F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – club vs club disputes / controversie tra società – (2017-2018) – fifa.com – atto non ufficiale – Decision 6 March 2018

Decision of the Single Judge

of the Players’ Status Committee

passed in Zurich, Switzerland, on 6 March 2018,

by

Geoff Thompson (England)

Single Judge of the Players’ Status Committee,

on the claim presented by the club

Club A, Country B

as “Claimant”

against the club

Club C, Country D

as “Respondent”

regarding a contractual dispute between the parties

relating to the Player E

Player E

I. Facts of the case

1. On 11 April 2014, the club of Country B, Club A (hereinafter: the Claimant) and the club of Country D, Club C (hereinafter: the Respondent) concluded a transfer agreement (hereinafter: the agreement) by means of which the Claimant would transfer the Player E (hereinafter: the player) to the Respondent upon payment of a transfer fee in the amount of EUR 50,000, in two instalments as follows :

“50% payable on 15 July 2014 following receipt of an invoice,

50% payable on 1 March 2015 following receipt of an invoice”.

2. Article 3 of the agreement stated inter alia that, “[b]oth parties also undertake to carry out the transfer over the TMS (Transfer Matching System)” and that “[the Claimant] undertakes to cancel its contractual relationship with the Player, Player E, effective 14 July 2014, as soon as [the Respondent] has provided [the Claimant] with evidence that an employment agreement has been concluded with [the player] for the period beginning 15 July 2014”.

3. According to article 4 of the agreement, “The effectiveness of [the agreement] shall be subject to the conclusion of an effective employment agreement between [the Respondent] and [the player] by 14 July 2014 for the period beginning 15 July 2014. The effectiveness of [the agreement] is furthermore subject to the player passing the sports medicine screening at [the Respondent]. Otherwise, the cancelation of the contractual relationship is to be considered invalid”.

4. On 28 February 2017, the Claimant lodged a claim against the Respondent in front of FIFA alleging that the latter did not comply with its contractual duties.

5. In this respect, the Claimant alleged that the Respondent failed to complete the transfer instruction in TMS with the requested information and to pay the outstanding transfer fee in accordance with the agreement. In this regard, the Claimant provided FIFA with an email dated 4 July 2014 according to which the Respondent was asked by the Claimant to complete the information in TMS.

6. Furthermore, the Claimant explained that, by means of a termination agreement signed with the player on 4 June 2014, the Claimant and the player agreed on the termination of their contractual relationship as from 15 July 2014.

7. Furthermore, the Claimant alleged that the player participated in the training sessions of the Respondent in July 2014. Nevertheless, the Claimant claimed that, “on August 25, 2014 the player (…) was told that the employment contract wasn’t valid anymore and wouldn’t also be notarially attested. Under severe pressure, [the player] was forced to sign a preformulated declaration”.

8. Finally, the Claimant explained that, by means of a letter dated 27 January 2017, it reminded the Respondent of the alleged outstanding amount of EUR 50,000, setting a time limit of 30 days to remedy the default and requested in addition the payment of the amounts of EUR 3,961.36 as interest and EUR 1,688.40 as legal costs. However, no payment was received.

9. Consequently, in front of FIFA the Claimant requested from the Respondent the allegedly outstanding amount of EUR 50,000, plus interest at a rate of 5% p.a. on the first instalment in the amount of EUR 25,000 as of 16 July 2014 and on the second instalment in the amount of EUR 25,000 as of 2 March 2015 until the date of effective payment.

10. In its reply to the claim lodged against it, the Respondent firstly acknowledged having concluded the agreement with the Claimant on 11 April 2014, however, contested all the allegations of the Claimant.

11. The Respondent argued that the claim for the amount of EUR 25,000 as first instalment of the transfer compensation, allegedly payable on 15 July 2014, is time-barred.

