F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2020-2021) – fifa.com – atto non ufficiale – Decision 08.10.2020
Decision of the
Dispute Resolution Chamber
08.10.2020
regarding an employment-related dispute concerning the player Nauzet Garcia Santana
COMPOSITION:
Geoff Thompson, (England), Chairman
Stéphane Burchkalter, (France), member
Joseph Antoine Bell, (Cameroon), member
CLAIMANT:
Nauzet Garcia Santana, Spain
Represented by Mr. Alfonso León Lleó
RESPONDENT:
Chennai City FC, India
Represented by Mr Aamir Khan
I. FACTS OF THE CASE
1. The Spanish player, Nauzet Garcia Santana (hereinafter: Claimant), and the Indian club,
Chennai City FC (hereinafter: Respondent) concluded an employment contract (hereinafter:
contract) valid as from 1 June 2019 until 31 August 2020.
2. According to art. 6 of the contract, the Claimant was entitled to receive a monthly
remuneration of USD 4,000 payable by the 10th of the following month.
3. Article 3.1.1 a) of the contracts provides the following regarding the player’s visa:
“3.1.1. The Player shall during the Term and during the Season:(a)Ensure all steps and
actions are taken as is required to obtain and maintain such visa, work permit and other
licences and statutory requirements as required to enable him to play for the Club
from the date of his arrival until the end of the Season and Term.”
4. Art. 17 of the contract foresaw the following:
“17. FORCE MAJEURE:
Subject to the other provisions of this Agreement, the failure by a party to fulfil any of its
obligations under this Agreement shall not be considered to be a breach of or a default
under this Agreement in so far as the inability arises from an event of Force Majeure,
provided that the party affected by that event has taken reasonable precautions, has duly
communicated the occurrence of the event to the other party, and has taken due care and
attempted to mitigate the consequences of such event, all with the objective of carrying
out the terms of this Agreement without delay. For the purpose of this Agreement, “FORCE
MAJEURE” means an event or circumstance which is beyond the reasonable control of a
party and which makes a party’s performance of its obligations impossible and includes but
is not limited to wars, acts of terrorism, civil unrest, hostilities, public disorder, epidemics,
fires, Acts of God, Court Orders or Governmental restrictions and actions and decisions of
regulatory and sports authorities”.
5. Art. 19 inter alia stipulated the following as to applicable law and jurisdiction:
“19.1 This agreement shall be governed by and construed in accordance with Indian law.
(…)
19.4 All disputes relating to termination shall be referred to the AIFF Player Status
Committee for adjudication directly without undergoing the process of good faith
negotiations and mediations referred to in Clause 19.2 and 19.3 unless both the Player and
the Club mutually decide otherwise.
19.5 At any stage of the good faith negotiation process or the mediation process referred
in Clause 19.3 and 19.4 both the Player and Club can mutually agree to refer the matter to
the AIFF Player Status Committee for an urgent decision and, in such circumstances the
requirement for the 10 day windows for good faith negotiations and mediation under
Clause 19.3 and 19.4 will not apply.
19.6 If the dispute is not within the jurisdiction of scope of the AIFF Player Status Committee
then it shall be referred to arbitration under a sole arbitrator appointed by mutual consent
under the provisions of the Arbitration and Conciliation Act 1996 or any modification thereof then in effect. The Arbitration shall be in English and the seat and venue of
Arbitration shall be Chennai. Subject to the above, the Courts in Chennai shall have sole
and exclusive jurisdiction in respect of all matters addressed under the Clause 19.6”
6. Art. 20 of the contract states the following regarding injury:
“If the Player requires surgery due to a disease or injury caused by the activities with the
Club, the surgery shall be done in India, at the hospital designated by the Club. If the Player
wishes to be given the surgery outside of India, the Player shall be responsible for
the surgical cost. The Player and the Player’s family shall not claim compensation to the
Club for what is not covered by the health insurance.”
7. By correspondence dated 29 March 2020, the Respondent terminated the contract invoking
force majeure in view of the COVID-19 pandemic.
