Ittihad Club of Saudi Arabia v. Anice Badri

III. BACKGROUND FACTS

5. Below is a summary of the main relevant facts, as presented in the Parties’ written and oral submissions and evidence adduced in the present proceedings. Additional facts may be set out, where relevant, in connection with the legal discussion. While the Sole Arbitrator has considered all the facts, allegations, legal arguments and evidence submitted by the Parties in the present proceedings, he refers in this Award only to the submissions and evidence he considers necessary to explain its reasoning.

A. The Employment Contract

6. On 14 January 2020, the Club signed an agreement with the Tunisian club, Espérance Sportive de Tunis, for the transfer of the Player against the payment of a transfer fee of 750,000 USD.

7. On the same date, the Player entered into an employment contract (hereinafter, the “Employment Contract”) with the Club, valid for 2 and a half years, from the date of signing until 30 June 2022.

8. The financial terms of the Employment Contract provide as follows:

Sign on fee 200,000 USD to be paid no later than 25/1/2020

Monthly salary from 200,000 USD 14/1/2020 to 30/6/2020

Monthly salary from 1/7/2020 166,666 USD to 30/6/2021

Monthly salary from 1/7/2021 183,333 USD to 30/6/2022

Total basic remuneration under 5,600,000 USD the Employment Contract (for a total of 30 months)

Contingent Benefits for each 200,000 USD net for winning the Saudi Professional season League 80,000 USD net for winning the King Cup 100,000 USD net for winning the Arabian Cup 100,000 USD net for winning the Asian Champion League 100,000 USD net upon the first team achieve the 2nd or 3rd position at the end of the season 100,000 USD net upon achievement of the Player’s 20 goals or assists in the Saudi Professional League or the King Cup for a full season (50,000 USD in case of 10 goals/assists) 50,000 USD net upon the Player make total assist or score 20 goals at the end of the season “It is agreed that in the event the Player reaches such bonus the Club shall automatically increase his annual salary for the agreed amount; it is understood that if the Player reaches such aim further to the first season, this provision shall remain in force for the season after”.

9. In addition, the Club agreed to provide the Player “high quality furnished” accommodation for a maximum cost of 50,000 USD per year, a car with full insurance cover (running costs to be borne by the Player) and a total of 8 business class return air tickets Tunis-Jeddah-Tunis per season.

10. On 2 February 2020, the Parties signed an amendment to the Employment Contract establishing a contribution by the Club towards the Player’s children school fees for a maximum of 40,000 SAR (Saudi Riyal) per year for each child.

11. On 13 April 2020, the Club sent a circular letter to all his players and staff (the “Circular Letter”) whereby, making reference to the suspension of football activity decided by the Ministry of Sports in the Kingdom of Saudi Arabia on 14 March 2020, due to the Covid-19 outbreak, it pointed out the financial impact of the pandemic on the Club and relevant consequences on the performance of the employment contracts: “The COVID-19 had affected all clubs financially including Al Ittihad SFC. The suspension of sport activities as described earlier adversely impacted the club resulting in losses of revenue streams such as the ticket sales, payments from sponsors, TV rights and many others. As such, the club is currently unable to continue the payments of the monthly salaries and other payments as expected. One-to-one emails or phone call maybe communicated with you to explain more on basis of individual employment contracts”.

12. On 22 April 2020, the Player sent a letter to the Club through his legal counsel in which he claimed having not received payment of his salaries for February and March 2020, corresponding to USD 200,000 each. The Player also made reference to the Circular Letter and to an ensuing phone call by the Club’s Vice President concerning the Club’s decision to cut the Player’s salaries by 50% and argued that he had not agreed to such reduction and that the Club’s decision was unjustified and not in line with the FIFA Covid-19 guidelines. Finally, the Player objected that, in any case, any reduction of his salaries could only have been accepted on condition that, at least, the Club first paid all the outstanding monies (i.e., the February 2020 and March 2020 instalments).

13. On 3 June 2020, the Player’s counsel sent a letter of formal notice to the Club, granting the latter a deadline of 10 days to pay the total amount of 800,000 USD net as overdue salaries for the months of February, March, April and May 2020 according to the Employment Contract (the “First Default Notice”).