12. Furthermore, by means of a letter dated 1 October 2014 and its annexe entitled “Protocol”, the Respondent alleged that it informed the Claimant that it had not signed an effective employment contract with the player and therefore alleged that in accordance with article 4 of the agreement, the Claimant is not entitled to receive any transfer compensation from the Respondent. In this respect, the Respondent submitted to FIFA a version of the protocol signed by the Respondent and the player.

13. The “protocol” stated inter alia that,

“MUTUAL AGREEMENT PROTOCOL

As we [i.e. the Respondent], we officially declare and commit that we have not signed anytype of labour contract with Professional football player, Player E (Born 27.01.1994) because the player’s declaration about couldn’t adaptated and orientated to Country D and new Club conditions. As we [i.e. the Respondent], we also confirm that we don’t have any claim regarding player’s sign contract with any other Club”.

14. Lastly, the Respondent alleged that, “the Player declared that he could not adapt to Country D and asked [the Respondent] its permission by not concluding and getting in force such an employment contract. [The Respondent] accepted the Player’s request and the Mutual Agreement Protocol was signed on 26 August 2014 accordingly. Upon the signing of the Protocol, the Player has left the Country D”.

15. In its replica, the Claimant reiterated its initial claim and requested FIFA to “involve the decision and documents of case DRC, case ref. XXX”. In this respect, the Claimant explained that on 9 February 2017, the Dispute Resolution Chamber considered in its decision that, “it could be established that [the Respondent] and the player entered into a valid and legally binding employment contract”.

16. In continuation, the Claimant contested all the allegations of the Respondent and further alleged that the latter admitted in its reply that the player participated in the training sessions of the 2014/15 football season and “training matches”. According to the Claimant, “an employment agreement was concluded at least on a factual basis (please note that Sec. 4 doesn’t require a written employment agreement), because the player took part in all these activities”.

17. Lastly, the Claimant contested the validity of the “protocol” submitted by the Respondent to FIFA, as according to it, “the signature of the player was given by him under pressure”.

18. In its duplica, the Respondent reiterated its position and maintained all its previous arguments.

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

1. First of all, the Single Judge of the Players’ Status Committee (hereinafter also referred to as: the Single Judge) analysed which edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: Procedural Rules) was applicable to the matter at hand. In this respect, considering that the present matter was submitted to FIFA on 28 February 2017, the Single Judge concluded that the 2017 edition of the Procedural Rules is applicable in the matter at hand (cf. art. 21 of the 2017 and 2018 editions of the Procedural Rules).

2. Subsequently, the Single Judge analysed which edition of the Regulations on the Status and Transfer of Players (hereinafter: “the Regulations”) should be applicable as to the substance of the matter. In this respect, he confirmed that the present matter was submitted to FIFA on 28 February 2017 and, therefore, concluded that the 2016 edition of the Regulations is applicable in the matter at hand as to the substance (cf. art. 26 par. 1 and par. 2 of the 2016 and 2018 editions of the Regulations).

3. With regard to his competence, the Single Judge confirmed that on the basis of art. 3 par. 1 and 2 of the Procedural Rules in connection with art. 23 par. 1 and 4 as well as art. 22 lit. f) of the 2016 edition of the Regulations on the Status and Transfer of Players he is competent to deal with the matter at stake, which concerns a dispute between two football clubs affiliated to two different associations.

4. His competence and the applicable regulations having been established and entering into the substance of the matter, the Single Judge started his analysis by acknowledging the facts of the case and the arguments of the parties as well as the documents contained in the file. However, the Single Judge emphasised that in the following considerations he will refer only to the facts, arguments and documentary evidence that he considered pertinent for the assessment of the matter at hand.

5. In doing so and to begin with, the Single Judge acknowledged that on 11 April 2014, the Claimant and the Respondent concluded an agreement in relation with the transfer of the player, by means of which the Respondent undertook to pay to the Claimant a transfer fee in the amount of EUR 50,000 in two instalments as follows:

“50% payable on 15 July 2014 following receipt of an invoice,

50% payable on 1 March 2015 following receipt of an invoice”.

