F.I.F.A. – Camera di Risoluzione delle Controversie (2014-2015) – controversie di lavoro – ———- F.I.F.A. – Dispute Resolution Chamber (2014-2015) – labour disputes – official version by www.fifa.com – Decision of the Dispute Resolution Chamber passed in Zurich, Switzerland, on 20 August 2014, in the following composition: Thomas Grimm (Switzerland), Deputy Chairman Taku Nomiya (Japan), member Theo van Seggelen (Netherlands), member on the claim presented by the club, Club S, from country B as Claimant against the player, Player T, from country B as Respondent 1 and the club, Club U, from country I as Respondent 2 regarding an employment-related dispute arisen between the Claimant and the Respondent 1

F.I.F.A. - Camera di Risoluzione delle Controversie (2014-2015) - controversie di lavoro - ---------- F.I.F.A. - Dispute Resolution Chamber (2014-2015) - labour disputes – official version by www.fifa.com – Decision of the Dispute Resolution Chamber passed in Zurich, Switzerland, on 20 August 2014, in the following composition: Thomas Grimm (Switzerland), Deputy Chairman Taku Nomiya (Japan), member Theo van Seggelen (Netherlands), member on the claim presented by the club, Club S, from country B as Claimant against the player, Player T, from country B as Respondent 1 and the club, Club U, from country I as Respondent 2 regarding an employment-related dispute arisen between the Claimant and the Respondent 1 I. Facts of the case 1. On 28 July 2006, the club from country B, Club S (hereinafter: Club S or Claimant) and the player from country B, Player T (hereinafter: player or Respondent 1), born on 2 March 1989, signed an employment contract valid as from the signature date until 27 July 2008. 1. Art. 17 of the contract stipulates that the player would receive a monthly salary in the amount of 2,400. 2. By means of an additional agreement (hereinafter: agreement) signed on the same date, the player and the club inter alia agreed (art. 6 par. 2) that “In the event of a unilateral breach or termination on the part of the [player] in order to transfer to another club overseas, or a contractual breach, a penalty fine is hereby established to be paid by the [player] to the club (…) in the amount of EUR 5,000,000”. 3. Art. 6 par. 3 of the agreement sets forth that “In the event the association without cause, terminates this contract, it shall pay the [player] the amount corresponding to 50% (fifty percent) of the period short of completing the term stipulated in executed contract (…)”. 4. Art. 6 par. 5 stipulates that the player’s salary for the second contractual year would amount to 2,500 (…) and that he shall receive a monthly allowance of 1,000 (…) relating to “costs of living”. 5. On 17 September 2007, the club from country I, Club T, and the player signed an employment contract that would enter into force upon receipt of the player’s International Transfer Certificate (ITC), be it during the sporting season 2007/08 or during the sporting season 2008/09, and valid until the end of the sporting season 2012/13 (hereinafter: the Club T contract). In its preamble, said contract reads that “Club T, having been informed by [the player] that the same will be free of ties by March 31, 2008, wishes and agrees to purchase, and [the player] agrees to sell, [the player’s] playing rights under the conditions below.” 6. The Club T contract further mentions that the “effectiveness of this agreement is contingent on the issuance of an international transfer certificate by the Federation of country B.” 7. In art. 2 par. 2 lit. a) to e) of the Club T contract, it is stipulated that “CLUB T shall have PLAYER sign, and PLAYER shall sign, a multi-annual economic agreement” setting forth specified payment terms as from the 2008/09 season until and including the 2012/13 season. Art. 2 par. 3 sets forth that the provisions pertaining to the above-described par. 2 “shall be attested in a federal form” as soon as the player is in a position to sign an economic agreement with Club T. 8. According to the Claimant, no ITC was ever issued by the Football Federation from country B on behalf of the Football Federation from country I in connection with the Club T contract. 9. According to a correspondence dated 4 November 2010 issued by the Football Federation from country I, the Respondent 1’s first registration in country I, which took place on 28 July 2009, was a registration in favour of the club from country I, Club U (hereinafter: Club U or Respondent 2) following the issuance on 27 July 2009 of an ITC by the Football Federation from country B to the Football Federation from country I. 10. According to the player, on 20 February 2009, he signed an employment contract with Club U entering into force on 20 February 2009 and coming to an end on 30 June 2013. According to art. 2 a) of the aforementioned contract, the player was to receive the following net amounts per season: 2008/2009 2009/2010 2010/2011 2011/2012 2012/2013 EUR 50,000 EUR 100,000 EUR 100,000 EUR 100,000 EUR 100,000 11. However, and according to a document submitted by Club U, on 13 May 2009, Club U and the player signed an employment contract