Decision of the Dispute Resolution Chamber - FIFA. of the Dispute Resolution Chamber ... the Claimant and the Respondent concluded an “extrajudicial ... settlement agreement

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  • Decis ion of the

    Dispute Resolution Chamber

    passed in Zurich, Switzerland, on 13 July 2017,

    in the following composition:

    Geoff Thompson (England), Chairman

    Mario Gallavotti (Italy), member

    Theo van Seggelen (Netherlands), member

    on the claim presented by the player,

    Player A, Country B,

    as Claimant

    against the club,

    Club C, Country D

    as Respondent

    regarding an employment-related dispute arisen between the parties

  • Player A, Country B / Club C, Country D Page 2 of 12

    I. Facts of the case

    1. On 15 June 2015, the Player of Country B, Player A (hereinafter: the Claimant),

    and the Club of Country D, Club C (hereinafter: the Respondent), concluded a

    sport services agreement (hereinafter: the contract), valid from 15 June 2015

    until 30 June 2017.

    2. Pursuant to art. 4.1.1 of the contract, the Claimant was entitled to receive the

    following remuneration:

    Fee established for the benefit period 15.06.2015-30.06.2017 will be 14.000

    euro net, as it follows:

    - period 15.06.2015-30.06.2015 [sic] - 9.000 euro net/month

    - 30.000 euro net 30.12.2015.

    - 30.000 euro net 30.06.2016

    - period 01.07.2016-30.06.2017 9.000 euro net/month

    - 30.000 euro net 30.12.2016.

    - 30.000 euro net 30.06.2017.

    - 7.000 euro net to be paid until 15.07.2015, as salary for the period 15.06.2015

    30.06.2015.

    The salary will be paid on the 15th of the next month.

    3. In addition, the Claimant was entitled to receive match bonuses as follows:

    - EUR 2,000 net per win payable as follows:

    EUR 1,000 after the game;

    EUR 1,000 by no later than 30 December or 30 June of the respective year;

    - EUR 1,000 net per draw away payable as follows:

    EUR 500 after the game;

    EUR 500 by no later than 30 December or 30 June of the respective year.

    4. In this respect, the contract specifies that [t]he bonus for the official game will

    be fully paid if the [Claimant] will pay minimum 45 minutes. If the [Claimant]

    will play less than 45 minutes he will receive proportionally with the minutes he

    play and with the proposal of the coach.

    5. Equally, art. 4.3 of the contract stipulates that the [Respondent] will provide

    accommodation and meals services, in the amount of 300 euro/month.

    6. Furthermore, art. 11 of the contract reads as follows:

    Any dispute arising between the parties out of or in connection with this

    Agreement, including that relating to the validity, interpretation, execution or

    termination, shall be settled amicably. If the parties fail to reach an amicable

    settlement, the dispute shall be submitted for settlement either to the

    jurisdictional organs of the Football Federation of Country D and the

  • Player A, Country B / Club C, Country D Page 3 of 12

    Professional Football League, or to the competent ordinary courts at the

    discretion of the parties.

    7. Art. 12.6 of the contract further stipulates that [t]his enforcement law is the

    Law of Country D.

    8. On 8 April 2016, the Respondent entered into insolvency proceedings.

    9. On 25 May 2016, the judicial administrator of the Respondent terminated the

    contract based on the Insolvency Law of Country D 85/2014.

    10. On 14 June 2016, the Claimant lodged a claim in front of FIFA against the

    Respondent for breach of contract, requesting the following:

    - EUR 101,203.13, plus 5% interest p.a. as of each due date, as outstanding

    salaries;

    - EUR 220,000, plus 5% interest p.a. from 25 May 2016, as compensation for

    breach of contract;

    - EUR 4,236, plus 5% interest p.a. as from the date of the decision,

    corresponding to the price of four round air tickets Country D Country B;

    - the imposition of sporting sanctions on the Respondent.

    11. In his claim, the Claimant explains that art. 11 of the contract does not

    constitute a valid jurisdiction clause and that, as a consequence, FIFAs Dispute

    Resolution Chamber is competent to deal with the matter in virtue of art. 22 lit.

    b of the FIFA Regulations on the Status and Transfer of Players.

    12. In continuation, the Claimant argues that the Respondent terminated the

    contract without just cause on 25 May 2016; in particular, the Claimant outlines

    that the termination occurred without any prior warning.

