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 10 February 2020

Decision of the Dispute Resolution Chamber (DRC) judge

passed on 10 February 2020,

by

Daan de Jong (The Netherlands)

on the claim presented by the player,

Samuel Akurugu, Ghana

represented by Mr Yussif Alhassan Chibsah

as Claimant

against the club,

Rivers United FC, Nigeria

represented by Mr Aminu Yusuf

as Respondent

regarding an employment-related dispute

between the parties

I. Facts of the case

1. On 20 February 2018, the Claimant and the Respondent (hereinafter jointly referred to as: the parties) concluded an employment contract (hereinafter: the contract), valid as from 1 March 2018 until 28 February 2021.

2. According to art. 7 par. 1 of the contract, the Respondent undertook to pay to the Claimant an annual salary of Nigerian Naira (NGN) 450,000, as well as bonuses as follows:

- NGN 50,000 per home win;

- NGN 50,000 per away draw;

- NGN 100,000 per away win.

3. On 9 October 2018, the Respondent terminated the contract in writing, due to “non performance” (hereinafter: the termination notice).

4. On 6 September 2019, the Claimant lodged a claim against the Respondent in front of FIFA.

5. In his claim, the Claimant firstly maintained that the Respondent still owed him NGN 50,000 corresponding to a match played and won on 20 May 2018.

6. In addition, the Claimant held that the Respondent terminated the contract without just cause. Therefore, the Claimant considered that he was entitled to compensation for breach of contract. In this context, the Claimant argued that the residual value of the contract amounted to twenty-nine monthly salaries of NGN 450,000, thereby totaling NGN 13,050,000.

7. Moreover, the Claimant argued that between October 2018 and September 2019, i.e. after the termination notice, the Respondent won seven home matches, drew four away matches and won one away match, resulting to a total amount of NGN 650,000.

8. In continuation, the Claimant estimated that he would be entitled to an additional match bonus compensation of NGN 2,500,000, corresponding to the probability of matches won and drawn by the Respondent between September 2019 and February 2021.

9. The Claimant further requested an additional compensation of NGN 2,700,000 “corresponding to 6 monthly salaries […] on the basis of specificity of sport”.

10. Finally, the Claimant requested that his legal costs in the amount of USD 1,000 be borne by the Respondent and that sporting sanctions be imposed on the Respondent.

11. In reply to the claim, the Respondent firstly acknowledged that the Claimant was entitled to NGN 50,000 as a bonus for the match played on 20 May 2018.

12. With regard to the termination notice, the Respondent argued that it had just cause to terminate the contract on the basis of a “code of conduct” allegedly signed between the parties on 1 January 2018, valid until 28 February 2021 (hereinafter: the code of conduct).

13. According to the Respondent, the “code of conduct” stipulated that it was entitled to terminate the contract “if the player is found incapable to perform his duties due to […] non-performance i.e. not meeting up in training and matches”. Thus, the Respondent considered that no compensation is due to the player.

II. Considerations of the Dispute Resolution Chamber judge

1. First, the Dispute Resolution Chamber judge (hereinafter also referred to as: the judge) analysed whether he was competent to deal with the matter at stake. In this respect, he took note that the present matter was submitted to FIFA on 6 September 2019. Consequently, 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 judge referred to art. 3 par. 1 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), the Dispute Resolution Chamber judge was competent to decide on the present matter, which concerns an employment-related dispute between a Ghanaian player and a Nigerian club.

3. In continuation, the 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 Players (edition 2020), and considering that the present claim was lodged on 6 September 2019, the June 2019 edition of said regulations (hereinafter: Regulations) were applicable to the matter at hand as to the substance.

4. The judge also recalled the content of art. 9 par. 3 third sentence of the Procedural Rules, according to which submissions received outside the time limit shall not be taken into account by the pertinent FIFA deciding body.

5. The competence of the Dispute Resolution Chamber judge and the applicable regulations having been established, the judge entered into the substance of the matter. In this respect, he started by acknowledging all the above-mentioned facts, the arguments and the documentation submitted by the Claimant and the Respondent. However, the 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.

6. First, the Dispute Resolution Chamber judge noted that the parties entered into an employment contract valid as from 1 March 2018 until 28 February 2021, according to which the Respondent undertook to pay the Claimant an annual salary of NGN 450,000, as well as bonuses of NGN 50,000 per home win, NGN 50,000 per away draw and NGN 100,000 per away win.

7. Second, the judge noted that on 9 October 2018, the Respondent unilaterally terminated the contract, invoking the Claimant’s “non performance”.

8. In continuation, the judge noted that the Claimant lodged a claim against the Respondent maintaining that the Respondent had terminated the contract without just cause. Consequently, the Claimant requested outstanding remuneration and compensation for breach of contract.

9. Having established the aforementioned, the judge deemed that the underlying issue in the present dispute was to determine whether the contract had been unilaterally terminated with or without just cause by the Respondent on 9 October 2018 and the consequences thereof.

10. In this context, the judge observed that in the termination notice, the Respondent explicitly invoked the poor performances of the Claimant to justify the termination of the contract. In particular, the judge noted that the Respondent referred to the code of conduct according to which it was entitled to terminate the contract “if the player is found incapable to perform his duties due to […] non-performance i.e. not meeting up in training and matches”.

11. First, the judge considered that poor performance is a purely subjective appreciation, as it is left to the full discretion of the Respondent. This led the judge to recall the constant jurisprudence of the Dispute Resolution Chamber and of the Court of Arbitration for Sport (CAS), according to which a player’s poor performance may not constitute a valid reason to unilaterally terminate an employment contract.

12. Second, the judge referred to art. 9 par. 3 third sentence of the Procedural Rules, as the Respondent had only provided the code of conduct after the closure of the investigation.

