F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2019-2020) – fifa.com – atto non ufficiale – Decision 24 February 2020

Decision of the

Dispute Resolution Chamber (DRC) judge

passed in Zurich, Switzerland, on 24 February 2020,

by Philippe Diallo (France), DRC judge,

on the claim presented by the player,

José Enrique Caraballo Rosal, Venezuela,

represented by Mr Loizos Hadjidemetriou

as Claimant

against the club,

Club Deportivo San José, Bolivia,

as Respondent

regarding an employment-related dispute

between the parties

I. Facts of the case

1. On 15 February 2019, the Venezuelan player, José Enrique Caraballo Rosal (hereinafter: the player or the Claimant) and the Bolivian club, Club Deportivo San José (hereinafter: the club or the Respondent) (hereinafter jointly referred to as the parties), concluded an employment contract (hereinafter: the contract) valid as from the date of signature until 31 December 2019.

2. According to clause 5 of the contract, the player was entitled to a total remuneration of USD 55,000, payable in 10 equal instalments of USD 5,500 each.

3. In March 2019, the club allegedly informed the player that he was not going to be included in the list of players eligible to participate in the club’s official matches for season 2019.

4. On 2 April 2019, the player’s agent informed the club that “this unilateral decision of the club cannot be accepted by the player”. The player’s agent further requested the club “to proceed with the player’s registration so that [the player] will be able to play for your club”.

5. On 5 April 2019, the player, via his Attorney, sent a letter to the club, by means of which he argued that his exclusion was “not acceptable” and requested the club to immediately “proceed with [his] inclusion / registration in the list of eligible to compete players”. In this respect, the player further provided the club 7 days to remedy the situation.

6. In reply to said notice, the club informed the player that, on 11 April 2019, it had allegedly sent a letter to the Bolivian FA indicating that the player would not be participating in any of the official matches organised by the CONMEBOL or the Bolivian Football Association.

7. On 15 April 2019, the player unilaterally terminated the employment contract in writing, inter alia, that he “has been deprived of his right to participate in the team’s official games for season 2019 and he has been barred in an absolute manner from potential access to competition”.

8. On 24 April 2019, amended on 3 May 2019, the player lodged a claim in front of FIFA and requested the payment of the following amounts, “plus legal interest” as from the due dates:

- USD 8,161.29, as outstanding remuneration, corresponding to the monthly salary of March 2019 and half month of April 2019;

- USD 41,338.71 as compensation for breach of contract without just cause and corresponding to the residual value of the contract.

9. The player further requested an “additional compensation and/or aggravated damages due to the abusive and/or unsporting and/or egregious behavior of the Respondent […]”.

10. Furthermore, the player requested “the imposition of a transfer ban for 2 consecutive registration periods on the Respondent”.

11. Despite having been requested to do so by the FIFA Administration, the Respondent did not reply to the claim.

12. Finally, in accordance with the player’s sayings and the information available in the Transfer Matching System (TMS), after returning to to his former club, the Chilean club CD Huachipato, the player concluded an employment contract on 7 August 2019 with the Venezuelan club, CD Lara, valid as from 26 July 2019 until 31 December 2019. According to said contract, the player was entitled to a monthly salary of USD 2,000.

II. Considerations of the Dispute Resolution Chamber judge

1. First of all, the Dispute Resolution Chamber judge (hereinafter referred as DRC judge) analysed whether it was competent to deal with the case at hand. In this respect, the DRC judge took note that the present matter was submitted to FIFA on 24 April 2019. Consequently, the DRC judge concluded that the 2018 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 Procedural Rules).

2. Subsequently, the DRC judge referred to art. 3 par. 2 and par. 3 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 and par. 2 in combination with art. 22 lit. b) of the Regulations on the Status and Transfer of Players (edition 2020), he is competent to deal with the matter at stake, which concerns an employment-related dispute with an international dimension between a Venezuelan player and a Bolivian club.

