F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2018-2019) – fifa.com – atto non ufficiale – Decision 14 September 2018
Decision of the
Dispute Resolution Chamber
passed in Zurich, Switzerland, on 14 September 2018,
in the following composition:
Geoff Thompson (England), Chairman
Jerôme Perlemuter (France), member
Elvis Chetty (Seychelles), member
Stefano Sartori (Italy), member
Takuya Yamazaki (Japan), 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
I. Facts of the case
1. On 2 February 2015, 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 as from the date of signature until 31 May 2018.
2. In accordance with art. 3 of the contract, the Claimant is entitled to the following:
“1) 2014-2015 football season transfer sum of € 22.000 […] will be paid in installments as seen below.
a) € 10.000 […] guaranty payment in installments as seen below:
a. A payment of € 2.500 on 28/02/2015, the following payment of €2.500 on 30/03/2015,
A payment of € 2.500 on 30/04/2015, the following payment of € 2.500 on 30/05/2015.
b. The residual of € 12.000[…] will be pad pay-per-match will be divided into 16 matches; € 750 payment per match.
2) 2015-2016 football sum of € 25.000 […]” in 10 installments of EUR 2,500 at the end of each month as from 30 August 2015 until 30 June 2016.
“3)2016-2017 football transfer sum of € 25.000 […]” in 10 installments of EUR 2,500 at the end of each month, as from 30 august 2016 until 30 June 2017.
“4) 2017-2018 football season transfer sum of € 25.000 […]” in 10 installments of EUR 2,500 at the end of each month as from 30 August 2017 until 30 June 2018.
3. Moreover, the contract stipulates that the Claimant “will deserve 100% if the pay-per-match fee when he’s charged for playing a match in the first squad, he will deserve 75% of the pay-per-match fee when he’s selected for the match line up of 18 players, and when he plays later in the match; he will deserve 50% if the pay-per-match fee when he’s selected for the match line up of 18 players, but when he doesn’t play.” The Claimant will not be entitled to any pay-per-match if he is not selected in the 18 players’ match day squad. In addition, in accordance with the contract, those pay-per-match premiums are only granted for league matches.
4. Furthermore, under art. 3 of the contract, the Claimant is entitled to EUR 46,000 “[…] when he is charged for playing each match in the first squad, in 23 official league matches” for each season.
5. According to art. 3 k) of the contract, the Respondent can terminate the contract unilaterally between “given dates”, and “the [Claimant] can’t demand rights of his receivables from the date of termination till the contract end date”.
6. On 26 May 2016 the Claimant and the Respondent signed an amendment to the contract (hereinafter: the amendment).
7. In accordance with art. 1 and 2 of the amendment, the Claimant is entitled to the following: “1. With regard to the season 2016/2017, [the Respondent] shall pay total 90.000 Euros[…] to [the Claimant] instead of the wages determined in article 3 of the [contract] in the payment types and maturity dates specified below.
a. For the football season 2016-2017, total 90.000 Euros[…] shall be paid as from 30/08/2016 in 10 installments, at 30th day each month, monthly 9.000 Euros. The last installment shall be paid on 30/05/2017.
2. With respect to the season 2017-2018, total 110.000 Euros […] to [the Claimant] instead of the wages envisaged in article 3 of the [contract] in this ways and maturity dates stated below. […]
a. for the football season 2017-2018, total 110.000 Euros […] shall be paid as from 30/08/2017 in 10 installments, at 30th day of each month, monthly 11.000 Euros. The last installment shall be paid on 30/05/2018.”
8. Moreover, art. 3 of the amendment establishes that:” All performance Premium payments written in the contract dated 02.2.2015 which is signed between player and club are made invalid mutually with this amendment contract.”
9. Furthermore, art. 7 specifies that:” Except for [the contract] which is submitted to Football Federation of Country D[…] with this additional contract. All kinds of written documents signed are cancelled, parties agree, declare and undertake that single written document between parties that state financial matters is this contract.”
10. On an unknown date, the Claimant and the Respondent signed another employment contract (hereinafter: the new contract) valid until 31 May 2019.
11. In accordance with art. 3.1 of the new contract, the Claimant is entitled to 140.000 Euros […] for the Football Season 2018-2019 […]” payable in 10 installments of EUR 14,000 at the end of each month, as from 30 August 2018 until 30 May 2019.
12. Art. 3.f) of the new contract stipulates that ”in case this contract is terminate with valid reason or without good cause by either party before ending date, the Player may claim his receivables till Date of Termination. He declares and undertakes not to claim another compensation or termination fee and has accepted this clause by reading and with his free will.”
