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 21 January 2015, in the following composition: Thomas Grimm (Switzerland), Deputy Chairman Eirik Monsen (Norway), member Zola Percival Majavu (South Africa), member on the claim presented by the player, Player A, Country B as Claimant against the club, Club C, Country D as Respondent regarding an employment-related dispute arisen between the parties

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 21 January 2015, in the following composition: Thomas Grimm (Switzerland), Deputy Chairman Eirik Monsen (Norway), member Zola Percival Majavu (South Africa), member on the claim presented by the player, Player A, Country B as Claimant against the club, Club C, Country D as Respondent regarding an employment-related dispute arisen between the parties I. Facts of the case 1. On 12 January 2012, the Player of Country B, Player A (hereinafter: the Claimant), and the Club of Country D, Club C (hereinafter: the Respondent), signed an employment contract (hereinafter: the contract), valid as from the date of signature until 31 May 2015. 2. According to art. 4 of the contract, the Respondent undertook to pay the Claimant, inter alia, the following amounts “on a net basis, free of any taxation and state levies”: - EUR 30,000 upon signature of the contract; - 2011/12 Season: o EUR 120,000 (4 instalments of EUR 30,000, due at the end of each month, beginning on 29 February 2012 and the last on 31 May 2012); - 2012/13 Season: o EUR 97,500 (3 instalments of EUR 32,500, due on 31 August 2012, 30 September 2012, 30 October 2012); o EUR 227,500 (10 instalments of EUR 22,750, due at the end of each month, beginning on 31 August 2012 and the last on 31 May 2013); - 2013/14 Season: o EUR 105,000 (3 instalments of EUR 35,000, due on 31 August 2013, 30 September 2013, 30 October 2013); o EUR 245,000 (10 instalments of EUR 24,500, due at the end of each month, beginning on 31 August 2013 and the last on 31 May 2014); - 2014/15 Season: o EUR 112,500 (3 instalments of EUR 37,500, due on 31 August 2014, 30 September 2014, 30 October 2014); o EUR 262,500 (10 instalments of EUR 26,250, due at the end of each month, beginning on 31 August 2014 and the last on 31 May 2015); - EUR 50,000 additional bonus for each season in which the Respondent qualifies for any of the UEFA club tournaments, payable immediately upon completion of the relevant season. 3. According to art. 9.2 of the contract, “[i]f the Respondent fails to pay two installments of the Claimant’s salary, partly or in full, in due time, the Claimant may serve a seven (7) day notice to the Respondent. If, notwithstanding the notice, the overdue salary payments are not entirely wire transferred to the Claimant, the Claimant shall be entitled to terminate the employment relationship for just cause, with immediate effect”. 4. In addition, according to art. 9.3 of the contract, “[i]n case of premature, unilateral termination of this contract with/without just cause by either party, the party in breach of this contract shall immediately pay compensation to the injured one, amounting to the entire residual value of this contract, including the UEFA bonuses stipulated hereinabove. The compensation shall be paid on a net basis, free of any taxation. The Parties hereby explicitly agree that no adjustment shall apply on the compensation amount. An interest rate of 10% per year as of the day following the termination date shall apply in case of delay of payment”. 5. Moreover, according to art. 11.1 of the contract, “[a]ny amendments, additions or deletions of this contract are only valid if agreed in writing.” 6. On 15 November 2012, the Claimant lodged a claim before FIFA against the Respondent for breach of contract without just cause and requested the payment of the total amount of EUR 1,395,000, plus interest of 10% p.a. as from 16 June 2012, made up of: - EUR 325,000 corresponding to salaries for 2012/13 season; - EUR 350,000 corresponding to salaries for 2013/14 season; - EUR 375,000 corresponding to salaries for 2014/15 season; - EUR 150,000 corresponding to UEFA bonus payments for the 2012/13, 2013/14 and 2014/15 seasons (3 x EUR 50,000); - EUR 195,000 (6 monthly salaries of EUR 32,500) as compensation for “sporting and moral damages and emotional distress” pursuant to Art. 337 Par. 3 of the Swiss Code of Obligations. 7. In addition, the Claimant requested sporting sanctions to be imposed on the Respondent. 8. In his arguments, the Claimant requested that the DRC apply the principle of “positive interest”. Specifically, the Claimant requested that the DRC order the Respondent to pay him “the due compensation on a net basis, free of any taxation, the [Respondent] being responsible for the filing and payment of all taxes relating to this payment of compensation to the [Claimant].” In support, the Claimant referred to the jurisprudence of CAS. 9. In addition, the Claimant claimed that the parties clearly agreed on the compensation payable in the event of breach of contract in art. 9.3 of the contract. The Claimant affirmed said clause has to be considered valid and fully effective, and that in particular, the remuneration and other benefits due to the Claimant under a new employment contract, should not be considered by the DRC when determining the amount of compensation, since “no adjustment shall apply on the compensation amounts”. 