F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2020-2021) – fifa.com – atto non ufficiale – Decision14 January 2021

Decision of the

Dispute Resolution Chamber

passed on 14 January 2021,

regarding an employment-related dispute concerning the player Nenad Novaković

COMPOSITION:

Geoff Thompson (England), Chairman Michelle Colucci (Italy), member Mohamed Muzammil (Singapore), member

CLAIMANT:

Nenad Novaković, Bosnia and Herzegovina

Represented by Mr Drazen Nikolic

RESPONDENT:

Churchill Brothers SC, India

I. FACTS OF THE CASE

1. On 14 September 2018, the Bosnian player, Nenad Novaković (hereinafter: player or Claimant) and the Indian club, Churchill Brothers SC (hereinafter: club or Respondent) signed an employment contract (hereinafter: the contract) valid as of the date of signature until 31 May 2020.

2. The contract reads inter alia as follows:

3. Between 16 July 2019 and 23 August 2019, the player sent several letters to the Respondent, requesting payment of his outstanding remuneration (April/May 2019), but no avail.

4. On 6 August 2019, the club terminated the contract with the player due to its financial difficulties.

5. On 29 August 2019, the player terminated the contract with the club, which insisted to continue the contractual relationship, remitted payment of the player’s salaries of April and May 2019 and invited the player to resume work on 4 September 2019. Consequently, the player withdrew his termination notice dated 29 August 2019.

6. On 14 October 2019, the Respondent sent a letter to the Claimant arguing that he obtained a visa to return to India, but with a forged invitation letter and asked the Claimant to provide comments on this allegation within 48 hours or it would lodge a claim against him in India.

7. On 14 October 2019, the Claimant replied that he obtained the visa on the basis of the employment contract with the Respondent.

8. On 17 October 2019, the Respondent replied to the Claimant arguing that it had evidence that the Claimant had forged the invitation letter and requested the presence at the club of the player on the following day to provide more evidence.

9. Allegedly, on the following day, the Claimant went to the club’s premises, but behaved bad during the meeting and left before the end.

10. On 3 March 2020, the player put the club in default for payment of USD 49,500, corresponding to his salaries as of June 2019 (9x USD 5,500). In this letter the player warned the club that he would terminate the contract if said payment was not remitted within 15 days.

11. On 24 March 2020, the player terminated the contract with the club, referring to Art. 14 and 14bis of the RSTP and due to its non-fulfilment of its financial obligations.

12. On 7 April 2019, the player lodged a claim for breach of contract against the Respondent in front of FIFA and requested the following:

13. In his claim, the player held having had just cause to terminate the contract on 24 March 2020 due to its non-fulfilment of its financial obligations.

14. In this regard, the player argued that the club failed to register the player for the season 2019/2020 and did not remit any further salary to the player after he withdrew his previous termination.

15. In its reply to the claim, the Respondent contested the competence of FIFA and held that the Civil Court of Goya was competent to deal with the matter at hand.

16. As to the substance, the Respondent rejected the claim and held that in accordance with the contract, no fixed salaries were provided for the season 2019/2020, and since there is no fixed amount provided for the 2019/2020 season, “he has no grievance is not maintainable”. The Respondent highlighted that “in the absence of a contract specifying the amount payable, no claim is maintainable before this Tribunal”.

17. The Respondent also held that no interest could be granted since it is not contractually provided.

18. Furthermore, the club held that on 6 August 2019, it had already terminated the contract with the player.

19. Additionally, the Respondent held that the Claimant came back late for the season 2019/2020, that he should have returned in August 2019 but allegedly only returned on 14 or 15 September 2019. The Respondent is arguing that this absence should not need to be paid.

20. Moreover, the Respondent emphasized that the Claimant did not play during the season 2019/2020.

21. The club further pointed out that it invited the Claimant in February 2020 “for discussions for working out the fee payable in terms of the agreement” but the Claimant did not go.

22. In his replica, the player reiterated his position and held that the Respondent requested him to come back on 4 September 2020, and therefore the both parties agreed to continue with the contractual relationship at this point. Furthermore, the player denied having forged any documents in relation to obtain a VISA to re-enter India.

23. What is more, the Claimant insisted that FIFA is competent to deal with the matter at hand.

24. The player pointed out that he continued to comply with the contract, whereby the Respondent failed to make any further payments and de-registered him for the season 2019/2020.

25. Regarding the salary for 2019/2020, the player held that the presumption shall be made that his salary continued to be USD 5,500 per month.

26. In its duplica, the Respondent reiterated its position and held that no employment relationship existed anymore during the 2019/2020 season.

27. In this regard, the club pointed out that therefore the player was not registered with it for this season.

28. According to the information available in the Transfer Matching System (TMS), the player remained unemployed as of 24 March 2020.

II. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER

1. First of all, the Dispute Resolution Chamber (hereinafter also referred as DRC or Chamber) analysed whether it was competent to deal with the case at hand. In this respect, the Chamber took note that the present matter was submitted to FIFA on 7 April 2020. Consequently, the DRC concluded that the November 2019 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 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 June 2020), the Dispute Resolution Chamber is, in principle, competent to deal with the matter at stake, which concerns an employment-related dispute with an international dimension.

3. However, the DRC acknowledged that the Respondent contested the competence of FIFA’s deciding bodies on the basis of the allegation that the Civil Court of Goya was competent to deal with the matter at hand, without any further specification.

4. On account of the above, the DRC examined the contract at the basis of the dispute and noted that no jurisdiction clause in favour of the Civil Court in Goya was included.

5. In view of all the above, the DRC established that the club’s objection to the competence of FIFA to deal with the present matter has to be rejected and that the Dispute Resolution Chamber is competent to consider the present matter as to the substance.

6. 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 Player (edition January 2021), and considering that the present claim was lodged on 7 April 2020, the March 2020 edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

7. The competence of the Chamber and the applicable regulations having been established, the Chamber entered into the substance of the matter. In this respect, the Chamber started by acknowledging all the above-mentioned facts as well as the arguments and the documentation submitted by the parties. 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.

8. First of all, the members of the Chamber recalled that, on 14 September 2018, the parties concluded a contract, valid as of the date of the signature until 31 May 2021.

9. In continuation, the DRC noted that the Claimant lodged a claim against the Respondent maintaining that he had terminated the contract with just cause on 24 March 2020 since the club failed to remit remuneration in the total amount of USD 49,500, corresponding to 9 monthly salaries. Furthermore, the Claimant held having been de-registered for the season 2019/2020. Consequently, the Claimant asks to be awarded his outstanding dues as well as the payment of compensation for breach of the employment contract.

10. The Respondent, for its part, rejected the claim and held that there was no contractual relationship for the season 2019/2020 since no salary was defined in the contract for said season. It referred to its termination dated 6 August 2019.

11. In turn, the Chamber took note of the player’s replica, where he reiterated his position and insisted that his salary remained the same as in the previous season.

12. The DRC noted that the Respondent reiterated its position in its duplica and held that the player did not play for the club in the season 2019/2020.

13. Having said this, the DRC acknowledged that the central issue in the matter at stake was to determine as to whether the contract was terminated by the Claimant with or without just cause and to decide on the consequences thereof.

14. With the above in mind, the Chamber 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.

15. On account of the above, the DRC recalled that there are three termination notices on file: One issued by the club on 6 August 2019, the first one of the player dated 29 August 2019 and then the second one of the player on 24 March 2020. After examining documentation on file, the Chamber concluded that due to the parties actions after the two termination notices issued in August 2019, it can be concluded that both parties wanted to continue with the contractual relationship. In this regard, the members of the Chamber wished to emphasize that the player formally withdrew his termination and the club invited the player to come back to India. The club’s argumentation that the player showed up late for the season 2019/2020 gives a further indication that both parties wanted to continue the contractual relationship. Therefore, the DRC focused its attention on the termination dated 24 March 2020.

16. Before doing so, the DRC examined the contract in order to determine which salary the player was entitled to during the season 2019/2020. The Chamber noted that the wording of the contract does not define an amount, but in the context of the salary of the previous season, the members concluded that the player remained entitled to a monthly salary of USD 5,500 during the season 2019/2020 and that such clause could be seen as a possibility of a raise. The Chamber clearly decided that the wording cannot lead to the conclusion that no contractual relationship was defined for this season.

17. Subsequently, the DRC acknowledged that the Claimant put the Respondent in default on 3 March 2020, giving the Respondent 15 days to remedy its default of USD 49,500, corresponding to nine monthly salaries, before he terminated the contract on 24 March 2020 by means of a letter, referring to outstanding remuneration.

18. As to alleged the de-registration, the Chamber noted that the club confirmed that the player was no longer registered for the season 2019/2020.

19. In this context, the members of the Chamber established that the Respondent failed to proof that it actually remitted the amounts claimed by the player.

20. Furthermore, the Chamber noted that the Respondent confirmed the alleged de-registration of the player for the season 2019/2020.

21. Consequently, considering that the Respondent had thus repeatedly and for a significant period of time been in breach of its contractual obligations towards the Claimant, the Chamber decided that the Claimant had just cause to unilaterally terminate the employment contract on 24 March 2020 and that, as a result, the Respondent is to be held liable for the early termination of the employment contact with just cause by the Claimant.

