hereinafter: 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 documentation contained in the file in relation to the substance of the matter. 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.

5. In this respect, the Chamber recalled that, the Claimant and the Respondent signed an employment contract valid as from 4 April 2016 until 30 June 2017. In this sense, the Chamber acknowledged that, in accordance with the contract, the Respondent was obliged to pay to the Claimant a monthly salary of EUR 6,000 net (cf. I.3). Moreover, the Chamber recalled that the contract established that the Respondent was obliged to provide the Claimant with an amount of EUR 200 per month “at the exchange rate for the rent” (cf. I.5).

6. The DRC further took into consideration that the Claimant unilaterally terminated the contract on 22 December 2016, after having put the Respondent in default on several occasions.

7. In continuation, the DRC recalled that the Claimant lodged a claim in front of FIFA on 30 May 2017, which was subsequently amended on 12 December 2017, requesting inter alia the amount of EUR 41,875 as outstanding remuneration, as well as the amount of EUR 49,600 as compensation for the alleged breach of contract by the Respondent.

8. Subsequently, the Chamber noted that the Respondent failed to present its response to the claim of the Claimant, in spite of having been invited to do so. By not presenting its position to the claim, the DRC was of the opinion that the Respondent renounced its right of defence and, thus, accepted the allegations of the Claimant.

9. Furthermore, as a consequence of the aforementioned consideration, the Chamber concurred that in accordance with art. 9 par. 3 of the Procedural Rules, it shall take a decision upon the basis of the documentation already on file; in other words, upon the statements and documents presented by the Claimant.

10. As a result, the Chamber established that the primary issue at stake is determining whether the Claimant had a just cause to terminate the contract with the Respondent on 22 December 2016. In this respect, the Chamber deemed it essential to make a brief recollection of the Claimant’s arguments regarding the contract termination, and in particular, verify which amount, if any, had in fact remained outstanding on the date of termination.

11. In this context, the Chamber evoked that, according the Claimant, part of the June 2016 salary was still outstanding, as well as the entire monthly salaries of July, August, September and October 2016, totalling EUR 27,465. Similarly, the DRC understood from the Claimant’s submissions that the Respondent failed to provide the rent money for the months June – October 2016, totalling EUR 1,000. In other words, and given that the contract stipulated that the due date for the monthly payment is on the 25th of the following month (cf. I.4), the Chamber concluded that, in accordance with the Claimant’s submissions, the Respondent had been in breach of the contract for almost five months by the time the Claimant terminated the contract.

12. Subsequently, the DRC referred to evidence provided by the Claimant, in particular the default notices sent to the Respondent by fax on 21 November 2016 and 7 December 2016 respectively (cf. I.9 and I.11), as well as the bank receipts indicating the amounts paid by the Respondent (cf. I.15-17), and concluded that the Claimant had substantiated his claim pertaining to these overdue payables with sufficient documentary evidence in accordance with art. 12 par. 3 of the Procedural Rules. That is, the Chamber concluded that the Claimant presented sufficient documentation relating to his claim for the outstanding monthly salaries and the outstanding rent money provided in the contract.

13. Taking into account the failure by the Respondent to pay the Claimant in accordance with the contract for a period of almost five months, the fact that the Claimant sent a number of default notices to the Respondent prior to terminating the employment contract; and the well established case law of the Chamber, the DRC concluded that these elements are sufficient to justify the termination by the Claimant of the employment contract with just cause on 22 December 2016.

14. That said, the Chamber concluded that the Respondent is to be held liable for the early termination of the employment contract with just cause by the Claimant and should therefore bear the consequences of its unjustified breach of the employment contract, including the possible payment of compensation to the Claimant, in addition to any possibly outstanding amounts at the time of termination.

15. Having established the above, and before entering the matter of the calculation of the compensation for breach of contract payable by the Respondent, the DRC first proceeded to establish the amount of outstanding remuneration, if any, still due to the Claimant by Respondent on the date of the decision.

16. In this context, the DRC recalled that, according to the Claimant, a total amount of EUR 41,875 was outstanding to him. As per the Claimant, this amount corresponded to outstanding salary, outstanding rent money, outstanding match bonus, as well as outstanding surgery and recovery costs (cf. I.14).

17. Firstly, with regard to the outstanding salary and rent money, the Chamber referred to its previous deliberations (cf. II.10-11), and determined that the amount of EUR 27,465 corresponding to monthly salaries, as well as the amount of EUR 1,000 corresponding to rent money, are still due to the Claimant.

18. Secondly, with respect to the alleged outstanding match bonus, the Claimant alleged that he is entitled to a total amount of EUR 5,600, corresponding to eight games played between August and November 2016 (cf. I.14). In this context, the DRC recalled that, as stipulated in the contract, the Claimant was entitled to “receive a bonus according (to) the Regulation of Internal Order” (cf. I.4). However, the Chamber also emphasized that neither the contract nor the Claimant’s submissions specified what the “Regulation of Internal Order” entailed, or what exact amount the Claimant was contractually entitled to, with respect to match bonus.

19. Consequently, taking into account the documentation presented by the Claimant in support of his petition, the DRC concluded that the Claimant had not fully substantiated his claim with pertinent documentary evidence in accordance with art. 12 par. 3 of the Procedural Rules. That is, there is no supporting documentation relating to the Claimant’s claim pertaining to outstanding bonus. Consequently, the DRC decided to reject this part of the Claimant’s claim.

