FIFA - Decisión disputa Musto 07092023

REF. FPSD-11223

Decision of the Dispute Resolution Chamber passed on 7 September 2023 regarding an employment-related dispute concerning the player Damian Marcelo Musto BY: Michele COLUCCI (Italy)

CLAIMANT:

Damian Marcelo Musto, Argentina Represented by Ariel N. Reck

RESPONDENT:

Sport Club Internacional, Brazil Represented by Cravo, Pastl e Balbuena Advogados Associados pg. 2

REF. FPSD-11223

I. Facts of the case

1. On 31 March 2022, the Dispute Resolution Chamber of the Football Tribunal passed a decision in case ref. FPSD-3206, regarding an employment-related dispute between the Argentinian player, Damian Marcelo Musto (hereinafter: the Claimant or the Player) and the Brazilian club, Sport Club Internacional (hereinafter: the Respondent or the Club).

2. The abovementioned decision was appealed to the Court of Arbitration for Sports (CAS).

3. On 31 March 2022, the Claimant and the Respondent concluded a payment agreement

(hereinafter: the agreement), in connection with the abovementioned decision and the CAS appeal. The agreement included the consent of “Damian Marcelo Musto Servicios de Publicidade LTDA. EPP”.

4. Under clause 2 of the agreement, the Respondent undertook to pay to the Claimant a total net amount of USD 362,000, payable as follows: - USD 50,000 net payable until 8 April 2022. - 15 instalments of USD 20,800 net each, payable on the 25th of each month or the next working day in case it falls on a public holiday or on a non-working day, starting on 25 May 2022.

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5. Clause 4 of the agreement reads as follows (quoted verbatim):

“En la hipótesis de retraso en el pago de cualquier de las cuotas establecidas por las partes en este acuerdo, y procediendo INDEPENDIENTE a la respectiva notificación hábil de [the Respondent] para su constitución en mora, con un plazo de 15 (quince) días para abonar la cuota en abierto, y dicha cuota no sea abonada, la integralidad de la deuda será considerada vencida. En tal supuesto, la aplicación de la multa contractual de 10% y de los intereses de 10% anual se aplicarán desde la fecha de la primera intimación de pago descontados los pagos efectuados”.

Freely translated to English: In the event of delay in the payment of any of the instalments established by the parties to this agreement and proceeding INDEPENDIENTE to the respective default notice to the Respondent, with a period of 15 (fifteen) days to pay the outstanding instalment, and such instalment is not paid, the entire debt will be considered overdue. In such event, the application of the contractual penalty of 10% and interest of 10% per annum shall apply from the date of the first default notice, net of the payments made.

6. By correspondence dated 30 May 2023, the Claimant put the Respondent in default of payment of USD 20,800 corresponding to May 2023 instalment, setting a 15-day time limit in order to remedy the default. pg. 3

REF. FPSD-11223

7. On 15 June 2023, the Claimant requested the Respondent to provide him with a proof of payment, subject to the application of the penalties in accordance with the agreement.

8. On 11 July 2023, the Claimant requested the payment of USD 62,400 plus the penalty of 10% (USD 6,240) and interest at the rate of 10% p.a. on the outstanding amounts as from

30 May 2023.

II. Proceedings before FIFA

9. On 4 August 2023, the Claimant filed the claim at hand before FIFA. A brief summary of the position of the parties is detailed in continuation.

a. Position of the Claimant

10. In his claim, the Claimant requested payment of USD 62,400 net corresponding to the 3 remaining instalments of the agreement, in accordance with clauses 2 and 4 and the payment of USD 6,240 as penalty (10%) in accordance with clause 4 of the agreement.

11. The Claimant further asked to be awarded interest of 10% p.a. of the outstanding amount

(USD 62,400) as from 30 May 2023. b. Position of the Respondent

12. In its reply, the Respondent held that due to financial difficulties, it was unable to pay the 13th instalment under the agreement.

13. The Respondent further requested “the dismissal of the penalty clause and the sporting sanctions in the present case, since it is clear the good faith, the firm intent and the effort of SC Internacional to pay the outstanding debt.”