    13. In addition, the Claimant outlines that until the date of termination, i.e. 25 May

    2016, the following amounts had fallen due: (i) EUR 134,258 as salaries; (ii) EUR

    3,550 as housing allowance; and EUR 16,000 as match bonuses. Considering the

    above, the Claimant points out that the Respondent had paid him the amount

    of EUR 52,604.87, resulting in an outstanding amount of EUR 101,203.13.

    14. In its reply to the claim, the Respondent first requests the suspension of the

    present procedure until the insolvency proceedings are finalised.

    15. In continuation, the Respondent alleges that the Tribunal E has exclusive

    competence to deal with the matter for the following reasons: (i) as per Law

    85/2014, as from the opening of the insolvency proceedings, all claims must be

  • Player A, Country B / Club C, Country D Page 4 of 12

    dealt with the insolvency judge and (ii) the Claimant has already registered a

    credit at the Tribunal E.

    16. In its comments as to the substance, the Respondent sustains that the

    termination was justified by the insolvency proceedings opened against it,

    which constitutes a just cause.

    17. Furthermore, the Respondent rejects the Claimants calculation as to the

    amounts paid.

    18. Besides, the Respondent emphasises that the Claimant did not prove that he

    actually bought the flight tickets claimed.

    19. On 14 July 2016, the Claimant and the Club of Country D, Club F, concluded an

    employment contract, valid as from 14 July 2016 until 31 May 2017 and

    according to which the Claimant is entitled to receive a basic monthly salary of

    XXX 30,310 as well as a sign-on fee of EUR 20,000.

    20. On 22 July 2016, the syndic judge of the Tribunal E rendered a decision,

    annulling the measure taken by the judicial administrator on 25 May 2016 as

    the latter did not comply with the notice provided for in art. 123 of Law

    85/2014.

    21. On 28 July 2016, the Claimant and the Respondent concluded an extrajudicial

    transaction contract (hereinafter: the settlement agreement), which, inter alia,

    provides for the following:

    ART. 1 OBJECT OF THE CONTRACT

    As a result of the Courts Decision [] where the Court ruled the revocation of

    the judicial administrators measure of the contract termination, The parties

    agreed that [the Respondent] regains the federative and economic rights of the

    [Claimant].

    [The Respondent] undertakes to conclude the Transfer Contract of the

    [Claimant] to Club F.

    [The Respondent] and the [Claimant] [] announce that any contractual

    relationship is terminated, jointly, starting when the present Contract is signed.

    [The Claimant] declares that he waves any claims from the litigations on trial

    against [the Respondent] regarding the [Respondent]s compulsion for

    compensations due to termination without just cause, the file [] pending

    before the Specialized Court G, namely the file [] pending before the Court H

    and file no. XXX pending before FIFAs DRC

    [The Claimant] does not waive the claim registered in the [Respondent]s

    statement of affairs

    []

  • Player A, Country B / Club C, Country D Page 5 of 12

    ART. 2 ACKNOWLEDGEMENT OF DUE PAYMENT

    [The Respondent] and [the Claimant] admit that [the Respondent] owes to [the

    Claimant] EUR 15.000 representing contractual financial rights from April

    08/2016 until the termination of the Contract and the [Respondent] undertakes

    to pay the sum as follows: EUR 5.000 until August 05/2016, EUR 5.000 until the

    end of the year and the rest of the money will be paid in 2017, in 10 equal

    instalments, starting January

    ART. 3 PENALTY CLAUSE

    The parties agreed that in case of not fulfilling the contractual obligations

    stipulated at art. 2 [the Respondent] will additionally pay to the [Claimant] EUR

    15.000 as penalties (penalty clause)

    ART. 4 OTHER CLAUSES

    Subject to the payment of the mentioned sums of money, [the Claimant]

    declares that by signing this present transaction he waives any other financial

    claim from [the Respondent], arising from the Contracts execution or as a result

    of the Contracts Termination Notification

    []

    ART. 6 APPLICABLE LAW AND THE COMPETENCE OF SOLVING LITIGATIONS

    In case of litigation, The Parties will try to settle amicably for any dispute. If The

    Parties do not agree, The Parties will address to the Competent Court of

    Country D. The applicable law is the Law of Country D.

    22. On 14 August 2016, the Respondent informed FIFA that the parties had reached

    a settlement agreement.

    23. Thereafter, the Claimant submitted his replica, first recalling that in accordance

    with FIFA and CAS jurisprudence, the FIFA Dispute Resolution Chamber is

    competent to hear disputes involving club under insolvency proceedings as far

    as it concerns the recognition of a debt.

    24. In continuatio