13. According to the Claimant, he sent a notice of default to the club on 14 April 2016, requesting outstanding remuneration on the basis of the contract up to EUR 53,500. According to the Claimant, he had not been paid the bonus of EUR 46,000 for playing 23 matches in the season 2015/2016, as well as 3 installments of EUR 2,500 corresponding to the salaries of January, February and March 2016. According to the player, following this notice of default, the club paid the outstanding remuneration on 25 April 2016.
14. By means of a letter dated 16 May 2017, the Claimant put the Respondent in default for outstanding remuneration of the amount of EUR 27,000 corresponding to the 3 salaries of February, March and April 2017. The player gave 8 days to the club to pay. According to the Claimant, the Respondent did not reply to this letter.
15. On 23 May 2017, the Claimant terminated the contract in writing, claiming that in spite of his notice of default of May 2017, the Respondent paid the salary of February 2017, but not those of March and April 2017. The Claimant underlined the recurrence of the delays of the Respondent’ salary payments.
16. On 24 May 2017, the Claimant lodged a claim against the Respondent in front of FIFA, for outstanding remuneration and breach of contract in the total amount of EUR 277,000 corresponding to :
a) Outstanding remuneration:
- EUR 9,000 corresponding to the March 2017 salary, plus 5% interest p.a. as from 31 March 2017;
- EUR 9,000 corresponding to the April 2017 salary, plus 5% interest p.a. as from 30 April 2017;
b) Compensation for breach of contract: EUR 259,000, plus 5% interest p.a. as from 23 May 2017 for the time frame between the termination of the contract, 23 May 2017 and the term of the new contract, 31 May 2019.
17. In his claim, the Claimant argued that the Respondent constantly paid his salaries with up to a 3-month delay. According to him, the Respondent should have paid him a total of EUR 81,000 corresponding to 9 salaries (from August 2016 until April 2017), however, he claimed to have received only EUR 61,000, meaning that EUR 18,000 are left outstanding. The Claimant underlined that in the past, he had put the Respondent in default for up to 3 months of outstanding salaries and that the only reason he renewed his contract was that the Respondent promised him that it was going to pay him in due time all of his future salaries.
18. In addition, the Claimant held that the compensation clause in art. 3 f) of the new contract is potestative as, according to him, it only benefits the Respondent, since no real compensation was provided in that clause, only the payment of the outstanding salaries until the date of the termination of the contract.
19. The Respondent, on its part, rejected the Claimant’s claim.
20. In respect to the alleged outstanding salaries, the Respondent argued that it had paid more than what it owed to the Claimant “as the footballer is very valuable for the club” and that for all 3 seasons, it allegedly overpaid the Claimant in the amounts of EUR 49,389.
21. The Respondent argued that compared to what the Claimant was entitled, it made the following payments:
Season
Progress Payment of the Footballer
Amount Paid to the Footballer
2014-2015
15,625
16,498.73
2015-2016
71,000
123,126.23
2016-2017
81,000
77,389.04
TOTAL
167,625 Euros
217,014 Euros
22. The Respondent also argued that the Claimant sent by fax the notice of termination of the contract on 23 May 2017, even before the notice of default of 16 May 2017, which was sent by post mail, and which was allegedly received by the club on 24 May 2017. The Respondent provided tracking information in that sense.
23. In his replica, the Claimant rejected the argumentation of the Respondent and insisted on his claim.
24. The Claimant insisted that in accordance with the amendment, he was entitled to EUR 90,000 as total remuneration for the season 2016/2017. And that, in accordance with the new contract, he was entitled to EUR 140,000 as total remuneration for the season 2018/2019. He reiterated his claim that his salaries were systematically paid late, with up to a 3-month delay.
25. Regarding the alleged payments mentioned by the Respondent in its reply, the Claimant argued that some of the payment were not salaries but reimbursement of expenses, and that other payments were superior to the normal salaries because those were the payment of the salary plus a penalty of 10% for the delay. The Claimant argued that some of the payments corresponded to match premiums. The Claimant also contested one payment of EUR 53,000 as he said he never received a check of that amount.
26. On the issue of the date of the notice of default, the Claimant argued that it was not possible that the default notice took 8 days to be delivered, as alleged by the Respondent. Moreover, the Claimant argued that in its different submissions, the Respondent contradicted itself on the matter, as in a letter dated 1 June 2017, sent by fax on 3 June 2017 the Respondent in its reply to the notice of termination, denied receiving the notice of default of 16 May 2017, and then in its reply to the claim, it alleged to have received it on 24 May 2017.
27. The Respondent, in its duplica, argued that all the payments that it made were made on the basis of the employment contracts, and that the Claimant did not substantiate the basis of the premiums and expenses he alleged the payment were for. Regarding the payment of EUR 53,000 contested by the Claimant, the Respondent argued that the receipt clearly marked it as a payment by cash.
