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 12 February 2020

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 12 February 2020,

in the following composition:

Omar Ongaro (Italy), Deputy Chairman

Johan van Gaalen (South Africa), member

José Luis Andrade (Portugal), member

on the claim presented by the player,

Adrien Daniel Karoly Regattin, France

represented by Mr. Riza Köklü

as Claimant

against the club,

Akhisar Belediye Gençlik ve Spor, Turkey

represented by Mr Levent Polat

as Respondent

regarding an employment-related dispute

between the parties

I. Facts of the case

1. On 31 August 2018, the French player, Daniel Karoly Regattin (hereinafter: the Claimant or the player) and the Turkish club, Akhisar Belediye Gençlik ve Spor (hereinafter: the Respondent or the club) signed an employment contract (hereinafter: the contract) valid as from the date of signature until 31 May 2020, i.e. 2 sporting seasons.

2. In accordance with the contract, the Claimant was entitled inter alia to the following:

a. EUR 684,000 as a salary for the 2018-2019 season, payable as follows:

- EUR 184,000 on registration;

- EUR 75,000 on 25 September and EUR 75,000 on 25 October 2018;

- EUR 50,000 each 25th of the month as from 25 November 2018 until 25 May 2019.

b. EUR 600,000 as a salary for the 2019-2020 season, payable as follows:

- EUR 150,000 on 25 July 2019;

- EUR 45,000 each 25th of the month as from 25 August 2019 until 25 May 2020.

b. During the term of the contract:

- EUR 1,000 as a rent allowance;

- EUR 100,000 per season as a “team/win bonus (…) in the minimum guarantee amount”.

3. In accordance with the contract, “the player declares, agree and undertakes to comply with the rules and the internal disciplinary Regulations of the Club and also declares and agrees that a copy of the club’s internal disciplinary regulations has been given to him”.

4. According to the Claimant, on 28 June 2019, he was authorized by the Respondent to be absent until 10 July 2019.

5. On 17 July 2019, the Claimant put the Respondent on default and gave 15 days for the respondent to pay him outstanding remuneration in the total amount of EUR 116,128, composed of partial salaries, part of the guaranteed amount and part of the rent allowance as well, equal to nearly 3 monthly salaries.

6. On 19 July 2019, the Respondent replied to the default of the Claimant informing him that its board had allegedly decided on 12 July 2019 to impose a fine on him in the amount of EUR 209,000 alleging poor sporting performances as well as late attendance to training sessions early July 2019.

7. On 2 August 2019, in the absence of the requested payments, the Claimant unilaterally terminated the contract, arguing that the imposed fine was invalid being justified by poor performances and late attendance to training sessions which the Respondent explicitly allowed.

8. On 4 October 2019, the Claimant lodged a claim against the Respondent in front of FIFA for outstanding remuneration and compensation for breach of contract, requesting the total amount of EUR 952,128 corresponding to:

i. EUR 267,128 as outstanding remuneration, composed of :

- EUR 25,000 as part of the salary for April 2019;

- EUR 50,000 as the salary for May 2019;

- EUR 150,000 as the salary for July 2019;

- EUR 3,000 as three monthly rent allowances for May, June and July 2019;

- EUR 39,128 as part of guarantee amount.

ii. EUR 550,000 as compensation for breach of contract.

iii. EUR 135,000 as additional compensation, corresponding to three monthly salaries;

iv. interest at a rate of 5% p.a. over the aforementioned amounts, as from the due dates on the outstanding remuneration and as from 2 August 2019 on the compensation as well as on the additional compensation;

v. to “annul” the fine imposed on him by the Respondent;

vi. costs of the proceedings on the Respondent.

9. The Claimant deemed that he had just cause to terminate the contract as the Respondent owed him more than 2 salaries at the date of termination.