14. The Club replied with a letter dated 12 June 2020 through its legal counsel, acknowledging that there had been delays in the payment of all the players’ salaries due to the financial consequence of the Covid-19 pandemic on the Club and that nevertheless, a substantial payment would be made in the following days and “Moreover, the funds that are further required will be made available at the latest by the end of the current month, so that by that time, we can settle all pending financial obligations”. The letter further read “We would also like to maintain our on-going discussions with you as to how the current COVID-19 crisis can be addressed within the current employment relationship between our clients, in a transparent manner and based on good faith”.

15. On 14 June 2020, the Club’s legal counsel informed the Player in writing that a substantial first payment was going to be executed on the same day or the following day.

16. On 17, 18 and 19 June 2020, the Club made three bank transfers to the Player of 204,244 USD 150,000 USD and 200,000 USD respectively, totally amounting to 554,244 USD.

17. On 20 June 2020, the Club sent a letter to the Player by which it informed the latter of the resumption of sports activities in the country, inviting him to join the Club by enclosing flight tickets from Paris to Dubai on 25 June 2020 and further indications for a private flight from Dubai to the Kingdom of Saudi Arabia on the next day.

18. On 27 June 2020, the Club notified the Player the decision to deduct 15% of his salary based on his failure to attend trainings on the same day: “According to a statement from the administrative that informed you did not present for the first team training on Saturday 27/06/2020 without any prior excuse which constitutes a punishable offence. Therefore, the management of the club confirms its dissatisfaction of that behavior mentioned above, so we kindly inform to consider this (15%) deduction from salary of June 2020. In additional, advising you to not repeat this behavior, and to abide by what is stated in the regulations”.

19. On 28 June 2020, the Club notified a further order deducting 15% of the Player’s salary for not attending training also on that day.

20. By a new letter to the Club dated 4 September 2020 (the “Second Default Notice”), the Player’s counsel objected that the previous request of payment was only partially performed and that the amount of 245,756 USD still remained unpaid and, moreover, the Club was also in default of payment of the Player’s salaries for June, July and August 2020, amounting to 532,000 USD. Therefore, the Club was granted a deadline of 15 days to pay the total amount of 777,756 USD to the Player, failing which the latter would refer the matter to FIFA pursuant to Article 14bis of the FIFA Regulations on the Status and Transfer of Players (the “FIFA RSTP”).

21. On 22 September 2020, the Player sent a termination notice to the Club by which he terminated the Employment Contract with just cause based on the Club’s failure to comply with its financial obligations with respect to the amount of 777,756 USD (the “Letter of Termination”).

22. On 23 September 2020, two bank transfers were executed by the Club in favor of the Player and namely, a payment of 86,804 USD for the salary of June 2020 and a payment of 166,666 USD for the salary of July 2020, according to the relevant bank receipts.

23. On 25 June 2020, the Player signed a document on the Club’s letterhead reading as follows: “I am the player / ANICE BADRI, a professional player at Al-Ittihad Club, as the car key was handed over, a plate number (DQB 3619), BMW 520 model 2020. As well as the handover of my key housing during the period of residence professional club I do not have any obligation or custody of the club” (the “Return Report”).

24. On 26 September 2020, the Club sent a letter to the Player arguing that the latter had no just cause to terminate the Employment Contract; that all his salaries up to July 2020 had been paid as the relevant payment orders were issued and executed before the Letter of Termination; that the Player could not claim full payment of his salaries as from March 2020 due to the mandatory reduction which was applied by the competent Saudi Arabian football authorities in compliance with the FIFA Covid-19 guidelines, according to the following terms:

March 2020 25% reduction; April 2020 50% reduction; May 2020 50% reduction;

June 2020 50% reduction; July 2020 100% payment.

B. The proceedings before the FIFA DRC

25. On 8 October 2020, the Club lodged a claim before the FIFA DRC against the Player for breach of contract. The Club argued that the Player had no just cause for termination and that the only outstanding salary was the one for August 2020, since the installments of June and July 2020 were paid by the Club on 22 September 2020, i.e. on the first available working day immediately after the deadline set by the Player in the Second Default Notice (which was also a non-working day). The Club requested that the Player be ordered to pay compensation in the amount of USD 8,224,986 broken down as follows:

- USD 525,000 for the non-amortized transfer fee;

- USD 3,000,000 for the lost value of the Player;

- USD 3,699,990 for the lost services of the Player;

- USD 999,996 for the aggravated circumstances considered under the “specificity of sport”.