10. The Claimant argued that the Respondent failed to pay his monthly salaries for April and May 2012. Therefore, on 7 June 2012, the Claimant faxed to the Respondent a “7-day default notice”. In his notice, the Claimant asked the Respondent to transfer to him the amount of EUR 60,000 (2 months salary x EUR 30,000) within seven days, or he would terminate the contract. 11. In a letter dated 8 June 2012, the Respondent acknowledged that it did not pay the Claimant his salaries for April and May 2012. The Respondent further stated in the letter that “the cash flow due to the Federation of Player A to April and May salaries this month to pay (June 2012) will pay between twenty and twenty five.” According to the Claimant, he rejected the Respondent’s extension of the deadline to pay. 12. On 15 June 2012, the Claimant faxed to the Respondent a “notice of termination” in which he unilaterally terminated the contract with immediate effect on account of the Respondent having failed to pay him the EUR 60,000 corresponding to the salaries for April and May 2012. 13. Finally, the Claimant indicated that, on 20 June 2012, the Respondent wire-transferred to him the amount of EUR 60,000. 14. In its response to the claim, the Respondent rejected the Claimant’s arguments stating that it paid the Claimant the outstanding amount in accordance with its letter dated 8 June 2012, in which it promised payment between 20 and 25 June 2012. The Respondent acknowledged that it was a “little late” with the payment “[d]ue to some financial difficulties (cash flow) of the Respondent”, but that the Respondent acted in good faith and had previously made salary payments to the Claimant in advance of their due dates in February and March 2012. 15. The Respondent held that “the Claimant broke the contract only late payment of 60.000.EUR and now claims 1.395.000.EUR compensation”, which shows the Claimant acted in bad faith. 16. The Respondent further asserted that on 20 June 2012, in addition to paying the Claimant the outstanding amounts, the Respondent invited the Claimant to pre-season camp commencing on 3 July 2012. 17. The Respondent claimed that the Claimant was absent from the pre-season camp, and that the Football Federation of Country D informed the Respondent on 4 July 2012 that the Claimant had unilaterally terminated his contract. 18. The Respondent argued that the Claimant acted in bad faith and that the Respondent has suffered as a result, particularly given that the Respondent paid a transfer compensation of EUR 800,000 to acquire the Claimant for what amounted to half of a season of play. 19. The Respondent stated that it “reserve[s] [its] rights for claiming compensation against the Claimant” and asked FIFA to reject the Claimant’s claim. 20. In his replica, the Claimant stated that the Respondent did not contest the validity of the contract, the factual background, FIFA’s jurisdiction and the law applicable to the merits, the validity of art. 9.2 and 9.3 of the contract and that the Claimant unilaterally and prematurely terminated the contract. 21. The Claimant held that the Respondent implied that its letter of 8 June 2012 extended the 7-day deadline for payment stipulated in art. 9.2 of the contract. In this regard, the Claimant sustained that according to art. 11.1, in the absence of the Claimant’s clear and unequivocal written agreement, the Respondent was not in a position to unilaterally extend the 7-day time limit set. 22. Regarding the calculation of compensation, the Claimant insisted that there is no reason to deduct any of the amounts that he has earned with his new club according to what is stipulated in art. 9.3 of the contract. 23. The Respondent submitted its final comments, repeating its position. II. Considerations of the Dispute Resolution Chamber 1. First of all, the Dispute Resolution Chamber (hereinafter also referred to as DRC or 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 submitted to FIFA on 15 November 2012. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2008; hereinafter: the Procedural Rules) are applicable to the matter at hand (cf. art. 21 of the 2008, 2012 and 2014 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 2014), 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 Player of Country B and a Club of Country D. 3. Furthermore, the Chamber analysed which edition of the Regulations on the Status and Transfer of Players should be applicable as to the substance of the matter. In this respect, it confirmed that in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players (editions 2010, 2012 and 2014), and considering that the present claim was lodged on 15 November 2012, the 2010 edition of the aforementioned regulations (hereinafter: the 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 members of the Chamber started by acknowledging that, on 12 January 2012, the Claimant and the Respondent had concluded an employment contract valid as from 12 January 2012 until 31 May 2015. 