3. Furthermore, the DRC judge analysed which regulations should be applicable as to the substance of the matter. In this respect, he confirmed that in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Player (editions 2020), and considering that the present claim was lodged on 24 April 2019, the June 2018 edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

4. The competence of the DRC judge and the applicable regulations having been established, he entered into the substance of the matter. In this respect, he started by acknowledging all the above-mentioned facts as well as the arguments and the documentation submitted by the parties. However, the DRC judge emphasised that in the following considerations he will refer only to the facts, arguments and documentary evidence, which he considered pertinent for the assessment of the matter at hand.

5. Having said this, the DRC judge proceeded with an analysis of the circumstances surrounding the present matter, the parties’ arguments as well the documentation on file, bearing in mind art. 12 par. 3 of the Procedural Rules, in accordance with which any party claiming a right on the basis of an alleged fact shall carry the burden of proof.

6. First of all, the DRC judge acknowledged that the parties signed an employment contract valid as from 15 February 2019 until 31 December 2019.

7. The DRC judge further observed that the Claimant lodged a claim in front of FIFA against the Respondent seeking payment of the total amount of USD 49,500, asserting that the Respondent had not fulfilled its contractual obligations towards him, i.e. it failed to “proceed with [his] inclusion / registration in the list of eligible to compete players”.

8. More specifically, the DRC judge took note that the Claimant indicated having been deprived of his right to participate to the Respondent’s official games for the 2019 season and, therefore, that he had been “barred in an absolute manner from potential access to competition”. Therefore, the DRC judge noted that in the Claimant’s opinion and despite his default notices sent to the Respondent by means of which he requested his “inclusion / registration”, the Respondent did not react accordingly.

9. Finally, the DRC judge recalled the Claimant’s request to be awarded an “additional compensation and/or aggravated damages due to the abusive and/or unsporting and/or egregious behaviour of the Respondent […]”, as well as “the imposition of a transfer ban for 2 consecutive registration periods on the Respondent”.

10. Furthermore, the DRC judge noted that the Respondent had been given the opportunity to reply to the claim submitted by the Claimant, but that the Respondent had failed to present its response. In this way, the DRC deemed that the Claimant’s allegations remained undisputed and therefore, that the Respondent accepted said allegations.

11. In this context, the DRC judge recalled that, first of all, despite the Claimant’s initial requests as to his “inclusion / registration”, the Respondent did not apparently reply properly. In continuation, the DRC judge underlined that, in response to the Claimant’s subsequent correspondence dated 5 April 2019, the Respondent sent a letter that had been previously sent to the Bolivian FA on 11 April 2019, unequivocally declaring that the player would not be participating in competitive national and/or international matches.

12. At this point, the DRC judge deemed it important to underline that, as it has been previously sustained in his various jurisprudence, among a player’s fundamental rights under an employment contract, is not only his right to a timely payment of his remuneration, but also his right to access training and to be given the possibility to compete with his fellow team mates in the team’s official matches.

13. In this respect, the DRC judge deemed that, given the situation in the matter at stake, it is clear that the aforementioned facts led the Claimant to legitimately believe that the Respondent was no longer interest in his services. Furthermore, the DRC judge deemed that since the Claimant had been barred in an absolute manner from potential access to competition, the Respondent’s actions deprived the Claimant of one of his fundamental rights.

14. As such, and bearing in mind the above-mentioned considerations, the DRC judge deemed that the Claimant had just cause to terminate the employment contract on 15 April 2019.

15. In continuation, and bearing in mind the previous considerations, the DRC judge went on to deal with the consequences of the early termination of the employment contract with just cause by the Claimant.

16. First of all, the DRC judge concurred that the Respondent must fulfill its obligations as per the employment contract in accordance with the general legal principle of “pacta sunt servanda”.

