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 31 August 2017

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 31 August 2017,

in the following composition:

Geoff Thompson (England), Chairman

Theo van Seggelen (Netherlands), member

Wouter Lambrecht (Belgium), member

Todd Durbin (USA), member

Takaya Yamazaki (Japan), 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 27 August 2015, the Player of Country B, Player A (hereinafter: the Claimant) signed an employment contract with the Club of Country D, Club C (hereinafter: the Respondent) valid from 27 August 2015 until 31 May 2016, on loan from the Club of Country B, Club E (hereinafter: Club E).

2. The contract provides for monthly remuneration of USD 5,000 for each of the nine months of validity of said contract. The contract also provides for the payment of USD 500 for “game for every official competition”.

3. On 30 May 2017, the Claimant lodged a claim against the Respondent before FIFA requesting to be paid a total of USD 40,000 plus 5% interest p.a. from 1 September 2015 until the date of effective payment as compensation for breach of contract.

4. The Claimant claims that after having suffered an injury in September 2015, the Respondent failed to pay the remaining amounts due in line with the employment contract. The Claimant and the Respondent had agreed that the Claimant would be sent to his home country for treatment and should return once he was able to re-join the group. He claims that upon his return to Country D, he had been informed that upon termination of the contract he would be free to continue with another club but would not receive the remaining amount of eight months of unpaid wages. Consequently, he deems to be entitled to USD 40,000 pertaining to the eight unpaid monthly salaries.

5. In spite of having been invited to do so, the Respondent did not reply to the claim of the Claimant.

6. From the information contained on the Transfer Matching System (TMS), it appears the player returned to Club E on 6 July 2016 after the end of his loan with Club C.

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 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. 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 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. 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 (2016), 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 arguments and the documentation submitted by the parties. The Chamber, however, 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. The Chamber first acknowledged that the parties were contractually bound by an employment contract dated 27 August 2015, valid as from the date of signature until 31 May 2016, and according to which the player was entitled to receive inter alia monthly remuneration in the amount of USD 5,000 for the 9 months of contract.

6. The members of the Chamber then reviewed the claim of the Claimant, who maintains to have been sent back to Country B for treatment by the Respondent, after suffering an injury in September 2015. Once he recovered, he allegedly returned to Country D on a unspecified date, only to be informed by the Respondent that he was being dismissed and would consequently not receive the 8 remaining monthly salaries originally stipulated in the contract.

7. Subsequently, the DRC 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 concurred that the Respondent renounced its right of defence and, thus, accepted the allegations of the Claimant.

8. Furthermore, as a consequence of the aforementioned consideration, the members of the DRC concurred that in accordance with art. 9 par. 3 of the Procedural Rules, the Chamber 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.

9. On account of the above, the Chamber highlighted that the underlying issue in this dispute was to determine whether the Respondent had had a just cause to dismiss the player after his return from Country B. The Chamber also underlined that, subsequently, if it were found that the contract was terminated by the Respondent without just cause, it would be necessary to determine the consequences thereof.

10. Having said that, the Chamber pointed out that there was no written evidence of the termination of the contract by the Respondent on file, but in view of the fact that all allegations of the Claimant remained entirely undisputed by the Respondent and that the Claimant states that the termination was announced to him as 8 monthly salaries were still to fall due, the Chamber came to the conclusion that the contract was terminated by the Respondent on or about the end of September 2015. As per the claim of the Claimant, no reason was provided for the termination. Therefore, the Chamber concluded that the latter was made without just cause and in disregard of its ultima ratio nature.

11. For the sake of completion of its analysis, the Chamber deemed it appropriate to remind the parties of its well-established jurisprudence, according to which an injury or health condition of a player cannot be considered as a valid reason to cease the payment of a player’s remuneration and even less so to terminate an employment contract.

12. In view of the above, the Chamber was of the opinion that the Respondent did not have a just cause to prematurely terminate the contract with the Claimant on or about the end of September 2015 and would thus be held liable for the financial and sporting consequences of such breach.

13. Prior to establishing the consequences of the breach of contract without just cause by the Respondent in accordance with art. 17 par. 1 of the Regulations, the Chamber held that it had to address the issue of any unpaid remuneration at the moment the contract was terminated by the Respondent. In this respect, the Chamber noted that the Claimant does not claim any outstanding remuneration and implicitly admits having received from the Respondent 1 monthly salary from the total of 9 salaries due for the entire contractual period. Therefore, the Chamber concluded that no outstanding remuneration was due to the Claimant.

14. Having established the above, the Chamber turned its attention to the question of the consequences of the unilateral termination of the contracts by the Respondent without just cause on or about the end of September 2015.

15. Taking into consideration art. 17 par. 1 of the Regulations, the Chamber decided that the Claimant is entitled to receive compensation from the Respondent for the termination of the contract without just cause.

16. The members of the Chamber firstly 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.

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

18. The members of the Chamber noted that no such clause was included in the contract and, as a consequence, 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. In this regard, the Dispute Resolution Chamber emphasised beforehand that each request for compensation for contractual breach has to be assessed by the Chamber on a case-by-case basis taking into account all specific circumstances of the respective matter.

19. In order to estimate the amount of compensation due to the Claimant in the present case, the members of the Chamber first 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, if any, in the calculation of the amount of compensation.

20. Bearing in mind the consideration under point II.19 above, the Chamber concluded that the amount of USD 40,000, i.e. corresponding to 8 months of remuneration in the amount of USD 5,000 serves as the basis for the final determination of the amount of compensation for breach of contract.

21. 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.

22. It was duly noted that, in accordance with the information contained in the TMS, the player only returned to his original club in Country B, from which he had been loaned to the Respondent, on 6 July 2016, i.e. after the original expiry date of the contract with the Respondent. Thus, the Chamber concluded that the Claimant was not able to mitigate the damages suffered from the premature termination of the contract by the Respondent and no deductions would be made to the amount of USD 40,000, corresponding to the residual amount of the contract.

23. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, the Chamber decided that the Respondent must pay the amount of USD 40,000 as compensation for breach of contract to the Claimant.

24. In addition, taking into account the Claimant’s request as well as its well-established jurisprudence, 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.

25. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claims lodged by the Claimant are 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 from the date of notification of this decision, compensation for breach of contract in the amount of USD 40,000 plus 5% interest p.a. from 30 May 2017 until the date of effective payment.

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

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.

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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

Encl. CAS directives