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 7 March 2019

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 7 March 2019,

in the following composition:

Geoff Thompson (England), Chairman

Stijn Boeykens (Belgium), member

Tomislav Kasalo (Croatia), member

Daan de Jong (The Netherlands), member

Elvis Chetty (Seychelles), member

on the claim presented by the club,

Club A, Country B

as Claimant / Counter-Respondent

against the player,

Player C, Country D

as Respondent / Counter-Claimant

regarding an employment-related dispute

arisen between the parties

I. Facts of the case

1. On 24 January 2013, the Player of Country D, Player C (hereinafter: Respondent / Counter-Claimant), and the Club of Country B, Club A (hereinafter: Claimant / Counter-Respondent), signed an employment contract valid as from the date of signature until 31 May 2016 (hereinafter: the contract).

2. As per clause 4 of the contract, the Respondent / Counter-Claimant was entitled to the following monies for the 2014/2015 and 2015/2016 seasons:

a) EUR 255,000, payable on 5 August 2014;

b) EUR 255,000, payable on 5 August 2015;

c) EUR 595,000 for the 2014/2015 and the 2015/2016 season each, payable in 10 equal monthly instalments, as from August until June, due at the end of each month;

d) EUR 30,000 for the 2014/2015 and the 2015/2016 season each for “ticket”, house rental and car rental costs.

3. On 6 January 2015, the Claimant / Counter-Respondent and the Respondent / Counter-Claimant signed a termination agreement (hereinafter: the termination agreement), in accordance with which the parties mutually terminated the contract with immediate effect.

4. In accordance with this agreement, the Respondent / Counter-Claimant undertook to pay to the Claimant / Counter-Respondent EUR 350,000 for the early termination of the contract as follows:

a) EUR 250,000 on 7 January 2015;

b) EUR 100,000 until 5 July 2016.

5. The termination agreement further stipulates that the Respondent / Counter-Claimant irrevocably waived all his rights and receivables arising from the contract.

6. According to the information in the Transfer Matching System (TMS), the Respondent / Counter-Claimant signed an employment contract with the Club of Country D, Club E on 12 January 2015, where he was registered as an out-of-contract player, valid as from its signature until 31 December 2017 and entitling the Respondent / Counter-Claimant to a monthly salary of 172,878.

7. On 15 December 2017, the Claimant / Counter-Respondent requested in writing the payment of EUR 100,000 from the Respondent / Counter-Claimant, corresponding to the second instalment of the termination agreement by no later than 22 December 2017.

8. On 28 December 2017, the Claimant / Counter-Respondent lodged a claim in front of FIFA and requested that the Respondent / Counter-Claimant be ordered to pay the second instalment of the termination agreement in the amount of EUR 100,000, plus interest of 5% p.a. as of 5 July 2016.

9. In this regard, the Claimant / Counter-Respondent argued that the validity of the termination agreement cannot be brought into question, given that the Respondent / Counter-Claimant was transferred to another club and that he paid the first instalment of EUR 250,000 on 7 January 2015.

10. On 15 March 2018, the Respondent / Counter-Claimant submitted his reply and counterclaim, by which he requested that the termination agreement be declared null and void, that it be declared that he does not owe any amount to the Claimant / Counter-Respondent, that the Claimant / Counter-Respondent reimburse the amount of EUR 250,000 he already paid, and that the Claimant / Counter-Respondent cover all the legal and procedural costs.

11. The Respondent / Counter-Claimant argued that the Claimant / Counter-Respondent had been breaching the contract since the very beginning of the employment relationship.

12. In this sense, the Respondent / Counter-Claimant referred to a letter from his former legal representative, sent on his behalf to the Claimant / Counter-Respondent on 27 October 2014, in which he requested the payment of EUR 255,000 corresponding to the instalment that was due on 5 August 2014.

13. However, as per the Respondent / Counter-Claimant, rather than paying him, the Claimant / Counter-Respondent verbally told him that he was “relegated” to the U-21 team.