10. The Respondent on its end held that on 27 May 2019, due to the alleged negotiations held between the parties, they mutually agreed to terminate the contract, without costs for the remaining term of the contract, under the condition that the Claimant finds another club. As a consequence, the Claimant allegedly left the Respondent, did not inform it of his ongoing negotiations and did not react to its letter of 27 June 2019 by means of which it communicated to the Claimant the training sessions, planned on 3 July 2019, for the new season’s preparation.

11. The Respondent held its fine imposed on the Claimant to be valid in accordance with the internal disciplinary regulations remitted to the Claimant upon signature of the contract. In addition, the Respondent sustained that the Claimant voluntarily rejected offers from other clubs in order to be able to receive the instalment of 25 July 2019 and leave just afterwards.

12. The Respondent admitted that it owed EUR 112,814 corresponding to sums due prior to the Claimant’s default notice, in accordance with the appropriate currency exchange calculations, which, in any case, corresponded to less than two monthly salaries on a pro-rata base in accordance with art. 14 bis RSTP.

13. Upon FIFA’s request, the Claimant explained that he remained unemployed as from 2 August 2019.

*****

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 2 August 2019. Consequently, the 2018 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: Procedural Rules) are applicable to the matter at hand (cf. article 21 of the 2018 and 2019 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 2020), 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 French player and a Turkish club.

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 (2020), and considering that the present claim was lodged on 2 August 2019, the June 2019 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. The members of the Chamber started by acknowledging the facts of the case, as well as the documentation contained in the file. 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 first acknowledged that the Claimant and the Respondent signed an employment contract valid as from 31 August 2018 until 31 May 2020, in accordance with which the Claimant was entitled to a total remuneration for the season 2018/2019 of EUR 684,000 payable as follows: EUR 184,000 on the registration of the player, EUR 150,000 payable in 2 instalments of EUR 75,000 respectively on 25 September 2018 and 25 October 2018 and EUR 50,000 payable as from 25 November 2018 until 25 May 2019 on a monthly basis on the 25th of each month.

6. The Chamber further recalled that the Claimant was entitled to the total remuneration of EUR 600,000 for the season 2019/2020 payable as follows: EUR 150,000 on 25 July 2019 and EUR 45,000 on the 25th of each month as from 25 August 2019 until 25 May 2020.

7. The Chamber took note that the contract entitled the Claimant to EUR 1,000 as monthly rent allowance and EUR 100,000 as a minimum guaranteed bonus.

8. In continuation, the members of the Chamber noted that the Claimant lodged a claim against the Respondent maintaining that he had terminated the employment contract with just cause on 2 August 2019, after previously having put the club in default, since the Respondent allegedly failed to pay the Claimant’s remuneration. In this respect, the Claimant held that part of the salary of April 2019, as well as the full salaries of May and July 2019 were not paid to him and that 3 monthly allowances and part of the guarantee bonus were also not paid. Consequently, the Claimant asks to be awarded his outstanding dues as well as the payment of compensation for breach of the employment contract. In this respect, the Claimant requested to be awarded as outstanding remuneration, the total amount of EUR 267,128 corresponding to the claimed above, and the amount of EUR 685,000 as compensation for breach of contract, corresponding to the residual value of the contract and to an additional compensation of 3 monthly salaries.

9. The DRC recalled that the Claimant held that the fine imposed on him could not be taken into account as the fine was invalid being justified by poor performances and late attendance to training sessions which the Respondent explicitly allowed. Moreover, the DRC further recalled that despite the default notice, he did not receive any of the claimed amount and considered that he therefore had just cause to terminate the contract.

10. Subsequently, the DRC observed that the Respondent, held that the parties had an agreement dated 27 May 2019 according to which the Claimant could make transfer negotiation and the “the parties would not request any compensation from each other for the remaining term of the contract”. The Chamber recalled that the Respondent held that the Claimant had had offers, but refused those without informing the Respondent about it.

11. Moreover, the DRC further took note that the Respondent argued that nonetheless, the Claimant had been fined by the Respondent due to his bad behaviour and poor performance, and that the Claimant never complained about the fine prior to the claim.

