This case involved a contract of employment between a Bulgarian professional and a Russian football club. The club initially confirmed the contract of employment and two additional agreements but after submitting the player to medical tests and making him attend a training camp, the club informed the player that it could no longer sign he contract due to its quotas for foreign players. The player sent a letter offering his services and granting the club one week to sign the standard employment contract, failing which he would consider that the club was no longer interested in his services. This would equate to a termination of the contract without just cause by the club. After the deadline expired, the player’s representative sent a confirmation of the contractual termination and brought the case before the FIFA Dispute Resolution Chamber (DRC), requesting the entire value of the contract (almost EUR 2’000’000). The FIFA DRC only awarded a small part of the salaries and dismissed the rest of the claims. Such decision was subsequently confirmed by the CAS.

In the motion to set aside the CAS award, the player alleged a violation of his right to be heard because the panel had allegedly disregarded some of his arguments during the CAS proceedings. The CAS Panel had assessed the parties’ conduct, finding that the player’s contention that the club would stop complying with its contractual obligations was premature. The Federal Tribunal found that by implicitly dealing with the player’s allegations and taking into account “the totality of factual circumstances” the CAS Panel had not violated the player’s right to be heard: the panel’s consideration that some elements of the file are irrelevant falls outside the scope of the violation of the right to be heard. The Federal Tribunal further held that a control of whether the panel had taken into account or correctly understood all the file references fell outside its scope of review (at 3.4).

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Warm regards,

Despina MAVROMATI

Translation:

4A_114/20181

Judgment of August 14, 2018

First Civil Law Court

Federal Judge Kiss, President

Federal Judge Niquille, and

Federal Judge May Canellas

Clerk: Kölz.

A.________,

represented by Dr. Lucien W. Valloni and Davide Colacino,

Appellant,

FC B.________, Respondent.

Facts:

A.________ (Appellant) is a professional footballer of Bulgarian nationality. FC B.________ (Respondent) is a Russian football club from Krasnodar affiliated to the Football Union of Russia (FUR), the umbrella organization for football in Russia. FUR is a member of the Union des Associations Européennes de Football (UEFA) and the Fédération Internationale de Football Association (FIFA).

On August 31, 2015, A.________ signed a contract of employment ("Contract of employment") and two additional agreements with FC B.________. Following a modification of the contract and various correspondence between the parties, FC B.________ confirmed the binding contract on December 30, 2015 and invited A.________ to a training camp in Cyprus on January 14, 2016.

Several meetings took place between the parties after A.________ underwent a medical test organized by FC B.________ in the training camp on January 15, 2016.

In a letter dated January 18, 2016, the legal representative of A.________ stated that FC B.________ had informed at a meeting of the same day between A.________, its representatives and the representatives of FC B.________ that, due to its quotas for foreign players it was not in a position to conclude the contract with A.________. It was the first time that the quotas for foreigners were mentioned – according to the letter.

A.________ formally offered his services and requested that the standard employment contract be signed and the work permit granted by January 19, 2016, otherwise he would assume that FC B.________ was no longer interested in his services and fulfillment of the contract and the employment contract would be terminated without just cause by January 19, 2016.

After this deadline expired without an answer, the legal representative of A.________ informed FC B.________ that he had accepted FC B.________'s decision to terminate the employment contract as of January 19, 2016 as final and liberated A.________ from all obligations under the employment contract.

On March 21, 2016, A.________ filed a claim with the Dispute Resolution Chamber of FIFA for the payment of a total of EUR 1’810’342 (EUR 1’465’514) salary claims and EUR 344’828 contract conclusion fee) plus interest against FC B.________.

By decision of January 19, 2017, the Chamber of Dispute Resolution partially upheld the claim and obliged FC B.________, to pay A.________ EUR 28'179 plus interest. It dismissed the claim for the rest.

A.________ appealed this decision to the Court of Arbitration for Sport (CAS). By decision of December 19, 2017, the CAS dismissed the appeal and upheld the Dispute Resolution Chamber's decision.

By appeal in civil matters, A.________ requested that the CAS award be set aside and that the case be sent back to Arbitral Tribunal for a new decision.

The CAS requested the dismissal of the appeal. FC B.________ did not file a reply.

The Appellant submitted a reply.

Reasons:

According to Art. 54(1) BGG,2 the decision of the Federal Tribunal is issued in an official language, usually that of the contested decision. If the latter was written in another language, the Federal Tribunal uses the official language used by the parties. The contested decision is in English. As this is not an official language, the decision of the Federal Tribunal is drafted in the language of the appeal.