20. Thirdly, regarding the alleged outstanding surgery and recovery costs, the Chamber recalled that the Claimant argued that he paid EUR 7,810 for his own treatment and that he should be reimbursed by the Respondent. In support of his request, the Claimant provided an invoice from a fitness center in Country B (cf. I.21).

21. However, the Chamber noted that the Claimant did not provide any evidence, such as bank receipts, that could demonstrate that he actually paid this amount. Furthermore, after examining the invoice provided by the Claimant, the DRC established that it was dated 2014, i.e. prior to the Claimant joining the Respondent, which was 1 February 2015. In other words, the DRC understood that the Respondent could not be held responsible for the payment of treatment that took place before the signing of the employment contract. Consequently, the DRC decided to reject this part of the Claimant’s claim.

22. On account of the aforementioned considerations, the DRC established that the Respondent failed to remit the Claimant’s pending remuneration in the total amount of EUR 28,465.

23. Consequently, the DRC decided that, in accordance with the general legal principle of pacta sunt servanda, the Respondent is liable to pay to the Claimant outstanding remuneration in the total amount of EUR 28,465.

24. In addition, taking into consideration the Claimant’s claim, the Chamber decided to award the Claimant interest at the rate of 5% p.a. on the amount of EUR 28,465, as of 22 December 2016 until the date of effective payment.

25. In continuation, the Chamber focused its attention on the calculation of the amount of compensation for breach of contract payable by the Respondent to the Claimant 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.

26. In application of the relevant provision, the Chamber held that it first of all had to clarify as to whether the pertinent employment contract contained 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.

27. As a consequence, 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 DRC 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. In this regard, the DRC emphasized beforehand that each request for compensation for contractual breach has to be assessed on a case-by-case basis taking into account all specific circumstances of the respective matter.

28. In order to estimate the amount of compensation due to the Claimant in the present case, the Chamber first turned its attention to the remuneration and other benefits due to him under the existing contract and/or the new contract(s), which criterion was considered to be essential. The DRC deemed it important to emphasise that the wording of art. 17 par. 1 of the Regulations allows it to take into account both the existing contract and the new contract, if any, in the calculation of the amount of compensation.

29. In view of the foregoing, the DRC concluded that the residual value of the contract amounted to eight monthly salaries, namely November 2016 until June 2017. Subsequently, the Chamber pointed out that in accordance with clauses 9.1 and 9.3 of the contract (cf. I.3 and I.5), the Claimant was to obtain a monthly salary of EUR 6,200. After multiplying the figure of EUR 6,200 by eight months, the Chamber concluded that the total residual value of the contract before mitigation is EUR 49,600.

30. 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 able 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 termination of contract with just cause in connection with the player’s general obligation to mitigate his damages.

31. The Chamber recalled that, on 11 January 2017 (cf. point I.23), the Claimant concluded an employment contract with Club F, for the period from 1 February 2017 to 31 December 2017. The Chamber then established that between 1 February 2017 and 30 June 2017 (i.e. the expiry date of the employment contract with the Respondent), the Claimant would have received a total amount of approx. EUR 72,993 plus a sign-on fee of approx. 47,231.

32. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, the Dispute Resolution Chamber decided that, even though the Respondent is considered liable for the breach of the relevant employment contract, the Claimant did not suffer any financial loss from the violation of the contractual obligations by the Respondent for the period from 1 February 2017 to 30 June 2017. Therefore, the Chamber decided that compensation for breach of contract in the matter should only be awarded to the Claimant for the months November 2016, December 2016 and January 2017. Consequently, the Dispute Resolution Chamber determined that the total amount of compensation due to the Claimant is EUR 18,600.

33. In addition, taking into account the Claimant’s request, the Chamber decided that the Respondent must pay to the Claimant interest of 5% p.a. on the amount of compensation as of the date on which the claim was lodged, i.e. 30 May 2017, until the date of effective payment.

34. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claims lodged by the Claimant are rejected.

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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, outstanding remuneration in the amount of EUR 28,465 plus 5% interest p.a. on the said amount as from 22 December 2016 until the date of effective payment.

3. The Respondent has to pay to the Claimant, within 30 days as from the date of notification of this decision, compensation for breach of contract in the amount of EUR 18,600 plus 5% interest p.a. on the said amount as from 30 May 2017 until the date of effective payment.

4. In the event that the amounts due plus interest to the Claimant in accordance with the above-mentioned points 2. and 3. are 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.

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

6. 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.

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Note relating to the motivated decision (legal remedy):

According to art. 58 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS directly within 21 days of receipt of notification of this decision and shall contain all the elements in accordance with point 2 of the directives issued by the CAS, a copy of which we enclose hereto. Within another 10 days following the expiry of the time limit for filing the statement of appeal, the appellant shall file a brief stating the facts and legal arguments giving rise to the appeal with the CAS (cf. point 4 of the directives).

The full address and contact numbers of the CAS are the following:

Court of Arbitration for Sport (CAS)

Avenue de Beaumont 2

CH-1012 Lausanne

Switzerland

Tel: +41 21 613 50 00

Fax: +41 21 613 50 01

e-mail: info@tas-cas.org

For the Dispute Resolution Chamber:

Omar Ongaro

Football Regulatory Director

Encl. CAS directives