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 23 April 2020

Decision of the

Dispute Resolution Chamber

passed on 23 April 2020,

in the following composition:

Geoff Thompson (England), Chairman

José Luis Andrade (Portugal), member

Stijn Boeykens (Belgium), member

on the claim presented by the player,

Lautaro Eloy Fernandez Cipolla, Argentina

represented by Messrs José Alejandro Sierra and Loïc Alves

as Claimant

against the club,

Mons Calpe Sports Club Limited, Gilbraltar

as Respondent

regarding an employment-related dispute between the parties

I. Facts of the case

1. On 29 July 2018, the Argentinian player, Lautaro Eloy Fernandez Cipolla (hereinafter: “Claimant” or “player”) concluded an employment contract (hereinafter: the contract) with the Gibraltarian club, Mons Calpe Sports Club Limited, (hereinafter: “Respondent” or “club”).

2. Pursuant to clause 1.1 of the contract, “this contract shall be valid for ONE football seasons and shall come into effect on 1st August 2018 and terminate naturally 31st May 2019 […] unless extended automatically by the Club due to international competitions and for the term in which the club continues to participate in such international competitions. The club shall have two separate and independent exclusive and irrevocable options to renew the term herein for additional independent Seasons under the same terms and conditions as the previous seasons. The option shall be deemed automatically exercised unless the club notifies player at any time during the term its intentions not to renew the term herein. In the event the club does not notify the player otherwise, then such additional season(s) shall automatically begin on the date of the then current season ends and shall be for a new season period.”

3. In accordance with ANNEX B Clause 1 of the contract, “the player’s gross base salary shall be the equivalent in Gibraltar Pounds to EUR 900 per calendar month”.

4. By means of Clause 3.6 of the contract, “this contract may be terminated either (a) upon the expiration of its natural term. (b) if the player violates any of his obligations under this contract [c] by mutual agreement between the parties [d] unilaterally by one of the parties for reasons of just cause or sportive just cause: [e] unilaterally by the club for any acts of indiscipline, mutiny or intent to revolt, suppress or intimidate anyone within the club and or the club’s staff or related parties [f] according to the club regulations […] and/or FIFA. The infringement of this sub-article [e] will be treated as a just cause for the unilateral termination of this contract without any responsibility by the club and without any right to get any further payments herein for the player.”

5. On 9 August 2019, the club unilaterally terminated the employment contract with the player. In said termination letter, the club informed the player, inter alia, of the following:

“On May 4, 2019, you and several other players participated in a “sit-down” on the pitch in the first minutes of Mons Calpe’s match vs. Gibraltar United. In addition, you displayed anti-competitive attitude and behaviour in both training and official matches throughout the 2018-19 season, including unexcused absences and insubordination both individually and in conjunction with other players. The Club investigated these matters, with several staffers and coaches discussing with you and multiple other players and staff. As a result, the Club determined the sanctions set forth below were applicable due to your illegal and unjustified actions.

[…]

Therefore, in addition to the termination or non-renewal of your player contract, the Club determined that it was justified in filing for damages of three (3) months’ salary for economic, sporting and reputational losses and for applicable additional charges (such as accommodation and air travel) that were not in your contract, but which the Club may have furnished as a positive gesture to you.”

6. On 12 December 2019, the player lodged a claim against the club for breach of contract, requesting the total amount of EUR 26,800.01 plus 5% interest p.a. as of the due dates, as follows:

a) EUR 4,519.4 as outstanding remuneration, corresponding to the salaries of October 2018, May to July 2019 and to 9 days of August 2019;

b) EUR 10,680.7 as compensation for breach of the contract, corresponding to:

i) EUR 780,7 for 22 days of August 2019;

ii) EUR 9,900 for the months of September 2019 to May 2020.

c) EUR 6,600 as additional compensation corresponding to 6 monthly salaries;

d) EUR 5,000 as legal costs.

7. In his claim, the player considered that the contract had been extended to include the season 2019/2020, since in application of clause 1.1 of the contract, the club had not notified the player of its intention not to renew the terms of the contract.

8. However, according to the player, as of 31 May 2019 (initial term of the contract), he had not received any information about the date of start of the next season.

9. Furthermore, the player maintained that he had not received the salaries of October 2018, as well as May 2019 and June 2019.

