The case involves a legal dispute between Lamontville Golden Arrows Football FC, a South African football club, and Kurt Kowarz, a German goalkeeping coach, with FIFA as a secondary respondent. The conflict arose from the termination of Kowarz's employment contract, which was signed on 1 July 2011 and valid until 30 June 2012. The contract outlined Kowarz's responsibilities, including achieving a top-six league finish and reaching at least one cup semi-final, and specified termination conditions, allowing either party to end the agreement with 30 days' notice in case of breach or failure to meet performance goals. On 1 November 2011, the club terminated Kowarz's contract summarily, citing poor performance after just four months. Kowarz contested this termination, arguing it was without just cause, and filed a claim with FIFA on 23 January 2012, seeking unpaid salary and reimbursement for flights.
The central legal issues revolved around jurisdiction and the validity of the termination. The FIFA Player’s Status Committee (PSC) examined whether the dispute should be heard by a national tribunal, as specified in the contract, or if FIFA had jurisdiction. The PSC ruled that unless the national tribunal was an independent arbitration body guaranteeing fair proceedings, FIFA could adjudicate the dispute. The case highlighted that the requirement for an independent arbitration tribunal in employment contracts applies equally to coaches under FIFA's regulations. The Panel found the club's termination after four months unreasonable, as it was too early to assess long-term performance goals. The decision emphasized that just cause for termination requires substantial evidence of failure, which was lacking here. The ruling reinforced that contractual jurisdiction clauses must explicitly designate independent arbitration bodies to override FIFA's authority.
The club appealed the PSC's decision to the Court of Arbitration for Sport (CAS), arguing that the dispute should be resolved by the South African Football Association's Dispute Resolution Chamber (SAFA DRC) rather than FIFA. The club contended that the employment contract, governed by South African law and incorporating the club's employee handbook, mandated dispute resolution through SAFA's DRC. However, the respondents countered that the contract lacked an explicit arbitration clause, thus granting FIFA jurisdiction. They also questioned the independence of the national tribunal. The CAS examined its jurisdiction under Article R47 of its Code, confirming its authority based on FIFA's statutes, which allow appeals within 21 days of a decision. The appeal was deemed admissible as it was filed within this timeframe.
On the merits, the CAS Panel upheld FIFA's decision, concluding that the dismissal was without just cause and that the club was liable for unpaid remuneration and compensation. The Panel rejected the club's argument that the employee handbook was incorporated into the contract, as there was no evidence of mutual acknowledgment. It also dismissed the claim that registration with the National Soccer League obligated Kowarz to refer disputes to SAFA's DRC, as this would contradict the requirement for explicit contractual reference to the tribunal's jurisdiction. The Panel affirmed the principle that foreign employees must be able to assess the fairness and independence of a national tribunal before agreeing to its jurisdiction.
Ultimately, the CAS ruled that the dispute had an international dimension due to Kowarz's foreign status and the absence of a clear contractual reference to the national tribunal's authority, making FIFA the appropriate forum for resolution. The Panel found that the club unlawfully terminated the contract and was liable to compensate Kowarz. It upheld the FIFA PSC's award of ZAR 563,224 for outstanding salaries and compensation, plus 5% annual interest from 23 January 2012, and dismissed all further claims. The decision underscores the importance of clear contractual terms and fair dispute resolution processes in employment disputes within football.