8. On 31 March 2020, the Claimant wrote to the Respondent and rejected the argument of
force majeure as a valid reason to unilaterally terminate the contract. The Claimant granted
the Respondent a 10-day deadline to “find an amicable solution” to the issue of termination
as well as to the outstanding salaries.
9. On 1 April 2020, the Respondent confirmed the termination of the contract and stated that
the overdue salaries would be paid by no later than the end of April 2020.
10. Following the unilateral termination of the contract, the Claimant remained unemployed.
II. PROCEEDINGS BEFORE FIFA
11. On 27 May 2020, the Claimant filed the claim at hand before FIFA. A brief summary of the
position of the parties is detailed below.
a. The claim of the Claimant
12. According to the Claimant, the Respondent had failed to pay his salary as from January until
the end of March 2020.
13. Then, on 29 March 2020, the Respondent terminated the contract invoking force majeure
in view of the COVID-19 pandemic without any prior notice. In particular, the Claimant
referred to the following abstract:
“We are writing to you to formally declare a Force Majeure event due to the Covid-19
pandemic, Government enforced restrictions and the decisions of the Regulatory and Sport
Authorities. As you are aware the football league in India as well as all international events
have been suspended. The Government has also ordered the closure of all sporting events
and banned the use of stadiums in India.
There is express provision for this type of event in your agreement with the Club (under
Clause 17). It is clear that these events are neither the fault of the Club or the players and
are due to events which are beyond anyone’s control.
We have been advised by the Tamil Nadu Government and the Sports Development
Authority to send all foreign players and staff safely back to their respective countries and
to confirm their departure.
It is therefore with great regret and sadness that the Club has no alternative but to terminate
your agreement with the Club with immediate effect through this declaration of Force
Majeure. (…)
We will ensure that the fee payable for December 2019 and January and February, 2020,
will be paid by 31st of July 2020 or at the time when the situation gets normal whichever
is later. We will keep you updated when those payments have been made (…)”.
14. On 31 March 2020, the Claimant contested the termination and requested the Respondent
to seek an amicable resolution of the dispute (cf. par. I. 8. above).
15. On 1 April 2020, the Respondent reaffirmed its decision to terminate the contract and
promised to pay the overdue salaries would be paid by no later than the end of April 2020.
However, the Respondent did not proceed to the said payments.
16. The Claimant pointed out that the Respondent terminated their employment contract
without any prior negotiations, and rejected his offer of an amicable solution to the parties’
issues.
17. The Claimant additionally stated that the Respondent invoked force majeure to terminate
the contracts of his foreign players only, which is against the principle of equal treatment,
and that the Respondent was rather trying to use the current situation to its advantage in
order to restructure the squad and terminate the contract more than one year prior to its
original expiry. The Claimant pointed out that the Indian FA suspended the season on 14
March 2020, but did not cancel it.
18. Recalling the definition of force majeure from the Swiss Federal Tribunal according to which
“(i) Force majeure is understood to be an unforeseeable, extraordinary event that is not
related to the "operation" of the person liable, but breaks in with inevitable force from
outside (…); (ii) Force majeure, in the opinion prevailing in the case law and in the literature,
cannot be considered in any case if the person who appeals to it could have averted the
extraordinary event or its consequences by reasonable precautions”, the Claimant
determined that this principle did not apply to the matter at hand and that the Respondent
could not terminate the agreement in this respect.
19. In addition, the Claimant indicated that the Respondent’s termination was against the FIFA
Regulations and the FIFA COVID-19 Football Regulatory Issues which do not foresee
termination with just cause in case of force majeure.
20. What is more, the Claimant underlined the following facts:
“(i) The Respondent already owed substantial financial entitlements to the Player;
(ii) The Respondent did not attempt to protect the Contract by finding the amicable solution
with the Claimant in relation to the state of “force majeure” despite benevolent offers of
the latter;
(iii) The Respondent did not attempt to modify the terms and conditions of the Contract in
good faith;
(iv) The Respondent did not take any reasonable and proportionate decisions in relation to
the temporary modification of the Contract;
(v) The Respondent did not suspend the Contract for the duration of the state of “force
majeure”;
(vi) The Respondent did not apply the same measures for the whole squad: the Respondent
only terminated the contracts of specific employees (foreign players), hereby groundlessly
patronising the national players, discriminating the foreign ones and severely violating the
principle of equal treatment.”