10. In this context, the player argued that he contacted the Gibraltar FA “with the purpose of requesting from the FA its intervention to obtain payment of the outstanding salaries” on 7 August 2019.

11. With regard to the requested outstanding remuneration and compensation for breach of contract, the player held that the monthly salary had been increased as from January 2019 to EUR 1,100. In support of his allegation, the player submitted two deposits amounting each to EUR 1,100 dated 22 March 2019 and 13 May 2019.

12. In reply to the player’s claim, the club requested, inter alia, the following:

a) That any financial and disciplinary request of the player against the club is annulled;

b) The imposition of sanctions against the player for the damages caused to the image of the club.

13. In this context, the club held that it fulfilled all its financial obligations vis-à-vis the player in accordance with the contract for the period as from 1 August 2018 until 18 April 2019.

14. In support of this allegation, the club provided various payment slips, proofs and other customer receipts, allegedly enclosed to the aforementioned termination letter, which supposedly sustained its position as to the duly provision of all payments towards the Claimant

15. In addition, the club reiterated its position as to the disciplinary violations committed by the player as mentioned in its termination letter dated 9 August 2019. In particular, the club argued that it had fulfilled its obligations toward the player, but that the player had a bad attitude, missed several trainings and participated in a “sit down” before a match. In this light, the club also provided a press article available online referring to the “sit-down” protest.

16. On 23 March 2020, the player informed FIFA that on 30 October 2019, he signed an employment contract with the Italian club of ASD Troina valid “for the 2019/2020 season” for the total value of EUR 9,000.

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 12 December 2019. Taking into account the wording of art. 21 of the 2019 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules), the aforementioned edition of the Procedural Rules is applicable to the matter at hand.

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 the Dispute Resolution Chamber shall adjudicate on employment-related disputes between an Argentinian player and a Gibraltarian club.

3. Next, 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, and considering that the present claim was lodged on 12 December 2019, the 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. 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. The Chamber first acknowledged that the player and the club signed an employment contract on 29 July 2018. Referring to said contract, the DRC recalled that the contract came into effect “on 1st August 2018 and terminate naturally 31st May 2019 […] unless extended automatically by the Club”. Consequently, the Chamber established that the first issue at stake is determining whether the employment contract was extended until after 31 May 2019.

6. In this context, the Chamber firstly recalled that, as per the player, the contract had been extended to the season 2019/2020 since in application of Clause 1.1 of the contract, the club had not notified the player of its intention not to renew the terms of the contract. Next, the DRC was eager to emphasize that it was the club who unilaterally terminated the contract on 9 August 2020, i.e. on a date after 31 May 2020.

7. In light of the above, the Chamber firstly concluded that the employment contract remained valid until after 31 May 2019.

8. Subsequently, the DRC again referred to clause 1.1 of the contract and acknowledged that the “club shall have two […] options to renew the term herein for additional independent Seasons under the same terms and conditions as the previous seasons”. Based on the foregoing, and taking into account that the extension had to be done “under the same terms and conditions as the previous seasons”, the Chamber determined that the contract was renewed until 31 May 2020.

9. In continuation, the DRC noted that the club unilaterally terminated the employment contract with the player on 9 August 2019. Thus, the Chamber established that the fundamental issue at stake is determining whether the club had a just cause to terminate the employment contract on 9 August 2019. In this respect, the DRC deemed it essential to make a brief recollection of the parties’ arguments regarding the contract termination, and in particular, determine whether there was any outstanding remuneration due to the player on the day he terminated the contract.

10. In this context, the Chamber turned to the player’s arguments who, inter alia, held that he had not received any information about the date of start of the next season. Moreover, the DRC recalled that the player had argued that he had not received the salaries of October 2018, as well as May 2019 and June 2019.

11. Similarly, the Chamber acknowledged that according to the club, it had fulfilled all its financial obligations vis-à-vis the player for the period as from 1 August 2018 until 18 April 2019. In addition, the DRC noted that, as per the club, the player had a bad attitude, missed several trainings and participated in a “sit down” before a match.

Finally, Chamber recalled that, a per the club’s termination letter of 9 August 2019, it “determined that it was justified in filing for damages of three (3) months’ salary”.