17. In this respect, the DRC judge decided that the Respondent is liable to pay to the player the remuneration that was outstanding at the time of the termination, i.e. the amount of USD 8,161.29, as a consequence of the termination with just cause on 15 April 2019.

18. Furthermore, considering the player’s claim for interest and also taking into account the DRC judge’s longstanding jurisprudence, he ruled that the club must pay 5% interest p.a. on the amount of USD 8,161.29, as from the due dates until the date of effective payment, as follows:

i. as from 1 April 2019 on the amount of USD 5,500;

ii. as from 1 May 2019 on the amount of USD 2,661.29

19. Having established that the Claimant terminated the contract with just cause, the DRC judge focused his attention on the consequences of such termination. Taking into consideration art. 17 par. 1 of the Regulations, the DRC judge decided that the Claimant would, in principle, be entitled to receive from the Respondent an amount of money as compensation for breach of contract.

20. In continuation, the DRC judge focused his attention on the calculation of the amount of compensation for breach of contract in the case at stake. In doing so, the DRC judge firstly recapitulated that, in accordance with art. 17 par. 1 of the Regulations, 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.

21. In application of the relevant provision, the DRC judge held that he first of all had to clarify as to whether the pertinent employment contract contains 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 DRC judge established that no such compensation clause was included in the employment contract at the basis of the matter at stake.

22. As a consequence, the DRC judge determined that the amount of compensation payable by the Respondent to the Claimant had to be assessed in application of the other parameters set out in art. 17 par. 1 of the Regulations. The DRC judge recalled that said provision provides for a non-exhaustive enumeration of criteria to be taken into consideration when calculating the amount of compensation payable. Therefore, other objective criteria may be taken into account at the discretion of the deciding body. In this regard, the DRC judge emphasised beforehand that each request for compensation for contractual breach has to be assessed by the DRC judge on a case-by-case basis taking into account all specific circumstances of the respective matter.

23. The DRC judge then turned his attention to the remuneration and other benefits due to the Claimant under the existing contract and/or the new contract, which criterion was considered by the Chamber to be essential. The DRC judge deemed it important to emphasise that the wording of art. 17 par. 1 of the Regulations allows the DRC judge to take into account both the existing contract and the new contract, if any, in the calculation of the amount of compensation.

24. Bearing in mind the foregoing, the DRC judge proceeded with the calculation of the monies payable to the player under the terms of the employment contract as from the date of termination with just cause by the Claimant until its natural expiration, bearing in mind that he would have received in total USD 41,338.71 as remuneration for the period as from termination until 31 December 2019. Consequently, the DRC judge concluded that the amount of USD 41,338.71 serves as the basis for the final determination of the amount of compensation for breach of contract in the case at hand.

25. In continuation, the DRC judge verified as to whether the Claimant had signed an employment contract with another club during the relevant period of time, by means of which he would have been enabled to reduce his loss of income. According to the constant practice of the DRC judge, such remuneration under a new employment contract shall be taken into account in the calculation of the amount of compensation for breach of contract in connection with the player’s general obligation to mitigate his damages.

26. Having said that, the DRC judge recalled that in accordance with art. 6 par. 3 of Annexe 3 of the aforementioned Regulations, FIFA may use, within the scope of proceedings pertaining to the application of the said Regulations, any documentation or evidence generated or contained in the TMS. In this respect, the DRC judge noted that, in accordance with the information available in TMS and according to the Claimant’s sayings, it appeared that the player was able to mitigate his damages with an amount of USD 10,000.

27. Consequently, the DRC judge concluded that the player shall be entitled to a compensation of USD 31,338.71.

28. In addition, taking into account the Claimant’s request and the DRC judge’s well-established jurisprudence, the DRC judge decided that the Respondent must pay to the Claimant interest of 5% p.a. on the amount of USD 31,338.71 as of the date on which the claim was lodged, i.e. 24 April 2019, until the date of effective payment.

29. At this point, the DRC judge recalled the Claimant’s request to be awarded additional compensation and decided to reject said request, the conditions of art. 17 par. 1 ii) of the Regulations being not met.

