F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2017-2018) – fifa.com – atto non ufficiale – Decision 15 February 2018

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 15 February 2018,

in the following composition:

Thomas Grimm (Switzerland), Deputy Chairman

Eirik Monsen (Norway), member

Stéphane Burchkalter (France), member

Philippe Diallo (France), member

Joseph Antoine Bell (Cameroon), member

on the claim presented by the player,

Player A, country A

as Claimant

against the club,

Club B, from country B

as Respondent

regarding an employment-related dispute

arisen between the parties

I. Facts of the case

1. On 15 June 2013, the player, player A, from country A (hereinafter: the Claimant) and the Club B, from country B (hereinafter: the Respondent), signed a document named “Private Instrument for preliminary agreement” (hereinafter: the private agreement), valid from the date of the signature until 15 June 2014.

2. According to clause III.1 of the private agreement, the Claimant was entitled to a monthly salary of 100,000, 30% in accordance with country B Labour Law and 70% in the contract of image rights. In this regard, clause III.2 of the private agreement established that “the payment in advance of the amount correspondent to its monthly remuneration of the last month of the contract in the moment of the signature”.

3. The Claimant was also entitled to receive a monthly housing allowance for 2,000 and eight flight tickets country A / country B / country A for the Claimant or a Claimant’s family member.

4. Clause VI of the private agreement established that in case of termination of the contract, the responsible party would have to pay the penalty of 800,000.

5. On 20 June 2013, the Claimant and the Respondent signed another document named “Special Sports Labor Contract” (hereinafter: the standard contract), valid from the date of signature until 30 June 2014, according to which the Claimant was entitled to a monthly salary of 20,000.

6. On that basis, clause 18 of the standard contract established a “sporting compensation” of 1,500,000 in case of a national transfer and of USD 1,500,000 in case of an international transfer. Moreover, the standard contract determined that the “Sporting compensation” shall apply in case the Claimant is transferred during the contractual term or “in the event the [Claimant] return to its professional activities in another entity of practice of sports (club), within 30 (thirty) months”.

7. On 20 June 2013, the Claimant and the Respondent signed a third document called “License Agreement for Use of Image, Voice, Name, and Sports Nickname of the Profesional Football Athlete” (hereinafter: image rights contract) with a company, regarding the exploitation of the Claimant’s image rights, valid from the date of the signature until 30 July 2014.

8. On 3 January 2014, the Claimant put the Respondent in default, requesting 428,000, amount corresponding to late salaries, image rights and housing allowances.

9. On 22 January 2014, the Claimant and the Respondent signed a document named “private instrument of contract termination and payment adjustment” (hereinafter: the termination agreement”), by means of which the Respondent acknowledged a debt to the Claimant of 428,000 amount corresponding to late salaries, image rights and housing allowance. Furthermore, the termination agreement referred to clause VI of the private agreement, in which it was established a “fine for termination of such contract in the amount of 800,000”.

10. In this respect, in accordance with the termination agreement, the parties mutually agreed to “rescind the [private agreement], as well as the employment contract signed between the parties, so as not to remain at all any financial or obligatory onus of legal or contractual nature between the parties.”.

11. Moreover, according to the termination agreement it was agreed that “with the termination, [the Respondent], since now, is obliged to terminate [the standard contract] signed with [the claimant] within 24 (twenty-four) hours from the signing of this termination”.

12. According to clause 2 of the termination agreement, the Respondent must pay to the Claimant the amount of 720,000 as follows:

- “1st instalment, in the amount of 40,000 (forty thousand), to be paid until 5 May 2014;

- 2nd instalment, in the amount of 40,000 (forty thousand), to be paid until 5 July 2014;

- 3rd instalment, in the amount of 40,000 (forty thousand), to be paid until 5 August 2014;

- 4th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 September 2014;

- 5th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 October 2014;

- 6th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 November 2014;

- 7th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 December 2014;

- 8th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 January 2015;

- 9th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 February 2015;

- 10th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 March 2015;

- 11th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 April 2015;

- 12th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 May 2015;

- 13th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 June 2015;

- 14th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 July 2015;

- 15th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 August 2015;

- 16th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 September 2015;

- 17th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 October 2015; and

- 18th instalment, in the amount of 40,000 (forty thousand), to be paid until 5 November 2015.”