21. Furthermore, recalling the contents of art. 17 of the contract, the Claimant highlighted that
this clause did not give “the Respondent a right to terminate the fixed-term Contract
prematurely and unilaterally”, and in any case the Respondent did not comply with its
provisions as it did not attempt to mitigate the consequences of such alleged force majeure
it had invoked.
22. In conclusion, the Claimant concluded that the Respondent terminated the contract without
just cause, and that the situation surrounding the COVID-19 pandemic shall not relieve it
from its contractual obligations.
23. The Claimant’s requests for relief were the following:
1. “To accept this claim;
2. To determine that the Respondent unilaterally terminated the Contract without just
cause;
3. To issue a decision condemning the Respondent to pay the Player:
3.1. a compensation for the unilateral premature termination of the
Contract:
3.1.1. As residual value of the Player’s Employment Contract, USD 20,000.00/-
(ninety seven thousand five hundred US Dollar); together with
3.1.2. Six monthly salaries under the specificity of sport due to the most abusive
and discriminatory attitude displayed by the Club causing an irreparable harm to
the Player’ in the amount of USD 24,000.00/- (thirty nine thousand US Dollar);
3.1.3. Five percent (5%) interest rate per annum applicable to any amount granted,
starting from the 29th of March 2020, when the Club terminated the Contract
without just cause.
3.2. Financial entitlements of the Player at the time of the termination without just cause
committed by the Club, in the amount of USD 20,352, including:
3.2.1. overdue salary payments in the amount of USD 12,000 (December 2019 to
March 2020);
3.2.2. VISA fees which had to be burdened by the Club but that the Player was
obliged to anticipate himself (as per the Club’s unjustified refusal despite the clear
arrangements between the Parties) in the amount of USD 240;
3.2.3. Fees for surgery which had to be burdened by the Club but that the Player
was obliged to anticipate himself (as per the Club’s unjustified refusal despite the
clear arrangements between the Parties) in the amount of USD 8,112.00;
3.2.4. Five percent (5%) interest rate per annum applicable to any amount granted,
starting from the 10th of January 2020, when the afore-referred financial
entitlements of the Player fell due;
4. To impose a sanction towards the Respondent, i.e.: ban the Respondent from
registering any new players, either nationally or internationally, for two consecutive
registration periods under the provisions of the Article 12bis and the Article 17 of the
FIFA RSTP and any other disciplinary sanction deemed pertinent by your most
esteemed services;
5. To order the Respondent to assume the entirety of the FIFA DRC administration and
procedural fees, if any”.
b. Position of the Respondent
24. In reply to the Claimant’s claim, the Respondent first challenged the competence of FIFA to
rule on the present matter.
25. The Respondent referred to the jurisdiction clause contained in art. 19 of the contract (cf.
par. I.5. above) and held that the matter at hand should have been referred to the AIFF
Players’ Status Committee (AIFFPSC).
26. Furthermore, the Respondent also refers to the FIFA COVID-19 Guidelines and states that
parties should solve their ‘differences’ ‘at a national level’.
27. Moreover, the Respondent is of the opinion that Indian law should be applicable to the
matter at hand.
28. As to the merits of the dispute, the Respondent acknowledged that it did not pay the
Claimant his salaries in the period between December 2019 and February 2020 and that
the Claimant was informed that such payments would be made by the end of April 2020.
29. Furthermore, the Respondent explained that, due to restrictions in the service of the local
banks as a result of COVID-19, it could not make the payments until now.
30. The Respondent explained that the Indian League was suspended as from 15 March 2020,
that the Claimant could not render his services anymore and that as a result, it is facing
financial difficulties. In view of these circumstances, the Respondent had no other option
but to terminate the contract with the Claimant on 29 March 2020, based on article 17 of
the contract (cf. par. I.4. above).
