The case revolves around a dispute between Edmond Lutaj, a professional football coach, and FC KS Flamurtari, an Albanian football club, concerning the termination of Lutaj's employment contract. Signed on 31 August 2011, the contract appointed Lutaj as head coach until 31 May 2013, with a monthly salary of EUR 3,500 and additional bonuses. The agreement stipulated that disputes would be resolved through mutual agreement or by the Albanian Football Federation's authorities. On 5 December 2011, after a series of poor match results, Lutaj sent a text message to the club president, Shpetim Gjika, expressing his willingness to "review his position" or resign, depending on the translation. The president suggested a meeting the next day, during which Lutaj claimed he sought to continue as coach, while the club asserted he confirmed his resignation. Media reports later indicated Lutaj had been replaced, and the club presented witness statements supporting their claim of resignation.
Lutaj filed a claim with the Albanian Football Association’s National Centre for Dispute Settlement (NCDS) for unpaid salaries and compensation, but his claim was rejected on 20 January 2012. He then appealed to the Court of Arbitration for Sport (CAS) on 9 February 2012, seeking to overturn the NCDS decision and secure payment of outstanding salaries (EUR 66,500), interest, and legal costs. The CAS addressed jurisdictional questions, as the NCDS Rules did not explicitly mention CAS as an appeals body. However, the Albanian Football Association confirmed CAS jurisdiction under Article 34 of the NCDS Rules, which referred to "another arbitration institute recognized by FIFA." The case proceeded with a sole arbitrator, Bernhard Welten, who examined whether Lutaj’s text message constituted a resignation offer. The arbitrator concluded the message was an offer to resign, but since the club neither accepted nor rejected it, there was no mutual agreement to terminate the contract.
The Respondent contested CAS jurisdiction, arguing the NCDS Rules did not expressly provide for CAS appeals and that it did not consent to arbitration. The Appellant, however, relied on AFA Statutes and a witness statement from the AFA’s Head of Legal Department, confirming CAS jurisdiction. The revised NCDS Rules (Article 35) also explicitly allowed appeals to CAS during a transitional period in the absence of a national arbitration body. The sole arbitrator upheld CAS jurisdiction, citing the AFA Statutes and the revised NCDS Rules, and proceeded to resolve the dispute based on written submissions.
On the merits, the Sole Arbitrator found that Lutaj’s text message was an offer to resign, not an immediate termination, and the president’s response indicated a need for further discussion rather than acceptance. The lack of mutual agreement or written confirmation meant the employment contract was not validly terminated by mutual consent. Consequently, the club’s subsequent dismissal of Lutaj was deemed unilateral and without just cause, entitling Lutaj to compensation. The Arbitrator ruled the club must pay 19 monthly salaries from November 2011 to May 2013, totaling EUR 66,500, with overdue payments subject to 5% interest from 19 July 2012. The CAS upheld the appeal, ordering the Respondent to pay the overdue amount of EUR 52,500 plus interest and fulfill the remaining salary payments as per the contract. The ruling emphasized the Respondent’s breach of contract and upheld the Appellant’s entitlement to the agreed compensation. The case underscores the importance of clear contractual terms, proper documentation, and the role of arbitration in resolving sports-related disputes.