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 15 February 2018

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 15 February 2018,

in the following composition:

Thomas Grimm (Switzerland), Deputy Chairman

Eirik Monsen (Norway), member

Stéphane Burchkalter (France), member

Philippe Diallo (France), member

Joseph Antoine Bell (Cameroon), 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

arisen between the parties

I. Facts of the case

1. On 22 July 2015, the player of Country B, Player A (hereinafter: the Claimant or the player) and the club of Country D, Club C (hereinafter: the Respondent or the club) signed an employment contract (hereinafter: the contract) valid as from the date of signature until 31 May 2016.

2. In accordance with art. 3 of the contract, the Claimant was entitled to a monthly salary of EUR 18,000, payable on the last day of each month starting on 31 August 2015.

3. Furthermore, art. 3 of the contract stipulates that “if the club does not fulfil the payment commitment in 90 days as from payment date, football player has the rights to send notice and cancel unilateral and immediately after giving time of 1 month”.

4. On 8 December 2015, the Claimant sent a letter to the Respondent by means of which he requested the payment of outstanding salaries, in the amount of EUR 54,000, corresponding to the period between September and November 2015, within seven days. The Claimant also held that, since the Respondent allegedly neither make any payment nor any statement in this regard, “granting [the Respondent] 30-day period which is set forth in the agreement has no meaning”.

5. On the same date, the Respondent replied to the Claimant’s letter stating that it could not accept a grace period of seven days, as the contract provided a period of thirty days.

6. On 22 January 2016, the Claimant informed the Respondent about the termination of the contract due to the non-payment of his salaries. Moreover, the Claimant alleged that the Respondent wanted him “to leave the team by keeping him suspended from the squad”.

7. On 13 December 2016, the Claimant lodged a claim in front of FIFA against the Respondent for breach of contract, requesting the following:

a) EUR 84,600 for outstanding salaries, broken-down as follows:

i. EUR 72,000 for the period between September and December 2015;

ii. EUR 12,600 for the period between 1 and 22 January 2016.

b) EUR 50,270 as compensation for breach of contract, calculated as follows:

i. EUR 77,400 for the residual value of the contract; minus

ii. USD 30,000, corresponding to the value of the new employment contract, until 31 May 2016, concluded between the Claimant and the club of Country E, Club F on 29 February 2016.

c) Interest of 5% p.a. on the aforementioned amounts as from the due dates until the date of effective payment.

8. In his claim, the Claimant alleged that the Respondent paid him only the first monthly salary for the month of August 2015 and stated that the new employment contract he concluded with the Club F was valid as from 29 February 2016 until 30 October 2016 and provided a monthly salary of USD 10,000.

9. In its reply, the Respondent rejected the arguments of the Claimant and stated that, in addition to the payment acknowledged by the latter, it paid him the following amounts:

a) 4,000 in the currency of Country D on 28 August 2015 “as a premium”;

b) EUR 1,000 on 28 August 2015 as “effective selling”;

c) 2,000 in the currency of Country D on 30 October 2015 as ”match premium”;

d) 2,000 in the currency of Country D on 11 December 2015 as “premium payment”.

In this regard, the Respondent submitted the bank receipts referring to the aforementioned payments.

10. Furthermore, the Respondent argued that the Claimant was responsible for having concluded a new employment contract, with Club F, providing for a lower remuneration. In view of that, the club maintained that it was not responsible for the payment of the claimed compensation for breach of contract.

11. In his replica, the Claimant insisted on his previous arguments and stressed that the further payments mentioned by the Respondent did not constitute salary payments, but rather match bonuses. Moreover, the Claimant denied having received the payment of EUR 1,000 on 28 August 2015 and emphasised that the relevant bank receipt submitted by the club did not indicate him as recipient.

12. In its duplica, the Respondent reiterated its arguments and, in particular, insisted that the further payments mentioned in its response to the claim had to be deducted from the Claimant’s outstanding salaries.

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 matter at hand. In this respect, it took note that the present matter was submitted to FIFA on 13 December 2016. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2015; hereinafter: Procedural Rules) are applicable to the matter at hand (cf. art. 21 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 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. In continuation, 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 (edition 2018), and considering that the present claim was lodged on 13 December 2016, 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 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.

5. First, the Chamber noted that the parties entered into an employment contract valid as of 22 July 2015 until 31 May 2016, which entitled the Claimant to a monthly salary of EUR 18,000, payable on the last day of each month as of 31 August 2015.

6. In continuation, the DRC took note that, on 8 December 2015, the Claimant put the Respondent in default of three monthly salaries, corresponding to the amount of EUR 54,000, granting the Respondent seven days in order to remedy the default.

7. Furthermore, the DRC acknowledged that it remained undisputed that the Claimant terminated the contract on 22 January 2016.

8. After having taken note of the above, the DRC also took note of the position of the parties in the present matter. First, the Claimant affirmed that, on the date he terminated the contract, the equivalent of more thanfour monthly salaries were unpaid by the Respondent and, thus, he argued that the he terminated the contract with just cause.

9. Equally, the members of the Chamber took note of the position of the Respondent, which, conversely, maintained that it made further payments to the Claimant, in the total amount of 8,000 in the currency of Country D and EUR 1,000 (cf. point I.9. above), which had to be deducted from the Claimant’s outstanding remuneration.

10. Furthermore, the Respondent affirmed that the Claimant concluded a new employment contract with the Club F providing for a remuneration lower than that of the contract. Consequently, the Respondent argued that only the Claimant was to be held responsible for his lower remuneration and, thus, no compensation was due to the latter.