26. The Club claimed that the Player’s termination was without just cause. In this respect, it maintained that at the time of the Second Default Notice, only the following amounts were outstanding: a) 50% of the salary for June 2020; b) the entire salary for July 2020 and c) the entire salary for August 2020, and that the Player could not claim full payment of his salaries from March until June 2020 due to mandatory reduction imposed according to FIFA and SAFF Covid-19 guidelines. In this respect, the Club contended that it was forced to take a unilateral decision notwithstanding having made the best efforts to find an agreement with the Player, to no avail. Moreover, according to the Club, the Player’s salary for June 2020 was also subject to a further reduction due to a sanction imposed on the Player because of contractual violations. The salaries for June and July 2020 were paid on the first available working day immediately after the deadline set in the Second Default Notice. As a result, when the Player terminated the Employment Contract, only the salary for August 2020 was outstanding. Besides, by means of the Return Report, the Player has waived his claims towards the Club.

27. On 13 October 2020, the Player also lodged a claim before the FIFA DRC against the Club for outstanding remuneration and compensation for breach of contract, as follows:

- A total amount of 634,412 USD as outstanding salaries of which 245,756 USD corresponding to the balance of the remuneration between February 2020 until May 2020; 113,196 USD corresponding to the remaining part of the salary for June 2020; 166,666 USD corresponding to the salary for August 2020; 105,555 USD corresponding to the pro rata salary for September 2020 until termination of the Employment Contract; 3,239 USD as housing costs until 22 September 2020;

- A total amount of 3,761,101 USD as compensation for breach of contract broken down as follows: 61,111 USD for the remaining salary for September 2020; 1,499,994 USD for the remaining salaries between October 2020 and June 2021; 2,199,996 USD for the remaining salaries between July 2021 and June 2022;

- 87,500 USD as housing allowance;

- 130,644 USD for the rental costs of a car between October 2020 and June 2022.

28. The Player insisted that the unilateral decision of the Club to impose reductions on his salaries was unjustified and not consistent with FIFA Covid-19 guidelines and that the Club failed to make payment of the outstanding monies within the deadline of 19 September 2020 granted in the Second Default Notice.

29. The relevant claims were consolidated into the same procedure before the DRC.

30. On 20 May 2021 the DRC issued the Appealed Decision ruling as follows:

“1. The claim of Mr Anice Badri is partially accepted.

2. Ittihad Club has to pay to Mr Anice Badri, the following amounts:

- USD 525,618 as outstanding remuneration plus 5% interest p.a. as from 22 September 2020 until the date of effective payment.

- USD 3,866,662 as compensation for breach of contract without just cause, plus 5% interest p.a. as from 20 May 2021 until the date of effective payment;

3. Any further claims of Mr Anice Badri are rejected.

4. The claim of Ittihad Club is rejected.

5. Mr Anice Badri is directed to immediately and directly inform Ittihad Club of the relevant bank account to which the latter must pay the due amount.

6. Ittihad Club 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 Ittihad Club within 45 days; as from the notification By Mr Anice Badri of the relevant bank details the following consequences shall arise:

1. Ittihad Club 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.

8. This decision is rendered without costs”.

31. The grounds of the Appealed Decision were notified to the Parties on 16 June 2021.

C. The grounds of the Appealed Decision

32. First of all, the DRC considered that it was competent to deal with the present matter in accordance with Article 24 (1) in combination with Article 22 lit. b) of the FIFA RSTP and that the June 2020 edition of the RSTP was applicable to the present dispute.

33. As to the substance, the Chamber pointed out that it was undisputed that the Player’s salary for August 2020 had remained unpaid when the Employment Contract was terminated. Regarding the salaries of June 2020 and July 2020, the DRC rejected the Club’s allegations that the payment was made within the relevant deadline set in the Second Default Notice (i.e. 19 September 2020), since the bank receipts submitted by the Club (although without English translation) showed that the bank transfer was executed on 23 September 2020, which is one day after the termination notice. As a consequence, the Club failed to pay in due time the Player’s salaries for June, July and August 2020 either in part, or in full, and therefore, the Player had just cause to terminate the Employment Contract according to Article 14bis of FIFA RSTP.

