F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2016-2017) – fifa.com – atto non ufficiale – Decision 9 February 2017
Decision of the
Dispute Resolution Chamber
passed in Zurich, Switzerland, on 9 February 2017,
in the following composition:
Thomas Grimm (Switzerland), Deputy Chairman
Eirik Monsen (Norway), member
Joaquim Evangelista (Portugal), member
Taku Nomiya (Japan), member
Todd Durbin (USA), 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 28 August 2014, 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 from the date of signature until 31 May 2015.
2. In accordance with to art. V, par. 1 of the contract, the Claimant was a entitled to a salary of EUR 150,000, payable as follows:
a) EUR 50,000 on signature of the contract;
b) EUR 100,000 in ten monthly instalments on the 30th of each month, starting from 30 September 2014 until 30 June 2015.
3. On an unspecified date, the Claimant sent a letter to the Respondent requesting the payment of EUR 30,000, corresponding to salaries from January 2015 to March 2015. The Claimant granted ten days for the payment and informed the Respondent that, “in case of not transferring the amount […] [the contract] will be cancelled unilaterally with a valid reason”.
4. On 9 April 2015, the Claimant wrote a letter to the Respondent, asserting that it neither replied to his letter allegedly dated 31 March 2015 nor paid the requested salaries. By means of such letter, the Claimant informed the Respondent that, “due to the reasons mentioned above […] [the contract] was cancelled unilaterally with a valid reason”.
5. On 12 August 2015, the Claimant put the Respondent in default for the amount of EUR 60,000, corresponding to salaries from January to June 2015, granting ten days for the payment.
6. On 17 November 2015, the Claimant lodged a claim in front of FIFA, requesting the amount of EUR 60,000, plus interest, corresponding to the salaries from 30 January 2015 until 30 June 2015.
7. In his claim, the player stated that he fulfilled its obligations provided in the contract, but the Respondent, despite his letters, did not pay him six monthly salaries, from 30 January 2015 until 30 June 2015, for the total amount of EUR 60,000.
8. In its reply, the Respondent argued that the Claimant terminated the contract on 9 April 2015 without just cause and asserted that “on January 6th 2015, a total of 25.000 € debt was paid off”.
9. Moreover, the Respondent reported that, on 10 March 2015, the Claimant was excluded from the first team and fined with the amount of EUR 15,000 for alleged lack of discipline.
10. Furthermore, the Respondent alleged that the Claimant did not attend trainings from 23 to 25 March 2015.
11. In conclusion, the Respondent asserted that “the payment [the Claimant] is asking is not correct” and argued that “the money the club had paid (25.000 €) and penalty given (15.000 €) should be reconsidered”.
12. Despite having been invited by FIFA Administration to do so, the Claimant did not provide his comments on the response of the Respondent.
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 17 November 2015. Consequently, the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2015; 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 combination 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. In continuation, 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 2 of the Regulations on the Status and Transfer of Players (edition 2016), and considering that the present claim was lodged on 17 November 2015, the 2015 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 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. First, the Chamber noted that the parties entered into an employment contract valid as of 28 August 2014 until 31 May 2015, which entitled the Claimant to a salary of EUR 150,000 of which EUR 50,000 were payable upon the signature of the contract and EUR 100,000 in ten monthly instalments, starting from September 2014 until 30 June 2015.
6. Furthermore, the DRC acknowledged that it was undisputed that, on 31 March 2015, the Claimant put the Respondent in default of three monthly salaries, corresponding to the amount of EUR 30,000, and thereafter terminated the contract on 9 April 2015.
7. In continuation, the DRC noted that the Claimant alleged that the Respondent breached the contract as it failed to pay the outstanding salaries for the months of January, February and March 2015, for the total amount EUR 30,000. Moreover, the Claimant emphasized that the Respondent did not reply to his notice of termination and stressed that, in view of the above-mentioned circumstances, he terminated the contract with just cause.
