F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2018-2019) – fifa.com – atto non ufficiale – Decision 10 August 2018

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 10 August 2018,

in the following composition:

Geoff Thompson (England), Chairman

Carlos González Puche (Colombia), member

Eirik Monsen (Norway), member

Juan Bautista Mahiques (Argentina), member

Daan de Jong (The Netherlands), 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 12 August 2016, 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) which “enters into force on 12.08.2016 and be effective during 2016/2017 and 2017/2018 football seasons”.

2. In accordance with art. 6.1 of the contract, the player was entitled to a salary of EUR 400,000 for season 2016/2017 and of EUR 450,000 for season 2017/2018. In particular, the salary for season 2016/2017 was payable as follows:

a) EUR 50,000 on the date of signature of the contract;

b) EUR 50,000 on 31 August 2016;

c) EUR 75,000 on 30 November 2016;

d) EUR 75,000 on 31 January 2017;

e) EUR 75,000 on 31 March 2017;

f) EUR 75,000 on 31 May 2017.

3. According to art. 6.3 of the contract, the player was entitled to EUR 10,000 for each season, “for the expenses with regard to – including but not limited with – residence, car, flight tickets”.

4. On 26 April 2017, the player put the club in default for the payment of EUR 145,000, corresponding to part of the instalment due on 31 January 2017 and to the entire instalment due on 31 March 2017, granting ten days to remedy the default.

5. On 9 May 2017, the club replied to the player’s letter acknowledging that it had receivables towards the player stating, however, that it had already paid him EUR 60,000 on 4 May 2017.

6. On 10 May 2017, the player sent another letter to the club, by means of which he acknowledged receipt of the payment of EUR 60,000 and put it in default for the amount of EUR 85,000, requesting the payment within the following five days.

7. On 16 May 2017, the player terminated the contract with immediate effect.

8. On 9 August 2017, the player lodged a claim in front of FIFA against the club for breach of contract, requesting the following:

a) EUR 85,000 plus 5% interest p.a., for outstanding salaries, broken-down as follows:

i. EUR 10,000 for part of the instalment due on 31 January 2017, plus 5% interest p.a. as of the same date;

ii. EUR 75,000 for the instalment due on 31 March 2017, plus 5% interest p.a. as of the same date.

b) EUR 535,000 as compensation for breach of contract, corresponding to the remaining value of the contract, plus 5% interest p.a. as of the date of the claim.

9. In his claim, the player alleged that the club was constantly late with the payment of his salary and he terminated the contract as he allegedly lost confidence in the future performance of the club’s obligations. In particular the player emphasised that the club completed the payment of the instalment due on 30 November 2016 with 5 months of delay, as follows: EUR 30,000 on 17 February 2017, EUR 20,000 on 2 March 2017 and EUR 25,000 on 20 April 2017.

10. Moreover, the player argued that he terminated the contract with just cause, as a significant amount – i.e. EUR 85,000 – corresponding to “nearly 3 month salary” was due on the date he terminated the contract.

11. In its reply, the club affirmed that the player terminated the contract without just cause because, on the date of termination, only the amount of EUR 48,680.49 was outstanding. In particular, the club stated that it paid the following amounts to the player:

a) EUR 50,000 on 15 August 2016;

b) EUR 60,000 on 31 August 2016;

c) 18,800 in the currency of Country D, corresponding to EUR 5,639.04, on 28 September 2016;

d) 8,100 in the currency of Country D, corresponding to EUR 2,395.74, on 27 October 2016;

e) EUR 30,000 on 16 February 2017;

f) 14,000 in the currency of Country D, corresponding to EUR 3,714.21, on 23 February 2017;

g) 19,000 in the currency of Country D, corresponding to EUR 4,974.47, on 28 February 2017;

h) EUR 20,000 on 1 March 2017;

i) EUR 30,000 on 20 April 2017;

j) EUR 60,000 on 4 May 2017;

k) 17,500 in the currency of Country D, corresponding to EUR 4,487.63, on 5 May 2017;

l) 20,000 in the currency of Country D, corresponding to EUR 5,108.42, on 9 May 2017.

In this regard, the club submitted alleged payment receipts, referring to the payments under the above lit. a), b), c), d), e), h), i) and j) only, however not translated in an official FIFA language.

12. In his replica, the player reiterated his previous arguments and acknowledged that the club presented payment receipts for only two of the alleged payments made in currency Country D- namely under point 11 lit. c) and d) above - which, however, referred to the payment of match bonuses. What is more, the player pointed out that said bonuses were not provided in the contract.

13. Despite having been invited by the FIFA Administration to do so, the club did not submit any comments on the player’s replica.

14. Upon request of the FIFA Administration, the player informed FIFA that, on a not specified date, he entered into an employment contract with the club of Country E, Club F, valid as from 1 July 2017 until 30 June 2019. According to this new contract, the player, for season 2017/2018, is entitled to a monthly salary of 216,667 in the currency of Country E “which is equal 54,166 Euro” payable on the last day of each month as from 1 July 2017 until 30 June 2018.

15. After the closure of the investigation-phase, the club informed the FIFA Administration that it paid the player the amount of EUR 50,000 on 29 March 2018. The player, upon request of FIFA, acknowledged receipt of such payment.

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 9 August 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 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 9 August 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. 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 12 August 2016 until the end of season 2017/2018, which entitled the Claimant to:

i) a total salary of EUR 400,000 for season 2016/2017 payable as follows:

a) EUR 50,000 on 12 August 2016;

b) EUR 50,000 on 31 August 2016;

c) EUR 75,000 on 30 November 2016;

d) EUR 75,000 on 31 January 2017;

e) EUR 75,000 on 31 March 2017;

f) EUR 75,000 on 31 May 2017;

ii) a total salary of EUR 450,000 for season 2017/2018.