34. With regard to the 15% deduction applied by the Club to the Player’s salary of June 2020 based on disciplinary reasons, the DRC considered that it was arbitrary, as the Player was not granted any fair disciplinary proceedings by means of which he could submit his position.

35. Moreover, the Club’s contention that the Return Report represented a waiver in relation to the Club’s financial obligations was rejected, as the Chamber considered it was a document by means of which the Player merely returned certain belongings to the Club upon termination of the Employment Contract.

36. With regard to the salary’s deductions made by the Club on the basis of the Covid-19 emergency, the DRC considered that such a unilateral decision was not consistent with the FIFA Covid-19 guidelines since the Club has failed to prove that it attempted to conduct a negotiation with the Player in good faith and therefore, the Player was entitled to his remuneration as originally agreed under the Employment Contract. As a consequence, the Chamber established that the following amounts shall be paid by the Club as outstanding remuneration:

- USD 245,756 corresponding to the balance of the salaries between February 2020 and May 2020;

- USD 113,196 corresponding to the balance of the salary for June 2020;

- USD 166,666 for the Salary of August 2020.

37. With regard to the compensation for breach payable to the Player according to Article 17 (1) of the FIFA RSTP, the DRC took into consideration the remaining value of the Employment Contract from the time of termination until June 2022 and concluded that the Player would have received a total amount of USD 3,866,662; which amount was considered to serve as the basis for determining the final compensation for breach.

38. Furthermore, it was considered that after termination of the Employment Contract, the Player signed a new employment agreement with the Tunisian club, Espérance Tunis, valid as from 18 January 2021 until 30 June 2021 under which he was entitled to receive a monthly salary corresponding to approximately 18,000 USD, and therefore the value of the contract, i.e. 99,000 USD was deducted from the value of the Employment Contract in accordance with the principle of mitigation of damages. As a consequence, the DRC determined that the mitigated compensation for breach amounted to 3,767,662 USD.

39. In addition, considering that the matter at stake concerns an early termination of contract based on overdue payables, the Chamber also established that the Player would also be entitled to an amount corresponding to three additional salaries, i.e., 564,999 USD in accordance with Article 17 (1) ii of the FIFA RSTP. Therefore, given that the additional compensation exceeds the mitigation, the Chamber established that the compensation for breach in the present case shall correspond to the residual value of the Employment Contract, i.e., 3,866,662 USD.

40. As a further consequence, the DRC rejected the Club’s request for compensation.

41. Lastly, pursuant to Article 24bis (1) and (2) of the FIFA RSTP, the Chamber pointed out that the consequence of the Club’s payment failure in due time would be 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.

IV. PROCEEDINGS BEFORE THE COURT OF ARBITRATION FOR SPORT

42. On 7 July 2021, the Club filed a Statement of Appeal according to Article R47 et seq. of the Code of Sports-related Arbitration, edition 2020 (hereinafter, “Code”) with the Court of Arbitration for Sport (hereinafter, “CAS”) against the Player concerning the Appealed Decision. The Appellant chose English as the language of the arbitration and requested that the present proceedings be submitted to a sole arbitrator. In addition, the Appellant applied for an extension of the time limit to file the Appeal Brief until 6 August 2020.

43. On 13 July 2021, the Respondent informed the CAS Court Office that he agreed with the appointment of a sole arbitrator and did not object to the Appellant’s request for an extension of the time limit to file its Appeal Brief but requested that the present proceedings be conducted in both English and French.

44. On 15 July 2021, the Appellant informed the CAS Court Office that it preferred that the present arbitration proceedings be conducted in English but did not object to the possibility for the Respondent to file documents in French, if any, without the need of official translation.

45. On 19 July 2021, FIFA informed the CAS Court Office that it renounced its right to request its possible intervention in the present arbitration proceedings.

46. By letter to the CAS Court Office on 3 August 2021, the Appellant requested a 5-day extension of the time limit to file its Appeal Brief, which was granted on the same day.

47. On 11 August 2021, the Appellant filed its Appeal Brief pursuant to Article R51 of the CAS Code. The Appellant submitted evidentiary request in order for the CAS to order the Respondent to disclose all information and documents in relation to the new employment contract signed by the latter with the club Espérance Tunis.

48. On 24 August 2021, the Respondent requested that the time limit to file his Answer be fixed once the advance of costs had been paid by the Appellant in accordance with Article R64.2 of the CAS Code.