12. Having said this, the Chamber analysed the documentation provided by the club and, after referring to the principle of the burden of proof explicitly stipulated in art. 12 par. 3 of the Procedural Rules, unanimously concluded that failed to provide conclusive evidence that could justify the termination of the contract.

13. In particular, the DRC was not able to establish unequivocally that club duly informed the player that it would not renew the contract for the subsequent season. Furthermore, and taking into account that the contract was extended until 31 May 2020 while terminated on 9 August 2019, the Chamber determined that it remained undisputed that the club had failed to pay to the player his salaries for the period May, June and July 2019.

14. In continuation, the DRC referred to club’s position that it was “justified in filing for damages of three (3) months’ salary”, and established that no evidence nor information related to said proceedings were communicated to the player in order for him to exercise his right of defense. As such, the Chamber concluded that any sanction, fines and/or deductions from the player’s salary cannot be justified.

15. Taking into account all of the above considerations, in particular the fact that at least three monthly salaries were outstanding, the DRC determined that the club terminated the employment contract on 9 August 2019 without just cause.

16. That said, the DRC concluded that the club is to be held liable for the early termination of the employment contract without just cause and should therefore bear the consequences of its unjustified breach of the employment contract.

17. In continuation, prior to entering into the issue of the consequences of the early termination of the employment contract with just cause by the player, the Chamber firstly proceeded to determine the amount of outstanding remuneration, if any, still due to the player by the club to this day.

18. In this light, the Chamber recalled that, as per the player, the October 2018, May to July 2019 and to 9 days of August 2019 were outstanding. Having said this, the DRC firstly highlighted that the club never disputed the player’s position that the October 2018 salary had not been paid. Thus, the Chamber concluded that the October 2018 salary was still outstanding.

19. Next, and with regard to the alleged outstanding monthly salaries of May, June and July 2019, the DRC referred to its previous deliberations, and reiterated that any sanction, fines and/or deductions from the player’s salary cannot be justified.

Therefore, as per the Chamber, the salaries for the months of May, June and July 2019 are still outstanding.

20. Along these lines, the DRC took into account that according to the player, the monthly salary had been increased as from January 2019 to EUR 1,100. Nonetheless, the Chamber agreed that the player failed to sufficiently proof that the monthly salary increased to EUR 1,100, given that he failed to provide evidence as to the effective payments made by the club to him, as well as any agreement between him and the club that unequivocally demonstrates that the salary had increased.

21. Therefore, the DRC determined that the monthly salary payable to the player remained at EUR 900, in accordance with ANNEX B clause 1 of the contract.

22. On account of the aforementioned considerations, the DRC decided that, in accordance with the general legal principle of pacta sunt servanda, the club is liable to pay to the player outstanding remuneration in the total amount of EUR 3,600, corresponding to the four monthly salaries in the amount of EUR 900 each of October 2018, May 2019, June 2019 and July 2019.

23. In addition, taking into consideration the player’s claim, the Chamber decided to award the player interest at the rate of 5% p.a. on the amount of EUR 3,600 as of the day following the day on which said instalments fell due.

24. In continuation, the Chamber focused its attention on the calculation of the amount of compensation for breach of contract payable by the club to the player in the case at stake. In doing so, the members of the Chamber first 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 player 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.

25. 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.

26. As a consequence, the Chamber determined that the amount of compensation payable by the club to the player had to be assessed in application of the other parameters set out in art. 17 par. 1 of the Regulations. The DRC 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 DRC emphasized beforehand that each request for compensation for contractual breach has to be assessed on a case-by-case basis taking into account all specific circumstances of the respective matter.

27. In order to estimate the amount of compensation due to the player in the present case, the Chamber first turned its attention to the remuneration and other benefits due to him under the existing contract and/or the new contract(s), which criterion was considered to be essential. The DRC deemed it important to emphasise that the wording of art. 17 par. 1 of the Regulations allows it to take into account both the existing contract and the new contract, if any, in the calculation of the amount of compensation.

28. Bearing in mind the foregoing, the Chamber proceeded with the calculation of the monies payable to the player under the terms of the employment contract as from its date of termination with just cause by the player, i.e. 9 August 2019, until 30 May 2020, and concluded that the player would have received EUR 9,000 in total as remuneration had the contract been executed until its expiry date. Consequently, the Chamber concluded that the amount of EUR 9,000 serves as the basis for the final determination of the amount of compensation for breach of contract in the case at hand.