12. The Chamber further recalled that the Respondent held that should the fine be disregarded, then the Respondent admitted to owing EUR 112,814 to the Claimant corresponding to sums prior to the default notice due taking into account the right currency exchange rate according to the Respondent.

13. Finally, the DRC noted that the Respondent was of the opinion that nevertheless, at the date of the notification of the default notice, 2 monthly salaries were not yet due since the salary of July 2019 was not due and that as such art, 14 bis of the Regulations could not apply and consequently, the Claimant did not have just cause to terminate.

14. In view of the foregoing and of the diverging opinions of the parties, the Dispute Resolution Chamber was of the opinion that the issue at stake considering the argumentation of both parties, was to determine whether the employment contract had been unilaterally terminated by the Claimant with or without just cause on 2 August 2019, and which party was responsible for the early termination of the contractual relationship in question.

15. The DRC also underlined that, subsequently, if it were found that the employment contract was breached by one of the parties without just cause, it would be necessary to determine the consequence for the party that caused the unjust breach of the relevant employment contract.

16. Reviewing the argumentation of the parties, the DRC took note that the Claimant considered that he had just cause to terminate the contract as the club failed to pay him 3 monthly rent allowances, part of the guaranteed bonus, part of the salary of April 2019 and the full salaries of May and July 2019.

17. On the other hand, the DRC took note that the Respondent deemed that it had no overdue toward the player due to an agreement signed between the parties, and a fine imposed on him and due to his general bad faith in his behaviour according to the Respondent.

18. With regard with the amount claimed by the Claimant, the DRC took note that the Respondent considered that should the claim of the Claimant be accepted, the amount awarded as outstanding should be lowered taking into account currency exchange issues that were allegedly not taken into account by the Claimant when calculating the overdue amounts.

19. Following this, the Chamber considered it remained uncontested that the Claimant and the Respondent signed an employment contract valid as from 31 August 2018 until 31 May 2020.

20. Moreover, the DRC recalled the content of 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.

21. In continuation, the Chamber considered the argumentation of the Respondent according to which, the parties had agreed to the mutual termination of the contract without any consequence as to compensation on 27 May 2019. In this regard, the DRC took note of the content of said agreement, but considered that the agreement was not a mutual termination agreement, but merely a written authorization for the player to be able to negotiate with other clubs with the purpose of a future transfer. The DRC was of the firm opinion that the event giving rise to the consequence claimed by the Respondent, i.e. the absence of any compensation between the parties, had not occurred and that as such, said agreement had to be disregarded.

22. Then, the DRC focused its attention on the fine of EUR 209,000 imposed on the Claimant by the Respondent’s Board on 12 July 2019 and took note that the Claimant contested the validity of said fine. In this regard, the DRC recalled that the fine was imposed due the absence of information from the Claimant to the Respondent on any transfer prospects, to his poor performance and to his 8 days delay to return to training. The DRC further recalled that the Respondent held that the Claimant had agreed and signed the internal regulations of the club and did not contest the fine prior to his claim to FIFA.

23. In this regard, the DRC was of the firm opinion that a fine cannot be used to offset financial obligations and as admitted by the Respondent, at the date of the default, he had outstanding amounts due to the Claimant. Moreover, the DRC wanted to highlight that poor performance is a very subjective concept which cannot be used to impose fines on a player nor to lower a player’s remuneration.

Moreover, the DRC also underlined that a player in possession of a valid and binding contract could not be forced to look for a new club and that the fact that said player did not look for a new club nor informed his current club about any possible negotiations with a new club could not be used against the player in the context of imposing a fine.

24. Moreover, the Chamber considered that the fine had the only aim to discharge the Respondent from paying outstanding dues to the Claimant.

25. In this context, and taking all of the above in consideration, the DRC decided that the fine of EUR 209,000 should be disregarded.

