F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2019-2020) – fifa.com – atto non ufficiale – Decision 3 July 2019

Decision of the

Dispute Resolution Chamber (DRC) judge

passed on 3 July 2019,

by Philippe Diallo (France), DRC judge,

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 25 March 2016, the player from Country B, Player A (hereinafter: the player or the Claimant), and the club from Country D, Club C (hereinafter: the club or the Respondent), concluded an employment contract (hereinafter: the contract), valid as “from 1 April 2016 through to 31 December 2017. Unless this contract is earlier terminated in accordance with the conditions herein as agreed by both parties, this contract shall continue to remain in effect for a period of 2 years from the effective date”.

2. According to clause 1.1.1 of the contract, the Respondent undertook to pay the Claimant, inter alia, a monthly salary of USD 8,250, due “bi-weekly or every 16th and the last day of the month depend on the club policy”.

3. Clause 1.1.3 of the contract stipulates that “accommodation will be provided or paid by the club or 10,000 /month after effective contract”.

4. Clause 7 of the contract further stipulates that “[P]rior departure as the club’s player, the player must make his request in writing by observing the contract, and must obtain approval from the club in advance; the club is entitled to ask for payment from the player if the player terminates without reason only”.

5. Moreover, clause 8 of the contract stipulates that “[I]f the player is in breach of any one of the rules in this contract, the player agrees to submit to compensation including fines, and if the player causes damage to the club, the player also agrees to submit to compensation to the club”.

6. On 31 October 2017, the parties concluded a termination agreement (hereinafter: the termination agreement), which stipulates the following:

“By signing this document, the parties agree upon the termination of the current employment contract signed between [the player] and the club from November 18th 2017. Furthermore, the parties agree to waive any contractual demands and hereby confirm that there are no further financial obligations between the parties after the termination on November 18th 2017. It is further specified that the club will pay the last salary of October 2017 and the salary covering the period from November 1st 2017 to November 18th 2017”.

7. On 26 March 2018 and 11 April 2018, the Claimant put the Respondent in default of payment of i) USD 5,565, corresponding to “the pro-rata monthly salary covering the period between 1 November 2017 to 18 November 2017” and ii) 110,000, corresponding to the Claimant’s “house rent” for 2017 (10,000 x 11 months), setting a 10 days’ time limit in order to remedy the default.

8. On 2 May 2018, the Claimant lodged a claim against the Respondent in front of FIFA asking that the Respondent be ordered to pay him the following amounts, plus “5% interest p.a. as from the date of signature of the termination agreement”, i.e. as from 31 October 2017:

i. USD 5,565, corresponding to “the pro-rata salary covering the period from 1 November 2017 to 18 November 2017”, as stipulated in the termination agreement;

ii. USD 3,480.21, which according to the Claimant, equals 110,000, corresponding to the “refund of the costs paid for the rental of the apartment for the year 2017”.

The Claimant further requested that sporting sanctions be imposed on the Respondent.

9. In his claim, the Claimant referred to the termination agreement signed between the parties and maintained that the Respondent failed to fulfil its financial obligations arising from said agreement since it only paid to the Claimant the salary of October 2017.

10. Furthermore, the Claimant referred to clause 1.1.3 of the contract and affirmed that the Respondent “never paid the costs for the accommodation concerning the year 2017, obliging the [Claimant] to pay the rent of the apartment by himself”.

11. In its reply, the Respondent affirmed that as of September 2017, the Claimant started “establishing concrete contacts with other clubs and wanted to force a transfer to another club”. Furthermore, the Respondent argued that the Claimant acted in bad faith and breached, in particular, clause 7 and 8 of the contract “by not notifying the club about his transfer while under contract with the club”. In this regard, the Respondent affirmed that it found out “through traditional media that the player had signed a contract with a club from Country D”.

12. Moreover, the Respondent held that it organized a meeting with the Claimant to “talk about this issue” and that it “had no other possibility than to fine the [Claimant] for [his] behaviour”. In this context, the Respondent declared that “given the good relationship they had with the player until then”, it decided to agree on a mutual termination of the contract with the Claimant on 31 October 2017.