13. In this regard, the termination agreement established that, “in the event of any breach of the instalment above, the next instalments automatically will become overdue, subjecting [the Respondent] to the implementation of this extrajudicial title, adding a fine of 10% (ten percent) over the remaining amount, statutory interest in the order of 1% per month and monetary adjustment according to the variation of the IGP-M index until the date of the effective payment”.

14. Clause five of the termination agreement emphasized that “this termination is effective between the parties, immediately producing its regular and legal effects from the date of its signature, choosing the parties to the jurisdiction of Fedération Internationale De Football Association – FIFA and its regulations to settle any doubts or controversies regarding this, renouncing therefore, any other jurisdiction whatever or not more privileged”.

15. On 13 April 2015, the Claimant lodged a claim against the Respondent in front of FIFA, requesting the amount of 720,000, plus the penalty of 10% and interest in the rate of 1% per month and monetary adjustment according to the variation of the IGP-M index until the date of effective payment. According to the Claimant, on the date of the claim, the due amount would be 894,988.41, detailed as follows:

- 737.020,37 (= 720,000 after applying the monetary adjustment related to the IGP-M index);

- 84,266 as interest (343 days);

- 73,702.04 as penalty of 10%.

16. According to the Claimant, the Respondent stopped paying his salaries and housing allowances as from September 2013 and as from November 2013, it forbid him to participate in the training sessions.

17. Moreover, the Claimant held that the Respondent did not pay for the flight tickets for him and his wife during Christmas holidays, reason why he had to buy the flight tickets himself.

18. In this context, the Claimant held that after the signature of the termination agreement, he did not receive any payment, and therefore, he submitted his claim in the basis of the termination agreement and requested the amount of 720,000 plus the penalties established in said agreement, in addition with the monetary adjustment at the date of the claim.

19. In its reply to the claim, the Respondent acknowledged that the parties signed the private agreement, the standard contract, the image rights contract and the termination agreement, respectively. Furthermore, the Respondent rejected the claim.

20. According to the Respondent, the Claimant took advantage of the disorganization and changes of the administration of it when signing the termination agreement, hence, it held that the termination agreement should be considered null and void. Moreover, the Respondent held that after the president was changed, the termination agreement was only signed to transfer the Claimant to Club X, from country A.

21. In this respect, the Respondent sustained that said agreement was made upon false statements and wrong confessions, since it, allegedly, had no debts towards the Claimant at the moment the termination agreement was signed. In this regard, the Respondent stated that “before the first instalment became due, the new administration of the Respondent finally put everything in order in the club and found out that every payment charged have been paid by the old direction”.

22. In this context, the Respondent submitted payment receipts allegedly signed by the Claimant, regarding the outstanding salaries of October, November and December 2013, the housing allowance of September, October, November and December 2013, the image rights payment of September, October, November and December 2013, as well as the plane tickets allegedly bought to the Claimant. As a consequence, the Respondent, deemed it did not have to pay the amount established in the termination agreement.

23. Subsequently, the Respondent argued that FIFA was not competent to deal with part of the claim, since according to it, the requested payment is partially related to image rights, and therefore the Dispute Resolution Chamber of FIFA shall disregard this part of the claim. In other word, it held that the payment established on the termination agreement included image rights payments, and as a consequence, this part cannot be dealt by FIFA.

24. In addition to that, the Respondent confirmed that the Claimant was not allowed to train, after some declarations to the press from the Claimant.

25. In his replica, the Claimant insisted that his claim is based on the termination agreement signed between the parties and not in any of the first three documents signed with the Respondent, therefore the Claimant held that FIFA is competent to deal with the claim.

26. Moreover, the Claimant argued that he never received any amount from September to December 2013 (salaries) and from October to December 2013 (housing) and that, all this receipts are false. In this regard he held that “[his] signature in all of them is completely different from the real signature”. In reply thereto, the Claimant submitted an examination of his signature which concluded that “are false the signatures presented in the disputed documents, described in section I and reproduced in Annex I, not having the same emanated from Player A…”. In this respect, the Claimant held that the proof of validity was that he was not transferred until the termination agreement was signed.

27. After having been granted a deadline extension upon its request, on 3 April 2017, the Respondent sent its duplica after the deadline granted by FIFA to provide its final comments which was set to 24 March 2014.

