F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – overdue payables / debiti scaduti – (2016-2017) – fifa.com – atto non ufficiale – Decision 18 May 2017

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 18 May 2017,

in the following composition:

Thomas Grimm (Switzerland), Deputy Chairman

John Bramhall (England), member

Takuya Yamazaki (Japan), member

Mohamed Al Saikhan (Saudi Arabia), member

Wouter Lambrecht (Belgium), 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

between the parties in connection with overdue payables

I. Facts of the case

1. On 16 February 2015, the Player of Country B, Player A (hereinafter: Claimant), and the Club of Country D Club C (hereinafter: Respondent) signed an employment contract valid as from its signature date until 31 December 2016.

2. On 31 March 2016, the Claimant and the Respondent signed an agreement by means of which said employment contract was terminated by mutual consent (hereinafter: termination agreement).

3. According to art. 2 of the termination agreement, the Respondent undertook to pay to the Claimant the amount of USD 480,000 as follows: USD 200,000 by 20 April 2016, USD 100,000 by 1 September 2016, USD 90,000 by 1 December 2016 and USD 90,000 by 1 March 2017. Art. 2 of the termination agreement further reads that the aforementioned amounts will be paid at the rate of the national bank of Country D at the date of payment.

4. According to art. 3 of the termination agreement, the Claimant and the Respondent agreed that in case of “failure, delays or partial payment of any of the above-mentioned installments”, the remaining instalments will become due “at once”.

5. On 2 February 2017, the Claimant put the Respondent in default of payment of the amount of USD 280,000, plus 5% interest p.a. on said amount calculated as from 2 September 2016, and granted the Respondent a deadline of ten days within which to remedy the default. In his default notice, the Claimant specified that his letter resulted from the fact that the instalment of 1 September 2016 had remained unpaid.

6. On 6 February 2017, the Respondent replied to the Claimant by asking him to provide it with a copy of the agreement at the basis of his request, so that it could consider the matter. In this respect, the Respondent informed the Claimant that within the framework of criminal proceedings involving its former head, the anticorruption investigators had seized many of the club’s documents for their investigation.

7. On 17 February 2017, the Claimant lodged a claim for outstanding receivables against the Respondent in front of FIFA.

8. In his claim, the Claimant explained that after the signature of the termination agreement and remittance of the first instalment, the Respondent ceased all payments. In particular, the Claimant explained that following his default notice, the Respondent had not made any payment.

9. On account of the aforementioned facts and the relevant clause of the termination agreement, the Claimant requested that the Respondent be ordered to pay him USD 280,000, plus 5% interest p.a. on said sum, calculated as from 2 September 2016.

10. In its reply to the claim, the Respondent requested that the proceedings at hand be suspended pending the development of the criminal investigation involving its former head.

11. The Respondent further indicated that it is possible that the court rules illegal the document signed by its former head and that for the time being, it is impossible for the club to “state an affirmative position regarding the claim of [the player] before the end of the pre-trial investigation.”

II. Considerations of the Dispute Resolution Chamber

1. First, 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 17 February 2017. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2017; hereinafter: Procedural Rules) are 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 in conjunction with art. 22 lit. b of the Regulations on the Status and Transfer of Players (edition 2016) 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 regulations should be applicable as to the substance of the matter. In this respect, it confirmed that in accordance with art. 26 par. 1 and par. 2 of the Regulations on the Status and Transfer of Players (edition 2016), and considering that the present claim was lodged on 17 February 2017, the 2016 edition of said regulations (hereinafter: 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 on file. 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. Having said this, the DRC acknowledged that, on 16 February 2015, the Claimant and the Respondent signed an employment contract, which was terminated by the parties with mutual consent on 31 March 2016 in accordance with the termination agreement.

6. The members of the Chamber duly noted that in accordance with the termination agreement, the Respondent undertook to pay the amount of USD 480,000 in various instalments to the Claimant and that in the event of failure or delay in payment of any of the relevant instalments the remaining unpaid instalments would fall due at once.