14. In view of the foregoing, the Respondent requested: “a) to receive the present Response, once they are being timely filed; b) to dismiss the requests of sanctions and penalty clause, in the terms outlined above; c) to reduce the interest rate to 5% per year.” pg. 4

REF. FPSD-11223

III. Considerations of the Dispute Resolution Chamber

a. Competence and applicable legal framework

15. First of all, the Single Judge of the Dispute Resolution Chamber (hereinafter also referred to as Single Judge) analysed whether he was competent to deal with the case at hand. In this respect, he took note that the present matter was presented to FIFA on 4 August 2023 and submitted for decision on 7 September 2023. Taking into account the wording of art. 34 of the March 2023 edition of the Procedural Rules Governing the Football Tribunal

(hereinafter: the Procedural Rules), the aforementioned edition of the Procedural Rules is applicable to the matter at hand.

16. Subsequently, the Single Judge referred to art. 2 par. 1 of the Procedural Rules and observed that in accordance with art. 23 par. 1 in combination with art. 22 par. 1 lit. b) of the Regulations on the Status and Transfer of Players (May 2023 edition), the Dispute Resolution Chamber is competent to deal with the matter at stake, which concerns an employment-related dispute with an international dimension between an Argentinian player and a Brazilian club.

17. Moreover, the Single Judge analysed which regulations should be applicable as to the substance of the matter. In this respect, he confirmed that, in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players (May 2023 edition), and considering that the present claim was lodged on 4 August 2023, the May 2023 edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

b. Burden of proof

18. The Single Judge recalled the basic principle of burden of proof, as stipulated in art. 13 par. 5 of the Procedural Rules, according to which a party claiming a right on the basis of an alleged fact shall carry the respective burden of proof. Likewise, the Single Judge stressed the wording of art. 13 par. 4 of the Procedural Rules, pursuant to which he may consider evidence not filed by the parties, including without limitation the evidence generated by or within the Transfer Matching System (TMS).

c. Merits of the dispute

19. The competence and the applicable regulations having been established; the Single Judge entered into the merits of the dispute. In this respect, the Single Judge started by acknowledging all the above-mentioned facts as well as the arguments and the documentation on file. However, the Single Judge emphasised that in the following

considerations he will refer only to the facts, arguments, and documentary evidence, which it considered pertinent for the assessment of the matter at hand. pg. 5

REF. FPSD-11223

1. Main legal discussion and considerations

20. The foregoing having been established, the Single Judge moved to the substance of the matter and took note of the fact that it pertains to a claim of a player against a club for overdue payables in which the main dispute of the parties is to establish whether the contractual penalty clause and interests would be applicable in accordance with the agreement.

21. In this context, the Single Judge acknowledged that his task was to determine if the player is entitled to the claimed amounts, i.e., USD 62,400 net corresponding to the 3 remaining instalments and USD 6,240 as contractual penalty. On the other hand, the Single Judge noted that the Respondent argued that the non-payment of the remained outstanding amount was due to financial difficulties.

22. In this respect, the Single Judge wished to point out that financial difficulties are not a reason to disregard its financial obligations and shall not be accepted, in accordance with the jurisprudence of the Football Tribunal.

23. Subsequently, the Single Judge observed that in accordance with clause 4 of the agreement, i.e., the acceleration clause, the penalty of 10% and the interest at the rate of 10% would be triggered if the Respondent failed to pay the respective amount on its due date and a default notice was send to the Respondent grating it 15 days to pay the requested amount due and the amount would still not paid.

24. In continuation, the Single Judge noted that the May 2023 instalment felt due on 25 May 2023, that a default notice was sent on 30 May 2023 granting the Respondent 15 days to pay the requested amount, and no evidence of payment was provided by the Respondent.

Consequently, the Single Judge concluded that per the said acceleration clause, the penalty of 10% and the application of interest at the rate of 10% were triggered, by the default of

the club; hence, in line with the general legal principle of pacta sunt servanda, the Claimant should be entitled to USD 62,400.

25. In addition, taking into consideration the player’s request, the agreement, and the constant practice of the Dispute Resolution Chamber in this regard, the Single Judge decided to award interest at the rate of 10% p.a. as from 30 May 2023.

