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 9 April 2020
Decision of the
Dispute Resolution Chamber
passed on 9 April 2020,
in the following composition:
Geoff Thompson (England), Chairman
Roy Vermeer (The Netherlands), member
Daan de Jong (The Netherlands), member
on the claim presented by the player,
Rémy Riou, France,
represented by Alexandre Zen-Ruffinen
as Claimant
against the club,
Alanyaspor Kulübü Dernegi, Turkey,
represented by Mr Sami Dinç
as Respondent
regarding an employment-related dispute
between the parties
I. Facts of the case
1. On 9 August 2018, the French player, Mr Rémy Riou, (hereinafter: the player or the Claimant) and the Turkish club, Alanyaspor Kulübü Dernegi (hereinafter: the club or the Respondent) signed a termination agreement, thereby agreeing to mutually terminate their employment relationship.
2. According to the termination agreement, the Respondent undertook to pay the Claimant the following amounts:
“EUR 80,000.00 (eighty thousand euro) net and without and deduction of any kind shall be paid on 10 August 2018
EUR 50,000.00 (fifty thousand euro) net and without and deduction of any kind shall be paid on 31.08.2018
EUR 50,000.00 (fifty thousand euro) net and without and deduction of any kind shall be paid on 30.09.2018
EUR 50,000.00 (fifty thousand euro) net and without and deduction of any kind shall be paid on 31.10.2018
EUR 50,000.00 (fifty thousand euro) net and without and deduction of any kind shall be paid on 30.11.2018
EUR 50,000.00 (fifty thousand euro) net and without and deduction of any kind shall be paid on 20.12.2018
EUR 50,000.00 (fifty thousand euro) net and without and deduction of any kind shall be paid on 31.01.2019
EUR 50,000.00 (fifty thousand euro) net and without and deduction of any kind shall be paid on 28.02.2019
EUR 50,000.00 (fifty thousand euro) net and without and deduction of any kind shall be paid on 31.03.2019”
3. According to art. 3 of the termination agreement, “a payment is deemed to be performed on time if, on or before expiry of the payment term, the following cumulative conditions are met: (i) the amount has been debited from the bank account of the Club (it means that all and any bank and/or change fees are to be borne by the Club) and (ii) the Club sends the copy of the bank confirmation (SWIFT) to the Player. Shall one of those condition not be met, the payment is not considered to be performed on time”.
4. Furthermore, art. 4 set out the process in case of delayed payments, as follows:
“The Club agrees that the strict punctuality of the payments as agreed on Art. 3.1 is to be considered as the absolute essence of the Agreement, in consideration to the concessions made by the Player by accepting an earlier termination of the Labor Contract and waiving an important part of the benefits arising out of it, as requested by the Club. At this title, the Club acknowledges that the Player makes a concession equivalent to more than EUR 640,000.-. Therefore a failure to pay the relevant amount is considered by both Parties as a significant breach of the present Agreement and will therefore have the following consequences (that the Club fully agrees with).
Shall the Club fail to pay any of the installments as agreed under Art. 3.1 to 3.3 above (i.e., its bank account has not been debited on or before expiry of the relevant deadline, the amount is not paid in full, bank fees are charged to the Player due to the payment instruction of the Club, the Swift is not sent to the Player on or before expiry of the relevant deadline) for more than 30 days or 3 (three) times for more than 15 days over the duration of the Agreement :
(i) The Payment schedule will be null and void and all amounts payable under this Agreement will become mature and due immediately;
(ii) The Club will pay a 5% default interest rate on all delayed payments;
(iii) The Club will pay a penalty of EUR 320,000.- (three hundred thousand Euros) corresponding to the half of the concession made by the Player. With full knowledge of FIFA and CAS jurisprudence, as well as Swiss law on the reduction of excessive penalty clauses, the Club (i) confirms that the amount of this penalty has been fixed in accordance with the concessions made by the Player (taking into account the losses incurred by the Player by waiving his contractual benefits) and is in no way excessive and (ii) irrevocably waives claiming before any Court or authority that the Penalty is excessive.