6. In this regard, the members of the Chamber duly considered the financial terms of the employment contract at the basis of this dispute. In this respect, the Chamber took note that it had been agreed upon between the parties that the Claimant was to receive an amount of EUR 30,000 at the signing of the contract, and a salary for the 2011/2012 season of EUR 120,000 payable in 4 equal instalments of EUR 30,000. It was also agreed that the Claimant was to receive a remuneration of EUR 97,500 payable in 3 equal instalments of EUR 32,500, plus a remuneration of EUR 227,500 payable in 10 equal instalments of EUR 22,750 for the 2012/2013 season, and a remuneration of EUR 105,000 payable in 3 equal instalments of EUR 35,000, plus a remuneration of EUR 245,000 payable in 10 equal instalments of EUR 24,500 for the 2013/2014 season. 7. It was also established that the Claimant would receive a remuneration of EUR 112,500 payable in 3 equal instalments of EUR 37,500, plus a remuneration of EUR 262,500 payable in 10 equal instalments of EUR 26,250 for the 2014/2015 season. Furthermore, the Chamber acknowledged that the claimant was entitled to a EUR 50,000 additional bonus for each season in which the Respondent qualifies for any of the UEFA club tournaments, payable immediately upon completion of the relevant season. 8. The Dispute Resolution Chamber further acknowledged that, on 15 November 2012, the Claimant lodged a claim in front of FIFA against the Respondent, stressing that he had unilaterally terminated the employment contract with just cause on 15 June 2012 in accordance with art. 9.2 of the contract, due to the fact that the Respondent had not paid him his salaries for the months of April and May 2012. In this respect, the Chamber duly noted that the Claimant was seeking payment of the amount of EUR 1,395,000 plus interest as well as sporting sanctions to be imposed on the Respondent. 9. In this regard, the members of the Chamber noted that the Claimant, on 7 June 2012, had sent a notification to the Respondent via fax in which he requested the Respondent to pay the outstanding salaries in the amount of EUR 60,000 within 7 days. Following this, and since no payment was received until the aforementioned deadline, the Claimant sent a letter to the Respondent on 15 June 2012 terminating the contract alleging just cause. The Chamber took due note of the supporting documentation presented by the Claimant in this regard. 10. In addition, the DRC took note that the Claimant argued that the parties had agreed on the compensation payable in the event of breach of contract in art. 9.3 of the contract. 11. It was observed by the Chamber that the Claimant insisted that the Respondent never contested the validity of the contract, in particular the validity of art. 9.2 and art. 9.3 of the contract, as well as the fact that he terminated the contract unilaterally. 12. Moreover, the Chamber pointed out that the Claimant acknowledged that the Respondent paid his salaries corresponding to April and May 2012, on 20 June 2012. 13. Subsequently, the Dispute Resolution Chamber duly considered the arguments of the Respondent, where the Respondent held that the Claimant acted in bad faith after it sent a letter to the Claimant on 8 June 2012, confirming that the payment of the outstanding salaries would be done between the 20th or 25th of June 2012. 14. The DRC found it important to point out that the Respondent accepted paying the outstanding salaries of the Claimant corresponding to April and May 2012, on 20 June 2012. 15. The Chamber then reviewed the claim of the Claimant, who maintained that he had unilaterally terminated the employment contract with just cause in accordance with art. 9.2 of the contract, since the Respondent had failed to pay two of the monthly installments in due time, after having been put in default by the Claimant, with a seven day notice. On account of the preceding consideration, the Chamber stated that with the evidence submitted by both parties and after the Respondent admitted only paying the outstanding remuneration on 20 June 2012, it was obvious that the Respondent had failed to pay the outstanding remuneration within the seven day deadline given by the Claimant. 16. What is more, reverting to art. 9.2 of the employment contract, the Chamber established that in the light of the preceding considerations, the Respondent had obviously been in delay of two salary payments. Furthermore, the Chamber established that the Claimant had duly put the Respondent in default of its contractual obligations in writing, on 7 June 2012, setting a 7 days’ time limit to remedy such default. Hence, the conditions set out in art. 9.2 of the employment contract have been fulfilled, as a result of which such article finds application in the matter at stake. 17. On account of the above, the Chamber concluded that the Claimant had terminated the employment contract with just cause on 15 June 2012 and that the Respondent is to be held liable for the early termination of the employment contact with just cause by the Claimant. 18. Bearing in mind the previous considerations, the Chamber went on to deal with the consequences of the early termination of the employment contract with just cause by the Claimant. 19. First of all, the members of the Chamber concurred that the Respondent must fulfill its obligations as per employment contract up until the date of termination of the contract in accordance with the general legal principle of “pacta sunt servanda”. In this respect, the DRC took note that, at the date of termination of the contract, two salary payments were outstanding. However, on 20 June 2012, the Respondent paid the mentioned outstanding salaries to the Claimant and therefore, no outstanding remuneration is due to the Claimant. 