Wuhan Zall FC v. Leonardo Carrilho Baptistão

At a glance

Parties

Wuhan Football Club (China) v. Leonardo Carrilho Baptistão (Brazilian professional football player)

Case no.

CAS 2021/A/8511

Forum and rules

Court of Arbitration for Sport, appeals procedure under the Code of Sports-related Arbitration (2021 edition), against a decision of the FIFA Dispute Resolution Chamber

Applicable rules

FIFA Regulations on the Status and Transfer of Players (RSTP) and CFA regulations, with Swiss law applying subsidiarily

Panel

Espen Auberg (President), Mingchao Fan, Francesco Macri

Sector

Professional football; player employment contract

Outcome

Appeal dismissed and FIFA DRC decision of 14 October 2021 upheld (award of 25 November 2022).

Amount

Upheld: EUR 1,100,000 net in outstanding salary (April–July 2021) and EUR 1,375,000 net in compensation for breach of contract, each with 5% interest a year. The Club had asked for its debt to be fixed at EUR 201,667. The costs paragraphs of the operative part are redacted in the published text.

The dispute

On 31 January 2019 the Chinese club Wuhan FC hired the Brazilian player Leonardo Carrilho Baptistão until 31 December 2021, at an annual salary of EUR 3,300,000 net. After China closed its borders to foreigners because of COVID-19, the player could not get a visa after his January 2021 vacation. He returned to China on 24 April 2021 and rejoined the team on 26 May 2021. The Club paid no salary from January 2021. The player put the Club in default on 6 July 2021 and terminated the contract on 23 July 2021 for overdue payables. The FIFA DRC awarded him outstanding salary and compensation. On appeal the Club did not dispute that the termination was for just cause. It argued that COVID-19 was force majeure under Chinese contract law, and that the player was not entitled to salary for the months he was absent from work.

Key holdings

1. The contract's choice-of-law clause referred to "related provisions of Labor Law, Contract Law" without naming a country. It was therefore not an effective choice of law. FIFA and CFA regulations apply primarily, and Swiss law applies subsidiarily. ¶¶ 66–67
2. COVID-19 can in principle amount to force majeure, but this must be decided case by case. The Club bore the burden of proof and did not meet it. It submitted no evidence of its alleged lost revenue, and it signed three new foreign players in the same period. It also raised force majeure only before the FIFA DRC. ¶¶ 74–78
3. The Club has an implied duty, and under the contract an express one, to obtain the player's visa and work permit. The player's absence from February to 26 May 2021 was a direct result of the Club's failure to do so, and he was not at fault. He is entitled to his salary for that period. The Club had never asked him to return on a set date and had never told him his pay would be reduced. ¶¶ 83–89
4. Under pacta sunt servanda, the player is entitled to EUR 1,100,000 net in outstanding salary (EUR 275,000 a month for April to July 2021). ¶ 90
5. Article 17(1) RSTP also applies when a contract is terminated with just cause. The residual value of the contract was EUR 1,375,000. From this the Panel deducted EUR 229,033.71 earned from Santos FC (employment and image rights) and added EUR 825,000 in additional compensation. Because overall compensation cannot exceed the residual value of the contract, the award is capped at EUR 1,375,000. ¶¶ 94–99
6. Interest runs at 5% a year under Article 73 of the Swiss Code of Obligations. The appeal is dismissed and the FIFA DRC decision is upheld. ¶¶ 101–103; operative part

Procedural history

1. 23 July 2021The player terminates the contract for overdue payables.
2. 28 July 2021The player files a claim before the FIFA Dispute Resolution Chamber.
3. 14 October 2021The FIFA DRC partially accepts the claim. It awards four months' salary of EUR 275,000 each and EUR 1,375,000 in compensation. The grounds are notified on 15 November 2021.
4. 6 December 2021Wuhan FC files its Statement of Appeal with CAS. The Appeal Brief follows on 10 December 2021.
5. 28 January 2022The Panel is constituted. The player challenges Prof. Fan on 29 January 2022.
6. 13 June 2022The ICAS Challenge Commission dismisses the challenge to Prof. Fan.
7. 1 July 2022The Panel decides to rule without a hearing. Untranslated documents are excluded.
8. 25 November 2022Award: the appeal is dismissed and the FIFA DRC decision is upheld.

Tribunal, counsel and experts

Decided by

• Espen Auberg President, CAS Panel — appointed by the institution
• Mingchao Fan Co-arbitrator, CAS Panel — appointed by the claimant (challenge rejected)
• Francesco Macri Co-arbitrator, CAS Panel — appointed by the respondent

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Keywords

• football
• COVID-19
• force majeure
• just cause
• overdue payables
• Article 14bis RSTP
• Article 17 RSTP
• mitigated compensation
• additional compensation
• visa and work permit
• border closure
• choice of law
• Chinese Contract Law
• Swiss law
• pacta sunt servanda
• Santos FC
• FIFA Dispute Resolution Chamber
• arbitrator challenge

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