49. By letter on 22 September 2021, following the Appellant’s payment of the advance of costs in the present arbitration proceedings, the CAS Court Office invited the Respondent to file his Answer within the following 20 days.

50. On 8 October 2021, the Respondent requested the CAS Court Office an extension of the time limit to file his Answer until 22 October 2021, which was granted on 11 October 2021.

51. On 21 October 2021, the Respondent filed his Answer, pursuant to Article R55 of the CAS Code. With the Answer, the Respondent also submitted copy of the employment contract signed with the club Esperance Tunis.

52. On 22 October 2021, the CAS Court Office informed the Parties that Mr Fabio Iudica, Attorney-at-Law in Milan, Italy, had been appointed as a sole arbitrator in the present proceedings by the Deputy President of the CAS Appeals Division.

53. On 5 November 2021, after having consulted the Parties, the CAS Court Office informed them that the Sole Arbitrator had decided to hold a hearing by videoconference on 14 January 2022.

54. On 12 January 2022 the CAS Court Office forwarded the Order of Procedure to the Parties, which was returned in duly signed copy by the Appellant on 13 January 2020 and the Respondent on 14 January 2022, respectively.

55. On 14 January 2022 a hearing took place in these proceedings, with the participation of the following persons, in addition to the Sole Arbitrator and Mr Giovanni Maria Fares, Counsel to the CAS, all attending remotely via videoconference:

For the Appellant: Mr Jan Kleiner and Mr Jonáŝ Gürtler, Counsel;

For the Respondent: Mr Anice Badri, the Respondent himself, and his Counsel, Mr Adam Taylor, Mr Anton Sotir, Ms Hortense Douard, and Mr Léo Zimero.

56. At the outset of the hearing, the Parties confirmed that they had no objection in relation to the composition of the Arbitral Tribunal and that the Sole Arbitrator has jurisdiction over the present dispute. In their opening statements, the Parties reiterated the arguments already put forward in their respective written submissions.

57. Before the hearing was concluded, the Parties expressly stated that they did not have any objection to the procedure adopted by the Sole Arbitrator and that their rights to be heard and to be treated equally had been duly respected.

V. SUBMISSIONS OF THE PARTIES

58. This section of the award does not contain an exhaustive list of the Parties’ contentions; it aims to summarize the substance of the Parties’ main arguments. In considering and deciding upon the Parties’ claims in this award, the Sole Arbitrator has accounted for and carefully considered all of the submissions made and evidence adduced by the Parties, including allegations and arguments not mentioned in this section or the discussion of the claims below.

A. The Appellant’s position

59. The Appellant’s submissions may be summarized, in essence, as follows:

60. The Player had no just cause to terminate the Employment Contract on 22 September 2022. In particular, the preconditions set forth under Article 14bis of FIFA RSTP were not fulfilled as, at that time, only the salary for August 2020 was overdue. According to FIFA and CAS jurisprudence, such circumstance is not sufficient to give a player just cause to terminate the employment contract.

61. The remaining outstanding amount had already been settled by the Club at the time when the Player terminated the Employment Contract. In fact, the Club prepared all the relevant documentation on time and the payment order was issued on 19 September 2020, i.e., within the deadline set in the Second Default Notice; however, there was a short delay in the processing of the international bank transfer since the deadline set by the Player expired on a weekend and the following day was a national public holiday in Saudi Arabia according to bank regulations. Therefore, the relevant payment orders could not be processed until 23 September 2020 (which was also not a working day in Saudi Arabia). In fact, according to the applicable legal principle, when a deadline falls on a holiday or a non-working day (like the one set by the Player), the time limit shall expire on the first following working day. Moreover, according to Swiss legal doctrine and Swiss jurisprudence, the date of issuance of a payment order is sufficient to meet a payment deadline, while the date of receipt on the designated bank account is not relevant. As a result, by issuing the payment order on 19 September 2020, the Club met the applicable payment deadline.

62. The amounts paid were those really due, i.e., 50% of the salary for June 2020 and the full instalment of July 2020.

63. The Player’s request concerning the balance of his salaries is unfounded since the Club had made legitimate and valid reductions due to the Covid-19 emergency. However, the DRC disregarded that the salary reductions were applied in compliance with the relevant regulatory framework within the guidelines issued by FIFA and SAFF.