28. Regarding the notification of the default notice, the Respondent argued that by using the tracking number in the receipt, i.e. the proof of deposit of the notice to the post office, the date of delivery of the letter was 24 May 2017. In any case, according to the Respondent, the Claimant did not respect the 8 days deadline he gave to the Respondent, since the notification of termination was sent to the club on 23 May 2017, 7 days after the notice of default.
29. Upon FIFA’s request, the Claimant informed that on 18 June 2017, the Claimant concluded an employment contract with the Club of Country D, Club E valid as from the date of signature until 30 May 2020.
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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 case at hand. In this respect, it took note that the present matter was submitted to FIFA on 24 May 2017. Consequently, the 2017 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: Procedural Rules) are applicable to the matter at hand (cf. article 21 of the 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 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 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 2 of the Regulations on the Status and Transfer of Players (editions 2016 and 2018), and considering that the present claim was lodged on 24 May 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. The members of the Chamber started by acknowledging the facts of the case, as well as the documentation contained in the 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. In this respect, the Chamber first acknowledged that the Claimant and the Respondent signed a first employment contract valid as from 2 February 2015 until 31 May 2018. The Chamber further noted that on 26 May 2016, the Claimant and the Respondent signed an amendment to said contract, in accordance with which the Claimant was entitled to the total remuneration of EUR 90,000 for the season 2016/2017 paid in 10 instalments of EUR 9,000 due on the 30th of each month and to the total remuneration of EUR 110,000 for the season 2017/2018 paid in 10 instalments of EUR 11,000 each due on the 30th of each month. The Chamber took note that at an unknown date, the Claimant and the Respondent signed a new contract valid until 31 May 2019, in accordance with which the Claimant was entitled the total remuneration of EUR 140,000 for the season 2018/2019 paid in 10 instalments of EUR 14,000 each as from 30 august 2018 until 30 May 2019. The DRC noted that in accordance with the new contract”in case this contract is terminate with valid reason or without good cause by either party before ending date, the Player may claim his receivables till Date of Termination. He declares and undertakes not to claim another compensation or termination fee and has accepted this clause by reading and with his free will.”
6. In continuation, the members of the Chamber noted that the Claimant lodged a claim against the Respondent maintaining that he had terminated the employment contract with just cause on 23 May 2017, after previously having put the club in default allegedly on 16 May 2017, since the Respondent failed to pay the Claimant’s remuneration. In this respect, the Claimant submitted to have been constantly paid late, with up to a 3 months delay and that at the time of termination, the Respondent owed him EUR 18,000.
7. Consequently, the Claimant asks to be awarded his outstanding dues as well as the payment of compensation for breach of the employment contract. In this respect, the Claimant requested to be awarded as outstanding remuneration, the total amount of EUR 18,000, plus interest, corresponding to the salaries of March and April 2017 for an amount of EUR 9,000 each. The Claimant further argued that the compensation clause provided in the new contract was potestative as only the payment of the outstanding amounts until the termination was provided and no compensation for the Claimant. The Claimant further requested the amount of EUR 259,000 plus interest, as compensation for breach of contract, corresponding, according to the Claimant, to the residual value of the contract as from the termination until 31 May 2019.
8. The Chamber took note of the argumentation of the Respondent which held that it had paid the Claimant more than what he was entitled to, and that moreover, it was not given an opportunity to reply to the default notice since it argued that it received the termination notice via fax before receiving the default notice via regular mail.
9. In view of the aforementioned considerations, the members of the Chamber highlighted that the underlying issue in this dispute, considering the diverging position of the parties, was to determine as to whether the Claimant had just cause to terminate the contract on 23 May 2017.
10. In this regard, the DRC took note that according to the Respondent, the default notice dated 16 May 2017, sent via regular mail was received on 24 May 2017, while the notice of termination was received on 23 May 2017 via fax and as such the termination would have been not valid as it arrived after the default notice. The Chamber further observed that the Respondent argued that in any case, the Claimant did not respect the deadline of 8 days set in his default notice as, according to the Respondent, the termination notice would have been sent on the 7th day following the date of the default notice.
11. The Chamber also took note that the Claimant deemed that the delivery time, for the default notice dated 16 May 2017, could not have been beyond 1 to 3 days maximum, and that, as such, the Respondent must had received the default notice in due time and before the termination notice on 23 May 2017.
12. Based on the foregoing, the DRC after a thorough analysis of the documentation on file, observed that the Claimant had sent his default notice via regular mail on 16 May 2017 while the termination notice was sent via fax on 23 May 2017. The Chamber recalled that no explanation was provided by the Claimant with regard to the difference in the notification process.
13. Moreover, the DRC again recalled the content of art. 12 par. 3 of the Procedural Rules, according to which any party claiming a right on the basis of an alleged fact shall carry the respective burden of proof, and, after a thorough analysis of the documentation on file as well as the argumentation on the present matter, the members of the Chamber were of the opinion that the Claimant did not provide conclusive evidence that the default notice had been received within 1 to 3 days as he alleged while the Respondent provided conclusive evidence that the default notice had been received on 24 May 2017. As such the DRC was of the view that the default notice was received on 24 May 2017.