26. Lastly, the Single Judge pointed out that the contractual penalty of USD 6,240 shall also be awarded insofar as it is contractually based, reasonable and proportionate in line with the jurisprudence of the Football Tribunal. Notwithstanding, by recalling the principle of ne bis in idem, the Single Judge established that no interest should be applicable over the penalty. ii. Compliance with monetary decisions pg. 6

REF. FPSD-11223

27. Finally, taking into account the applicable Regulations, the Single Judge referred to art. 24 par. 1 and 2 of the Regulations, which stipulate that, with his decision, the pertinent FIFA deciding body shall also rule on the consequences deriving from the failure of the concerned party to pay the relevant amounts of outstanding remuneration and/or compensation in due time.

28. In this regard, the Single Judge highlighted that, against clubs, the consequence of the failure to pay the relevant amounts in due time shall consist of a ban from registering any new players, either nationally or internationally, up until the due amounts are paid. The overall maximum duration of the registration ban shall be of up to three entire and consecutive registration periods.

29. Therefore, bearing in mind the above, the Single Judge decided that the Respondent must pay the full amount due (including all applicable interest) to the Claimant within 45 days of notification of the decision, failing which, at the request of the Claimant, a ban from registering any new players, either nationally or internationally, for the maximum duration of three entire and consecutive registration periods shall become immediately effective on

the Respondent in accordance with art. 24 par. 2, 4, and 7 of the Regulations.

30. The Respondent shall make full payment (including all applicable interest) to the bank account provided by the Claimant in the Bank Account Registration Form, which is attached to the present decision.

31. The Single Judge recalled that the above-mentioned ban will be lifted immediately and prior to its complete serving upon payment of the due amounts, in accordance with art. 24 par. 8 of the Regulations.

d. Costs

32. The Single Judge referred to art. 25 par. 1 of the Procedural Rules, according to which “Procedures are free of charge where at least one of the parties is a player, coach, football agent, or match agent”. Accordingly, the Single Judge decided that no procedural costs were to be imposed on the parties.

33. Likewise, and for the sake of completeness, the Single Judge recalled the contents of art. 25 par. 8 of the Procedural Rules and decided that no procedural compensation shall be awarded in these proceedings.

34. Lastly, the Single Judge concluded its deliberations by rejecting any other requests for relief made by any of the parties. pg. 7

REF. FPSD-11223

IV. Decision of the Dispute Resolution Chamber

1. The claim of the Claimant, Damian Marcelo Musto, is accepted.

2. The Respondent, Sport Club Internacional, must pay to the Claimant the following amounts: - USD 62,400 net as outstanding remuneration plus 10% interest p.a. as from 30 May 2023 until the date of effective payment; - USD 6,240 as contractual penalty.

3. Any further claims of the Claimant are rejected.

4. Full payment (including all applicable interest) shall be made to the bank account indicated in the enclosed Bank Account Registration Form.

5. Pursuant to art. 24 of the Regulations on the Status and Transfer of Players, if full payment

(including all applicable interest) is not made within 45 days of notification of this decision, the following consequences shall apply:

1. The Respondent shall be banned from registering any new players, either nationally or internationally, up until the due amount is paid. The maximum duration of the ban shall be of up to three entire and consecutive registration periods.

2. The present matter shall be submitted, upon request, to the FIFA Disciplinary Committee in the event that full payment (including all applicable interest) is still not made by the end of the three entire and consecutive registration periods.

6. The consequences shall only be enforced at the request of the Claimant in accordance with art. 24 par. 7 and 8 and art. 25 of the Regulations on the Status and Transfer of Players.

7. This decision is rendered without costs.

For the Football Tribunal: Emilio García Silvero Chief Legal & Compliance Officer pg. 8

REF. FPSD-11223

NOTE RELATED TO THE APPEAL PROCEDURE: According to article 57 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS) within 21 days of receipt of the notification of this decision.

NOTE RELATED TO THE PUBLICATION: FIFA may publish this decision. For reasons of confidentiality, FIFA may decide, at the request of a party within five days of the notification of the motivated decision, to publish an anonymised or a redacted version (cf. article 17 of the Procedural Rules Governing the Football

Tribunal).

CONTACT INFORMATION

Fédération Internationale de Football Association FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland www.fifa.com | legal.fifa.com | psdfifa@fifa.org | T: +41 (0)43 222 7777 pg. 9