entering into force on 1 July 2009 and coming to an end on 30 June 2014. According to art. 2 a) of the aforementioned contract, the player was to receive the following net amounts per season: 2009/2010 2010/2011 2011/2012 2012/2013 2013/2014 EUR 100,000 EUR 100,000 EUR 100,000 EUR 100,000 EUR 100,000 Club S’ initial claim against the player and Club T 12. According to Club S, on 24 September 2007, i.e. one week after having signed the Club T contract, and allegedly under Club T’s influence, the player lodged a claim against Club S before a labour court in country B, requesting the termination of the contract signed with Club S due to the latter’s alleged breach of its contractual obligations. In this respect, Club S pointed out that the player attached a copy of the contract he signed with Club T in support of his claim against Club S in front of the labour court in country B. 13. On the other hand, Club S lodged a counterclaim in front of said labour court in country B against the player arguing that the latter is acting out of bad faith and, inter alia, requested the payment of moral damages. 14. On 21 November 2007, the judge of the labour court in country B rejected both the player’s request and Club S’ counterclaim. 15. In support of its claim against the player in front of FIFA, Club S pointed out that the player did not terminate the employment contract he had signed with Club S before signing the Club T contract. In the club’s opinion, the player therefore had two contracts ongoing at the same time with two different clubs, which is a violation of the contract signed with Club S as well as a breach of the FIFA Regulations. Club S’ claim against the player and Club U 16. After FIFA had previously invited the player and Club T to present their respective positions with regard to the claims for breach of contract and inducement to breach of contract, respectively, lodged against them by Club S on 21 December 2007, Club S amended its position and decided to withdraw its claim against Club T while maintaining its claim against the player. 17. In this respect, Club S explained that prima facie, it believed that Club T had induced the player to breach his contract signed with Club S. However, and based on the letters it respectively received from Club T and the Football Federation from country I, it appeared that the player was never registered with Club T but was firstly registered in country I with Club U. In this respect, the Football Federation from country I enclosed a copy of an ITC dated 27 July 2009 and showing that the Football Federation from country B issued an ITC to the Football Federation from country I in view of the player’s registration with its affiliated club Club U. 18. Therefore, on 26 November 2010, Club S lodged a claim in front of FIFA against the player and Club U for breach of contract without just cause and inducement of breach of contract, respectively. 19. In this respect, Club S asked that the player be sentenced to pay compensation for breach of contract in the amount of EUR 5,000,000, i.e. the contractual amount applicable in case the player was internationally transferred, plus 5% interest to be applied on the amount due as compensation to Club S, calculated as from the date the Dispute Resolution Chamber will find suitable. Club S also claimed that sporting sanctions be imposed upon the player. 20. Additionally, Club S requested that Club U be held jointly liable for the payment of the compensation imposed upon the player in accordance with art. 17 par. 2 of the FIFA Regulations. Club S also claimed the imposition of a ban from registering any players either nationally or internationally for two registration periods on Club U. 21. Club S stressed that in addition to the above-described events, Club U never informed Club S of its intention to hire the player and clearly induced the player to breach his contract with Club S. 22. Club S referred to art. 18 par. 3 of the Regulations and held that Club U shall be sanctioned for having breached its duty of due diligence as it never informed Club S of its intention to hire the player. 23. In this respect, Club S stressed that based on some media articles, it is clear that the player started to be linked to Club U since the summer 2008 and that, allegedly, Club U only waited for the player to receive an passport from country I before signing a contract with him and have him registered at the Football Federation from country I. Player’s answer to Club S’ claim 24. In his answer to Club S’ claim, the player explained that based on the fact that Club S had not complied with its financial obligations in a timely manner, he decided to lodge a claim against Club S before a labour court in country B on 24 September 2007 seeking, inter alia, to be granted compensation for breach of contract and to be released from said contract. The player maintained that Club T had in no way influenced him to lodge said claim. 25. In addition, the player stressed that Club S lodged a counterclaim against him in country B and, based on the allegation that the player’s claim against the club was unjustified and abusive, Club S claimed the payment stipulated in art. 6 par. 1 of the Club S contract. 