Club Olimpia de Paraguay v. Emmanuel Adebayor

At a glance

Parties

Club Olimpia (Asunción, Paraguay) v. Emmanuel Adebayor (Togo)

Case no.

CAS 2022/A/8835

Forum and rules

Court of Arbitration for Sport, appeal arbitration under the CAS Code; appeal from the FIFA Dispute Resolution Chamber

Treaty

Termination Agreement of 30 June 2020, Article 4 (FIFA DRC at first instance, CAS on appeal)

Tribunal

Prof. Luigi Fumagalli (Sole Arbitrator)

Sector

Professional football; player employment

Outcome

Appeal dismissed and FIFA DRC decision of 27 January 2022 confirmed (award of 28 March 2023).

Amount

DRC award confirmed: USD 510,000 plus 12% interest p.a. on the outstanding instalments, and interest on late partial payments of USD 40,000 and USD 50,000. The Club had asked for the interest rate to be cut to 5% p.a. Cost terms are redacted in the published award.

The dispute

Club Olimpia, a Paraguayan football club, signed Togolese player Emmanuel Adebayor on 6 February 2020 under an employment contract running to 31 December 2020. After football in Paraguay was suspended because of Covid-19, the parties signed a Termination Agreement on 30 June 2020. Under it the Club was to pay USD 650,000 net in four instalments. If a later instalment was missed, the remaining instalments fell due at once with interest of 1% per month (Article 1.6). The Club paid the first instalment and part of the second, and the FIFA DRC ordered it to pay USD 510,000 plus 12% interest p.a. On appeal the Club challenged only the interest rate. It argued that 12% was excessive and punitive because of the pandemic's effect on its finances, the Player's departure to Togo and the imbalance of the settlement, and asked for the 5% statutory rate under the Swiss Code of Obligations. The Player argued that these arguments were new and should be excluded under Article R57.3 of the CAS Code. He also argued that the Club had itself proposed the rate.

Key holdings

1. Article R57.3 of the CAS Code gives a panel discretion, not an obligation, to exclude evidence that was available before the decision under appeal. The power is to be used with restraint to preserve de novo review, and only where there is a clear showing of bad faith. Nothing showed that here, so the Club's new arguments were admitted. ¶¶ 52–54
2. FIFA regulations, chiefly the RSTP, apply primarily, and Swiss law applies subsidiarily. The contract chose Paraguayan law as the alternative, but the parties relied only on Swiss law and CAS precedents. ¶¶ 44–45
3. A 12% annual rate is not contrary to Swiss law or Swiss public policy. CAS precedents accepted 15% (CAS 2016/A/4858) and struck down only much higher rates (198% in CAS 2010/A/2128; 48% in CAS 2018/A/6023). ¶ 56(i)
4. The Club itself proposed the 1% monthly rate in June 2020. By then the pandemic's effect on its finances could be foreseen and the Player's limited number of matches was known. The rate was agreed as part of a mutual compromise with concessions on both sides, and the agreement was not affected by any imbalance. ¶ 56(ii)–(iv)
5. There was no reason to reduce the agreed interest rate. The appeal was dismissed and the DRC decision confirmed. ¶¶ 57–58; operative part

Procedural history

1. 6 February 2020Employment contract concluded, valid until 31 December 2020.
2. 30 June 2020Termination Agreement signed, providing for USD 650,000 net in four instalments.
3. 2 September 2021The Player's counsel sends a default notice to the Club.
4. 17 September 2021The Player files a claim before the FIFA Dispute Resolution Chamber.
5. 27 January 2022The DRC orders the Club to pay USD 510,000 plus 12% interest p.a. and imposes a warning. The decision is notified on 6 April 2022.
6. 27 April 2022The Club files its Statement of Appeal with CAS.
7. 6 July 2022Prof. Luigi Fumagalli is appointed Sole Arbitrator. The case is decided on the written submissions without a hearing.
8. 28 March 2023Award: appeal dismissed and DRC decision confirmed.

Tribunal, counsel and experts

Decided by

• Luigi Fumagalli Sole arbitrator, Court of Arbitration for Sport — appointed by the institution

Run a conflict check on these names →

Keywords

• football
• Adebayor
• Olimpia Asunción
• termination agreement
• default interest rate
• 12% interest
• FIFA Dispute Resolution Chamber
• Article R57 CAS Code
• new evidence on appeal
• de novo review
• Swiss law
• Covid-19
• acceleration clause
• pacta sunt servanda
• Article 12bis RSTP
• usury

Summary generated with AI from the published documents — refer to the award for the authoritative text.