31. Moreover, the Respondent denied that it has to pay for the player’s visa fee. The
Respondent stated in this regard that, contrary to what the Claimant claims, it was clearly
the latter who, under the terms of the contract, was responsible for maintaining his visa,
including the payment of any relevant fees. In addition, no evidence has been submitted
by the Claimant on the actual amount of fees he has incurred.
32. Equally, the Respondent denied it is responsible for the payment of the Claimant’s surgery,
referring to art. 20 of the contract (cf. par. I.6. above). Indeed, the Respondent underlined
that the Claimant had surgery outside India and that, consequently, it had been made clear
to him that the club would not cover the relevant expenses.
33. In addition, the Respondent explained that it is not obliged to pay any bonus payments to
the Claimant, as “the Player agreed with the Club that no further payments were due to
him from his participation in the 2018/2019 season and provided a written agreement to
reflect the same”.
34. The Respondent also argued that article 17 of the contract cannot be seen as a ‘disruption
of contractual stability’, as the circumstances under which the Respondent used the force
majeure concept, were truly exceptional. Furthermore, the Respondent explained that it did
not only suspend the payment to its foreign players, but also to its Indian players.
35. The Respondent denied that it refused to reach an amicable solution with the
Claimant; however, given its financial position, it did not have the resources to reach a
compromise where the Claimant could continue to be paid or partly paid.
36. The Respondent referred to the FIFA COVID-19 Guidelines and argued that these guidelines
are not intended to supersede national law. In this respect, the Respondent explained that
the termination was made in line with Indian law.
37. Subsequently, the Respondent argued that ‘there was no requirement under the Clause 17
for the Club to consider the duration of the suspension of the I-League when exercising its
rights’.
38. In conclusion, the Respondent was of the opinion that the circumstances around the
termination of the player’s contract (the outbreak of COVID-19) can be defined as a force
majeure. As a result, the Respondent denied any right of the Claimant to claim
compensation for breach of contract, and stated that it will pay the overdue payables as
soon as possible.
III. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER
a. Competence and applicable legal framework
39. 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 presented to FIFA on 27 May 2020 and submitted
for decision on 8 October 2020. Taking into account the wording of art. 21 of the June
2020 edition of the Rules Governing the Procedures of the Players’ Status Committee and
the Dispute Resolution Chamber (hereinafter: the Procedural Rules), the November 2019 of
the Procedural Rules is applicable to the matter at hand.
40. Subsequently, the members of the Chamber referred to art. 3 par. 1 of the Procedural Rules
and observed that in accordance with art. 24 par. 1 and 2 in combination with art. 22 lit.
b) of the Regulations on the Status and Transfer of Players (edition October 2020), the
Dispute Resolution Chamber would, in principle, be competent to deal with the matter at
stake, which concerns an employment-related dispute with an international dimension
between a Spanish player and an Indian club.
41. This being said, the Chamber recalled that the Respondent had challenged its jurisdiction
in the present matter, arguing that according to art. 19 of the contract, the parties had
agreed on the exclusive jurisdiction of the AIFF Players’ Status Committee (AIFFPSC) to hear
disputes.
42. The Chamber emphasised in this regard that in accordance with art. 22 lit. b) of the October
2020 edition of the Regulations on the Status and Transfer of Players, it is competent to
deal with employment-related disputes between a player and club unless the parties have
opted explicitly and in writing for such disputes to be decided by an independent arbitration
tribunal that has been established at national level within the framework of the association
and/or a collective bargaining agreement. Any such arbitration clause must be included
either directly in the contract or in a collective bargaining agreement applicable on the
parties. The independent national arbitration tribunal must guarantee fair proceedings and
respect the principle of equal representation of players and clubs.
43. With regard to the requirements which an independent arbitration tribunal guaranteeing
fair proceedings must fulfill, the Chamber referred to the FIFA Circular no. 1010 dated 20
December 2005 as well as to the FIFA National Dispute Resolution Chamber (NDRC)
Standard Regulations.