22. Subsequently, prior to establishing the consequences of the termination of the employment contract with just cause by the Claimant in accordance with art. 17 par. 1 of the Regulations, the Chamber held that it, in general, had to address the issue of unpaid remuneration at the moment when the contract was terminated by the Claimant.

23. Bearing in mind the considerations above, and in accordance with the general legal principle of pacta sunt servanda, the Chamber established that the Claimant is entitled to USD 49,500, corresponding to 9 monthly salaries of USD 5,500 (June 2019 to February 2020).

24. In addition, taking into consideration the player’s claim, the Chamber decided to award the Claimant interest at the rate of 5% p.a. as requested, as of the respective due dates.

25. Moreover, and taking into consideration art. 17 par. 1 of the Regulations, the Chamber decided that the Claimant is entitled to receive compensation for breach of contract from the Respondent.

26. In continuation, the Chamber focused its attention on the calculation of the amount of compensation for breach of contract in the case at stake. In doing so, the members of the Chamber 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.

27. In application of the relevant provision, the Chamber 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 Chamber established that no such compensation clause was included in the employment contract at the basis of the matter at stake.

28. As a consequence, the members of the Chamber 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 Chamber 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 Dispute Resolution Chamber emphasised beforehand that each request for compensation for contractual breach has to be assessed by the Chamber on a case-by-case basis taking into account all specific circumstances of the respective matter.

29. The members of the Chamber then turned their 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 members of the Chamber deemed it important to emphasise that the wording of art. 17 par. 1 of the Regulations allows the Chamber to take into account both the existing contract and the new contract, if any, in the calculation of the amount of compensation.

30. Bearing in mind the foregoing, the Chamber 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. Furthermore, the Chamber took into account the amount claimed by the player and consequently, the Chamber concluded that the amount of USD 16,500 serves as the basis for the final determination of the amount of compensation for breach of contract in the case at hand.

31. In continuation, the Chamber 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, 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.

32. In this respect, the Chamber noted that the Claimant had not found new employment.

33. Consequently, on account of the above-mentioned considerations, the Chamber decided that the Respondent must pay the amount of USD 16,500 as compensation for breach of contract to the Claimant, which is considered by the Chamber to be a fair and reasonable amount.

34. In addition, taking into consideration the player’s claim, the Chamber decided to award the Claimant interest at the rate of 5% p.a. as of the date of the claim, i.e. 7 April 2020, until the date of effective payment.

35. The DRC concluded its deliberations by rejecting any further claim of the Claimant.

36. Furthermore, taking into account the consideration under number II./6. above, the Chamber 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.

37. In this regard, the Chamber established that, in virtue of the aforementioned provision, it has competence to impose a sanction on the Respondent. More in particular, the DRC 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.

38. Therefore, bearing in mind the above, the DRC 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.

39. Finally, the Chamber 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

1. The claim of the Claimant, Nenad Novaković, is admissible.

2. The claim of the Claimant is partially accepted.

3. The Respondent, Churchill Brothers SC, has to pay to the Claimant, the following amounts:

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

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

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

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

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

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

- USD 5,500 plus 5% interest p.a. as from 1 January 2020 until the date of effective payment;

- USD 5,500 plus 5% interest p.a. as from 1 February 2020 until the date of effective payment;

- USD 5,500 plus 5% interest p.a. as from 1 March 2020 until the date of effective payment;

- USD 16,500 as compensation for breach of contract plus 5% interest p.a. as from 7 April 2020 until the date of effective payment.

4. Any further claim of the Claimant is rejected.

5. The Claimant is directed to immediately and directly inform the Respondent of the relevant bank account to which the Respondent must pay the due amount.

6. The Respondent shall provide evidence of payment of the due amount in accordance with this decision to psdfifa@fifa.org, duly translated, if applicable, into one of the official FIFA languages (English, French, German, Spanish).

7. In the event that the amount due, plus interest as established above is not paid by the Respondent within 45 days, as from the notification by the Claimant of the relevant bank details to the Respondent, the following consequences shall arise:  1.

The Respondent shall be banned 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. The aforementioned ban mentioned will be lifted immediately and prior to its complete serving, once the due amount is paid.

(cf. art. 24bis of the Regulations on the Status and Transfer of Players). 2.

In the event that the payable amount as per in this decision is 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 the FIFA Disciplinary Committee.

For the Dispute Resolution Chamber:

Emilio García Silvero

Chief Legal & Compliance Officer

NOTE RELATED 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) within 21 days of receipt of the notification of this decision.

NOTE RELATED TO THE PUBLICATION:

FIFA may publish this decision. For reasons of confidentiality, 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 Procedural Rules).

CONTACT INFORMATION:

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