6. In continuation, the Single Judge took note of the content of article 4 of the agreement which states that, “the effectiveness of [the agreement] shall be subject to the conclusion of an effective employment agreement between [the Respondent] and [the player] by 14 July 2014 for the period beginning 15 July 2014. The effectiveness of [the agreement] is furthermore subject to the player passing the sports medicine screening at [the Respondent]. Otherwise, the cancelation of the contractual relationship is to be considered invalid”.

7. On the one hand, the Single Judge noted that the Claimant maintained being entitled to receive from the Respondent the outstanding amount of EUR 50,000, indicating that the latter had not yet paid any of the instalments of the transfer fee that respectively fell due on 15 July 2014 and 1 March 2015. In view of the above, the Claimant referred to the agreement and claimed from the Respondent the amount of EUR 50,000, plus interest at a rate of 5% p.a. on the first instalment in the amount of EUR 25,000 as from 16 July 2014 and on the second instalment in the amount of EUR 25,000 as from 2 March 2015 until the date of effective payment.

8. Furthermore, the Single Judge took into account the Claimant’s reference to the decision passed by the Dispute Resolution Chamber on 9 February 2017 in case ref. XXX by means of which the Dispute Resolution Chamber considered that, “it could be established that [the Respondent] and the player entered into a valid and legally binding employment contract”.

9. On the other hand, with regard to the payment of the instalments of the transfer fee, the Single Judge observed that, for its part, the Respondent contested the allegations of the Claimant and maintained that the claim for the amount of EUR 25,000 corresponding to the first instalment of the transfer fee, allegedly payable on 15 July 2014, is time-barred. Furthermore, the Respondent alleged that it had not signed an effective employment contract with the player and therefore was of the opinion that in accordance with article 4 of the agreement, the Claimant is not entitled to receive any transfer compensation from the Respondent.

10. In continuation, the Single Judge focussed its attention to the content of article 4 of the agreement and observed that the validity of said agreement was made subject to two conditions: 1) the conclusion of an effective employment agreement between the Respondent and the player by 14 July 2014 for the period beginning 15 July 2014 and 2) the player passing the sports medicine screening at the Respondent.

11. With regard to the first condition, the Single Judge referred to art. 6 par. 3 of Annexe 3 of the Regulations and pointed out that an employment contract, signed by the Respondent and the player and valid as from 15 July 2014, was uploaded by the Respondent in the Transfer Matching System (TMS) on 9 July 2014.

12. Moreover, the Single Judge took due note of the decision rendered by the Dispute Resolution Chamber on 9 February 2017 in case ref. XXX, in which it was established that the Respondent and the player entered into a valid and legally binding employment contract.

13. With regard to the second condition, the Single Judge observed that it was undisputed between the parties that the player had participated for a certain period during the preseason in trainings and matches with the Respondent. On account of the aforementioned, the Single Judge was comfortably satisfied to conclude that the player had already passed a medical examination at the Respondent before actually participating in trainings and matches during the preseason.

14. Having established the above, the Single Judge concluded that both conditions for the validity of the agreement between the parties had been fulfilled and, consequently, established that the agreement was validly concluded between the parties and that the Respondent was, in principle, liable to pay the transfer compensation of EUR 50,000 to the Claimant.

15. In continuation, turning his attention to the Claimant’s request amounting to EUR 25,000 corresponding to the payment of the first instalment of the transfer fee due as from 15 July 2014 in accordance with the agreement, the Single Judge pointed out that the Claimant lodged its claim on 28 February 2017.

16. In this respect, the Single Judge referred to art. 25 par. 5 of the Regulations according to which the Players’ Status Committee or its 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. The Single Judge also recalled that such application of the two year time limit shall be examined ex officio in each individual case.

17. In view of the above, the Single Judge deemed it fundamental to underline that in order to determine whether the first instalment of the transfer fee was due, he had to first establish which was the event giving rise to the dispute in this particular case, i.e. which had to be considered as the starting point of the time period of two years set out under art. 25 par. 5 of the Regulations.