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 13 April 2015. Consequently, the 2015 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 at hand (cf. art. 21 of the 2015, 2017 and 2018 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 and 2 in combination with art. 22 lit. b) of the Regulations on the Status and Transfer of Players (edition 2018), the Dispute Resolution Chamber is competent to deal with the matter at stake, which concerns an employment-related dispute with an international dimension between an player and a club.

3. The DRC, however, acknowledged that the Respondent contested the competence of FIFA’s deciding bodies on the basis that the requested payment is related to the payment of image rights.

4. In this regard, the Chamber noted that the Claimant insisted on the competence of the DRC to adjudicate on the claim lodged by him against the Respondent. The Claimant added that the competence of FIFA is undeniable on the basis that the claim is based on the execution of the termination agreement, and not related to any of the other agreements signed by the parties.

5. With regards to the argument of the Respondent that part of the claim was related to the payment of image rights, the DRC underlined that the claim is based on the execution of the termination agreement only. In this respect, the Chamber noted that the amount established in said agreement does not mention is payable as image rights, and since the object of the termination agreement was to “rescind the [private agreement], as well as the employment contract signed between the parties, so as not to remain at all any financial or obligatory onus of legal or contractual nature between the parties.”. The DRC concluded that the amount derives from the employment relationship and is therefore, in principle competent to deal with the Claimant’s claim.

6. Moreover, the Chamber took into consideration that clause five of the termination agreement (cf. point I/14. above) contained a jurisdiction clause by means of which FIFA’s deciding bodies are appointed to settle any doubts or controversies arisen between the parties in relation to the termination agreement. Therefore, the members of the DRC deemed that there is no reason which would preclude the Chamber from adjudicating on the present dispute.

7. In view of the above, the Chamber established that the Respondent’s objections to the competence of FIFA no to deal with part of the present matter had to be rejected and that the DRC is competent, on the basis of art. 22 lit. b) of the Regulations on the Status and Transfer of Players, to consider the present matter as to the substance.

8. 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 2 of the Regulations on the Status and Transfer of Players (editions 2015, 2016 and 2018), and considering that the present claim was lodged on 13 April 2015, the 2015 edition of said regulations (hereinafter: Regulations) is applicable to the matter.

9. 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.

10. The DRC acknowledged that, on 15 June 2013, the parties to the dispute had signed a private agreement valid as from the date of the signature until 15 June 2014, in accordance with which the Respondent would pay the Claimant a monthly salary in the amount of 100,000, as well as a monthly housing allowance in the amount of 2,000 and 8 flight tickets country A / country B / country A for the Claimant or the Claimant’s family.

11. Subsequently, the DRC noted that on 20 June 2013, the parties signed a standard contract valid as from the date of the signature until 30 June 2014, according to which the Claimant was entitled to a monthly salary of 20,000. Moreover, the Chamber acknowledged that on the same date, the parties signed an image rights contract valid as form the date of the signature until 30 June 2014.

12. In this regard, the Chamber observed that, according to the Claimant, the Respondent failed to pay his monthly salaries and housing allowances as from September 2013, and that as from November 2013, the Respondent prohibited the Claimant to participate in any training sessions. In this respect, the members of the Chamber noted that on 3 January 2014, the Claimant put the Respondent in default, since the Respondent allegedly failed to pay him 428,000, corresponding to late salaries, image rights and housing allowance.

13. In continuation, the DRC acknowledged that on 22 January 2014, the parties signed a termination agreement by means of which, the parties mutually agreed to terminate the private agreement and the standard contract and in which, the Respondent acknowledged a debt of 428,000 towards the Claimant.

14. In this context, the members of the Chamber observed the content of the termination agreement, by means of which it was established that the Respondent must pay to the Claimant the amount of 720,000 divided in 18 equal instalments of 40,000, each payable the 5th of each month starting on 5 May 2014 until 5 November 2015. Moreover, the DRC recalled the content of the termination agreement, which established that “in the event of any breach of the instalments, the next instalment automatically will become overdue, subjecting [the Respondent] to the implementation of this extrajudicial title, adding a fine of 10% over the remaining amount, statutory interest in the order of 1% per month and monetary adjustment according to the variation of the IGP-M index until the date of the effective payment.”.

15. In this respect, the Chamber noted that the Claimant lodged a claim against the Respondent since it failed to pay him 720,000 regarding the termination agreement. Consequently, the Claimant requested to be awarded with his outstanding dues plus the penalties established in the aforementioned agreement, as well as the monetary adjustment.