7. The Claimant lodged a claim against the Respondent in front of FIFA, maintaining that the Respondent has overdue payables towards him in the amount of USD 280,000 based on the fact that the Respondent had failed to pay the instalment of USD 100,000 that fell due on 1 September 2016 in accordance with the termination agreement. According to the Claimant, the Respondent had only paid him the first instalment and subsequently had ceased any further payments. Therefore, the Claimant asked to be awarded the amount of USD 280,000 pertaining to the entirety of the remaining unpaid instalments in accordance with the termination agreement as well as 5% interest p.a. on said amount as of 2 September 2016.

8. In this context, the DRC took particular note of the fact that with his correspondence dated 2 February 2017, the Claimant put the Respondent in default of payment of the amount of USD 280,000 setting a 10 days’ time limit to remedy default.

9. Consequently, the DRC concluded that the Claimant had duly proceeded in accordance with art. 12bis par. 3 of the Regulations, which stipulates that the creditor (player or club) must have put the debtor club in default in writing and have granted a deadline of at least ten days for the debtor club to comply with its financial obligation(s).

10. Subsequently, the DRC took into account that the Respondent, for its part, asked that the proceedings in the matter at hand be suspended in the light of ongoing criminal investigations into the Respondent’s former head and pending the outcome of such investigations. In this regard, the members of the Chamber noted that the termination agreement appears to have been signed by the person referred to by the Respondent as its former head.

11. The DRC took particular note that the Respondent does not allege that the termination agreement is falsified or that the former head was not entitled to sign the termination agreement.

12. After due consideration, the members of the Chamber agreed that the Respondent’s request for the suspension of the proceedings cannot be accommodated and stressed that the termination agreement was signed by the Claimant in good faith. In addition, the DRC deemed that the situation as described by the Respondent cannot be considered a valid reason to withhold payment of the amounts agreed upon by and between the parties in accordance with the termination agreement.

13. Having said that, the Chamber pointed out that the clause relating to the exchange rate included in the termination agreement is rather unclear and was not referred to by the parties. Consequently, the Chamber confirmed that the relevant amount is awarded in USD, as per art. 2 of the termination agreement.

14. On the basis of the above considerations, the Chamber concluded that the Respondent failed to pay the instalment of USD 100,000 that fell due on 1 September 2016 and that, consequently, in accordance with art. 3 of the termination agreement, all of the remaining unpaid instalments totalling USD 280,000 have fallen due as from 2 September 2016.

15. In addition, the DRC established that the Respondent had delayed a due payment for more than 30 days without a prima facie contractual basis.

16. On account of the above, the DRC decided that, in accordance with the general legal principle of pacta sunt servanda, the Respondent is liable to pay to the Claimant overdue payables in the amount of USD 280,000.

17. In addition, taking into consideration the Claimant’s request as well as the Chamber’s constant jurisprudence, the Chamber decided to award the Claimant interest at the rate of 5% p.a. on the outstanding amount as of the day following the day on which it fell due, i.e. 2 September 2016.

18. In continuation, taking into account the consideration under number II./15. above, the DRC referred to art.12bis par. 2 of the Regulations which stipulates that any club found to have delayed a due payment for more than 30 days without a prima facie contractual basis may be sanctioned in accordance with art. 12bis par. 4 of the Regulations.

19. The DRC established that by virtue of art. 12bis par. 4 of the Regulations it has competence to impose sanctions on the Respondent. Bearing in mind that the Respondent duly replied to the claim of the Claimant and in the absence of the circumstance of repeated offence, the DRC decided to impose a warning on the Respondent in accordance with art. 12bis par. 4 lit. a) of the Regulations.

20. In this connection, the DRC wished to highlight that a repeated offence will be considered as an aggravating circumstance and lead to more severe penalty in accordance with art. 12bis par. 6 of the Regulations.

III. Decision of the Dispute Resolution Chamber

1. The claim of the Claimant, Player A, is accepted.

2. The Respondent, Club C, has to pay to the Claimant, within 30 days as from the date of notification of this decision, overdue payables in the amount of USD 280,000 plus 5% interest p.a. as of 2 September 2016 until the date of effective payment.

3. In the event that the amount plus interest due to the Claimant is not paid by the Respondent 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. 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.

5. A warning is imposed on the Respondent.

*****

Note relating to the motivated decision (legal remedy):

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, 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 Dispute Resolution Chamber:

Omar Ongaro

Football Regulatory Director

Encl: CAS directives