F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – coach disputes / controversie allenatori (2019-2020) – fifa.com – atto non ufficiale – Decision 24 July 2019

Decision of the Single Judge

of the Players’ Status Committee

passed in Zurich, Switzerland, on 24 July 2019,

by

Roy Vermeer (The Netherlands)

Single Judge of the Players’ Status Committee,

on the claim presented by the coach

Coach A, Country B,

as “Claimant”

against the club

Club C, Country D

as “Respondent”

regarding a contractual dispute arisen between the parties.

I. Facts of the case

1. On 29 April 2015, the Coach of Country B, Coach A (hereinafter: the Claimant or the coach), and the club of Country D, Club C (hereinafter: the Respondent or the club), signed an employment contract (hereinafter: the first contract) valid as from 27 April 2015 until 31 December 2015.

2. According to Article 2.3 of the first contract, the coach was inter alia entitled to USD 5,000 if the club “is qualified […] from League of country D”.

3. On 31 July 2015, the parties signed a document by which the first contract was extended until 31 December 2018.

4. On 14 November 2016, the coach and the club signed another employment contract (hereinafter: the second contract) valid as from 1 January 2017 until 1 December 2019.

5. According to clause 2 of the second contract, the coach was entitled to a monthly salary of USD 6,000 “to be paid in two monthly installments on the 16th and last business day of each month or depends on club policy”.

6. On 3 September 2018, the coach put the club in default, requesting USD 3,000 corresponding to half of the April 2018 salary, USD 12,000 corresponding to the July and August 2018 salaries and USD 5,000 corresponding the “agreed promotion bonus […] that has become due in November 2016”, to be paid by 18 September 2018.

7. On 19 September 2018, the coach terminated the contract in writing. In said letter, the coach further requested USD 20,000 as overdue salaries, as well as USD 90,000 corresponding to the residual value of the contract, by 5 October 2018.

8. On 25 March 2019, the coach lodged a claim in front of FIFA for breach of contract, and requested USD 110,000 plus 5% interest “thereof since October 6 2018”, as follows:

a. USD 20,000 as outstanding remuneration, namely:

i) USD 3,000 corresponding to half of the April 2018 salary;

ii) USD 12,000 corresponding to the July and August 2018 salaries;

iii) USD 5,000 corresponding to the promotion bonus in accordance with Art. 2.3 of the first contract.

b. USD 90,000 as compensation for breach of contract, corresponding to the remaining value of the contract.

9. In his claim, the coach explained that at the end of the year 2016, the club was promoted to the “League E” and that he consequently was entitled to a bonus of USD 5,000.

10. The coach further held that the club never replied to his letters dated 3 September 2018 and 19 September 2018 respectively (cf. points I.6 and I.7 above).

11. Consequently, the coach argued that he terminated the contract with just cause as the club allegedly owed him an amount higher than three monthly salaries.

12. Despite having been invited to do so, the club failed to reply to the claim lodged by the coach.

13. On 10 July 2019, the coach informed FIFA that he remained unemployed since the termination of his employment relationship with the club.

II. Considerations of the Single Judge of the Players’ Status Committee

1. First of all, the Single Judge of the Players’ Status Committee (hereinafter: the Single Judge) analysed whether he was competent to deal with the present matter. In this respect, he took note that the matter was submitted to FIFA on 25 March 2019. Consequently, the 2018 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 in hand (cf. art. 21 of the Procedural Rules).

2. Subsequently, the Single Judge referred to art. 3 of the Procedural Rules and confirmed that in accordance with art. 23 par. 1 and 4 in combination with art. 22 lit. c) of the June 2019 edition of the Regulations on the Status and Transfer of Players, he is competent to deal with the matter at sake which concerns an employment-related dispute of an international dimension between a coach of Country B and a club of Country D.

3. Furthermore, the Single Judge 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, he confirmed that in accordance to art. 26 par. 1 and 2 of the June 2019 edition of the Regulations on the Status and Transfer of Players and considering that the present claim was lodged with FIFA on 25 March 2019, the June 2018 edition of the Regulations on the Status and Transfer of Players (hereinafter: the Regulations) is applicable to the present matter as to the substance.

4. His competence and the applicable regulations having been established, and entering into the substance of the matter, the Single Judge started by acknowledging the above-mentioned facts as well as the arguments and the documentation submitted by the parties. However, the Single Judge emphasized 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 Single Judge firstly recalled that the parties entered into a first employment contract valid as from 27 April 2015 until 31 December 2015 and into a second employment contract valid as from 1 January 2017 until 1 December 2018, the financial terms of which are respectively indicated at point I.2 and I.5 above.