16. In this regard, the DRC took particular note that the Respondent acknowledged the existence of the termination agreement and the fact that no payment was done regarding said agreement.

17. Furthermore, the Chamber took note of the arguments used not to proceed with the payment established in the termination agreement. In this respect, the DRC observed that the Respondent held that it did not had any outstanding debts with the Claimant, therefore no payment had to be done regarding the termination agreement. In particular, the Respondent presented alleged payment receipts.

18. In this regard, the DRC observed that the Respondent sustained that after its President was changed, the termination agreement was only signed to transfer the Claimant to the Club X, from country A.

19. In continuation, the Chamber noted that on his replica, the Claimant held that he never received any payment either from the monthly salaries from September to December 2013, the housing allowances from October to December 2013 and the payment of plane tickets for the Claimant or in relation to the termination agreement. In this respect, the Claimant argued that the signature of the alleged payment receipts presented by the Respondent was forged submitting an examination of the signature and stating that the proof of the validity regarding the termination agreement was that the Respondent never formally released him until the termination agreement was signed.

20. In this regard, the DRC took into account that the Respondent on its part, sent its duplica after the deadline had expired, therefore, the Chamber concurred that in accordance with art. 9 par. 3 of the Procedural Rules it shall take a decision upon the basis of the documents already on file. This being established, the members of the Chambers concluded that, the Respondent had de facto accepted the allegation of the Claimant.

21. In line with the above, the DRC deemed that the arguments raised by the Respondent cannot be considered as valid reasons for non-payment of the payment claimed by the Claimant, in other words, the reasons brought forward by the Respondent on its defence do not exempt the Respondent from its obligation to fulfil its contractual obligations towards the Claimant. Moreover, the Chamber considered that the termination agreement cannot be null and void, since it was duly signed by the Respondent, fact that remains uncontested.

22. Along this line, the Chamber noted that it remains uncontested that the Respondent did not pay any amounts to the Claimant in connection with the termination agreement, which is the basis of the claim.

23. In this context, the Chamber observed that there is no contractual basis to the Claimant’s request in respect to the monetary adjustment. The DRC, in consequence, rejected this part of the Claimant’s request.

24. To that end, and in accordance with the general principle of “pacta sunt servanda”, the Chamber unanimously established that the Respondent has to pay to the Claimant the amount established in the termination agreement (i.e. 720,000).

25. In addition, taking into account the Claimant’s request of interest in accordance with the penalties established in the termination agreement, after due deliberation, the members of the Chamber were of the opinion that clauses such as the one at hand may be freely entered into by the contractual parties and may be considered acceptable in the event that the pertinent written clause meets certain criteria such as proportionality and reasonableness. In this respect, the Chamber emphasised that in determining whether such a clause is valid or not, the specific circumstances of the relevant case brought before it shall also be taken into consideration.

26. Consequently, the DRC decided that the Respondent shall pay interest of 1% per month since the date of each instalment; plus 10% of the amount as a penalty, which is USD 72,000, which the members of the Chamber deemed that it comply with Chamber’s criteria of proportionality and reasonableness.

27. The 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 B, has to pay to the Claimant, within 30 days as from the date of notification of this decision, the amount of 720,000 plus interest as follows:

- 1% per month on the amount of 40,000 as from 6 May 2014 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 July 2014 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 August 2014 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 September 2014 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 October 2014 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 November 2014 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 December 2014 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 January 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 February 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 March 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 April 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 May 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 June 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 July 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 August 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 September 2015 until the date of effective payment;

- 1% per month on the amount of 40,000 as from 6 October 2015 until the date of effective payment; and

- 1% per month on the amount of 40,000 as from 6 November 2015 until the date of effective payment.

3. In the event that the above-mentioned amounts (cf. point 2. above) plus interest due to the Claimant are 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 Respondent has to pay to the Claimant, within 30 days as from the date of notification of this decision, a penalty in the amount of 72,000.

5. In the event that the aforementioned sum (cf. point 4. above) is not paid within the stipulated time limit, interest at the rate of 5% p.a. will fall due as of expiry of the above-mentioned time limit and the present matter shall be submitted,upon request, to the FIFA Disciplinary Committee for consideration and a formal decision.

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

7. The Claimant is directed to inform the Respondent immediately and directly of the account number to which the remittances are 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. 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

CH-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