64. The Club suffered severe financial difficulties because of the suspension of the sporting season 2019/2020 as well as the suspension of state fundings to clubs in the relevant period and therefore, the Appellant was not able to fulfill its contractual obligations in full: “It simply cannot be disputed that Appellant suffered an extreme and unprecedented financial hardship”. The adverse impact of Covid-19 pandemic on the Club was promptly notified to the Club’s players and staff in good faith by means of the Circular Letter. Notwithstanding this, the Player “never approached the management of the Club. He did not proactively discuss how he would see an appropriate solution to this complex and difficult situation” but, on the contrary, he suddenly decided to put the Club in default of payment and did not accept any reduction on his salaries, although almost all other players did and although the Club tried its best to find an agreement with the Player. Finally, the Club was forced to apply a reduction of 50% on all the players’ monthly salaries exceeding the amount of SAR 20,000 (approximately 5,000 USD), in accordance with the Directive of the Saudi Arabian Pro League. In fact, unilateral reductions of players’ salaries were even mandatory under such Directive. Although this was a proportionate remedy, the Club did not always apply the entire reduction to the Player (the salary of March 2020 was only reduced by 25%) and, in any event, reductions were applied only during the suspension of the sporting season, i.e., from March 2020 until June 2020. The Club maintained the following with respect to the proportionality of the measure: “Every employee had a guaranteed basic salary of SAR 20,000.- Only amounts in excess of this basic salary were reduced by 50%. In other words, to protect the weakest, the employees with the highest income had to make an effort for the benefit of all staff workers of the club”. Moreover, the reduction was not applied in a discriminatory way against the Player and in addition, the latter still benefited of an extremely high salary despite the reduction (more than 1 million USD for half of the season 2019/2020). Therefore, all the conditions for the validity of the salary reduction were present.

65. In addition, the salary for June 2020 was subject to a further reduction due to disciplinary sanction imposed on the Player in accordance with the Typical List of Penalties and Sanctions issued by the SAFF which was expressly referred to in the Employment Contract. The sanction was justified on the Player’s failure to take the flight to Jeddah and to attend trainings on 27 June 2020 and on 28 June 2020, notwithstanding the Player had been summoned by the Club which had also provided the necessary travel documents and arrangements. The application of that sanction was in compliance with Item 8 of the Employment Contract and, therefore, it was not arbitrary. The Player was also informed that he could lodge appeal against the Club’s decision but failed to do so.

66. As a consequence of the foregoing, the Player’s request in the Second Default Notice to receive the balance of his salaries for March, April, May and June 2020 up to 100% remuneration was unjustified.

67. As a consequence, the DRC’s conclusion that “several monthly salaries were still overdue to the Player at the moment of termination, namely, the salaries of June, July and August 2020” is not correct.

68. Beside this, by signing the Return Report, the Player also declared he had no more claims towards the Club.

69. Therefore, the Player committed breach of the Employment Contract and, conversely, it is the Appellant that is entitled to compensation.

70. In this respect, the following criteria must be applied pursuant to Article 17 of FIFA RSTP in order to determine the amount of compensation due to the Appellant, taking into consideration the principle of the “positive interest”:

a) The non-amortized transfer fee paid to the Tunisian club, amounting to USD 525,000 (for a period of 21 months);

b) The transfer value of the Player resulting from the Employment Contract under item 10 para 5 providing a “buy-out clause” corresponding to USD 3,000,000;

c) The loss of the Player’s services, to be calculated on the basis of the Player’s remuneration under the new employment contract i.e., 18,000 USD multiplied for the time remaining of the Employment Contract until its natural expiration, which is 21 months, for a total amount of 378,000 USD;

d) An additional penalty payment of six-monthly salary (108,000 USD) based on the “specificity of sport” in consideration of the fact that the Player’s termination occurred within the “protected period” and only after half a season.

71. The total amount of compensation to be paid by the Player for breach of contract is therefore 4,011,000 USD plus 5% interest p.a. as from 22 September 2020 according to Article 102(1) of the Swiss Code of Obligations (the “Swiss CO”).

72. In the unlikely event that the CAS confirms the Appealed Decision, the compensation awarded to the Player must be annulled (because of the waiver of claims based on the Return Report) or significantly reduced according to the principle of rebus sic stantibus due to the new circumstances and conditions which affected the Employment Contract after the signing due to the Covid-19 pandemic, causing a disruption of the contractual balance.

