Altay SK v. Prince Segbefia

II. FACTUAL BACKGROUND — A. Background Facts

3. On 1 January 2020, the Player and the Club concluded an employment contract (the “Contract”) valid between 1 January 2020 and 31 May 2021.

4. The Contract contained a unilateral option for the Club to extend the Contract for one more season if the Club was promoted to the Super Lig (i.e. the top division of the Turkish football league system) at the end of the season 2019/2020 (between 15 April 2020 and 30 May 2020) or at the end of the season 2020/2021 (between 15 April 2021 and 30 May 2021). Equally, the Contract provided that if the Club is not promoted to the Super Lig, the Contract will end without further notice at the end of the season 2020/2021.

5. In its Article 3, the Contract further contained the following general financial obligations of the Club towards the Player:

a. Season 2019/2020: EUR 25,000 payable in 5 instalments of EUR 5,000 each between 1 February 2020 and 1 June 2020,

b. Season 2020/2021: EUR 250,000 payable as follows:

• EUR 50,000 due an 31 July 2020,

• EUR 200,000 payable in ten instalments of EUR 20,000 each between 1 August 2020 and 1 May 2021,

c. Season 2021/2022 (should the club exercise the option for extension): EUR 450,000 payable as follows:

• EUR 150,000 due on 31 July 2021,

• EUR 300,000 payable in ten instalments of EUR 30,000 each between 1 August 2021 and 1 May 2022.

6. Further, the following bonus payments were agreed on:

a. if during the season 2019/2020 the player is a starter 11 in at least 10 matches in the TFF 1. Lig, the player will receive EUR 30,000,

b. if during the season 2019/2020 the player is a starter 11 in at least 20 matches in the TFF 1. Lig, the player will receive EUR 50,000,

c. if during the season 2019/2020 the player is a starter 11 in at least 30 matches in the TFF 1. Lig, the player will receive EUR 100,000,

d. if the player plays in the number of matches indicated in points A, B or C above, the player will only be entitled to the higher amount and the lower amounts will not be due,

e. if during the season 2020/2021 the player is a starter 11 in at least 10 matches in the Super Lig, the player will receive EUR 50,000,

f. if during the season 2020/2021 the player is a starter 11 in at least 20 matches in the Super Lig, the player will receive EUR 100,000,

g. if during the season 2020/2021 the player is a starter 11 in at least 20 matches in the Super Lig, the player will receive EUR 150,000

h. if the player plays in the number of matches indicated in points E, F or G above, the player will only be entitled to the higher amount and the lower amounts will not be due,

i. if during the season 2021/2022 the player is a starter 11 in at least 10 matches in the Super Lig, the player will receive EUR 50,000,

j. if during the season 2021/2022 the player is a starter 11 in at least 20 matches in the Super Lig, the player will receive EUR 100,000,

k. if during the season 2021/2022 the player is a starter 11 in at least 20 matches in the Super Lig, the player will receive EUR 150,000,

l. if the player plays in the number of matches indicated in points I, J or K above, the player will only be entitled to the higher amount and the lower amounts will not be due.

7. On 3 August 2020, the Player put the Club in default for the payment of the salaries for the months of February, March, April and May 2020, the advance payment due on 31 July 2020 as well as the salary for August 2020, amounting to a total of EUR 95,000. The Club was granted a 15-day deadline to pay the said amount.

8. On 20 August 2020, the Player sent another letter to the Club, informing the latter of the unilateral termination of the Contract as no remuneration had been paid within the time limit set.

9. On 28 August 2020, the Player signed a contract with the Turkish club Tuzla Spor Kulübü valid until 31 May 2021, according to which he was entitled to a total salary of EUR 50,000.

B. Proceedings before the FIFA Dispute Resolution Chamber

10. On 23 September 2020, the Player lodged a claim against the Club before the FIFA Dispute Resolution Chamber (the “DRC”), requesting outstanding remuneration in the amount of EUR 275,000 as well as compensation for breach of contract without just cause for an amount of EUR 150,000 equivalent to 6 months of salary, plus 5% interest p.a. He also requested that sporting sanctions be imposed on the Club.

11. The Club did not reply to the claim.

12. On 25 March 2021, the DRC passed the following decision (the “Appealed Decision”):

“1. The claim of the Claimant, Mr Prince Segbefia, is accepted. 2. The Respondent, Altay SK, has to pay to the Claimant, Mr Prince Segbefia, the following amounts:

• EUR 95,000 as outstanding remuneration plus 5% interest p.a. as from 25 April 2021 until the date of effective payment,

• EUR 180,000 as compensation for breach of contract plus 5% interest p.a. as from 25 April 2021 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” (emphasis omitted).