8. Equally, the Chamber took note of the reply of the Respondent, which first argued that the Claimant terminated the contract without just cause as it paid him EUR 25,000 on 6 January 2015. Moreover, the Respondent emphasised that, on 10 March 2015, the Claimant was excluded from the first team and fined with EUR 15,000 for alleged lack of discipline.
9. In view of the foregoing considerations, the Chamber deemed that the underlying dispute in the matter at hand was whether the relevant employment contract had been terminated by the Respondent with or without just cause and, depending on this finding, it would have to determine which would be the potential consequence of said termination.
10. In this context, the members of the Chamber pointed out that the payment allegedly made by the Respondent was made on 6 January 2015, i.e. before the claimed outstanding salaries had fallen due. Consequently, the member of the Chamber considered that said alleged payment, even if actually made by the Respondent, could not correspond to the claimed outstanding salaries. Thus, as a consequence thereof, the Chamber decided to reject the first argument of the Respondent in this regard.
11. In continuation, as to the fine allegedly imposed on the Claimant, the Chamber recalled its long-standing jurisprudence, according to which the imposition of a fine, or any other available financial sanction in general, shall not be used by clubs as a means to set off outstanding financial obligations towards players. What is more, the members of the Chamber emphasised that the Respondent did not provide any evidence that the alleged fine had been properly notified to the Claimant, let alone that the latter was given the opportunity to defend himself within the context of the alleged disciplinary proceedings. Consequently, the Chamber decided to disregard the alleged fine imposed on the Claimant and to reject the Respondent’s argument in this regard.
12. On account of the aforementioned, and considering that the Respondent did not invoke any other reason to justify the non-payment of the Claimant’s salaries, the Chamber deemed that the Respondent failed to pay the due salary for January, February and March 2015 without any valid reason and, therefore, it could be established that the Respondent had seriously neglected its contractual obligations towards the Claimant in a continuous manner and for a significant period of time.
13. In view of the above, and taking into consideration the Chamber’s longstanding jurisprudence in this respect, the Chamber decided that the Claimant had just cause to unilaterally terminate the employment contract on 9 April 2015 and that, as a result thereof, the Respondent is to be held liable for the early termination of the employment contact with just cause by the Claimant.
14. In continuation, 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 focused its attention on the consequences of such termination. In this regard, in accordance with the general legal principle of pacta sunt servanda, the Chamber decided that the Respondent is liable to pay to the Claimant the amounts which were outstanding under the contract at the moment of the termination, i.e. EUR 30,000 corresponding to the salaries relating to January, February and March 2015.
15. In continuation, the Chamber decided that, in accordance with art. 17 par. 1 of the Regulations, the Respondent is liable to pay compensation for breach of contract to the Claimant.
16. Furthermore, the Chamber considered that 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.
17. In application of the relevant provision, the Chamber held that it first of all had to clarify as to whether the pertinent employment contract and the private agreement contain 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 Chamber established that no such compensation clause was included in the employment contract or in the private agreement at the basis of the matter at stake.
18. Bearing in mind the foregoing, the Chamber proceeded with the calculation of the monies payable to the Claimant under the terms of the employment contract and concluded that the Claimant would have received a total remuneration of EUR 30,000, had the contract been executed until its expiry date.
19. Furthermore, the Chamber noted that the Claimant did not conclude a new employment contract during the original period of validity of the contract which was terminated prematurely with just cause.
20. Consequently, on account of all of the above-mentioned considerations, the Chamber decided that the Respondent must pay the amount of EUR 30,000 as compensation for breach of contract to the Claimant, which is to be considered a reasonable and justified compensation for the breach of contract in the matter at hand.
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, outstanding remuneration in the amount of EUR 30,000.
3. The Respondent has to pay to the Claimant, within 30 days as from the date of notification of this decision, compensation for breach of contract in the amount of EUR 30,000.
4. In the event that the amounts due to the Claimant in accordance with the above-mentioned numbers 2. and 3. are not paid by the Respondent within the stated time limit, interest at the rate of 5% p.a. will fall due as of expiry of the aforementioned time limit and the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee for consideration and a formal decision.
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.
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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