6. In continuation, the Single Judge acknowledged that the Claimant lodged a claim against the Respondent in front of FIFA on 25 March 2019, requesting compensation for breach of contract and alleging that, on the date the claim was lodged, a remuneration in the amount of USD 20,000 was outstanding. In particular, the Single Judge acknowledged that the aforementioned amount also included the promotion bonus of USD 5,000 provided under art. 2.3 of the first contract.

7. In this context, the Chamber referred to art. 25 par. 5 of the Regulations, according to which the Single Judge shall not hear any case subject to the Regulations if more than two years have elapsed since the event giving rise to the dispute. Considering that the claim of the Claimant was lodged in front of FIFA on 25 March 2019 only, the Chamber found that it could not enter into any claim for outstanding remuneration that fell due prior to 25 March 2017.

8. Taking into account the previous consideration, the Single Judge preliminarily concluded that the Claimant’s request for the abovementioned promotion bonus set out in the first contract was barred by the statute of limitations in accordance with art. 25 par. 5 of the Regulations.

9. In continuation, the Single Judge highlighted that the Respondent, for its part, failed to present its response to the claim of the Claimant, in spite of having been invited to do so. In this way, the Single Judge considered that the Respondent renounced its right of defence and, thus, accepted the allegations of the Claimant.

10. Consequently, the Single Judge held that, in accordance with art. 9 par. 3 of the Procedural Rules, it shall take a decision upon the basis of the documents on file, in other words, upon the statements and documents presented by the Claimant.

11. Having said this, the Single Judge acknowledged that, in accordance with the second contract, the Respondent was obliged to pay the Claimant a monthly salary of USD 6,000 “to be paid in two monthly instalments on the 16th and last business day of each month or depends on club policy”.

12. Moreover, the Single Judge observed that, after having put the Respondent in default on 3 September 2018, the Claimant terminated the contract in writing on 19 September 2018.

13. In continuation, the Single took note that, in his claim to FIFA, the Claimant had requested from the Respondent the payment of outstanding remuneration as well as the payment of compensation for breach of contract, arguing that the Respondent failed to pay him a substantial part of his remuneration and that, consequently, he terminated the contract with just cause.

14. In light of all the above, the Single Judge deemed that the main question to be addressed in the present matter was whether the contract had been terminated by the Claimant with or without just cause on 19 September 2018.

15. In this respect, bearing in mind that the Respondent did not present its response to the claim, the Single Judge wished to recall that, pursuant to art. 12 par. 3 of the Procedural Rules, any party claiming a right on the basis of an alleged fact - namely the Claimant in the case at stake - shall carry the burden of proof.

16. In light of the foregoing considerations and of the requests of the Claimant, the Single Judge considered that it remained uncontested that, on the date of the termination of the contract by the Claimant, the total amount of USD 18,000 was outstanding, corresponding to: (i) half of the salary for the month of April 2018; (ii) the salary for the months of July and August 2018 and (iii) half of the salary for the month of September 2018.

17. Therefore, the Single Judge concluded that the Respondent had seriously neglected its contractual obligations towards the Claimant, reason for which the latter had just cause to terminate the contract on 19 September 2018, having previously put the Respondent in default of its financial obligations on 3 September 2018.

18. Consequently, the Single Judge concluded that the Claimant terminated the contract with just cause and the Respondent is to be held liable for the aforementioned contractual termination.

19. In continuation, prior to establishing the consequences of the termination of the employment contract with just cause by the Claimant, the Single Judge decided that the Respondent must fulfil its obligations as per the employment contract in accordance with the general legal principle of “pacta sunt servanda”. Consequently, the Single Judge decided that the Respondent is liable to pay to the Claimant the amount of USD 18,000, corresponding to the remuneration which remained outstanding on the date of termination of the contract by the Claimant, as detailed in point II.16 above.

20. In addition, taking into consideration the Claimant’s request, the Single Judge decided to award the Claimant interest at the rate of 5% p.a. on the aforementioned amount as of 6 October 2018.

21. Having established the aforementioned, the Single Judge established that, as the coach terminated the contract with just cause, the Respondent shall pay compensation for breach of contract to the Claimant. In this respect, turning his attention to the calculation of the aforementioned compensation, the Single Judge held that it had to be first of all clarified whether the contract at the basis of the present dispute 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 Single Judge acknowledged that no provision of that kind was contained in the contract and, thus, the amount of compensation due to the Claimant had to be assessed in accordance with other criteria.

22. As to that, the Single Judge reverted to his established jurisprudence and pointed out that the amount to be taken into account as a basis for the calculation of the compensation due to the Claimant by the Respondent amounted to USD 87,000, corresponding to his remaining salaries as of the second half of September 2018 until 1 December 2019.