(iv) In addition, in such case, the Club will take in charge all legal, procedure and recovery fees incurred by the Player (including but not limited to: attorney’s fees, court fees, official translation fees, etc.).”
5. By means of a letter dated 22 July 2019, the Claimant informed the Respondent that the payment of the first instalment of the termination agreement had been delayed for more than 30 days. In this context, the Claimant granted the Respondent 10 days to pay the amount of EUR 320,000 as the penalty set out in the termination agreement.
6. On 2 December 2019, the Claimant lodged a claim against the Respondent in front of FIFA.
7. In his claim, the Claimant mentioned that the first instalment of EUR 80,000, due on 10 August 2018, had been paid by the Respondent on 12 September 2018, thus with a delay of more than 30 days.
8. In these circumstances, the Claimant held that this late payment triggered the penalty clause as set out in art. 4 of the termination agreement. The Claimant further noted that the Respondent had not replied to his default notice sent on 22 July 2019.
9. Moreover, the Claimant emphasised that the penalty was provided in the termination agreement, thus agreed upon by the parties, and that the amount of the penalty is not excessive, considering that it represents half of the total amount due under the termination agreement.
10. In light of the above, the Claimant requested the payment of EUR 320,000, corresponding to the penalty provided in the termination agreement, plus 5% interest p.a. as from 10 August 2018. The Claimant also asked that his legal costs be borne by the Respondent.
11. In its reply to the claim, the Respondent first underlined that it had paid all the instalments as set out in the termination agreement and that only the first instalment of EUR 80,000 had been paid late due to delays caused by the bank. In this regard, the Respondent argued that the payment delay was not under its control and occurred despite its best endeavours to pay the first instalment on time. In view of the foregoing, the Respondent claimed its good faith and requested the non-application of the penalty clause.
II. Considerations of the Dispute Resolution Chamber
1. First of all, the Dispute Resolution Chamber (hereinafter also referred to as: the DRC or the Chamber) analysed whether it was competent to deal with the case at hand. In this respect, the Chamber took note that the present matter was first submitted to FIFA on 2 December 2019. Consequently, the 2019 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 members of the Chamber referred to art. 3 par. 1 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 (March 2020 edition), it is competent to decide on the present litigation, which concerns an employment-related dispute with an international dimension between a French player and a Turkish club.
3. Furthermore, the DRC analysed which edition of the Regulations should be applicable as to the substance of the matter. In this respect, the Chamber confirmed that, in accordance with art. 26 par. 1 and 2 of the Regulations (March 2020 edition) and considering that the present matter was submitted to FIFA on 2 December 2019, the October 2019 edition of said Regulations is applicable to the present matter as to the substance.
4. With the above having been established, the Chamber entered into the substance of the matter. In doing so, it started to acknowledge the facts of the case as well as the documents contained in the file. However, the Chamber emphasized that in the following considerations it will refer only to facts, arguments and documentary evidence which it considered pertinent for the assessment of the matter at hand.
5. In this respect, the Chamber firstly acknowledged that it was undisputed that the Claimant and the Respondent had signed a termination agreement on 9 August 2018, according to which the Respondent undertook to pay the Claimant the instalments as set out in point I./ 2. above.
6. In continuation, the Chamber noted that it was also undisputed that the parties had acknowledged, in the termination agreement, that the Claimant was making a “concession equivalent to more than EUR 640,000.-“ when agreeing to conclude the termination agreement and that in the event of delayed payments by the Respondent of more than 30 days, the Claimant would be entitled to receive the full amount immediately, plus 5% default interest and EUR 320,000 as a penalty.