14. In continuation, the Respondent / Counter-Claimant submitted an exchange of correspondence as from 1 November 2014 until 11 November 2014 between himself and the Claimant / Counter-Respondent, from which it can be noted that he argued that the Claimant / Counter-Respondent’s reason to send him to the U-21 team was to punish him for requesting his salary. In addition, the Respondent / Counter-Claimant argued that the U-21 team was an amateur team without adequate medical assistance and that the employment contract does not provide for the possibility for him to train and play with such team. On the other hand, the Claimant / Counter-Respondent inter alia held in its correspondence that it did not owe the player any salary, that the U-21 team is not an amateur team, that it had the right to send him to the U-21 team, and that the decision was temporary.

15. Furthermore, the Respondent / Counter-Claimant claimed that the Club of Country D, Club E wanted to sign him on, but that the Claimant / Counter-Respondent did not grant the Respondent / Counter-Claimant permission to leave.

16. Instead, as per the Respondent / Counter-Claimant, the Claimant / Counter-Respondent informed him that if he leaves, he would have to renounce all outstanding receivables and pay to it an additional amount.

17. As per the Respondent / Counter-Claimant, believing that the Claimant / Counter-Respondent would lodge a claim against him in front of FIFA, he did not dare to terminate the contract unilaterally, but proceeded to have a personal meeting with the Claimant / Counter-Respondent instead. The Respondent / Counter-Claimant explained that, at said meeting, the Claimant / Counter-Respondent threatened him with ruining his name and footballing career, unless he signed the termination agreement that obliged him to pay EUR 350,000 to the Claimant / Counter-Respondent.

18. The Respondent / Counter-Claimant argued that the circumstances under which the termination agreement was signed need to be taken into account when deciding on the matter at hand.

19. According to the Respondent / Counter-Claimant, the termination agreement is completely disproportionate and clearly reflects the level of anxiety provoked by the Claimant / Counter-Respondent’s manipulative tactics, pressure, and without the possibility for the Respondent / Counter-Claimant to use a legal representative.

20. Therefore, the Respondent / Counter-Claimant claimed that the termination agreement should be invalidated in accordance with the Swiss Code of Obligations.

21. Moreover, the Respondent / Counter-Claimant held that the Claimant / Counter-Respondent was aware of Club E’ interest in contracting him and used this information to manipulate the Respondent / Counter-Claimant into signing the termination agreement.

22. In this sense, according to the Respondent / Counter-Claimant, Club E agreed to pay the amount of EUR 50,000 of the EUR 350,000 due to the Claimant / Counter-Respondent, with the objective of incorporating the Respondent / Counter-Claimant.

23. However, the Respondent / Counter-Claimant explained that Club E rescinded the contract with the Respondent / Counter-Claimant without paying the promised amount of EUR 50,000, thereby leaving him without possibility of complying with the terms stipulated in the termination agreement.

24. In its reply to the Respondent / Counter-Claimant’s counterclaim, the Claimant / Counter-Respondent held that the counterclaim is time-barred.

25. Furthermore, the Claimant / Counter-Respondent argued that the Respondent / Counter-Claimant can only invoke the relevant articles of the Swiss Code of Obligations within one year after signing the allegedly invalid termination agreement, in accordance with Article 31 of the Swiss Code of Obligations. However, the Respondent / Counter-Claimant did not lodge any claim until March 2018.

26. For these reasons, the Claimant / Counter-Respondent requests that the counterclaim be considered inadmissible.

27. In his final comments, the Respondent / Counter-Claimant argued that the conditions stipulated in the termination agreement were beyond his limited capacity to understand the future consequences. In this light, the Respondent / Counter-Claimant further explained that he understands neither English nor Language of Country B.

28. Furthermore, the Respondent / Counter-Claimant reiterated that the termination agreement lacks “any kind of equity” and argued that, in accordance with CAS jurisprudence, as well as inter alia the 2018 edition of the FIFA Regulations on the Status and Transfer of Players, certain contracts, such as the termination agreement in question, must be considered void. In this regard, the Respondent / Counter-Claimant claimed that signing such an agreement without a legal representative, and all the consequences this entailed, is a reason for the termination agreement to be declared void.

29. With regard to the Claimant / Counter-Respondent’s statement that the counterclaim is time-barred, the Respondent / Counter-Claimant argued that he is not claiming back the first payment as such. Instead, the Respondent / Counter-Claimant is challenging the validity of the termination agreement. As per the Respondent / Counter-Claimant, the validity of a contract can be challenged at any point in time.