44. In particular, the Chamber underlined that the principle of equal representation of players
and clubs constitutes one of the very fundamental elements to be fulfilled in order for a
national dispute resolution chamber to be duly recognised. Indeed, this prerequisite is mentioned in the Regulations on the Status and Transfer of Players, in the FIFA Circular no.
1010 as well as in art. 3 par. 1 of the NDRC Regulations, which illustrates the
aforementioned principle as follows: “The NDRC shall be composed of the following
members, who shall serve a four-year renewable mandate: a) a chairman and a deputy
chairman chosen by consensus by the player and club representatives (…); b) between three
and ten player representatives who are elected or appointed either on proposal of the
players’ associations affiliated to FIFPro, or, where no such associations exist, on the basis
of a selection process agreed by FIFA and FIFPro; c) between three and ten club
representatives (…).”
45. Equally, the FIFA Circular no. 1010 states the following: “The parties must have equal
influence over the appointment of arbitrators. This means for example that every party shall
have the right to appoint an arbitrator and the two appointed arbitrators appoint the
chairman of the arbitration tribunal (…). Where arbitrators are to be selected from a
predetermined list, every interest group that is represented must be able to exercise equal
influence over the compilation of the arbitrator list”.
46. Bearing in mind the principles recalled above, the Chamber first of all established that art.
19 of the contract does constitute a clear and exclusive jurisdiction clause in favour of the
AIFFPSC.
47. Notwithstanding the above and with reference to the principle of burden of proof, the
Chamber observed that the Respondent had not provided any evidence, in the form of the
regulations governing the procedures of the AIFFPSC. As such, the Chamber was not in a
position to determine whether the said deciding body respects the principles mentioned in
the FIFA Circular no. 1010 as well as the NDRC Regulations.
48. In view of the above, the Chamber decided to reject the Respondent’s challenge as to its
competence and determined that its competence to deal with the present matter is given,
in accordance with art. 22 lit. b) of the Regulations on the Status and Transfer of Players.
49. Subsequently, 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 October 2020), and
considering that the present claim was lodged on 17 May 2020, the March 2020 edition of
said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the
substance. Furthermore, the Chamber held that it could also refer to the FIFA Covid
Regulatory Issues published in April 2020.
b. Burden of proof
50. The Chamber recalled the basic principle of burden of proof, as stipulated in art. 12
par. 3 of the Procedural Rules, according to which a party claiming a right on the basis of
an alleged fact shall carry the respective burden of proof. Likewise, the DRC stressed the
wording of art. 12 par. 4 of the Procedural Rules, pursuant to which it may consider
evidence not filed by the parties.
51. In this respect, the Chamber also recalled that in accordance with art. 6 par. 3 of Annexe 3
of the Regulations, FIFA’s judicial bodies may use, within the scope of proceedings
pertaining to the application of the Regulations, any documentation or evidence generated
or contained in TMS.
c. Merits of the dispute
52. The competence of the DRC and the applicable regulations having been established, the
DRC entered into the merits of the dispute. In this respect, the DRC started by
acknowledging all the above-mentioned facts as well as the arguments and the
documentation on file. However, the DRC 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.
i. Main legal discussion and considerations
53. The foregoing having been established, the Chamber moved to the substance of the matter,
and took note of the fact that the parties strongly disagree as to whether the Respondent
had just cause to terminate the contract unilaterally on 29 March 2020 by invoking force
majeure and art. 17 of the contract.
54. In this respect, the Claimant alleged that the Respondent used the alleged existence of a
force majeure situation to terminate the contracts of its foreign players only, which is
against the principle of equal treatment. According to the Claimant, the Respondent was
rather trying to use the current situation around COVID-19 to its advantage to restructure
the squad and terminate the Claimant’s contract -more than a year prior to its natural
expiry.
55. In addition, the Claimant indicated that the Respondent’s termination was not in line with
FIFA Regulations and the FIFA COVID-19 Football Regulatory Issues.
