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 15 January 2020
Decision of the
Dispute Resolution Chamber (DRC) judge
passed in Zurich, Switzerland, on 15 January 2020,
by Omar Ongaro (Italy), DRC judge,
on the claim presented by the player,
Asante Kwasi, Ghana
represented Mr Yussif Chibsah
as Claimant
against the club,
Simba Sports Club, Tanzania
as Respondent
regarding an employment-related dispute between the parties
I. Facts of the case
1. On 1 December 2017, the Ghanaian player, Asante Kwasi (hereinafter: the player or the
Claimant) and the Tanzanian club, Simba Sports Club (hereinafter: the club or the Respondent)
concluded an employment contract (hereinafter: the contract) valid as from 13 December 2017
until 10 December 2019.
2. According to articles 1.1 and 1.2 of the contract, the player was entitled to a monthly salary of
USD 2,200 and to a signing-on fee of USD 22,000 payable in two instalments of USD 11,000 on
1 December 2017 and 13 December 2018 respectively.
3. On 28 June 2019, the player put the club in default for the payment of the second instalment
of the signing-on fee and granted the club a 10 days’ deadline to remedy the default.
4. According to the Claimant, on 6 July 2019, the club unilaterally terminated the contract.
5. On 8 July 2019, the player addressed the club a correspondence by means of which he contested
the termination arguing that it was without just cause.
6. On 18 July 2019, the parties concluded a settlement agreement (hereinafter: the settlement
agreement), according to which the club confirmed the termination of the contract and
committed itself to pay to player the amount of USD 13,200, payable as follows:
a) USD 2,200 on 25 July 2019;
b) USD 5,000 on 15 August 2019;
c) USD 6,000 on 15 September 2019.
7. Pursuant to article 6 of the settlement agreement, the parties agreed upon the following: “in
the event that the Club fails to pay one of the instalments […] of this Settlement Agreement
within the relevant deadline, the full “remaining amount” will immediately fall due without
further notice. For the sake of good order, and as an example, should the first instalment of
USD 2,200 not be paid on 25 July 2019, but on a later date or not at all, the “remaining
outstanding amount” will correspond to USD 13,200, which will have to be paid by the Club to
the Player with immediate effect. In addition, the Club shall be liable to pay interest to the
Player on any delayed payment or outstanding payment, from the date it fell due until the
date of actual payment at a rate of 15% (fifteen percent) per annum”.
8. According to article 7 of the settlement agreement, “in the event that the Club fails to pay the
Player one of the above-mentioned instalments within the relevant deadline, the Club shall
pay a penalty fee in the amount of USD 10,000 […] to the Player”.
9. On 7 August 2019, the player informed the club about his bank details for the purpose of the
payment of the second instalment of the settlement agreement.
10. On 22 August 2019, the player put the club in default for the payment of USD 21,000 plus 15%
interest, granting a 7 days’ deadlines to remedy the situation. The requested amount included
the following: a) the second and third instalment of the settlement agreement; b) 15% interest
stipulated under article 6 of the settlement agreement; c) the penalty stipulated under article
7 of the settlement agreement.
11. On 12 September 2019, the Claimant lodged a claim against the Respondent in front of FIFA,
requesting the payment of USD 21,000 plus 15% as from 16 August 2019 until the date of
effective payment and USD 2,000 as legal costs.
12. In its reply to the Claimant’s claim, the Respondent considered that it resolved the dispute by
paying the amount of USD 11,000 on 10 October 2019. In this context, in support of its
allegations, it provided a copy of the proof of payment.
13. On 22 October 2019, the player acknowledged receipt of the amount of USD 11,000 on 10
October 2019 from the club and amended his claim requesting the following:
a) USD 10,000 related to the penalty fee plus 15% interest as from 16 August 2019 until
the date of effective payment;
b) USD 248 for the accrued interest on the amount of USD 11,000 calculated as from 16
August 2019 until 10 October 2019;
c) USD 2,000 for legal costs.
II. Considerations of the DRC judge
1. First of all, the Dispute Resolution Chamber judge (hereinafter: the DRC judge or the judge)
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 12 September 2019. Taking into account the
wording of art. 21 of the 2019 edition of the Rules Governing the Procedures of the Players’
Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules), the
aforementioned edition of the Procedural Rules is applicable to the matter at hand (cf. article
21 par. 2 and 3 of the Procedural Rules).
2. Subsequently, the DRC judge 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 2020), the DRC judge is competent to deal with the
matter at stake, which concerns an employment-related dispute with an international
dimension between a Ghanaian player and an Tanzanian club.
3. In continuation, the judge 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, and considering that the present claim was
lodged on 12 September 2019, the June 2019 edition of said regulations (hereinafter:
Regulations) were applicable to the matter at hand as to the substance.