30. The DRC judge concluded his analysis by establishing that the Claimant’s claim is partially accepted and by rejecting any further claim of the Claimant.

31. Furthermore, taking into account the consideration under number II./3. above, the DRC judge referred to par. 1 and 2 of art. 24bis of the Regulations, which stipulate that, with its decision, the pertinent FIFA deciding body shall also rule on the consequences deriving from the failure of the concerned party to pay the relevant amounts of outstanding remuneration and/or compensation in due time.

32. In this regard, the DRC judge established that, in virtue of the aforementioned provision, it has competence to impose a sanction on the Respondent. More in particular, the DRC judge pointed out that, against clubs, the sanction shall consist in a ban from registering any new players, either nationally or internationally, up until the due amount is paid and for the maximum duration of three entire and consecutive registration periods.

33. Therefore, bearing in mind the above, the DRC judge decided that, in the event that the Respondent does not pay the amount due to the Claimant within 45 days as from the moment in which the Claimant, following the notification of the present decision, communicates the relevant bank details to the Respondent, a ban from registering any new players, either nationally or internationally, for the maximum duration of three entire and consecutive registration periods shall become effective on the Respondent in accordance with art. 24bis par. 2 and 4 of the Regulations.

34. Finally, the DRC judge recalled that the above-mentioned sanction will be lifted immediately and prior to its complete serving upon payment of the due amounts, in accordance with art. 24bis par. 3 of the Regulations.

III. Decision of the Dispute Resolution Chamber judge

1. The claim of the Claimant, Mr José Enrique Caraballo Rosal, is partially accepted.

2. The Respondent, Club Deportivo San José, has to pay to the Claimant the amount of USD 8,161.29, plus 5% interest p.a. calculated as follows:

- 5% interest p.a. on the amount of USD 5,500 as from 1 April 2019 until the date of effective payment;

- 5% interest p.a. on the amount of USD 2,661.29 as from 1 May 2019 until the date of effective payment.

3. The Respondent has to pay to the Claimant compensation for breach of contract in the amount of USD 31,338.71, plus 5% interest p.a. as from 24 April 2019 until the date of effective payment.

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

5. The Claimant is directed to inform the Respondent, immediately and directly, preferably to the email address as indicated on the cover letter of the present decision, of the relevant bank account to which the Respondent must pay the amounts mentioned under points 2. and 3. above.

6. The Respondent shall provide evidence of payment of the due amounts in accordance with points 2. and 3. above to FIFA to the e-mail address psdfifa@fifa.org, duly translated into one of the official FIFA languages (English, French, German, Spanish).

7. In the event that the amounts due in accordance with points 2. and 3. above are not paid by the Respondent within 45 days as from the notification by the Claimant of the relevant bank details to the Respondent, the Respondent shall be banned from registering any new players, either nationally or internationally, up until the due amounts are paid and for the maximum duration of three entire and consecutive registration periods (cf. art. 24bis of the Regulations on the Status and Transfer of Players).

8. The ban mentioned in point 7. above will be lifted immediately and prior to its complete serving, once the due amounts plus interest is paid.

9. In the event that the amounts due in accordance with points 2. and 3. above are still not paid by the end of the ban of three entire and consecutive registration periods, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision.

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Note related to the publication:

The FIFA administration may publish decisions issued by the Players’ Status Committee or the DRC. Where such decisions contain confidential information, FIFA may decide, at the request of a party within five days of the notification of the motivated decision, to publish an anonymised or a redacted version (cf. article 20 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber).

Note related to the appeal procedure:

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. 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.

The full address and contact numbers of the CAS are the following:

Court of Arbitration for Sport

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Tel: +41 21 613 50 00

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e-mail: info@tas-cas.org

For the Dispute Resolution Chamber:

Emilio García Silvero

Chief Legal & Compliance Officer