30. Lastly, the Respondent / Counter-Claimant requested that sporting sanctions be imposed on the Claimant / Counter-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 case at hand. In this respect, it took note that the present matter was submitted to FIFA on 28 December 2017. Consequently, the 2017 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: Procedural Rules) is 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 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 Club of Country B and a Player of Country D.

3. At his stage, and before analysing the substance of both the Claimant / Counter-Respondent’s claim and the Respondent / Counter-Claimant’s counterclaim, the members of the DRC considered that they should examine if the present claim and counterclaim, or any part of them, is barred by the statute of limitations.

4. In this respect, the Chamber firstly recalled that it remained undisputed that the Respondent / Counter-Claimant and the Claimant / Counter-Respondent signed a termination agreement on 6 January 2015 by which the Respondent / Counter-Claimant undertook to pay the Claimant / Counter-Respondent EUR 250,000 by 7 January 2015 and EUR 100,000 by 5 July 2016.

5. In continuation, the DRC noted that in its claim, dated 28 December 2017, the Claimant / Counter-Respondent requested to be awarded EUR 100,000 corresponding to the second instalment of the termination agreement. Similarly, the Chamber highlighted that in his counterclaim, dated 15 March 2018, the Respondent / Counter-Claimant inter alia requested that the termination agreement be declared null and void and that the Claimant / Counter-Respondent reimburse him the EUR 250,000 he already paid.

6. In this context, the Chamber referred to art. 25 par. 5 of the Regulations, which, in completion to the general procedural terms outlined in the Procedural Rules, clearly establishes that the Dispute Resolution Chamber shall not hear any dispute if more than two years have elapsed since the event giving rise to the dispute arose and that the application of this time limit shall be examined ex officio in each individual case.

7. In view of the above, the DRC deemed it fundamental to underline that in order to determine whether the Chamber could hear the present matter, it should, first and foremost, establish which is “the event giving rise to the dispute”, i.e. which is the starting point of the time period of two years as set out under art. 25 par. 5 of the Regulations.

8. Firstly, with regard to the Claimant / Counter-Respondent’s claim, the Chamber established that the due date of the second instalment of the termination agreement was due on 5 July 2016 and that the claim was lodged on 28 December 2017. In other words, and referring to art. 25 par. 5 of the Regulations, the DRC concluded that the time limit of two years for the Claimant / Counter-Respondent’s claim had not elapsed at the time it lodged its claim in front of FIFA.

9. However, with regard to the Respondent / Counter-Claimant’s counterclaim dated 15 March 2018, the DRC concluded that the signing of the termination agreement on 7 January 2015 must be considered as the event giving rise to the dispute at the basis of the Respondent / Counter-Claimant’s counterclaim. As a consequence, and referring once again to art. 25 par. 5 of the Regulations, the DRC concluded that the time limit of two years had elapsed at the time the Respondent / Counter-Claimant lodged his counterclaim in front of FIFA.

10. Therefore, the Chamber decided that the counterclaim of the Respondent / Counter-Claimant is barred by the statute of limitations and, consequently, inadmissible.

11. Having established the above, the Chamber proceeded to analysing which regulations should be applicable as to the substance of the claim submitted by the Claimant / Counter-Respondent. 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 2018), and considering that said claim was lodged on 27 December 2017, the 2016 edition of the said regulations (hereinafter: Regulations) is applicable to the matter at hand as to the substance.

12. The competence of the Chamber and the applicable regulations having been established, the Chamber entered into the substance of the Claimant / Counter-Respondent’s claim. In this respect, the Chamber started by acknowledging all the above-mentioned facts and arguments as well as 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. In this respect, the Chamber recalled that, in accordance with art. 6 par. 3 of Annexe 3 of the Regulations, FIFA may use, within the scope of proceedings pertaining to the application of the Regulations, any documentation or evidence generated or contained in the TMS.

13. In this context, the DRC reiterated that the Respondent / Counter-Claimant signed an employment contract with the Claimant / Counter-Respondent on 24 January 2013, valid until 31 May 2016. Moreover, the DRC noted that, on 6 January 2015, the Respondent / Counter-Claimant and the Claimant / Counter-Respondent signed an agreement by means of which the employment contract was terminated by mutual consent and by which the Respondent / Counter-Claimant undertook to pay to the Claimant / Counter-Respondent EUR 250,000 by 7 January 2015 and EUR 100,000 by 5 July 2016.