13. In this context, the Respondent affirmed that “it was orally agreed that the [Respondent] would pay the salary of October and set-off the remaining November salary with the fine because of the breach of contract […] leaving no further debts for either parties”. In this context, the Respondent deemed that it paid the Claimant’s salary for October 2017 and that the Claimant’s pro-rata salary for November 2017 was set-off with the alleged fine imposed on the Claimant.

14. What is more, the Respondent argued that the termination agreement does not contain any clause providing “the right to demand a housing compensation by the claimant”. In this regard, the Respondent held that the termination agreement “clearly states that further than salary there will be no financial obligations between the parties”.

15. In view of the above, the Respondent requested FIFA to fully dismiss the claim of the Claimant or alternatively, “and in the unlikely event the claim is not fully dismissed, at least lower the claim of the [Claimant] to the pro-rata salary of November 2017 (USD 5,556)”. In addition, the Respondent requested that all the legal costs be borne by the Claimant.

16. In his replica, the Claimant reiterated all his argumentations and declared that the Respondent “recognized its debt” arising from the termination agreement.

17. Furthermore, the Claimant explained that he only signed a contract with the club from Country D, Club F, after the signature of the termination agreement and submitted in this regard a copy of his new contract, which provides that the contract was valid as from 1 January 2018 until 31 December 2018.

18. In addition, the Claimant underlined that “there were no other pacts or agreements reached orally and/or signed in written by the parties” and reiterated that the Respondent failed to pay him the amount of USD 5,565 as pro-rata monthly salary for November 2017.

19. Equally, the Claimant argued that “the requested refund of the accommodation costs concerns the period prior of the anticipated termination” and that “this contractual right was never waived by the player upon signature of the termination agreement”.

20. In its duplica, the Respondent reiterated its previous argumentations.

II. Considerations of the DRC Judge

1. First of all, the DRC judge analysed whether he was competent to deal with the case at hand. In this respect, the DRC judge took note that the present matter was submitted to FIFA on 2 May 2018. Consequently, the DRC judge concluded that the 2018 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber, (hereinafter: the Procedural Rules), is applicable to the matter at hand (cf. art. 21 of the Procedural Rules).

2. Subsequently, the DRC judge referred to art. 3 par. 2 and 3 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 and 2 in combination with art. 22 lit. b) of the Regulations on the Status and Transfer of Players (edition June 2019) the DRC judge is competent to decide on the present matter, which concerns an employment-related dispute with an international dimension between a player from Country B and a club from Country D.

3. Furthermore, the DRC judge 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, he confirmed that in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players (edition June 2019) and considering that the present claim was lodged in front of FIFA on 2 May 2018, the 2018 edition of the Regulations on the Status and Transfer of Players (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

4. The competence of the DRC judge and the applicable regulations having been established, the DRC judge entered into the substance of the matter. The DRC judge started by acknowledging the above-mentioned facts as well as the documentation contained in the file. However, the DRC judge emphasised that in the following considerations he will refer only to the facts, arguments and documentary evidence, which he considered pertinent for the assessment of the matter at hand.

5. Having said this, the DRC judge acknowledged that the Claimant and the Respondent signed an employment contract valid as from “1 April 2016 through to 31 December 2017. Unless this contract is earlier terminated in accordance with the conditions herein as agreed by both parties, this contract shall continue to remain in effect for a period of 2 years from the effective date”. In accordance with said contract, the Claimant was entitled to receive, inter alia, a monthly salary of USD 8,250, due “bi-weekly or every 16th and the last day of the month depend on the club policy”.

6. Furthermore, the DRC judge acknowledged that, in accordance with art. 1.1.3 of the contract, “accommodation will be provided or paid by the club or 10,000/month after effective contract”.

7. Equally, the DRC judge took note that, on 31 October 2017, the parties had concluded a termination agreement, by means of which the parties agreed upon the following: “By signing this document, the parties agree upon the termination of the current employment contract signed between [the player] and the club from November 18th 2017. Furthermore, the parties agree to waive any contractual demands and hereby confirm that there are no further financial obligations between the parties after the termination on November 18th 2017. It is further specified that the club will pay the last salary of October 2017 and the salary covering the period from November 1st 2017 to November 18th 2017”.

