The case involves a contractual dispute between Christian Letard, a French professional football coach, and the Congolese Football Federation (FECOFOOT), adjudicated by the Court of Arbitration for Sport (CAS). The conflict arose from the termination of Letard's employment contract, signed on March 1, 2004, for a fixed term of three years. The contract stipulated that FECOFOOT would provide resources for Letard to establish a training center by October 1, 2004, including hiring specific technical staff. However, FECOFOOT failed to meet these obligations, leading to repeated delays and non-payment of salaries for Letard and his staff. Letard formally terminated the contract on January 21, 2005, citing FECOFOOT's breach of contract under Article IX, which allowed termination for "grave fault" by the employer. He sought unpaid salaries, additional benefits, and compensation for moral damages.
The CAS examined whether Letard's termination was justified and whether the contractual penalty clause was enforceable. It found that FECOFOOT's repeated failures—such as not establishing the training center, not paying salaries, and not providing adequate support—constituted just cause for termination under Swiss law (Article 337 of the Code of Obligations). The CAS upheld Letard's right to terminate the contract immediately due to FECOFOOT's material breaches. However, it rejected his claim for moral damages, ruling that the termination, while justified, did not constitute an attack on his honor or reputation, which would be necessary for such compensation.
The CAS also addressed the contractual penalty clause, noting that while parties are free to agree on penalty clauses, courts may reduce them if excessive, particularly to protect economically weaker parties. In this case, the penalty was deemed enforceable as it reflected the damages caused by FECOFOOT's breach. The tribunal calculated the indemnity based on Letard's monthly salary of 13,000 euros for the remaining 25 months of the contract, totaling 325,000 euros. The contractual clause explicitly excluded offsetting this amount with unemployment benefits Letard received during the period.
The CAS rejected Letard's additional claims, including match bonuses and supplementary benefits, due to insufficient evidence. It also dismissed his claim for moral damages, emphasizing that Swiss law requires proof of severe and unjustified harm for such compensation, which Letard failed to demonstrate. The tribunal concluded that the contractual penalty covered all proven damages, adhering to Swiss legal principles.
Ultimately, the CAS ruled in favor of Letard, confirming his right to terminate the contract due to FECOFOOT's failures and awarding him unpaid salaries and contractual benefits. However, his claim for moral damages was dismissed, as the termination did not involve personal harm beyond financial loss. The decision reinforced the principle that contractual obligations must be upheld, and termination for just cause is permissible when one party fails to meet essential terms. The ruling also highlighted the CAS's role in applying FIFA regulations and Swiss law to resolve sports-related disputes, ensuring fairness and adherence to contractual agreements.