26. On 21 November 2007, the relevant judge dismissed the player’s claim and the club’s counterclaim, leading to the fact that the player continued rendering his services to Club S up and until the end of the duration of their contract. 27. Also, and allegedly comforted by the player’s opinion that he had just cause to terminate the Club S contract under the law in country B and in accordance with FIFA’s jurisprudence, Club T and the player concluded an employment contract in September 2007. This employment contract, signed in good faith, was only to start as of 31 March 2008 so as to give enough time to the labour court in country B to confirm the termination of the contract signed with Club S. 28. In view of the above, the player deemed that Club S’ claim is inadmissible as the matter opposing him to Club S is a res iudicata. 29. The player also stressed that Club S accepted the jurisdiction of the labour court in country B and even lodged a counterclaim against the player in front of said court. 30. As a result, the player held that the FIFA DRC is not competent to deal with Club S’ claim. Should the DRC not consider this matter to be a res iudicata, the player presented the following arguments in relation to the Club S contract. 31. In this respect, the player firstly explained that even after the court in country B issued its ruling, the player kept rendering his services to the club. As an illustration of that fact, the player submitted a copy of an article dated 29 February 2008 related to his participation as a player of Club S in a regional tournament for youth teams. 32. In the player’s opinion, Club S is malicious to lodge a claim before FIFA against one of its own players who, additionally, was still rendering his services to the club at that time. In this respect, the player asserted that a breach of contract triggering the payment of compensation implies that the contractual relationship between the parties has come to an end or should have come to an end as of the date of the alleged breach of contract, in other words, that the player is no longer playing for the club’s team. 33. To conclude in this regard, the player stressed that no breach of contract actually occurred since the employment relationship had continued. 34. In continuation, the player addressed the question of the amount of compensation claimed by Club S. In this respect, the player held that in “Matuzalem” and “El-Hadary” cases, the Court of Arbitration for Sport (CAS) adopted an approach aiming at putting the victim of the breach in the position it would have been should the contract have been performed without any breach. 35. However, in the matter at hand, Club S did not lose the benefit of the player and therefore has no reason to be granted any compensation. The contract was performed as if no breach had ever happened. In the player’s opinion, a different outcome would result in an unjustified enrichment for Club S, which is contrary to art. 62 of the Swiss Code of Obligations. 36. Additionally, the player specified that Club S, having forfeited its right to receive a financial compensation, also forfeited its right to request sporting sanctions to be imposed upon the player. 37. In the player’s opinion, Club S’ claim is only a “desperate” attempt to collect money in relation to a player who had decided to stop playing for the club after the expiry of his contract in July 2008. In other words, after Club S understood that its chances to successfully negotiate another contract with the player were overcome by the offer made by Club T and that the player had decided to leave the club, it decided to lodge a claim against the player before FIFA. 38. As to the amount of compensation sought by Club S, the player asserted that the amount stipulated in art. 6 par. 2 of the contract is totally disproportionate since, bearing in mind the amount of the player’s remuneration, i.e. EUR 864 per month, the latter would have had to work 440 years to be able to pay to the club the amount stipulated in the clause in question. 39. What is more, the player, referred to CAS jurisprudence and to art. 163 of the Swiss Code of Obligations and pointed out that said article provides that “excessively high liquidated damages shall be reduced at the discretion of the judge.” 40. The amount stipulated in said contractual clause being inapplicable, the player referred to the question of the prejudice suffered by Club S to justify its claim for compensation. 