14. Furthermore, the DRC concurred with the argumentation of the Respondent regarding the deadline provided in the default notice. The DRC deemed that had the default notice indeed been received on the day following its sending, then the notification of the termination would have happened a day before the end of the deadline provided by the Claimant in his default notice.
15. Moreover, the DRC recalled that, from the documentation on file, in the past, upon been put in default, the Respondent had previously remedy its default.
16. Taking into account all of the above, the Chamber was of the firm belief that, since the Respondent did not receive the default notice before the termination notice, it was not given a fair opportunity to remedy its default, as it did in the past when it had been duly notified of outstanding remuneration and paid the requested amounts. Consequently, the DRC was keen to underline that the right of the player to terminate an employment contract with just cause in a situation of late payment by the club of his salary would only be given if the player has, prior to terminating the employment contract, issued the club a warning, or in other words, drawn the club’s attention to the breach of the contractual obligations. However, as reminded by the Chamber, at the date of termination, and in the absence of conclusive evidence that the default notice dated 16 May 2017 had been received by the Respondent before the termination notice dated 23 May 2017, the alleged breach of its contractual obligation had not been drawn to the Respondent’s attention.
17. Based on the aforementioned, the DRC decided that the Claimant had no just cause to terminate the contract on 24 May 2017 and in this context, no compensation could be awarded to the Claimant as requested.
18. With this established, the Chamber decided to turn its attention to the issue of the outstanding remuneration claimed by the Claimant.
19. In this regard, the Chamber took note that the Claimant claimed, until the date of termination, that salaries March and April 2017, of a value of EUR 9,000 each, were outstanding.
20. The Chamber also recalled that the Respondent argued that it had paid all that was due to the Claimant and stated that it had overpaid the Claimant and provided multiple payment proofs.
21. In this regard, the Chamber was of the opinion that since the requested amounts were only concerning salaries for the season 2016/2017, the Chamber decided to take into consideration the evidence provided by the Respondent for the relevant period. Having said that, the Chamber observed that, from the documentation on file, the Respondent had paid the Claimant in a chaotic manner, mixing the currencies, and paying amounts that did not correspond to those provided by the amendment of the contract.
22. Based on the aforementioned and, in particular, on the argumentation and documentation presented by the Respondent in its reply to the claim, in accordance with art. 12. par. 3 of the Procedural Rules, the Chamber was unable to identify which payments corresponded to which concepts, and as such could not established with certainty that the salaries of March and April 2017 had been paid by the Respondent to the Claimant.
23. Consequently, the Chamber was of the opinion that the salaries of March and April 2017 requested by the Claimant as outstanding remuneration were due to the Claimant.
24. With this in mind, the Dispute Resolution Chamber decided that, although the Claimant was not entitled to compensation for breach of contract, since the DRC deemed that he had no just cause to terminate the contract, the Claimant was still entitled to the outstanding remuneration claimed until the date of termination in accordance with the general legal principle of “pacta sunt servanda”.
25. Taking into consideration the date of termination, 23 May 2017, the Chamber was of the opinion that in addition to the salaries of March and April 2017 requested by the Claimant, and although the salary of May 2017 had been requested as part of the compensation for breach of contract, the Chamber deemed that the Claimant was entitled to all the outstanding remuneration until the date of termination. In doing so, the DRC decided to grant as outstanding remuneration the pro rata of the salary of May 2017 until the date of termination. The Chamber established that the salary of May 2017 until the date of termination was equal to EUR 6,900.
26. For all of the above reasons, the Chamber decided to partially accept the Claimant’s claim and determined that the Respondent, in accordance with the general principle of pacta sunt servanda, must pay him the total amount of EUR 24,900.
27. In addition, taking into account the Claimant’s request, the Chamber decided that the Respondent must pay to the Claimant interest of 5% p.a. as of the respective due dates, until the date of effective payment.
28. The Dispute Resolution Chamber concluded its deliberations in the present matter establishing that any further claim lodged by the Claimant was rejected.
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III. Decision of the Dispute Resolution Chamber
1. The claim of the Claimant, Player A, is partially 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 24,900 plus 5% interest p.a. until the date of effective payment as follows:
a. 5% p.a. as of 1 April 2017 on the amount of EUR 9,000;
b. 5% p.a. as of 1 May 2017 on the amount of EUR 9,000;
c. 5% p.a. as of 23 May 2017 on the amount of EUR 6,900.
3. In the event that 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. Any further claim lodged by the Claimant is rejected.
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 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 Dispute Resolution Chamber:
Omar Ongaro
Football Regulatory Director
Encl.: CAS directives