26. Subsequently, the DRC took note of the argumentation of the Respondent according to which in case the fine was to be disregarded, the amount of outstanding should be lowered as the Claimant allegedly did not take into account the right currency exchange.

27. In this regard, the DRC once again recalled the principle of the burden of proof, which is a basic principle in every legal system, a party deriving a right from an asserted fact has the obligation to prove the relevant fact (cf. art.12 par. 3 of the Procedural Rules). Therefore, due to the lack of convincing evidence with regard to the assertion made by the Respondent, the DRC rejected the argument raised by the Respondent.

28. With these consideration in mind, and in the absence of any conclusive proof of payments brought forward by the Respondent, on the date of the notification of the default notice by the Claimant, the Respondent had failed to pay to the Claimant part of the salary of April 2019, the salaries of May 2019, as well as the remaining part of the guaranteed bonus and 2 monthly rental allowances, and that taking into account the attempt of the Respondent to set off existing debt with a fine based on poor performance, the Claimant, at the date of termination could have logically lost confidence in the capacities of the Respondent to respect its financial obligations towards him.

29. On account of the aforementioned, the Chamber established that the Respondent, without any valid reason, failed to remit to the Claimant, until 2 August 2019, date on which the Claimant terminated the contract, the total amount of EUR 267,128. Consequently, the DRC was of the opinion that the Claimant had just cause to unilaterally terminate the employment contract on 2 August 2019 and that, as a result, the Respondent is to be held liable for the early termination of the employment contact with just cause by the Claimant.

30. 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.

31. Taking into consideration art. 17 par. 1 of the Regulations, the Chamber decided that the Claimant is entitled to receive from the Respondent an amount of money as compensation for breach of contract in addition to any outstanding payments on the basis of the relevant employment contract.

32. In this regard, the DRC addressed the issue of unpaid remuneration at the moment when the contract was terminated by the Claimant and 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 267,128.

33. In addition, taking into consideration the Claimant’s claim, the DRC decided to award the Claimant interest the Chamber decided to award the Claimant interest at the rate of 5% p.a. on the respective amounts due as of the day following the day on which said instalments fell due until the date of effective payment.

34. 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 DRC judge focussed its attention on the consequences of such termination. Taking into consideration art. 17 par. 1 of the Regulations, the DRC decided that the Claimant is entitled to receive an amount of money from the Respondent as compensation for the termination of the contract with just cause in addition to any outstanding payments on the basis of the relevant employment contract.

35. Having stated the above, the Chamber turned to the calculation of the amount of compensation payable to the Claimant by the Respondent in the case at stake. In doing so, 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.

36. 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.

37. 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.

38. The DRC then 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 DRC judge to be essential. The DRC deemed it important to emphasise that the wording of art. 17 par. 1 of the Regulations allows the DRC to take into account both the existing contract and the new contract, if any, in the calculation of the amount of compensation.

39. Bearing in mind the foregoing as well as the claim of the Claimant, the Chamber proceeded with the calculation of the monies payable to the Claimant under the terms of the employment contract from its date of termination with just cause by the Claimant, i.e. 2 August 2019 until 31 May 2020 and concluded that the Claimant would have received in total EUR 550,000 as remuneration had the contract been executed until its expiry date. Consequently, the Chamber concluded that the amount of EUR 550,000 serves as the basis for the determination of the amount of compensation for breach of contract.

40. 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.

41. The Chamber noted that the Claimant noted that the Claimant had not signed any new employment contract within the period of time between the termination of the contract and its original date of expiry and, thus, had not been able to mitigate damages.

42. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, as well as the impossibility for the Claimant to mitigate his damages, the DRC concluded that the Respondent must pay the amount of EUR 550,000 as compensation for breach of contract in the case at hand, which it considered as a reasonable and justified amount of compensation.

43. In addition, taking into account the Claimant’s request as well as the constant practice of the Dispute Resolution Chamber in this regard, the DRC judge decided that the Respondent must pay to the Claimant interest of 5% p.a. on the amount of compensation as of the date of the claim, i.e. 4 October 2019 until the date of effective payment.