14. In continuation, the DRC noted that the Claimant / Counter-Respondent requested that the Respondent / Counter-Claimant be ordered to pay EUR 100,000 corresponding to the second instalment of the termination agreement. Similarly, the Chamber highlighted that, in his reply, the Respondent / Counter-Claimant inter alia held that the termination agreement was null and void alleging that he was coerced into signing it. Therefore, the Respondent / Counter-Claimant deemed that he does not owe the amount of EUR 100,000 to the Claimant / Counter-Respondent.

15. With respect to the Respondent / Counter-Claimant’s argument that he had been coerced into signing the termination agreement, the DRC recalled that, according to the Respondent / Counter-Claimant, the Claimant / Counter-Respondent threatened him with ruining his name and footballing career, unless he signed the termination agreement. In this context, the Respondent / Counter-Claimant highlighted that he had previously been sent to the U-21 team following his request to be paid his dues and that Club E had expressed an interest in employing him.

16. Having said that, the DRC stressed that, in spite of such position, the Respondent / Counter-Claimant had started to execute the termination agreement and paid the first instalment in the amount of EUR 250,000 to the Claimant / Counter-Respondent. In view of the above, the members of the DRC deemed that, by paying the said first instalment the Respondent / Counter-Claimant de facto agreed with the content and obligations set in said agreement.

17. What is more, the DRC was eager to stress that the Respondent / Counter-Claimant did not submit any documentation corroborating his allegation that he was coerced into signing the termination agreement and / or that he was threatened by the Claimant / Counter-Respondent in any way. In this regard, the Chamber referred to the principle of the burden of proof stipulated in art. 12 par. 3 of the Procedural Rules, and stressed that the Respondent / Counter-Claimant had not submitted convincing documentary evidence in support of such allegations.

18. Furthermore, the Chamber turned to the Respondent / Counter-Claimant’s arguments that he did not understand what he was signing both due to his allegedly limited knowledge of the language and his limited capacity to understand the future consequences. In this regard, the members of the Chamber deemed important to point out that, pursuant to the long-standing jurisprudence of the DRC, any party signing a document of legal importance without knowledge of its precise content does so on its own responsibility. With this in mind, the Chamber was of the firm opinion that also these arguments brought by the Respondent / Counter-Claimant cannot be considered valid and, consequently, decided not to take them into account.

19. Having rejected the arguments put forward by the Respondent / Counter-Claimant, who had not disputed that the second instalment of the termination agreement in the amount of EUR 100,000 had not been paid, the Chamber decided that, in accordance with the general legal principle of pacta sunt servanda, the Respondent / Counter-Claimant is liable to pay to the Claimant / Counter-Respondent the amount of EUR 100,000.

20. In addition, taking into account the request of the Claimant / Counter-Respondent as well as the constant practice of the Dispute Resolution Chamber, the DRC decided that the Respondent / Counter-Claimant must pay to the Claimant / Counter-Respondent interest of 5% p.a. on the amount of EUR 100,000 as from 6 July 2016 until the date of effective payment.

21. The Dispute Resolution Chamber concluded its deliberations in the present matter by establishing that any further claims lodged by the Claimant / Counter-Respondent are rejected.

III. Decision of the Dispute Resolution Chamber

1. The claim of the Claimant / Counter-Respondent, Club A, is partially accepted.

2. The counterclaim of the Respondent / Counter-Claimant, Player C, is inadmissible.

3. The Respondent / Counter-Claimant has to pay to the Claimant / Counter-Respondent, within 30 days as from the date of notification of this decision, the amount of EUR 100,000, plus 5% interest p.a. as from 6 July 2016 until the date of effective payment.

4. In the event that the amount plus interest due to the Claimant / Counter-Respondent in accordance with the above-mentioned point 3. is not paid by the Respondent / Counter-Claimant within the stated time limit, the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee for consideration and a formal decision.

5. Any further claim lodged by the Claimant / Counter-Respondent is rejected.

6. The Claimant / Counter-Respondent is directed to inform the Respondent / Counter-Claimant 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.

*****

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 (CAS)

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:

Emilio García Silvero

Chief Legal & Compliance Officer

Encl. CAS directives