4. The competence of the DRC judge and the applicable regulations having been established, the
judge entered into the substance of the matter. In this respect, it 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 it
will refer only to the facts, arguments and documentary evidence, which it considered
pertinent for the assessment of the matter at hand.
5. First and foremost, the judge acknowledged that the parties had terminated their employment
relation by mutual consent by signing the settlement agreement on 18 July 2019. In accordance
with the settlement agreement, the Respondent inter alia undertook to pay to the Claimant
the amount of USD 13,200 in three instalments, as follows: i) USD 2,200 on 25 July 2019; ii) USD
5,000 on 15 August 2019; iii) USD 6,000 on 15 September 2019.
6. Furthermore, the DRC judge observed that in case of non-compliance of the aforementioned
payments within the relevant deadlines, the settlement agreement stipulated in its article 6
that the Respondent “shall be liable to pay interest to the Player on any delayed payment or
outstanding payment, from the date it fell due until the date of actual payment at a rate of
15% (fifteen percent) per annum”.
7. In addition, the DRC judge further noted that the in case of non-compliance of the
aforementioned payments within the relevant deadlines, the settlement agreement stipulated
in its article 7 that the Respondent “shall pay a penalty fee in the amount of USD 10,000”.
8. In continuation, the judge noted that the Claimant, on the one hand, while finally
acknowledging full receipt of the main amounts stipulated in the settlement agreement,
namely USD 5,000 plus USD 6,000, still requested to be awarded the amount of USD 10,000
related to the penalty fee plus 15% interest as from 16 August 2019 until the date of effective
payment on the basis of articles 6 and 7 of the agreement, arguing that the Respondent had
not paid the second and the third instalment of the agreed amount on the respective due
dates.
9. On the other hand, the DRC judge noted that the Respondent deemed that the payment of
USD 11,000 on 10 October 2019 “has resolved this dispute”.
10. In view that the Respondent acknowledged having paid USD 11,000 to the Claimant on 10
October 2019, the DRC judge noted that, thus, the Respondent implicitly confirms that it paid
the amounts stipulated in the settlement agreement with delay, and that no valid reasons were
provided by the Respondent for such delay. In this context, the DRC judge took note that, in
principle, the condition contained in articles 6 and 7 of the settlement agreement is met.
11. Having established the above, the judge focussed its attention on the penalty fee stipulated
under article 7 of the settlement agreement.
12. After due deliberation, the DRC judge concluded that penalty clauses 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 judge highlighted that in order to determine as to whether a penalty clause is
to be considered acceptable, the specific circumstances of the relevant case brought before it
shall also be taken into consideration.
13. In the specific case at hand, the DRC judge deemed that the penalty fee of USD 10,000, which
the parties contractually agreed upon the settlement agreement, is disproportionate in the
case at hand, as it is almost 100% p.a. over the main amount. This interest rate is clearly
excessive and disproportionate, in accordance with the Chamber’s jurisprudence as well as with
Swiss law
14. In view of the above, the DRC judge decided that the penalty fee should be reduced to the
amount of USD 4,000.
15. Having established the above, the DRC judge also noted that the settlement agreement indeed
stipulated the application of 15 p.a. interest for late payment.
16. Considering its well-established jurisprudence as well as Swiss law, the judge found that this
specific interest clause of 15% p.a. is not disproportionate or unreasonable in the case at hand.
17. Notwithstanding the above, in accordance with the longstanding jurisprudence of the DRC, the
DRC judge pointed out that the late payment interest can only be applied on the main amount
of USD 11,000, for the period during which the payment was delayed, i.e. between 16 August
and 10 October 2019.
18. In conclusion, the DRC judge decided to partially accept the claim of the Claimant and award
him interest of 15% p.a. on the amount of USD 11,000, as from 16 August 2019 until 10 October
2019, and the amount of USD 4,000 as the penalty fee.
19. The DRC judge concluded its deliberations in the present matter by establishing that any
further claim lodged by the Claimant is rejected.
20. 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.
21. In this regard, the DRC 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.
22. 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.
23. Finally, the DRC 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 DRC judge
1. The claim of the Claimant, Asante Kwasi, is partially accepted.
2. The Respondent, Simba Sports Club, has to pay to the Claimant the amount corresponding to
15% interest p.a. calculated on the amount of USD 11,000 as from 16 August 2019 until 10
October 2019.
3. The Respondent has to pay to the Claimant the further amount of USD 4,000.
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 III.2.
and III.3. above.
6. The Respondent shall provide evidence of payment of the due amounts in accordance with
point III.2. and III.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 in accordance with points III.2. and III.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 III.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 amounts 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:
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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 motivated decision (legal remedy):
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.
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For the Dispute Resolution Chamber:
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