44. Furthermore, taking into account the consideration under number II./3. above, the DRC judge referred to par. 1 and 2 of art. 24bis of the Regulations, which stipulate that, with its decision, the pertinent FIFA deciding body shall also rule on the consequences deriving from the failure of the concerned party to pay the relevant amounts of outstanding remuneration and/or compensation in due time.

45. In this regard, the DRC pointed out that, against clubs, the consequence of the failure to pay the relevant amounts in due time shall consist of a ban from registering any new players, either nationally or internationally, up until the due amounts are paid and for the maximum duration of three entire and consecutive registration periods.

46. Therefore, bearing in mind the above, the DRC decided that, in the event that the Respondent does not pay the amounts due to the Claimant within 45 days as from the moment in which the Claimant, following the notification of the present decision, communicates the relevant bank details to the Respondent, a ban from registering any new players, either nationally or internationally, for the maximum duration of three entire and consecutive registration periods shall become effective on the Respondent in accordance with art. 24bis par. 2 and 4 of the Regulations.

47. Finally, the DRC recalled that the above-mentioned ban will be lifted immediately and prior to its complete serving upon payment of the due amounts, in accordance with art. 24bis par. 3 of the Regulations.

48. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claim lodged by the Claimant is rejected.

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III. Decision of the Dispute Resolution Chamber

1. The claim of the Claimant, Adrien Daniel Karoly Regattin, is partially accepted.

2. The Respondent, Akhisar Belediye Gençlik ve Spor, has to pay to the Claimant outstanding remuneration in the amount of EUR 267,128, plus interest at the rate of 5% p.a. until the date of effective payment, as follows :

i. as from 26 April 2019 on the amount of EUR 25,000;

ii. as from 26 May 2019 on the amount of EUR 50,000;

iii. as from 26 July 2019 on the amount of EUR 150,000;

iv. as from 1 June 2019 on the amount of EUR 1,000;

v. as from 1 July 2019 on the amount of EUR 1,000;

vi. as from 1 August 2019 on the amount of EUR 1,000;

vii. as from 1 June 2019 on the amount of EUR 39,128.

3. The Respondent has to pay to the Claimant compensation for breach of contract in the amount of EUR 550,000, plus interest at the rate of 5% p.a. as from 4 October 2019 until the date of effective payment.

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

5. The Claimant is directed to inform the Respondent, immediately and directly, preferably to the e-mail addresses as indicated on the cover letter of the present decision, of the relevant bank account to which the Respondent must pay the amounts plus interest mentioned under point 2 and 3 above.

6. The Respondent shall provide evidence of payment of the due amounts plus interest in accordance with point 2 and 3 above to FIFA to the e-mail address psdfifa@fifa.org, duly translated, if need be, into one of the official FIFA languages (English, French, German, Spanish).

7. In the event that the amounts due plus interest in accordance with point 2 and 3 above are not paid by the Respondent within 45 days as from the notification by the Claimant of the relevant bank details to the Respondent, the Respondent shall be banned from registering any new players, either nationally or internationally, up until the due amounts plus interest are paid and for the maximum duration of three entire and consecutive registration periods (cf. art. 24bis of the Regulations on the Status and Transfer of Players).

8. The ban mentioned in point 7 above will be lifted immediately and prior to its complete serving, once the due amounts are paid.

9. In the event that the aforementioned sums plus interest are still not paid by the end of the ban of three entire and consecutive registration periods, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision.

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Note related to the publication:

The FIFA administration may publish decisions issued by the Players’ Status Committee or the DRC. Where such decisions contain confidential information, FIFA may decide, at the request of a party within five days of the notification of the motivated decision, to publish an anonymised or a redacted version (cf. article 20 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber).

Note relating to the appeal procedure:

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. 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 / www.tas-cas.org

For the Dispute Resolution Chamber:

Emilio García Silvero

Chief Legal & Compliance Officer