73. In fact, all the conditions for the application of the principle rebus sic stantibus are met in the present case and therefore, an adjustment of the Employment Contract is required: the restrictive measures imposed as a consequence of the sanitary emergency seriously affected the Appellant’s possibility to perform its contractual obligations in comparison with the original circumstances at the time when the Employment Contract was concluded (Subsequent change in circumstances); the Appellant would essentially have faced bankruptcy proceedings in case it would have to adhere to the original financial terms of the Employment Contract (Serious disruption in contractual balance); the above mentioned change in the circumstances was not foreseeable when the Employment Contract was concluded (Lack of

predictability).

74. As a consequence, the amount awarded by the FIFA DRC in the Appealed Decision is excessive and must be reduced.

75. In its Appeal Brief, the Appellant submitted the following requests for relief:

“1) To set aside in its entirety the Decision issued by the FIFA Dispute Resolution Chamber (Ref. Nr. 20- 01464) on 20 May 2021;

2) To order Mr. Anice Badri to pay the amount USD 4,011,000.00, plus interest of 5% p.a. as from 22 September 2020, to Ittihad FC.

3) To charge all costs of these proceedings to Mr. Anice Badri and to grant a contribution to the legal fees of Ittihad FC of CHF 25,000”.

B. The Respondent’s position

76. The submissions of the Respondent may be summarized, in essence, as follows.

77. First of all, the Respondent pointed out that, after having paid the first monthly instalment, the Club ceased to fulfil its obligations since the beginning of the Employment Contract, and namely, since February 2020, (i.e., before the Covid-19 outbreak). This led the Player to send the First Default Notice on 3 June 2020 for the payment of 800,000 USD corresponding to the salaries from February to May 2020. This means that the Player was not paid any salary from February 2020 until June 2020, i.e., for more than 4 months, with no justification whatsoever.

78. After that, the Appellant took the unilateral and illegal decision to apply reductions on his salaries for the period from March until June 2020. Such a decision was abusive and not consistent with the FIFA rules and regulations which are applicable to the Employment Contract and shall prevail over any other regulations issued by the SAFF or the Saudi Professional League, in accordance with Item 3 of the said contract. In fact, it results that the decision taken by the SAFF to apply a reduction by 50% on all the players’ salaries during the suspension of the sporting season was not in compliance with the FIFA Covid-19 guidelines. Indeed, FIFA recommended that clubs find appropriate collective agreements with their employees regarding employment conditions during the suspension of sporting activities, or, alternatively, FIFA would consider a unilateral decision to vary contractual terms to be reasonable, provided that a club has attempted to reach a mutual agreement with its employee(s). On the contrary, the Club has never been able to provide evidence of an attempt to reach an amicable agreement with the Player concerning the amendment of the Employment Contract, or any attempt to negotiate in good faith. In fact, the Player was contacted by the Club only to be informed of the decision already taken to impose the relevant reduction in accordance with the decision of the Council of the Saudi Professional League, with no previous consultation. The Player also contested the Appellant’s interpretation of the FIFA Covid-19 guidelines according to which, the consent by the majority of players to a

salary reduction would entitled the interested club to impose the same cut on the players who were not in agreement, considering that FIFA gives priority to reaching an amicable agreement with each player. It is also important to note that, when the reduction was decided, the Appellant was already in default of payment of the Player’s salaries of February and March 2020. Finally, the Club also failed to provide evidence of the financial difficulties and risk of bankruptcy allegedly suffered as a result of the pandemic. As a consequence, the Club’s unilateral decision to reduce the Player’s salaries is arbitrary and unreasonable and manifestly disregards the FIFA Covid-19 guidelines.

79. From 1 July 2020, despite the resumption of trainings and the restart of the sporting season, the Club still persisted in not paying the Player’s salaries for June, July and August 2020 amounting to 533,332 USD (200,000 USD + 166,666 USD + 166,166 USD), so that, at the end of August 2020, the total amount of 779,088 USD was outstanding, including the balance of the salaries from March until May 2020 amounting to 245,756 USD which had also remained unpaid.