8. In addition, the DRC judge observed that the Claimant claimed from the Respondent the amount of USD 5,565, corresponding to i) the “pro-rata salary covering the period from 1 November 2017 to 18 November 2017”, as stipulated in the termination agreement and ii) USD 3,480.21, which according to the Claimant, equals 110,000, corresponding to the “refund of costs paid for the rental of the apartment for the year 2017”.

9. Furthermore, the DRC judge noted that the Claimant asserted that the Respondent had not paid him said amounts despite having put the Respondent in default on 26 March 2018 and 11 April 2018.

10. At this point, the DRC judge took note that, for its part, the Respondent acknowledged having signed the termination agreement with the Claimant and affirmed that “it was orally agreed” that the Respondent would only pay the Claimant’s salary for October 2017 and set-off the pro-rata salary for the month of November 2017 with a fine that had allegedly been imposed on the Claimant as described in point I./12. above. In this regard, the DRC judge noted that the Respondent deemed that it duly proceeded with the payment of the Claimant’s salary for the month of October 2017 and that the Claimant’s pro-rata salary for November 2017 had been set-off with the alleged fine imposed on the Claimant.

11. Furthermore, the DRC judge observed that the Respondent affirmed that the termination agreement does not contain any clause providing “the right to demand a housing compensation by the Claimant”, in particular taking into account the clear wording of the termination agreement. In this regard, the DRC judge noted that according to the Respondent, the termination agreement “clearly states that further than salary there will be no financial obligations between the parties”.

12. Moreover, the DRC judge also noted that the Claimant affirmed that “the requested refund of the accommodation costs concerns the period prior of the anticipated termination” and that “this contractual right was never waived by the player upon signature of the termination agreement”.

13. Bearing in mind the abovementioned facts and the positions of both parties, the DRC judge deemed it appropriate to recall the general principle of burden of proof stipulated 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 burden of proof.

14. The DRC judge then reverted to the Respondent’s line of defence, according to which the parties “orally agreed” that the Claimant’s pro-rata salary for the month of November 2017 was to be set off with a fine that had been allegedly imposed on the Claimant.

15. In this regard, the DRC judge noted that the Respondent failed to provide any evidence with regard to the alleged fine imposed on the Claimant, in particular, in relation with the procedure followed in order to sanction the Claimant, i.e. if the Claimant had the possibility to defend his case. Furthermore, the DRC judge noted that the Respondent failed to provide any supporting evidence that the parties agreed to set off the Claimant’s pro-rata salary for November 2017 with the alleged fine imposed on the player.

16. In this context, and irrespective of the foregoing consideration, the DRC judge wished to point out that the imposition of a fine, or any other available financial sanction in general, shall not be used by clubs as means to set off outstanding financial obligations towards players. Consequently, the Chamber decided to reject the Respondent’s argument in this connection.

17. In light of all the foregoing considerations, the DRC judge concluded that, in accordance with the general legal principle of “pacta sunt servanda”, the Respondent is liable to pay the amount of USD 5,565 to the Claimant.

18. In addition, taking into account the Claimant’s claim, the DRC judge decided to award the Claimant interest of 5% p.a. as of the day following the day on which the relevant payment fell due in accordance with the termination agreement, which, in the absence of any specific due date, was considered to be the first day after the signature of the termination agreement, i.e. 1 November 2017.

19. In continuation, and with regard to the Claimant’s claim for the reimbursement of the amount of USD 3,480.21, corresponding to “the costs paid for the rental of the apartment for the year 2017”, the DRC judge referred once again to the wording of the termination agreement and concluded that the parties had freely agreed to “[…] waive any contractual demands and hereby confirm that there are no further financial obligations between the parties […]”. The DRC judge also pointed out that, in any case, the Claimant did not provide any documentary evidence in accordance with art. 12 par. 3 of the Procedural Rules that he had to incur the abovementioned costs. Consequently, the DRC judge decided to reject this part of the Claimant’s claim.

20. The DRC judge concluded his deliberations in the present matter by rejecting any further claim of the Claimant.

III. Decision of the DRC Judge

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 USD 5,565, plus 5% interest p.a. as from 1 November 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 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

Avenue de Beaumont 2 - 1012 Lausanne

Switzerland

Tel: +41 21 613 50 00

e-mail: info@tas-cas.org

For the DRC Judge:

Emilio García Silvero

Chief Legal & Compliance Officer

Encl. CAS directives