13. On 4 June 2021, the grounds of the Appealed Decision were communicated to the Parties.

14. First of all, the DRC concluded that it was competent to deal with the case at hand and that the February 2021 edition of the FIFA Regulations on the Status and Transfer of Players (the “ FIFA RSTP”) shall be applicable to the matter at hand as to the substance.

15. It then noted that all facts established by the Player remained uncontested as the Club had not replied to the claim. Thus, the DRC noted that the decision would be passed based on the documents on file, i.a. those provided by the Appellant.

16. The DRC acknowledged that the Player unilaterally terminated the Contract on 20 August 2020 after having put the Club in default regarding the payment of four monthly salaries (February, March, April and May 2020), the advance payment due on 31 July 2020 and also the salary for August 2020.

17. The DRC concluded that the Player had terminated the Contract with just cause in accordance with Article 14bis FIFA RSTP on 20 August 2020. It considered that the Club had undoubtedly failed to pay more than two monthly salaries at the time the Player terminated the Contract. Furthermore, the DRC observed that the Player had duly put the Club in default of payment of the outstanding remuneration and granted a time limit of 15 days to settle its debts, to no avail.

18. The DRC then addressed the claim of the Player for payment of the outstanding remuneration, corresponding to any and all amounts not received but due up until the date of termination of the Contract. As the claim for EUR 25,000 (outstanding amounts in the season 2019/2020) had remained uncontested, the DRC decided to grant such amount to the Player.

19. The Player’s claim for payments in the season 2020/2021, corresponding to an advance payment of EUR 50,000 due on 31 July 2020 and the salary for August 2020 of EUR 20’000, was found to be justified as well. The DRC concluded that those amounts were outstanding and that the claim was admitted also in this regard.

20. Thus, the DRC decided that – in accordance with the principle of pacta sunt servanda – the Club shall pay the Player an amount of EUR 95,000 plus, according to the Player’s request and constant practice of the Chamber, 5% interest p.a. as from 25 April 2021 until the date of effective payment.

21. Furthermore and in addition to the outstanding remuneration, the DRC decided that, taking into consideration Article 17 (1) FIFA RSTP, the Player is entitled to compensation for breach of contract.

22. As it calculated the amount of said compensation, the DRC first noted that the Contract did not contain any clause, by means of which the Parties had beforehand agreed upon a compensation payable in the event of breach of contract. It then took into account both the remuneration due as stated in the Contract and the time remaining along with the professional situation of the Player after the early termination. The DRC noted that the Contract would have lasted until 31 May 2021, so for another 9 months, had it not been terminated early. Thus, it concluded that the remaining value of the Contract from its early termination until the regular expiry amounted to EUR 180,000.

23. The DRC then pointed out that the Player had been able to mitigate the damages by concluding a new employment contract with the Turkish club Tuzla Spor Kulübü from 28 August 2020 until 31 May 2021. According to the constant practice of the DRC and the general obligation to mitigate damages, the DRC concluded that total remuneration of EUR 50,000 which the Player earned with that club during the period mentioned, shall be deducted from the amount of compensation owed by the Club.

24. Therefore, the amount of the mitigated compensation for breach of contract would amount to EUR 130,000 (EUR 180,000 – EUR 50,000).

25. The DRC then addressed the entitlement to three additional monthly salaries in case of an early termination of the contract due to overdue payables according to Article 17 (1) lit. ii FIFA RSTP. However, it concluded that adding said additional compensation (i.e. 3x EUR 62,500 as average salary including the advance payment due on 31 July 2020) would exceed the residual value under the contract, which is not permitted as per the provision of Article 17 (1) lit. ii FIFA RSTP itself.

26. The DRC therefore decided that the Club shall pay the Player an amount of EUR 180,000 for breach of compensation, as well as 5% interest p.a. as of 25 April 2021 until the date of effective payment (as requested by the Player and in accordance with the constant practice of the DRC).

27. Finally, the DRC addressed the compliance with monetary decisions according to Article 24bis (1) and (2) of the FIFA RSTP and 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 (2) and (4) of the FIFA RSTP.

28. All other requests for relief made by any of the Parties were rejected.

III. PROCEEDINGS BEFORE THE COURT OF ARBITRATION FOR SPORT

29. On 24 June 2021, the Appellant filed its Statement of Appeal against the Appealed Decision.

30. On 28 June 2021, the CAS Court Office invited the Appellant to complete its Statement of Appeal with the name and full address of the Respondent.