11. In view of the foregoing considerations, the Chamber deemed that the underlying dispute in the matter at hand was whether the relevant employment contract had been terminated by the Claimant with or without just cause and, depending on this finding, it would have to determine which would be the potential consequences of said termination.

12. In this context, the members of the Chamber went on to analyse the Respondent’s line of defence and, in particular, the further payments it made to the Claimant (cf. point I.9. above). In this regard, the members of the DRC noted that the payments made in the currency of Country D expressly referred to “premium(s)”. Moreover, the DRC also noted that the relevant bank receipt of the payment of EUR 1,000 only referred to an “effective selling” and did not even mention the name of the player involved.

13. With the above in mind, the DRC recalled the basic principle of burden of proof, as established in art. 12 par. 3 of the Procedural Rules, according to which a party claiming a right on the basis of an alleged fact shall carry the respective burden of proof.

14. In view of the above-mentioned considerations, the DRC concluded that the payments mentioned by the Respondent could not correspond to the outstanding salaries due to the Claimant. Thus, as a consequence thereof, the Chamber decided to reject the argument of the Respondent in this regard.

15. In continuation, considering that the Respondent did not invoke any other reason to justify the non-payment of the Claimant’s salaries, the Chamber deemed that the Respondent failed to pay in due time the Claimant’s salary for the months of September, October, November and December 2015 without any valid reason and, therefore, it could be established that the Respondent had seriously neglected its contractual obligations towards the Claimant in a continuous manner and for a significant period of time. What is more, the Chamber emphasised that it remained undisputed that the Claimant put the Respondent in default on 8 December 2015. This is, 45 days elapsed since the date of the Claimant’s default notice and the date on which he terminated the contract.

16. In view of the above, and taking into consideration the Chamber’s longstanding jurisprudence in this respect, the DRC decided that the Claimant had just cause to unilaterally terminate the employment contract on 22 January 2016 and that, as a result thereof, the Respondent is to be held liable for the early termination of the employment contact with just cause by the Claimant.

17. In continuation, having established that the Respondent is to be held liable for the early termination of the employment contract with just cause by the Claimant, the Chamber focused its attention on the consequences of such termination. In this regard, in accordance with the general legal principle of pacta sunt servanda, the Chamber decided that the Respondent is liable to pay to the Claimant the amounts which were outstanding under the contract at the moment of the termination, i.e. EUR 72,000 corresponding to the salaries for the months of September, October, November and December 2015.

18. In addition, taking into consideration the Claimant’s request as well as the constant practice of the Dispute Resolution Chamber in this regard, the members of the Chamber decided to award the Claimant interest on the above-mentioned amount as follows:

a) as of 1 October 2015, on the amount of EUR 18,000;

b) as of 1 November 2015, on the amount of EUR 18,000;

c) as of 1 December 2015, on the amount of EUR 18,000;

d) as of 1 January 2016, on the amount of EUR 18,000.

19. In continuation, the Chamber decided that, in accordance with art. 17 par. 1 of the Regulations, the Respondent is liable to pay compensation for breach of contract to the Claimant. In this regard, the Chamber pointed out that, according to said art. 17 par. 1, in all cases the party in breach shall pay compensation. Therefore, the Chamber outlined that the argument of the Respondent that the Claimant would not be entitled to compensation by the mere fact that he concluded a new contract clearly cannot be upheld.

20. In application of the aforementioned provision, the Chamber recalled that 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.

21. Furthermore, the Chamber held that it first of all had to clarify as to whether the pertinent employment contract and the private agreement contain 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.

22. 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.

23. Bearing in mind the foregoing, and in order to evaluate the compensation to be paid by the Respondent, the members of the Chamber proceeded with the calculation of the monies payable to the Claimant under the terms of the employment contract and concluded that the Claimant would have received a total remuneration of EUR 90,000, had the contract been executed until its expiry date. The Chamber concluded that this amount shall serve as the basis for the final determination of the amount of compensation for breach of contract.

24. 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.

25. Indeed, the Claimant found employment with the club, Club F, which entitled him to a total salary of EUR 24,900 for the period between 29 February and 31 May 2016.

26. The members of the Chamber further recalled that the Claimant’s entire claim amounts to EUR 134,870 and that the Respondent, as provided above, shall pay EUR 72,000 for outstanding remuneration.

27. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, the DRC concluded that the Respondent must pay compensation for breach of contract in the final amount of EUR 62,870 to the Claimant, which is to be considered a reasonable and justified amount of compensation for breach of contract in the matter at hand.

28. In addition, and with regard to the Claimant's request for interest, the Chamber, pursuant to its well-established jurisprudence, decided that the Claimant is entitled to 5% interest p.a. on said amount, as of the date the claim was lodged, i.e. as of 13 December 2016.

29. The members of the Chamber concluded their deliberations by rejecting any further claim of the Claimant.

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 72,000 plus 5% interest p.a. until the date of effective payment, as follows:

a. as of 1 October 2015, on the amount of EUR 18,000;

b. as of 1 November 2015, on the amount of EUR 18,000;

c. as of 1 December 2015, on the amount of EUR 18,000;

d. as of 1 January 2016, on the amount of EUR 18,000.

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 62,870, plus 5% interest p.a. as of 13 December 2016 until the date of effective payment.

4. In the event that the amounts plus interest due to the Claimant in accordance with the above-mentioned numbers 2. and 3. are not paid by the Respondent within the stated time limits, 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 remittances are 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:

Omar Ongaro

Football Regulatory Director