18. In doing so, the Single Judge turned his attention to the exact date on which the Claimant lodged its claim in front of FIFA, i.e. 28 February 2017, and recalled that according to the transfer agreement the date on which the first instalment of the transfer fee fell due was 15 July 2014, i.e. starting point of the two years’ time period. In conclusion, as more than two years have elapsed between 15 July 2014 and 28 February 2017, the Single Judge confirmed that the claim for the first instalment of the transfer fee in the amount of EUR 25,000 due as from 15 July 2014, is time-barred.

19. Having established the above, the Single Judge continued his deliberations by examining the second instalment of the transfer fee in the amount of EUR 25,000 which fell due on 1 March 2015 according to the agreement.

20. In this respect, the Single Judge deemed that it remained undisputed that the Claimant is contractually entitled to receive from the Respondent the second instalment of the transfer fee amounting to EUR 25,000 and that such amount has not been paid by the Respondent and is, therefore, still due.

21. Bearing in mind the aforementioned and the basic legal principle of pacta sunt servanda, which in essence means that agreements must be respected by the parties in good faith, the Single Judge concluded that the Respondent had breached its contractual obligations towards the Claimant and should, as a consequence, be liable to pay the remaining amount of the second instalment of the transfer fee in accordance with the agreement concluded between the parties.

22. In continuation and in view of the Claimant’s request for interest at a rate of 5% p.a. on the above-mentioned amount until the date of effective payment and in line with the well-established jurisprudence of the Players’ Status Committee, the Single Judge decided to grant interest at a rate of 5% p.a. on the aforementioned amount, i.e. EUR 25,000, as from 2 March 2015 until the date of effective payment.

23. In conclusion, the Single Judge decided that the claim of the Claimant is accepted insofar as it is admissible and held that the Respondent has to pay to the Claimant the amount of EUR 25,000, plus interest at a rate of 5% p.a. on the said amount as from 2 March 2015 until the date of effective payment.

24. 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 CHF 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.

25. In respect of the above, the Single Judge reiterated that the Claimant’s claim was accepted insofar as it is admissible, the Single Judge concluded that both the Claimant as well as the Respondent have to bear a part of the costs of the current proceedings in front of FIFA.

26. 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 that the total amount at dispute in the present matter is less than CHF 100,000, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to CHF 10,000.

27. In conclusion, and considering the particularities of the present matter, the Single Judge determined the costs of the current proceedings to the amount of CHF 10,000. Furthermore, and in line with his aforementioned considerations and taking into account the degree of success, the Single Judge decided that the amount of CHF 2,000 has to be paid by the Claimant and the amount of CHF 8,000 by the Respondent.

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

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

2. The Respondent, Club C, has to pay to the Claimant, Club A, within 30 days as from the date of notification of this decision, the amount of EUR 25,000 as well as 5% interest p.a. on the said amount as from 2 March 2015 until the date of effective payment.

3. If the aforementioned sum, plus interest, is not paid within the stated time limit, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision.

4. The final costs of the proceedings in the amount of CHF 10,000 are to be paid within 30 days as from the date of notification of this decision, as follows:

4.1 The amount of CHF 2,000 has to be paid by the Claimant, Club A, to FIFA. Given that the Claimant, Club A, has already paid the amount of CHF 2,000 as advance of costs at the start of the present proceedings, the Claimant, Club A, is exempted to pay the cited amount.

4.2 The amount of CHF 8,000 has to be paid by the Respondent, Club C, to FIFA.

4.3 The abovementioned amount in point 4.2 has to be paid to FIFA to the following bank account with reference to case nr. XXX:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

5. The Claimant, Club A, is directed to inform the Respondent, Club C, immediately and directly of the account number to which the remittance under point 2 above is to be made and to notify the Single Judge of 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, 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

For the Single Judge of the

Players’ Status Committee

Omar Ongaro

Football Regulatory Director

Encl. CAS directives