7. Summarising the parties’ respective positions in this dispute, the members of the Chamber noted that the Claimant, on the one hand, claimed that the Respondent had paid the first instalment of EUR 80,000 late, i.e. over 30 days after its due date, thus meaning he should be entitled to the penalty in the amount of EUR 320,000, plus 5% interest p.a. as from 10 August 2018, whilst on the other hand, the Respondent affirmed that it had paid all the instalments as set out in the termination agreement and that only the first instalment had been paid late due to delays caused by the bank.
8. In view of the foregoing, the Chamber established that the main issue to be analysed in the present case is whether the late payment of the first instalment had triggered the payment of the penalty contained in art. 4 of the termination agreement, in the amount of EUR 320,000, or not.
9. In this context, the Chamber first noted that the Respondent did not contest having paid the first instalment late. Rather, the Respondent argued that the delay in the payment had been caused by its bank, which was not under its control, and considered to have acted in good faith and used its best endeavours to pay the first instalment on time.
10. Furthermore, the Chamber was eager to emphasise that the termination agreement clearly stipulated the set deadlines for the instalments to be paid and that the wording of the penalty clause was unequivocal as it stated that it is “in no way excessive and [the Respondent] irrevocably waives claiming before any Court or authority that the penalty is excessive”.
11. In this respect, the Chamber pointed out that the penalty was rather a “suspended debt” in the sense that it was intrinsically based on the Claimant’s concession with regard to the total amount which was due to him at the moment of concluding the termination agreement, i.e. a debt of half of what would have been due to the Claimant under the original employment contract. In continuation, the Chamber underlined that the wording used in the termination agreement only illustrated the fact that the Claimant had accepted to sign the termination agreement on the sole condition that the Respondent complied with the terms set out, failing which he would be entitled to a higher amount.
12. With this being said, the members of the DRC were of the opinion that it was not necessary to make a proportionality evaluation of the amounts set out in the termination agreement and concluded to follow strictly the unambiguous wording contained at art. 4 of the termination agreement.
13. Therefore, in light of all the aforementioned, the Chamber concluded that the Respondent failed to respect the terms of the termination agreement and that the penalty contained in art. 4 of the termination agreement had been triggered and was thus due to the Claimant.
14. Consequently, the Chamber decided that the Respondent is liable to pay the Claimant the amount of EUR 320,000.
15. With regard to the Claimant’s request for the payment of interest on the aforementioned amount, the DRC referred to its constant jurisprudence, according to which interest does not apply to the payment of a penalty. As such, the Chamber decided to reject this part of the claim.
16. Furthermore, the DRC 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.
17. 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.
18. Therefore, bearing in mind the above, the DRC decided that, in the event that the Respondent does not pay the amount 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.
19. Finally, the DRC recalled that the above-mentioned ban will be lifted immediately and prior to its complete serving upon payment of the due amount, in accordance with art. 24bis par. 3 of the Regulations.
20. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further request filed by the Claimant is rejected.
III. Decision of the Dispute Resolution Chamber
1. The claim of the Claimant, Rémy Riou, is partially accepted.
2. The Respondent, Alanyaspor Kulübü Dernegi, has to pay to the Claimant the amount of EUR 320,000.
3. Any further claim lodged by the Claimant is rejected.
4. The Claimant is directed to inform the Respondent, immediately and directly, preferably to the email address as indicated on the cover letter of the present decision, of the relevant bank account to which the Respondent must pay the amount mentioned under point 2. above.
5. The Respondent shall provide evidence of payment of the due amount in accordance with point 2. above to FIFA to the e-mail address psdfifa@fifa.org, duly translated into one of the official FIFA languages (English, French, German, Spanish).
6. In the event that the amount due in accordance with point 2. above is 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 amount is 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).
7. The ban mentioned in point 6. above will be lifted immediately and prior to its complete serving, once the due amount is paid.
8. In the event that the amount due in accordance with point 2. above is 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 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. 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
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:
Emilio García Silvero
Chief Legal & Compliance Officer