20. Subsequently, after 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 decided that, taking into consideration art. 17 par. 1 of the Regulations, the Claimant is entitled to receive from the Respondent compensation for breach of contract. 21. In this context, the Chamber outlined that, in accordance with said provision, 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. 22. In application of the relevant provision, the Chamber held that it first of all had to clarify whether the pertinent employment contract contained any clause, by means of which the parties had beforehand agreed upon a compensation payable by the contractual parties in the event of breach of contract. Upon careful examination of the employment contract concluded between the Claimant and the Respondent, the members of the Chamber took note that art. 9.3 provides that “[i]n case of premature, unilateral termination of this contract with/without just cause by either party, the party in breach of this contract shall immediately pay compensation to the injured one, amounting to the entire residual value of this contract, including the UEFA bonuses stipulated hereinabove. The compensation shall be paid on a net basis, free of any taxation. The Parties hereby explicitly agree that no adjustment shall apply on the compensation amount. An interest rate of 10% per year as of the day following the termination date shall apply in case of delay of payment”. 23. The Chamber duly analysed the contents of said clause and acknowledged that the aforementioned clause provides that the party in breach of the contract shall pay compensation to the injured one. In this respect, the Chamber acknowledged that said contractual clause did not include a precise and specific amount of compensation, however, it clearly provided for a determinable amount of compensation payable by the Respondent in the event of breach of the contract with just cause by the Claimant, which amount corresponds to the remaining value of the employment contract, including the bonuses stipulated in the contract, and an interest rate of 10% per year as of the day following the termination date, which was not considered disproportionate by the Chamber. 24. On account of the above, the parties having contractually agreed on the compensation payable in the event of breach of contract, with such compensation being reciprocal and not deemed disproportionate, the Dispute Resolution Chamber concluded that the provision contained under article 9.3 of the pertinent employment contract has to be considered as valid and fully effective, i.e. the amount of compensation provided for in said article shall be awarded to the Claimant. 25. In this regard, and according to the documentation provided by the Claimant to FIFA, the Chamber established that the remaining value of the relevant employment contract amounts to EUR 1,200,000 relating to the Claimant’s financial entitlements under said contract as from June 2012 until May 2015. 26. In this context, the DRC took further and careful notice of the contents of art. 9.3 of the contract in relation to the application of any mitigation on the compensation payable in the event of breach of contract. In this regard, according to art. 9.3 of the contract, the parties had mutually agreed that no adjustment would apply on the compensation amount. As a result, the Chamber concurred that any remuneration under the new employment is irrelevant in the case at hand. 27. Taking into account all of the above, the Chamber decided that the Respondent has to pay to the Claimant the total amount of EUR 1,200,000 as compensation for breach of contract. 28. In addition, the Chamber decided that the Respondent must pay to the Claimant interest of 10% p.a. on the amount of compensation as of the date on which the claim was lodged, i.e. 15 November 2012, until the date of effective payment. 29. Furthermore, the DRC analysed the request of the Claimant corresponding to compensation for moral damages in the amount of EUR 195,000. In this regard, the Chamber deemed it appropriate to point out that the request for said compensation presented by the Claimant had no legal or regulatory basis and pointed out that no corroborating evidence had been submitted that demonstrated the damage suffered or its quantity. 30. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claim lodged by the Claimant is rejected. ***** III. Decision of the Dispute Resolution Chamber 1. The claim of the Claimant, Player A, is partially accepted. 2. The Respondent, Club C, has to pay to the Claimant compensation for breach of contract in the amount of EUR 1,200,000 plus 10% interest p.a. on said amount as from 15 November 2012 until the date of effective payment, within 30 days as from the date of notification of this decision. 3. In the event that the aforementioned sum plus interest is not paid within the stated time limit, the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee for consideration and a formal decision. 4. Any further claim lodged by the Claimant is rejected. 5. The Claimant is directed to inform the Respondent immediately and directly of the account number to which the remittance is to be made and to notify the Dispute Resolution Chamber of every payment received. ***** Note relating to the motivated decision (legal remedy): According to art. 63 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