13. Therefore, the judge concluded that the Respondent failed to provide any corroborating evidence within the granted deadline which could justify the contract termination.

14. As a general rule and notwithstanding the aforementioned, the judge recalled that the termination of a contract should only be an ultima ratio. In the present matter, the judge noted that the Respondent did not alert, warn or sanction the Claimant, prior to terminating the contract.

15. In light of the above, the Dispute Resolution Chamber judge decided that the Respondent terminated the contract without just cause.

16. The judge firstly noted that outstanding remuneration in the amount of NGN 50,000 was still due to the Claimant as a bonus for a match played and won on 20 May 2019. In this regard, the judge observed that the Respondent acknowledged the right of the Claimant to receive this bonus. As such, the judge decided that the Claimant is entitled to outstanding remuneration in the amount of NGN 50,000.

17. In addition, taking into account the Claimant’s request, the judge decided that the Respondent must pay to the Claimant interest of 5% p.a. on the amount of NGN 50,000 as of 10 October 2018 until the date of effective payment.

18. Having established that the Respondent is to be held liable for the early termination of the contract without just cause, the judge focused its attention on the consequences of such termination. Taking into consideration art. 17 par. 1 of the Regulations, the judge decided that the Claimant is entitled to receive from the Respondent an amount of money as compensation for breach of contract.

19. In these circumstances, the 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 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.

20. In application of the relevant provision, the judge held that it 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 judge established that no such compensation clause was included in the contract at the basis of the matter at stake.

21. As a consequence, the 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 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.

22. Bearing in mind the foregoing as well as the claim of the Claimant, the judge proceeded with the calculation of the monies payable to the Claimant under the terms of the contract until 28 February 2021. In view of the foregoing, the judge observed that the residual value of the contract is NGN 13,050,000, corresponding to twenty-nine monthly salaries of NGN 450,000, which shall serve as the basis for the final determination of the amount of compensation for breach of contract.

23. In continuation, the 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 able to reduce his loss of income. According to art. 17 par. 1 point ii) of the Regulations, such remuneration under a new employment contract shall be deducted from the residual value of the contract that was terminated early, in the calculation of the amount of compensation for breach of contract (“the mitigated compensation”).

24. In this respect, the judge noted that indeed the Claimant had concluded a new employment contract with the Japanese club Ocacias Kyoto, which entitled him to a monthly salary of Japanese Yen (JPY) 200,000. As such, the judge deemed that the Claimant was able to mitigate his loss in the amount of JPY 2,400,000. In this regard, the judge concluded that the mitigated compensation of the Claimant would amount to NGN 5,161,910.

25. Having established the above, the judge took note of the Claimant’s request for NGN 650,000, corresponding to bonuses for matches won and drew by the Respondent between October 2018 and September 2019. In this regard, the judge observed that the parties were no longer contractually bound during that period of time. Consequently, the judge concluded that this request lacked any contractual basis and decided that the Claimant is not entitled to bonuses for results obtained by the Respondent after the termination of the contract.

26. In continuation, the judge analysed the Claimant’s request for the payment of NGN 2,500,000 as an additional match bonus compensation corresponding to the probability of matches won and drawn by the Respondent between September 2019 and February 2021. Considering that this request is purely speculative as it is based on matches which have not yet occurred, the judge decided to reject it.

27. Finally, the judge addressed the request of the Claimant for the payment of an additional compensation of NGN 2,700,000 “corresponding to 6 monthly salaries […] on the basis of specificity of sport”. The judge noted that this request was not based on any contractual provision, nor was it substantiated. Therefore, the judge decided to reject this request.

28. Consequently, in view of all of the above, the Dispute Resolution Chamber judge decided that the Respondent must pay the amount of NGN 5,161,910 to the Claimant, which is considered by the judge to be a reasonable and justified amount as compensation for breach of contract.

29. In addition, taking into account the Claimant’s request, the judge decided that the Respondent must pay to the Claimant interest of 5% p.a. on the amount of compensation as of the date on which the claim was lodged, i.e. 6 September 2019, until the date of effective payment.

30. In light of the above, the judge concluded his deliberations in the present matter by establishing that any further claim lodged by the Claimant is rejected.

31. Furthermore, the 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 judge pointed out that, against clubs, the consequence of the failure to pay the relevant amounts in due time shall consist of a ban 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.

33. Therefore, bearing in mind the above, the Dispute Resolution Chamber judge decided that, in the event that the Respondent does not pay the amounts 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 judge recalled that the above-mentioned ban will be lifted immediately and prior to its complete serving upon payment of the due amount, in accordance with art. 24bis par. 3 of the Regulations.

III. Decision of the Dispute Resolution Chamber judge

1. The claim of the Claimant, Samuel Akurugu, is partially accepted.

2. The Respondent, Rivers United FC, has to pay to the Claimant outstanding remuneration in the amounts of Nigerian Naira (NGN) 50,000, plus interest at the rate of 5% p.a. on the aforementioned amount as from 10 October 2018 until the date of effective payment.

3. The Respondent has to pay to the Claimant compensation for breach of contract in the amount of NGN 5,161,910, plus interest at the rate of 5% p.a. on the aforementioned amount as from 6 September 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 e-mail 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, if need be, into one of the official FIFA languages (English, French, German, Spanish).

7. In the event that the amounts due plus interest 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 are paid.

9. In the event that the aforementioned sums plus interest 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.

*****

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 relating to the appeal procedure:

According to article 58 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS directly within 21 days of receipt of notification of this decision and shall contain all the elements in accordance with point 2 of the directives issued by the CAS. 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

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 judge:

Emilio García Silvero

Chief Legal & Compliance Officer