De Sanctis and the Article 17: The Last of the Saga?

Article excerpt

Introduction

On 28 February 2011, the Court of Arbitration for Sport (CAS) issued a leading decision regarding Article 17 of the RSTP on the Status and Transfer of Players, hereinafter "RSTP (1)" in the three joint cases between Udinese and Sevilla (2), Udinese and Mr. Morgan De Sanctis (3), and Udinese against Mr. De Sanctis and Sevilla (4).

In these cases, which are commonly referred to jointly as the De Sanctis case, the CAS Panel ruled that De Sanctis and Sevilla were jointly and severally liable to pay the amount of EUR 2,250,055 as indemnification to Udinese after it was held that De Sanctis had unilaterally terminated his employment contract with Udinese without just cause.

In this article, we shall give a brief introduction to Article 17 of the RSTP and the most important CAS jurisprudence regarding this article. Afterwards we shall review the facts of the De Sanctis case, the decision of the FIFA Dispute Resolution Chamber, and the CAS award. Finally we shall endeavour to explore the future development of Article 17 of the RSTP and the approach the CAS might take to such cases.

Article 17 of the Regulations on the Status and Transfer of Players

Article 17 is part of chapter IV of the RSTP regarding the "Maintenance of Contractual Stability between Professionals and Clubs". It is common knowledge that the parties to a contract should respect the terms and duration of that contract, such is also typically referred to as pacta sunt servanda. This principle is expressly provided for in Article 13 of the RSTP, which stipulates that "a contract between a professional and a club may only be terminated upon expiry of the term of the contract or by mutual agreement". (5)

In 2001, FIFA included Article 17 in the RSTP which stipulated what would happen in the event that one of the parties of an employment contract (the player or the club) would terminate said employment contract prematurely and without just cause. (6)

One of the most important aspects of Article 17 is that it states that "in all cases, the party in breach shall pay compensation" to the party that has suffered damage as a result of said breach..

Article 17 of the RSTP now states, with regard to the calculation of the compensation to be paid to the party that has suffered damage, that:

  "Compensation for the breach shall be calculated with due
  consideration for the law of the country concerned, the
  specificity of sport, and any other objective criteria. These
  criteria shall include, in particular, the remuneration and
  other benefits due to the player under the existing contract
  and/or the new contract, the time remaining on the existing
  contract up to a maximum of five years, the fees and expenses
  paid or incurred by the former club (amortised over the term of
  the contract) and whether the contractual breach falls within a
  Protected Period. (7)"

Furthermore, Article 17 of the RSTP states that if the unilateral termination of the contract occurred during the Protected Period, sporting sanctions shall be imposed on the party in breach. For players, this sanction can be a 4 to 6 months restriction on playing official matches, (8) whereas Clubs shall (9) be sanctioned with a ban on registering any new players for two Registration Periods as defined in the RSTP. (10) Furthermore, in the event that the unilateral termination of the contract occurs outside the Protected Period no sporting sanctions shall be imposed.

Hereafter we shall discuss the application of Article 17 of the RSTP on cases in which the player was the party who unilaterally breached the contract without just cause.

CAS jurisprudence on Article 17

In the recent past there have been various cases regarding the the consequences of terminating a contract without just cause before the Court of Arbitration for Sport, hereinafter "CAS", which were decided in accordance with Article 17 of the RSTP. …