23. Equally, the Single Judge verified as to whether the Claimant had signed a new employment contract after having terminated the contract on 19 September 2018, by means of which he would have been enabled to reduce his loss of income. According to his constant practice, the Single Judge stressed that such remuneration under a new employment contract would be taken into account in the calculation of the amount of compensation for breach of contract in connection with the coach’s general obligation to mitigate his damages. Nevertheless, the Single Judge took note that, as confirmed by the Claimant, no further employment contract was concluded by the coach.

24. Consequently, on account of all the above-mentioned considerations, the Single Judge established that the amount of USD 87,000 had to be considered as fair and reasonable, in casu, as compensation for breach of contract.

25. In continuation and with regard to the Claimant’s request for interest, the Single Judge, in accordance with his well-established jurisprudence, decided that the Respondent has to pay to the Claimant 5% interest p.a. on the amount of USD 87,000 as from the date the claim was lodged, i.e. 25 March 2019.

26. In view of all the aforementioned, the Single Judge concluded that the claim of the Claimant, insofar as it is admissible, is partially accepted and that the following payments are to be made to the Claimant by the Respondent:

a) outstanding remuneration in the amount of USD 18,000, plus 5% interest p.a. from 6 October 2018 until the date of effective payment and;

b) compensation for breach of contract in the amount of USD 87,000, plus 5% interest p.a. from 25 March 2019 until the date of effective payment.

27. Lastly, the Single Judge referred to art. 25 par. 2 of the Regulations in combination with art. 18 par. 1 of the Procedural Rules, according to which in the proceedings before the Players’ Status Committee and the Single Judge, costs in the maximum amount of 25,000 are levied. The costs are to be borne in consideration of the parties’ degree of success in the proceedings and are normally to be paid by the unsuccessful party.

28. In this respect, the Single Judge reiterated that the claim of the Claimant is only partially accepted and that the Respondent is the party at fault. Therefore, the Single Judge decided that the Claimant and the Respondent have to bear the costs of the current proceedings in front of FIFA.

29. Furthermore and according to Annexe A of the Procedural Rules, the costs of the proceedings are to be levied on the basis of the amount in dispute. Consequently and taking into account the total amount at dispute in the present matter, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to 10,000.

30. In conclusion, and considering that the particularity of the case at hand, the Single Judge determined the costs of the current proceedings in the amount of 10,000.

31. Consequently, the Single Judge decided that the Claimant has to pay the amount of 3,000 and the Respondent has to pay the amount of 7,000 in order to cover the costs of the present proceedings.

III. Decision of the Single Judge of the Players’ Status Committee

1. The claim of the Claimant, Coach A, is partially accepted, insofar as it is admissible.

2. The Respondent, Club C, has to pay to the Claimant, within 30 days as from the date of notification of the present decision, outstanding remuneration in the amount of USD 18,000, plus interest at the rate of 5% p.a. on the said amount as from 6 October 2018 until the date of effective payment.

3. The Respondent has to pay to the Claimant within 30 days as from the date of notification of the present decision, compensation for breach of contract in the amount of USD 87,000, plus 5% interest p.a. on the said amount as from 25 March 2019 until the date of effective payment.

4. If the aforementioned sums, plus interest as established above, are not paid within the aforementioned deadline, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision.

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

6. The final costs of the proceedings in the amount of 10,000 are to be paid by both parties, within 30 days as from the date of notification of the present decision, as follows:

6.1 The amount of 3,000 has to be paid by the Claimant, Coach A. Considering that the latter already paid an advance of costs in the amount of 3,000 at the start of the present proceedings, the Claimant is exempted from paying the aforementioned amount as costs of the proceedings.

6.2 The amount of 7,000 has to be paid by the Respondent, Club C, directly to FIFA to the following bank account with reference to case nr. xxxx:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

7. The Claimant is directed to inform the Respondent immediately and directly of the account number to which the remittances under points 2 and 3 above are to be made and to notify the Players’ Status Committee of every payment received.

*****

Note relating to the motivated decision (legal remedy):

According to art. 58 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS directly within 21 days of receipt of notification of this decision and shall contain all the elements in accordance with point 2 of the directives issued by the CAS. Within another 10 days following the expiry of the time limit for filing the statement of appeal, the appellant shall file a brief stating the facts and legal arguments giving rise to the appeal with the CAS (cf. point 4 of the directives).

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

Court of Arbitration for Sport

Coach A, Country B /Club C, Country D 10

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 Single Judge of the

Players’ Status Committee

Emilio García Silvero

Chief Legal & Compliance Officer