41. In this regard, the player highlighted that bearing in mind that art. 42 of the aforementioned Swiss Code provides that “whoever claims damages must prove the damages”, and taking into account CAS’ approach in relation to the full reparation of one’s prejudice, Club S is not in a position to be awarded any compensation as it has not been able to put forward any damages since the player executed the contract until its end. 42. In view of all of the above, the player concluded should the DRC consider that a breach of contract of contract occurred and has not been covered by the execution of the contract by both parties, the amount stipulated in art. 6 par. 2 of the contract is to be set aside as it is disproportionate and the player shall not be sentenced to pay any compensation to Club S as said club did not suffer any prejudice arising from the above-described situation. Club U’s answer to Club S’ claim 43. In its reply to the claim, Club U pointed out that in its opinion, Club S’ claim is inadmissible as a result of it being a res iudicata. In this respect, it explained that the player already submitted an employment-related dispute opposing him to Club S to a labour court in country B, which, afterwards, rendered a decision in relation to the player’s claim and Club S’ counterclaim. As a result, Club U considers that FIFA’s decision-making bodies are not in a position to decide on the substance of Club S’ claim against the player. 44. In addition to the aforementioned, Club U also held that “considering the litis pendens before the court of Club S much before the case was submitted to FIFA, the latter is not able to hear the case.” 45. In continuation, Club U pointed out that based on art. 25 of the FIFA Regulations, Club S’ claim against Club U is time-barred. In this respect, Club U recalled that Club S lodged its claim against Club U before FIFA on 26 November 2010 whereas the player had lodged his claim against Club S before the local labour court in country B on 24 September 2007. In particular, Club U stressed that Club S knew that the player had signed a contract with Club T and decided to move to country I as from 24 September 2007. 46. Furthermore, Club U held that it has no standing to be sued since (i) it never induced the player to breach his contract with Club S and (ii) that the contract signed between Club U and the player was signed about a year after the Club S contract had expired. 47. In this respect, Club U stressed that it has respected the principle of due diligence and asked the Football Federation from country B information in relation to the player’s contractual situation before approaching the player. In this respect, Club U submitted copies of two faxes issued by the Football Federation from country B and confirming the date of the end of the contract between the player with Club S, i.e. 27 July 2008. On the basis of the aforementioned, Club U claims that (a) it never contacted the player whilst the latter was registered with Club S, (b) it never induced the player to terminate the contract with Club S or to bring a legal action against Club S in country B. 48. In this respect, Club U rejected Club S’ assertions in relation to the actual beginning of the relation between the player and Club U. In particular, it held that Club S’ statement that their relation would have started in 2008 is groundless and unproven, only consisting of Club S’ own beliefs, possibly having been instigated by Club T. 49. In continuation, Club U highlighted that the club with which the player signed a contract whilst his contract with Club S was still valid is Club T, not Club U. In this regard, Club U referred to Club S’ statement of claim and stressed that in said document, Club S explained that the player lodged a claim against Club S in country B ”induced by Mr X, a former managing director of Club T”. 50. What is more, Club U stressed that the absence of registration of the contract signed between the player and Club T does not impact its validity. In Club U’s opinion, it is Club T that has to be seen as the “club” in the sense of art. 17 par. 4 of the FIFA Regulations. 51. Finally, Club U challenged the amount claimed by Club S for compensation for breach contract. In this respect, it held that as Club S trained the player, it never had to pay a transfer fee to recruit him. Also, Club U pointed out that Club S only fielded the player once during the remainder of the sporting season. 52. In continuation, considering the remuneration the player was receiving with Club S, i.e. about EUR 750 per month, or considering the entire value of said employment contract, i.e. about EUR 18,216, Club U holds that the claim of EUR 5,000,000 is disproportionate and disconnected from the player’s market value. In Club U’s opinion, the amount stipulated in the clause therefore appears to be a way for Club S to enrich itself without justification and the compensation for breach of contract granted to Club S, if any, has to be diminished to zero, notably based on art. 163.3 of the Swiss Code of Obligations. 53. Finally, Club U stressed that it neither caused any prejudice to Club S nor did it benefit from the player’s services as the player, who never played for Club U during the season, was subsequently loaned for free to another club from country I. II. Considerations of the Dispute Resolution Chamber 1. First of all, the Dispute Resolution Chamber (hereinafter also referred to as Chamber or DRC) analysed whether it was competent to deal with the matter at hand. In this respect, it took note that the present matter was submitted to FIFA on 21 November 2007. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2005; hereinafter: Procedural Rules) are applicable to the matter at hand (cf. art. 21 par. 1 and 2 of the 2014 edition of the Procedural Rules in combination with art. 18 par. 1 and 2 of the 2008 and 2005 edition 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 par. 2 Regulations on the Status and Transfer of Players (edition 2014, hereinafter: the Regulations), it firstly had to analyse under the lights of art. 22 lit. a) and lit. b) of said Regulations as to whether it was competent to deal with the matter at hand, which primarily concerns an employment-related dispute opposing a club from country B to a player from country B. 3. In this context, the DRC first reverted to art. 22 lit. b) of the Regulations and duly noted that according to said article, the DRC is competent to hear disputes between a club and a player of an international dimension, unless an independent arbitration tribunal guaranteeing fair proceedings and respecting the principle of equal representation of players and clubs has been established at national level within the framework of the association and/or a collective bargaining agreement. 4. Bearing these considerations in mind, the DRC duly noted that the Claimant is a football club affiliated to the Football Federation from country B and that, on the other hand, the Respondent 1 is a football player holding the nationality from country B. 5. In view of the above, the Chamber came to the conclusion that it is not competent to deal with the matter at hand on the basis of art. 22 lit. b) of the Regulations as the matter opposing the Claimant and the Respondent 1 is deprived of the mandatory international dimension required under the above-referred provision. 6. In continuation, the DRC turned its attention to art. 22 lit. a) of the Regulations and noted that according to said article, the Dispute Resolution Chamber is competent to hear disputes between clubs and players in relation to the maintenance of contractual stability where there has been an ITC request and a claim from an interested party in relation to said ITC request, in particular regarding the issue of the ITC, sporting sanctions or compensation for breach of contract. 7. Against such a background, the Chamber was eager to note that on 5 November 2010, the Claimant decided to withdraw its claim against Club T and that on 26 November 2010, besides maintaining, mutatis mutandis, its initial claim against the Respondent 1, the Claimant amended its claim and involved the club from country I, Club U, instead of Club T in the proceedings at hand. 8. However, the Chamber found that on the basis of the documentation available on file, no ITC had ever been requested by the Football Federation from country I, left alone issued by the Football Federation from country B, in relation to the Club T contract. It follows from the aforementioned that the Claimant’s claim, regardless of its posterior withdrawal, could not possibly be lodged in relation to an ITC request involving the Football Federation from country B and the Football Federation from country I in relation to the Respondent 1 and Club T. 9. Additionally, the Chamber found that the Respondent 1’s signature of the contract and subsequent registration with the Respondent 2, which was accompanied by the issuance of an ITC dated 27 July 2009 sent by Football Federation from country B to the Football Federation from country I, took place after complete execution of the employment contract signed by and between the Claimant and the Respondent 1. In this respect, the Chamber also wished to point out that the Claimant’s amended statement of claim was not related to said ITC request. 10. In view of the aforementioned, the Chamber found that as the Claimant’s claim against the Respondent 1 was not consisting of a claim of an interested party in relation to an ICT request, the DRC could also not consider itself competent to deal with the Claimant’s claim at hand on the basis of art. 22 lit. a) of the Regulations. 11. In the absence of any legal basis justifying its competence, the Dispute Resolution Chamber considered itself not competent to deal with the matter at hand and consequently held that the Claimant’s claim was not admissible. III. Decision of the Dispute Resolution Chamber The claim of the Claimant, Club S, is not admissible. ***** Note relating to the motivated decision (legal remedy): According to art. 67 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS directly within 21 days of receipt of notification of this decision and shall contain all the elements in accordance with point 2 of the directives issued by the CAS, a copy of which we enclose hereto. Within another 10 days following the expiry of the time limit for filing the statement of appeal, the appellant shall file a brief stating the facts and legal arguments giving rise to the appeal with the CAS (cf. point 4 of the directives). The full address and contact numbers of the CAS are the following: Court of Arbitration for Sport Avenue de Beaumont 2 1012 Lausanne Switzerland Tel: +41 21 613 50 00 Fax: +41 21 613 50 01 e-mail: info@tas-cas.org www.tas-cas.org For the Dispute Resolution Chamber: Jérôme Valcke Secretary General Encl. CAS directives