31. On 30 June 2021, the Appellant submitted the missing information to the CAS Court Office.

32. On the same day, the CAS Court Office acknowledged receipt of the Statement of Appeal and initiated the present arbitral procedure.

33. On 2 July 2021, the Appellant requested an extension of the time limit to submit the Appeal Brief.

34. On 5 July 2021, said request was granted by the CAS Court Office.

35. On 9 July 2021, FIFA submitted a clean copy of the challenged decision, informing that it renounced its right to request possible intervention in the present arbitration proceedings.

36. On 14 July 2021, the Appellant filed its Appeal Brief via e-filing. It requested the CAS:

“1.To decide that the termination made by the Player is without just cause and due to the fact the Player

has no right to claim any compensation, 2. To decided [sic] that the Player has no unpaid salaries, 3. To fix a sum of CHF 4.000.- (Four Thousand Swiss Francs Only) to be paid by the Player to the Appellant, to help the payment of its legal fees and costs”.

37. On 14 July 2021, the Respondent was given a deadline of 20 days to submit its Answer.

38. By letter of 15 July 2021, the legal Respondent’s representative submitted a power of attorney and stated that he considered that the Appeal was filed late. Therefore, the Respondent considered the Appeal to be withdrawn. He also considered that the costs of the proceedings should be borne by the Appellant and if not, the proceedings should be terminated and the Appeal considered withdrawn. Should the Appeal be upheld, the Appellant should pay the full costs of the proceedings. In the light of the above, the Respondent requested a 20 day extension of the time-limit to file its Answer.

39. On 19 July 2021, the Appellant was invited to comment on the Respondent’s objection to the admissibility of the Appeal Brief as well as to his request for extension of the time-limit to file his Answer.

40. On 19 July 2021, the Appellant stated that the Appeal Brief had to be submitted by 15 July 2021. It pointed out that said requirement was fulfilled as the Appeal Brief was uploaded to the e-filing platform on 14 July 2021 and e-mailed with its annexes on 14 July 2021. It therefore requested that the Respondent’s claim be dismissed as groundless.

41. On 3 August 2021, the Answer of the Respondent, dated 26 July 2021, was received by e-mail and uploaded to the e-filing platform. He requested the CAS the following:

“1- To decide that the termination made by the Player is without just cause and due to the fact the Player has no right to claim any compensation, 2- To decided [sic] that the Player has no unpaid salaries, 3- To fix a sum of CHF 4.000.- (Four Thousand Swiss Francs Only) to be paid by the Player to the Appellant, to help the payment of its legal fees and costs”.

42. On the same day, the Parties were invited to inform the CAS Court Office whether they preferred a hearing to be held in the matter at hand or for the Sole Arbitrator to issue an award based solely on the Parties’ written submissions.

43. The Parties did not provide their preference in this respect within the prescribed time limit.

44. On 17 August 2021, the Respondent sent a letter dated 15 July 2021, stating that the Appellant had not paid the advance of costs within the prescribed time limit and that, accordingly, the proceedings should be terminated and the Appeal should be considered withdrawn.

45. On the same day, the Appellant was invited by the CAS Court Office to provide a proof of timely payment of the costs within the deadline granted.

46. On 18 August 2021, the CAS Court Office noted that – according to the SWIFT proof of payment filed by the Appellant – the advance of costs had been paid within the deadline. Therefore, the Respondent’s request that the Appeal be deemed withdrawn and the present procedure be terminated were denied. On a separate note, the Parties were informed that the Panel appointed to decide the case at hand was constituted as follows:

Sole Arbitrator: Mr Patrick Lafranchi, Attorney-at-law in Bern, Switzerland

47. On 25 August 2021, the Appellant was invited to submit an English translation of its Exhibits 1-3 as the Respondent objected to their admissibility. Further, the Sole Arbitrator noted that no employment contract had been submitted by either Party.

48. On 1 September 2021, the Appellant submitted the requested translations.

49. On 15 September 2021, the Respondent was invited to comment on the translated exhibits submitted by the Appellant. Further, the Parties were invited to inform the CAS Court Office about their preferences regarding a possible hearing. Finally, the Parties were, again, reminded that no employment contract had been submitted yet and that, if no such contract was filed, the Sole Arbitrator would have to rely on the assessment made by the DRC in the Appealed Decision concerning the Contract.