56. The Respondent, for its part, argued that the Indian League was suspended as from
15 March 2020, as a result of which (a) the player could not render his services anymore
and (b) the club faced financial difficulties. In view of these circumstances, the
Respondent explains that it had no other option but to terminate the contract with the
Claimant on 29 March 2020 based on article 17 of the contract, which provides for the
possibility to terminate the contract due to force majeure. According to the Respondent,
the outbreak of COVID-19 pandemic can be defined as a force majeure event, justifying a
premature termination of the contract, based on article 17 of the contract, that cannot be seen as a “disruption contractual stability”, as the circumstances under which the club used
the force majeure concept were truly exceptional. In this respect, the Respondent explains
that it did not only suspend the payment to its foreign players, but also to its Indian players.
57. Finally, the Respondent referred to the FIFA COVID-19 Guidelines and argued that these
guidelines are not intended to supersede national law. In this respect, the Respondent
explains that the termination was made in line with Indian law, which should be applicable
to the matter at hand.
58. In light of the parties’ respective arguments as to whether the COVID-19 pandemic can be
considered an event of force majeure, the Chamber referred to the fact that, in light of the
worldwide COVID-19 outbreak, FIFA issued a set of guidelines, the COVID-19 Guidelines,
which aim at providing appropriate guidance and recommendations to member
associations and their stakeholders. These guidelines aimed at both mitigating the
consequences of disruptions caused by COVID-19 and ensuring that any response is
harmonised in the common interest of all stakeholders. Moreover, on 11 June 2020, FIFA
has issued an additional document, referred to as FIFA COVID-19 FAQ, which provides
clarification about the most relevant questions in connection with the regulatory
consequences of the COVID-19 outbreak and identifies solutions for new regulatory
matters.
59. In addition, the Chamber turned its attention to wording of article 17 of the contract,
which reads as follows:
“17. FORCE MAJEURE: Subject to the other provisions of this Agreement, the failure by a
party to fulfil any of its obligations under this Agreement shall not be considered to be a
breach of or a default under this Agreement in so far as the inability arises from an event
of Force Majeure, provided that the party affected by that event has taken reasonable
precautions, has duly communicated the occurrence of the event to the other party, and
has taken due care and attempted to mitigate the consequences of such event, all with the
objective of carrying out the terms of this Agreement without delay. For the purpose of this
Agreement, “FORCE MAJEURE” means an event or circumstance which is beyond the
reasonable control of a party and which makes a party’s performance of its obligations
impossible and includes but is not limited to wars, acts of terrorism, civil unrest, hostilities,
public disorder, epidemics, fires, Acts of God, Court Orders or Governmental restrictions
and actions and decisions of regulatory and sports authorities”.
60. Analysing the concept of force majeure, the members of the Chamber noted that, based
on the contents of the FIFA COVID-19 Guidelines and the FIFA COVID-19 FAQ, FIFA did not
declare the COVID-19 outbreak as an event of force majeure in any specific country or
territory, or that any specific employment or transfer agreement was impacted by the
concept of force majeure. In other words, in any given dispute, it is for a party invoking
force majeure to establish the existence of said event under the applicable law/rules as well
as the consequences that derive from it. The analysis as to whether a situation of force majeure existed has to be considered on a case-by-case basis, taking into account all the
relevant circumstances.
61. Turning to the circumstances in the present matter and the elements on file, the Chamber
held that the Respondent, in this particular matter, did not submit any form of documentary
evidence to support its position that the situation it faced was to be considered a situation
of force majeure entitling it to terminate the contract. Moreover, the Chamber referred to
the contents of article 17 of the contract, which also provides that “the party failing to fulfil
its obligations shall take ‘reasonable precautions, has duly communicated the occurrence
of the event to the other party, and has taken due care and attempted to mitigate the
consequences of such event, all with the objective of carrying out the terms of this
Agreement without delay.”