6. Moreover, the DRC acknowledged that it was undisputed that, on 10 May 2017, the Claimant put the Respondent in default of payment of EUR 85,000, corresponding to part of the instalment due on 31 January 2017 and to the entire instalment due on 31 March 2017, and thereafter terminated the contract on 16 May 2017. Furthermore, the Chamber observed that the Respondent provided the Claimant with the payment of EUR 50,000 on 29 March 2018.

7. In continuation, the DRC noted that the Claimant alleged that the Respondent breached the contract as it failed to pay him EUR 85,000, arguing that such amount was corresponding to nearly three monthly salaries. Moreover, the Claimant emphasised that the Respondent was constantly late with the payment of his salaries and stressed that, in view of the above-mentioned circumstances, he terminated the contract with just cause.

8. Equally, the Chamber took note of the reply of the Respondent, which maintained that it provided the Claimant with the payments listed under point I.11 above, arguing that, on the date the Claimant terminated the contract, only the amount of EUR 48.680,49 was outstanding. Hence, the Respondent averred that the Claimant terminated the contract without just cause.

9. Furthermore, the DRC also duly noted that the Claimant rejected the arguments raised by the Respondent and, in particular, he argued that the Respondent, within its submission, only submitted two payment receipts for the payments allegedly made in currency of Country D, namely those under paragraph I.11 lit. c) and d). What is more, the Claimant maintained that said payment receipts referred to two match bonuses which were not provided in the contract.

10. 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 consequence of said termination.

11. In continuation, the members of the Chamber referred to the basic principle of burden of proof, as established in 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 respective burden of proof.

12. With the above in mind, the members of the Chamber went on to analyse the alleged payment receipts submitted by the Respondent in order to prove that the execution of the payments under paragraph I.11 above. In this regard, the members of the Chamber first recalled that, in accordance with art. 9 par. 1 lit. e) of the Procedural Rules, all documentation provided in the context of a dispute in front of FIFA should be presented in the original version and, if applicable, translated into one of the official FIFA languages (English, French, Spanish and German). Bearing in mind the wording of the aforementioned provision, the Chamber were eager to emphasise that the Respondent failed to submit such documents translated into one of the four official FIFA languages which, therefore, could not be taken into account.

13. Consequently, the members of the DRC deemed that no substantial evidence was provided by the Respondent with regard to the alleged payments and, in accordance with the well-established jurisprudence of the DRC, the members of the Chamber had no other option than not to take into account the alleged payment receipts submitted by the Respondent.

14. On account of the aforementioned, and 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, on the date of termination of the contract by the Claimant - i.e. 16 May 2017- failed to pay the amount of EUR 85,000 to the player. Moreover the members of the Chamber pointed out that such amount is equivalent to more than two and a half monthly salaries and concluded that, as the Respondent failed to pay said remuneration without any valid reason, 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.

15. In view of the above, and taking into consideration the Chamber’s longstanding jurisprudence in this respect, the Chamber decided that the Claimant had just cause to unilaterally terminate the employment contract on 16 May 2017 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.

16. 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 would be, in principle, liable to pay to the Claimant the amounts which were outstanding under the contract at the moment of the termination, i.e. EUR 85,000. Nonetheless, the Chamber recalled that it remained undisputed that the Respondent provided the Claimant with the payment of EUR 50,000 on 29 March 2018 and, thus, proceeded to deduct such amount from the monies which were outstanding on the date of termination of the contract. On account of the aforementioned considerations, the DRC concluded that Claimant is entitled to receive from the Respondent outstanding remuneration in the amount of EUR 35,000.

17. In addition, taking into consideration the Claimant’s claim, the Chamber decided to award the Claimant interest at the rate of 5% p.a. as of the day following the day on which the payment fell due in accordance with the contract, i.e. 1 April 2017, until the date of effective payment.

18. In continuation and 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 decided that, taking into consideration art. 17 par. 1 of the Regulations, the Claimant is entitled to receive from the Respondent compensation for breach of contract in addition to the aforementioned outstanding remuneration.

19. In this context, the Chamber outlined that in accordance with said provision 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.

20. In application of the relevant provision, the Chamber held that it first of all had to clarify whether the pertinent employment contract contained any clause, by means of which the parties had beforehand agreed upon a 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 contract at the basis of the matter at stake.

21. 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. Bearing in mind the foregoing, the Chamber proceeded with the calculation of the monies payable to the Claimant under the terms of the contract as from its termination and concluded that the Claimant would have been entitled to receive EUR 535,000, namely the last instalment for season 2016/2017 (i.e. EUR 75,000) and the entire remuneration for season 2017/2018 (i.e. EUR 460,000), had the contract been executed until its expiry date.

22. In continuation the Chamber assessed as to whether the Claimant has 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 DRC, such remuneration under a new employment contract(s) 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.

23. Indeed, the Claimant found employment with the club of Country E, Club F, which entitled him to a monthly salary of 216,667 in the currency of Country E for season 2017/2018, corresponding to approximately EUR 54,166. Therefore, for the period between 1 July 2017 until 30 June 2018, the player’s salary amounted to EUR 595,826.

24. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, the DRC decided that the Respondent must pay the Claimant the amount of EUR 75,000, which is to be considered a reasonable and justified amount of compensation for breach of contract in the matter at hand.

25. In addition, taking into account the Claimant’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 Claimant interest of 5% p.a. on the amount of compensation as of the date on which the claim was lodged, i.e. 9 August 2017, until the date of effective payment.

26. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claim lodged 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, outstanding remuneration in the amount of EUR 35,000, plus 5% interest p.a. as of 1 April 2017 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 75,000, plus 5% interest p.a. as of 9 August 2017 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

Encl.: CAS directives