2.1. The seat of the arbitral tribunal, whose decision is challenged before the Federal Tribunal, is in Lausanne. Both parties had their domicile or seat outside Switzerland at the relevant time (Art. 176(1) PILA3). As the parties did not expressly rule out the validity of Chapter 12 PILA, the provisions of this chapter apply (Article 176(2) PILA). The appeal in civil matters is therefore admissible under the conditions of Art. 190-192 PILA (Art. 77(1)(a) BGG).

2.2.

The decision can only be challenged for one of the reasons enumerated in Article 190(2) PILA. On the other hand, it cannot be asserted directly that the Arbitral Tribunal violated the ECHR (BGE 142 III 360 at 4.1.2 p. 362). According to Art. 77 (3) BGG, the Federal Tribunal only examines the grievances that were invoked and substantiated in the appeal; this corresponds to the duty to give reasons under Article 106 (2) BGG for the violation of fundamental rights and of cantonal and intercantonal law (BGE 134 III 186 clause 5 with references). Criticisms of appellatory nature are inadmissible (BGE 134 III 565 at 3.1; 119 II 380 at 3b).

3.1.

The Appellant alleges that the Arbitral Tribunal violated his right to be heard (Article 190 (2) (d) PILA) by disregarding some of his submissions in the arbitral proceedings.

3.2.

According to case law, (BGE 134 III 186 at 6.1, with references), the right to be heard in adversarial proceedings under Art. 190(2)(d) PILA does not include the right to a reasoned international award. However, there is a minimal duty on the part of arbitrators to review and deal with the issues that are material to their decision. That duty is violated where the arbitral tribunal, due to an oversight or misunderstanding, overlooks some legally pertinent allegations, arguments, evidence or offers of evidence from a party. However, this does not mean that the arbitral tribunal is compelled to address each and every submission of the parties (BGE 142 III 360 at 4.1.1; 133 III 235 at 5.2, with references).

3.3.

The Arbitral Tribunal examined in the contested decision whether the Appellant had been able to anticipate the non-performance of the contract by the Respondent on January 18, 2016. In this context, it assessed the parties’ behavior in the training camp in Cyprus, and in particular at the meeting on January 18, 2016. It concluded that the Appellant's contention that the Respondents intended to stop complying with the contractual provisions was premature, especially as the new registration period would start just over a week later and the intentions of the Respondent could then have been assessed in a definitive manner.

3.4.

From this situation, the Appellant does not establish any breach of his right to be heard, to the extent that he raises individual arguments relating to the conduct of the parties before the termination of the contract, which the arbitral tribunal did not expressly address. At its hearing on May 9, 2018, referring to the Appellant's allegedly disregarded allegations, the CAS rightly stated that they had been implicitly dealt with by the Arbitral Tribunal. This also finds support in the challenged decision, especially as the Arbitral Tribunal made its conclusion expressly taking into account all of the factual circumstances (“the totality of factual circumstances”). The fact that the Arbitral Tribunal did not consider certain elements to be pertinent does not constitute a violation of the right to be heard within the meaning of Art. 190(2)(d) PILA, as well as the substantive assessment. It is not the task of the Federal Tribunal to check whether the Arbitral Tribunal has taken into account and correctly understood all of the file references (BGE 127 III 576 at 2b p. 578).

The Appeal is unfounded and should be dismissed to the extent that it is admissible. In accordance with the outcome of the proceedings, the Appellant must pay the costs (Art. 66(1) BGG). The Respondent did not incur any expenses for which it would have to be compensated pursuant to Art. 68(2) BGG.

Accordingly, the Federal Tribunal pronounces:

The appeal is dismissed to the extent it is admissible.

The judicial costs of CHF 17'000 shall be borne by the Appellant.

This judgment shall be communicated in writing to the parties and the Court of Arbitration for Sport (CAS).

Lausanne, August 14, 2018

On behalf of the First Civil Law Court of the Swiss Federal Tribunal

Presiding Judge: Clerk:

Kiss Kölz

1. Translator’s Note: Quote as A.________ v. FC B.________, 4A_114/2018. The decision was issued in German. The full text is available on the website of the Federal Tribunal, www.bger.ch.
2. Translator’s Note: BGG is the German abbreviation of the Swiss Law on the Federal Tribunal(Bundesgerichtsgesetz).
3. Translator’s Note: PILA is the most frequently used abbreviation for the Swiss Private International Law Act of December 18, 1987.