62. In this respect, it appeared to the members that there is no documentation on file on the
basis of which it could be concluded that the Respondent took such precautions or
attempted to mitigate the damages for the Claimant. As can be established from the facts
of the present matter, the Respondent decided to immediately unilaterally terminate the
contract without exploring less drastic measures and without any prior notice.
63. Equally, the Chamber remarked that art. 17 of the contract rather aimed at allowing the
parties to carry out the terms of the agreement again without delay, and not at the
termination of the contractual relationship. In this regard, the Chamber also noted that
(i) the All India Football Federation (AIFF) only suspended the season and did not cancel it
and (ii) in any event, the contract was due to run until August 2020. Thus, at the date on
which the contract was terminated, i.e. 29 March 2020, nothing indicated that the contract
had become permanently impossible to perform.
64. Finally, the Chamber emphasised that the aforementioned COVID-19 documents issued by
FIFA – as per the explicit wording of FAQ no. 16, as well as pages 6 and 7 of the FIFA
COVID-19 Guidelines – are only applicable to “unilateral variations to existing employment
agreements”. Therefore, except where a termination of a contract occurred following a
unilateral variation made as a result of COVID-19 (in which case the validity of the variation
must first be assessed under the guidelines), said guidelines do not apply to assess unilateral
terminations of existing employment agreements. The members of the Chamber further
noted that for the assessment of disputes that are presented before the FIFA judicial bodies
concerning the unilateral termination of a contract, the FIFA Regulations as well as the
established jurisprudence of the Chamber, shall apply. The Chamber noted that, in the
present case, there was no variation of the contract prior to its termination. The pertinent
guidelines, therefore, do not apply in the present matter; only the FIFA Regulations and the
jurisprudence of the Chamber will apply.
65. With the foregoing considerations in mind, the Chamber recalled that, in accordance with
the long-standing jurisprudence of both the DRC and CAS, only a breach or misconduct
which is of a certain severity justifies the termination of a contract. In other words, only
when there are objective criteria which do not reasonably permit a continuation of the employment relationship between the parties, may a contract be terminated prematurely.
Hence, if there are more lenient measures which can be taken in order for an employer to
ensure the employee’s fulfilment of his contractual duties, such measures must be taken
before terminating an employment contract. A premature termination of an employment
contract can only ever be an ultima ratio measure.
66. In view of the above, the Chamber first reiterated that the Respondent had unilaterally
terminated the contract on 29 March 2020, without any prior notice. In particular, the club
did not invoke any wrongdoing on the Claimant’s side. What is more, the Respondent did
not undertake any attempt to find an amicable solution with the player. The Chamber in
this respect also referred to the Claimant’s explicit request ton 31 March 2020 to find an
amicable solution after having received the termination letter. Said request was denied by
the Respondent, the latter only confirming that the contract was terminated and that
possible outstanding salaries would be paid at the end of April 2020.
67. More importantly, the Chamber underlined that the Respondent had not fulfilled its
financial obligations set forth in the employment contract signed between the parties
already ahead of the outbreak of the pandemic and that it failed to pay to the Claimant his
remuneration between December 2019 and March 2020. Hence, at the date of termination
of the contract, the Respondent had already been in default of its financial obligations
towards the Claimant.
68. As to the reasons brought forward by the Respondent for the non-payment of said salaries,
the DRC was unanimous in its opinion that said argumentation, i.e. that due to restrictions
in the service of the local banks as a result of COVID-19 the payments could not be
made, cannot justify the non-fulfilment of the Respondent’s contractual obligations
towards the Claimant, particularly if one is to consider that at least two of the salaries
should have been paid before the pandemic had even broken out. Specifically, the
Chamber concluded that the COVID-19 outbreak shall not be used as an opportunity to
escape from debts that arose from contractually agreed payments that fell due already
before the COVID-19 outbreak.
69. On account of all the above-mentioned considerations, the Chamber decided that the
Respondent had no justification to unilaterally terminate the employment relationship
between the parties and, therefore, concluded that the Respondent had terminated the
employment contract without just cause on 29 March 2020. Consequently, the Respondent
is to be held liable for such early termination.
