The case involves a dispute between Al Ittihad Club and FC Girondins de Bordeaux over the non-payment of a transfer fee for a football player. On August 1, 2011, the clubs signed a transfer agreement requiring Al Ittihad to pay Bordeaux €1,700,000 in two installments: €1,000,000 upfront and €700,000 by August 1, 2012. Al Ittihad failed to pay the second installment, prompting Bordeaux to file a claim with FIFA’s Players’ Status Committee on September 13, 2012, seeking the unpaid €700,000 plus interest. Al Ittihad acknowledged the debt and proposed a settlement, formalized on February 17, 2014, which outlined nine monthly payments starting March 5, 2014. However, Al Ittihad defaulted on the first installment, leading Bordeaux to seek FIFA’s intervention.
On August 26, 2014, the FIFA PSC Single Judge ruled in favor of Bordeaux, ordering Al Ittihad to pay the €700,000 plus 5% annual interest from August 2, 2012, citing the principle of pacta sunt servanda. Al Ittihad appealed to the Court of Arbitration for Sport (CAS) on February 4, 2015, arguing that interest should accrue only from the date of the FIFA decision, not the original due date. The CAS panel, applying Swiss law, determined that the settlement agreement did not replace the original obligation but merely deferred payment, meaning the original debt remained enforceable. The panel also clarified that settlement agreements lack binding legal effect unless formally acknowledged by a judicial authority and noted that counterclaims cannot be filed in CAS appeal proceedings.
The CAS upheld the FIFA decision, confirming Al Ittihad’s liability for the unpaid €700,000 plus interest from the original due date, as the settlement agreement did not alter the underlying obligation. The ruling emphasized the importance of adhering to contractual terms and the limited legal effect of settlement agreements without judicial ratification. Additionally, the CAS dismissed Bordeaux’s counterclaim for €100,000 in damages, deeming it inadmissible under CAS rules. The final decision rejected all other motions, leaving no further claims to be addressed. The case highlights the complexities of contractual disputes in sports transfers and the role of arbitration in resolving such conflicts, underscoring the enforceability of original obligations unless explicitly novated.