50. On 17 September 2021, the Respondent pointed out that an English translation of the Appellant’s Exhibit 2 was still missing and that said document referred to a signing bonus (in Turkish “imza ucreti odemesi”) for the Player, which constituted a remuneration “outside the contract” and did not correspond to the payment of wages. The Respondent thus considered the failure to provide an English translation of Exhibit 2 as a demonstration of the Appellant’s bad faith. Furthermore, the Respondent stated that even if the Club had made a payment of TL 230,000 (which he considered not proven), it still owed more than two months’ salaries at the time of termination of the Contract. Finally, the Respondent stated that he did not consider it necessary that a hearing be held in the matter at hand and added that he is currently unemployed.

51. On 21 September 2021, the Appellant submitted the Contract between the Parties and stated that it did not consider a hearing to be necessary in the matter at hand.

52. On 23 September 2021, the CAS Court Office invited the Parties to a very last round of submissions. In this context, it underlined that the Sole Arbitrator had noted that the Contract submitted by the Appellant did not bear any signatures and did not seem to be a certified English translation. The Appellant was therefore invited to explain why the Contract bears no signatures and/or submit another copy of the Contract. Also, the Appellant was invited to file its comments on the allegations made by the Respondent on 17 September 2021 regarding Exhibit 2 and the fact that he is currently unemployed.

53. On 12 October 2021, in the absence of a timely reaction by the Appellant, the Respondent was in turn invited to comment on the fact that the Contract bears no signatures and/or to submit a copy of the Contract actually signed between the Parties and/or a certified English translation of the Contract.

54. On the same day, the Appellant (and not, as mistakenly stated by the CAS Court Office, the Respondent) submitted the Turkish version of the Contract bearing the Parties’ signature and an English version translated from the original one.

55. On 13 October 2021, the Respondent pointed out that the English translation submitted by the Appellant also concerned the transfer order of 230,000 TL made on 31 January 2020 by the Club and that this order also mentioned “Altay SK – Payment of the Kossi Prince Segbefia Contract Signing Fee”.

56. On 14 October 2021, the Parties were sent the Order of Procedure with the request for signature and return of a copy.

57. The Order of Procedure was signed by the Parties on 18 October 2021.

IV. THE POSITION OF THE PARTIES

58. The following outline of the Parties’ positions is illustrative only and does not necessarily comprise every contention put forward by the Parties. The Sole Arbitrator, indeed, has carefully considered all the written submissions made by the Parties, even if there is no specific reference to those submissions in the following summary.

A. The Position of the Appellant

59. According to the Appellant, not all the amounts paid by the Club to the Player were taken into consideration in the Appealed Decision, although they should have been. It considers that the following sums should be deducted from the receivables of the Player:

• EUR 7,500 paid as a representation payment to the legal counsel of the Player, Mr. Selcuk Demir, at the beginning of the Contract, on 31 January 2020;

• TL 230,000 (corresponding to EUR 34,863) paid with the note “Payment for contract for Prince Segbefia pursuant to the claim of the Player” to the account of the legal counsel of the Player, on 31 January 2020.

60. Furthermore, the Appellant considers that there were no unpaid and overdue amounts towards the Player.

B. The Position of the Respondent

61. The Respondent considers that the amount of EUR 7,500 paid to the legal counsel of the Player concerns a service at the time of signing the Contract. Said service, as mentioned in the invoice, included “representation of the party in the contract, legal and tax advice, research, travel”. The service was provided by and therefore paid to the Player’s lawyer. Hence, the Respondent points out, it has nothing to do with the Player’s remuneration.

62. The Respondent further claims that the alleged payment made on 31 January 2020 has no relation with the Player’s remuneration. It was not mentioned in the Contract and was thus paid independently from the amounts set out in the Contract. Said payment rather corresponded to an advance of salary, which becomes clear when seen in context with the contract offer made by the Club on 30 January 2020.

63. According to the Respondent, the bank statements and receipts for an alleged payment of the Player submitted by the Club correspond to match bonuses for matches played between 12 March and 3 July 2020 against Hataysport, Menemen, Altinordu, Akhisarspor and Osmanlispor. Thus, he concludes, the payments have nothing to do with regular wages.

64. Finally, the Respondent states that even if a payment of TL 230,000 would have been made, quod non, the Club owed more than two monthly salaries at the time the Player put the Club in default and finally terminated the Contract. Thus, with reference to Article 14 of the FIFA RSTP, the Player had just cause to unilaterally terminate the Contract.