29. In continuation, the Chamber verified as to whether the player had 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 the DRC, such remuneration under a new employment contract shall be taken into account in the calculation of the amount of compensation for termination of contract with just cause in connection with the player’s general obligation to mitigate his damages

30. Along these lines, the DRC noted that according to the information on file, the player signed an employment contract with the Italian club of ASD Troina on 30 October 2019 valid “for the 2019/2020 season” for the total value of EUR 9,000.

31. The Chamber thus established that between 30 October 2019 and 20 June 2020, i.e. the expiry date of the employment contract with the club, the player was able to fully mitigate his damages. However, the Chamber took into account that during the months of August 2019, September 2019 and October 2019, during which the player was entitled to receive the amount of EUR 2,700, the player had remained unemployed.

32. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, as well as the player’s general obligation to mitigate his damage, the Chamber decided that the club must pay the amount of EUR 2,700 to the player as compensation for breach of contract.

33. In addition, taking into account the player’s request, the Chamber decided that the club must pay to the player interest of 5% p.a. on the amount of compensation as of the date on which the claim was lodged, i.e. 12 December 2019, until the date of effective payment.

34. In continuation, the DRC recalled that in his request for relief, the player requested EUR 6,600 as additional compensation corresponding to 6 monthly salaries. Having said this, the Chamber noted that as per Art. 17 (1) (ii) of the Regulations, additional compensation is “subject to the early termination of the contract being due to overdue payables”. In other words, as per the DRC, in order for additional compensation to be awarded, it is necessary for the player to terminate the contract for overdue payables. However, given that in the case at hand the club unilaterally terminated the contract, it follows that the player’s request for additional compensation is rejected.

35. Finally, as regards the claimed legal expenses, the Chamber referred to art. 18 par. 4 of the Procedural Rules as well as to its long-standing and well-established jurisprudence, in accordance with which no procedural compensation shall be awarded in proceedings in front of the Dispute Resolution Chamber. Consequently, the Chamber decided to reject the player’s request relating to legal expenses.

36. Furthermore, taking into account the consideration under number II./3. above, the Chamber 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.

37. In this regard, the Chamber established that, in virtue of the aforementioned provision, it has competence to impose a sanction on the club. More in particular, the DRC pointed out that, against clubs, the sanction shall consist in a ban from registering any new players, either nationally or internationally, up until the due amount is paid and for the maximum duration of three entire and consecutive registration periods.

38. Therefore, bearing in mind the above, the DRC decided that, in the event that the club does not pay the amount due to the player within 45 days as from the moment in which the player, following the notification of the present decision, communicates the relevant bank details to the club, 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 club in accordance with art. 24bis par. 2 and 4 of the Regulations.

39. Finally, the Chamber recalled that the above-mentioned sanction 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.

40. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claims lodged by the player are rejected.

III. Decision of the Dispute Resolution Chamber

1. The claim of the Claimant, Lautaro Eloy Fernandez Cipolla, is partially accepted.

2. The Respondent, Mons Calpe Sports Club Limited, has to pay to the Claimant outstanding remuneration in the amount of EUR 3,600, plus interest at the rate of 5% p.a. until the date of effective payment, as follows:

a) 5% interest p.a. on the amount of EUR 900 as from 1 November 2018;

b) 5% interest p.a. on the amount of EUR 900 as from 1 June 2019;

c) 5% interest p.a. on the amount of EUR 900 as from 1 July 2019;

d) 5% interest p.a. on the amount of EUR 900 as from 1 August 2019.

3. The Respondent has to pay to the Claimant compensation for breach of contract in the amount of EUR 2,700, plus interest at the rate of 5% p.a. as from 12 December 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 points III.2 and III.3 above.

6. The Respondent shall provide evidence of payment of the due amounts plus interest in accordance with points III.2 and III.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 points III.2 and III.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 III.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.

*****

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.

The full address and contact numbers of the CAS are the following:

Court of Arbitration for Sport (CAS)

Avenue de Beaumont 2

CH-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:

Emilio García Silvero

Chief Legal & Compliance Officer