70. This being established, the members of the Chamber concurred that the Respondent must
fulfil its obligations as per the employment contract up until the date of termination of the
contract in accordance with the general legal principle of “pacta sunt servanda”.
71. On account of the above considerations and the documentation on file, the Chamber
decided that the Respondent is liable to pay to the Claimant the remuneration that was outstanding at the time of the termination i.e. the claimed amount of USD 12,000,
consisting of the unpaid salaries of January, February and March 2020.
72. In addition, taking into account the Claimant’s claim and the longstanding jurisprudence
of the Chamber in this respect, the Chamber decided to award the Claimant interest of
5% p.a.as of the respective due dates in accordance with the contract, i.e. as of the 11th of
the following month.
73. What is more, the Chamber decided to reject the Claimant’s claim for reimbursements of
the costs of a visa for a stay in India, as there is no documentary evidence on file that the
Claimant had effectively incurred said costs. The same goes for the Claimant’s request for
the reimbursement of surgery fees.
74. In continuation, the Chamber decided that, taking into consideration art. 17 par. 1 of the
Regulations, the Claimant is entitled to receive from the Respondent compensation
for breach of contract in addition to any outstanding remuneration on the basis of the
relevant employment contract.
75. In this context, the Chamber outlined that, in accordance with said provision, 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.
76. In application of the relevant provision, the Chamber held that it first of all had to clarify
whether the pertinent employment contract contained any clause, by means of which the
parties had beforehand agreed upon a 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.
77. Subsequently, and in order to evaluate the compensation to be paid by the Respondent,
the Chamber took into account the remuneration due to the Claimant in accordance
with the employment contract as well as the time remaining on the same contract, along
with the professional situation of the Claimant after the early termination occurred. In this
respect, the Chamber pointed out that at the time of the termination of the employment
contract on 29 March 2020, the contract would run for another 5 months, that is, until
August 2020. Consequently, taking into account the financial terms of the contract, the
Chamber concluded that the remaining value of the contract as from its early termination
by the Respondent until the regular expiry of the contract amounts to USD 20,000 and that
such amount shall serve as the basis for the final determination of the amount of
compensation for breach of contract.
78. In continuation, the Chamber remarked that following the early termination of the
employment contract at the basis of the present dispute, the Claimant was not able to find
new employment.
79. As a result, the Claimant was not able to mitigate his damages.
80. In view of all of the above, and referring to art. 17 par. 1.2 i. of the Regulations, the
Chamber decided that the Respondent must pay the amount of USD 20,000 to the
Claimant as compensation for breach of contract without just case, which is considered
by the Chamber to be a reasonable and justified amount as compensation.
81. The Dispute Resolution Chamber concluded its deliberations in the present matter
stipulating that any further claim lodged by the Claimant is rejected. In conclusion, the
Claimant’s claim is admissible and partially accepted.
ii. Compliance with monetary decisions
82. Finally, taking into account the consideration under number 49. 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.
83. In this regard, the DRC highlighted 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.
84. Therefore, bearing in mind the above, the DRC 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, communicates the relevant bank details to the Respondent,
provided that the decision is final and binding, 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.
85. The DRC recalled that the above-mentioned bans 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.
IV. DECISION OF THE DISPUTE RESOLUTION CHAMBER
1. The claim of the Claimant, Nauzet Garcia Santana, is partially accepted.
2. The Respondent, Chennai City FC, has to pay to the Claimant, Nauzet Garcia Santana, the
following amounts:
- USD 12,000 as outstanding remuneration plus 5% interest p.a. as follows:
5% p.a. on the amount of USD 4,000 as from 11 February 2020 until the
date of effective payment,
5% p.a. on the amount of USD 4,000 as from 11 March 2020 until the date
of effective payment,
5% p.a. on the amount of USD 4,000 as from 11 April 2020 until the date of
effective payment.
- USD 20,000 as compensation for breach of contract plus 5% interest p.a. as from 27
May 2020 until the date of effective payment.
3. Any further claims of the Claimant are rejected.
4. 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.
5. 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).
6. 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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FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland
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