80. It is against this background that the Player decided to terminate the Employment Contract on 22 September 2020 pursuant to Article 14bis of FIFA RSTP after the expiry of the 15-day deadline set in the Second Default Notice. In any event, the termination of the Employment Contract was justified by the substantive and repeated nature of the Club’s breaches which caused the loss of trust in the Club’s future performance of its contractual obligations.

81. Contrary to the Club’s submissions, the Player did not terminate the Employment Contract precipitately, considering he sent two default notices and taking into account that the Club was in default since February 2020.

82. The Club’s allegation that the relevant amounts were paid within the deadline is false since the Player did not receive any payment by 19 September 2020. The document submitted by the Club shows that the relevant payments were initiated only on 23 September 2020, after the Club received the Letter of Termination. The Appellant’s allegation that the payment was made “immediately once this was possible” is false, given that the bank transfer could have been processed on Monday 21 September or on Tuesday 22 September, if the Bank could not proceed with it on Sunday 20 September 2020 (which the Respondent assumes being a working day in Saudi Arabia). Moreover, the Appellant’s document does not demonstrate that the bank transfer was instructed before the end of the 15-day deadline. In addition, the Club could have immediately informed the Player of the issuing of the payment order. And, in any case, the Club showed lack of intention in performing all of its contractual obligations since the payment was partial (and moreover, no explanations were given about the failure to pay the salary for August 2020).

83. In fact, the Player only received the Club’s payments on 25 September 2020 which were initiated on 23 September 2020; such payments were therefore belated and partial since because only the amount of 253,470 USD was paid, instead of 777,756 USD. Therefore, the Club was still in default of payment of the amount of 525,618 USD broken down as follows:

- 245,756 USD corresponding to the outstanding balance of the salaries from February to May 2020;

- 113,196 USD corresponding to the outstanding balance of the salary for June 2020;

- 166,166 USD corresponding to the outstanding salary for August 2020.

84. Furthermore, the disciplinary sanction imposed on the Player in June 2020, consisting in a 15% reduction of his salary is also arbitrary since the Club did not respect the necessary procedure in accordance with the Employment Contract. In fact, the Player was not previously informed, nor was he granted the possibility to reply before the application of the sanction so that he was prevented to exercise his right to defense, in clear violation of the adversarial principle. Moreover, the amount of the sanction also exceeds the maximum amount set forth under item 8 of the Employment Contract which provides that “the parties agree that the maximum amount in every season that the First Party can deduct from the Second Party is 10% of each monthly salary”.

85. As a consequence, the CAS should confirm the Appealed Decision and order the Club to pay to the Player 525,618 USD as outstanding salaries under the Employment Contract.

86. In addition, the Player is also entitled to compensation for breach in accordance with Article 17 of FIFA RSTP in the amount of 3,866,662 USD established in the Appealed Decision.

87. Finally, the Appellant’s request for compensation must be rejected due to the club’s breach of contract; on a subsidiary basis, should the CAS establish that the Player had no just cause for termination, the present case should be send back to FIFA for reconsideration; in any event, the Appellant’s claim for compensation is disproportionate and unjustified for the following reasons: a) the Club did not prove that it paid the full transfer fee to the Tunisian club and therefore, the request for the non-amortized costs is unfounded; b) the request concerning the loss of the Player’s value cannot be based on the value of the buy-out clause since the latter is not a compensation clause; in addition, the Club also failed to prove that it had a real opportunity to obtain a certain amount as consideration for the Player’s transfer; c) the request for the loss of the Player’s services based on the remaining salaries under the Employment Contract for 21 months is unjustified since this amount were indeed saved by the Club because of the early termination and therefore the Club cannot claim compensation for salaries it did not have to pay; d) finally, the “specificity of sport” would rather justify a reduction and not an increase of the compensation claimed by the Appellant, considering the Club’s defaulting conduct during the employment relationship and minimal interest in the Player.

88. In his Answer, the Respondent submitted the following requests for relief:

“TO DISMISS the appeal filed by Ittihad FC on 7 July 2021 in its entirety.

TO CONFIRM the decision of the FIFA Dispute Resolution Chamber (case ref. 20-01464) dated 20 May 2021.

TO ORDER Ittihad FC to pay the full CAS arbitration costs.

TO ORDER Ittihad FC to make significant contribution to the legal and other costs of Mr Anice BADRI in connection with these proceedings”.