The case involves a dispute between Cruzeiro EC, a Brazilian football club, and FC Zorya Luhansk, a Ukrainian football club, over unpaid transfer fees and default interest related to the transfer of a player. The dispute originated from a transfer agreement signed in July 2014, where Cruzeiro agreed to pay Zorya €3.5 million in six installments for the player. The agreement included a default interest rate of 0.2% per day for late payments. Cruzeiro delayed payments for the first three installments and failed to pay the fourth installment entirely, prompting Zorya to claim €233,000 in default interest and €500,000 for the unpaid installment, plus additional interest. The case was initially heard by FIFA’s Players’ Status Committee, which ruled in Zorya’s favor in February 2017. Cruzeiro appealed to the Court of Arbitration for Sport (CAS), arguing issues such as the scope of CAS’s review power, the admissibility of modifications to the relief sought, and the reliability of expert evidence. The CAS panel, consisting of a sole arbitrator, emphasized that its review was limited to the issues raised in the original proceedings and that modifications to the relief sought must remain within the dispute's original boundaries. The panel also found an expert report submitted by Cruzeiro unreliable due to its reliance on poor-quality document copies.
The dispute’s factual background revealed the player had initially been on loan to Cruzeiro from FC Metalist, with an option for a permanent transfer. However, the player later terminated his contract with Metalist and signed with Zorya, leading to the transfer agreement between Cruzeiro and Zorya. Cruzeiro’s delays and non-payment prompted Zorya to initiate proceedings before FIFA, which ruled in Zorya’s favor, ordering Cruzeiro to pay €487,500 (after a 2.5% solidarity contribution deduction) with 5% annual interest, rejecting the contractual 0.2% daily rate as excessive. Cruzeiro’s appeal to CAS included allegations of fraud, claiming Zorya had no right to transfer the player due to alleged forgery of the player’s signature on termination and employment agreements. The CAS panel dismissed these claims, finding the expert report on signature authenticity unreliable and noting the player had informed Cruzeiro of his contract termination and new employment. The panel also rejected a letter from Metalist questioning Zorya’s rights to the player, deeming it irrelevant and untrustworthy.
The CAS panel upheld the validity of the transfer agreement, emphasizing the principle of pacta sunt servanda and the importance of contractual compliance in football transfers. It ruled that Cruzeiro was liable for the outstanding transfer fee and default interest, dismissing Cruzeiro’s request for a refund of earlier payments as inadmissible. The panel confirmed the FIFA decision, reinforcing the enforceability of transfer agreements and the role of arbitration in resolving such disputes. The case highlights the complexities of international football transfers, the significance of credible evidence in legal proceedings, and the consequences of failing to meet contractual obligations. The final decision underscored the need for clubs to adhere to agreed terms and the limited scope of appellate review in sports arbitration.