The case involves a dispute between Cruzeiro E.C. and Club Tigres over the failure to pay a transfer fee as stipulated in a contract for the permanent transfer of a player. The contract, signed on 25 June 2016, required Cruzeiro to pay Tigres a total of USD 4,000,000 in four installments. Cruzeiro failed to pay the second installment of USD 1,000,000, prompting Tigres to file a claim with FIFA on 15 December 2016, seeking the unpaid amount plus interest. Cruzeiro argued it could not pay due to not receiving an invoice from Tigres. FIFA’s Single Judge partially accepted Tigres’ claim on 8 May 2017, ordering Cruzeiro to pay the outstanding amount plus 5% annual interest from 2 November 2016 until payment, along with procedural costs. Cruzeiro appealed to the Court of Arbitration for Sport (CAS) on 3 August 2017, requesting a sole arbitrator.
The key issue before CAS was the discrepancy in the contract’s interest clause: the English version specified 4% monthly interest, while the Portuguese version stated 4% annually. Applying the principle in dubio contra stipulatorem (ambiguity interpreted against the drafter), the sole arbitrator concluded the higher 4% monthly rate was binding, as Cruzeiro had drafted the contract. However, since Tigres had not appealed FIFA’s decision setting the interest at 5% and had itself requested this rate in its CAS submission, the arbitrator upheld the 5% rate. The arbitrator emphasized that a debtor must ensure payment reaches the creditor’s designated account and cannot evade obligations by citing procedural lapses like missing invoices.
The CAS proceedings confirmed its jurisdiction and the admissibility of the appeal, noting Cruzeiro had exhausted prior legal remedies and filed within the required timeframe. The applicable law was determined to be the contract terms and relevant regulations, with Swiss law providing interpretive guidance. Cruzeiro sought relief on grounds including the Portuguese version of the clause prevailing and Tigres’ failure to provide an invoice, while Tigres requested the English version prevail and payment of the owed amount plus 5% annual interest. The arbitrator ruled that the obligation to pay did not depend on the issuance of an invoice, as the contract provided clear bank account details for payment. Interest began accruing from the day after the due date, as stipulated in the contract.
The dispute over the interest rate hinged on conflicting interpretations of the contract’s English and Portuguese versions. The English version, designated as binding in case of disputes, specified a 4% monthly interest rate, while the Portuguese version indicated 4% annually. The Sole Arbitrator found the English version unambiguous, supported by Cruzeiro’s initial offer letter proposing a 4% monthly rate. The principle in dubio contra stipulatorem was invoked, meaning ambiguous clauses are interpreted against the drafting party (Cruzeiro). Consequently, the 4% monthly interest rate was upheld as the agreed term. However, the arbitrator noted the need to assess whether such a rate (48% annually) was disproportionate under commercial practices but deemed this unnecessary as Tigres had not appealed the FIFA decision setting the rate at 5%.
The CAS upheld FIFA’s ruling, requiring Cruzeiro to pay the outstanding amount with 5% interest and costs. The final decision affirmed the FIFA Players' Status Committee's earlier judgment, rejecting all other claims and motions. The case underscores the importance of precise contract drafting, adherence to payment obligations, and the legal principles governing contractual interpretation in football transfers. It highlights how ambiguities in contracts are construed against the drafting party and the role of proportionality and creditor concessions in influencing final decisions. The outcome reinforces the need for clarity in international sports contracts to avoid disputes.