The case involves a dispute between Dalian Professional Football Club and José Carlos Pérez-Cascallana Álvarez, a fitness coach, adjudicated by the Court of Arbitration for Sport (CAS) on 17 September 2021. The dispute arose from the Club's termination of the coach's employment contract without just cause, leading to legal proceedings. The contract, signed on 16 March 2018, included clauses for automatic extension based on the team's performance in the Chinese Super League (CSL). The team finished 11th in the 2018 season, triggering a two-season extension. However, the Club terminated the contract on 26 December 2018, citing disputes over the coach's performance and working conditions. The coach argued the termination was unlawful and sought compensation for unpaid bonuses, residual contract value, and legal costs, along with interest. The Club countered by alleging the coach breached his obligations and sought damages from him.
The case was initially heard by FIFA's Players' Status Committee (PSC), which ruled partially in favor of the coach, ordering the Club to pay net compensation with interest and provide tax certificates. Dissatisfied, the Club appealed to CAS, challenging FIFA's jurisdiction and the validity of the termination. The CAS panel, comprising Mr. Alain Zahlan de Cayetti, Prof. Petros Mavroidis, and Mr. José Juan Pintó, examined multiple issues, including admissibility of new evidence, classification of the coach's role, validity of termination, contractual penalty clauses, tax-related disputes, and procedural costs.
Under Article R56 of the CAS Code, the panel ruled that submitting new evidence after the closure of written submissions is only permissible under exceptional circumstances, such as the emergence of new facts. The panel dismissed the Club's request to submit a late legal expert report, emphasizing procedural discipline. The panel also clarified the coach's role, determining he qualified as a coach under FIFA regulations due to his duties assisting the head coach in squad selection and tactical development, not merely as a physical trainer. This classification granted the coach the right to have employment disputes heard by FIFA.
On the issue of termination, the panel defined "just cause" under Swiss law (Article 337(2) of the Swiss Code of Obligations) as circumstances making the continuation of the employment relationship unconscionable, requiring a material breach of contract. The panel concluded the Club's termination was without just cause, as there was no mutual agreement or material breach by the coach. The panel upheld the coach's entitlement to compensation for the unjust termination, referencing Swiss law (Article 337b and 337c of the SCO) and the employment contract's terms. The compensation amount was set at the coach's annual income for the 2019 season, with 5% annual interest. The panel rejected the Club's argument that the coach failed to mitigate damages by not seeking new employment, as the Club provided no evidence to support this claim.
Regarding tax-related disputes, the panel affirmed FIFA's ruling that the Club must provide the coach with a tax certificate proving payment of applicable taxes, as the contract stipulated payments were to be made net of Chinese taxes. The panel noted FIFA's general lack of jurisdiction over tax matters unless contractually grounded, and the coach's request was deemed contractually justified.
Finally, the panel dismissed the Club's request for reimbursement of procedural costs from FIFA, stating CAS jurisprudence does not allow reallocation of costs from prior proceedings. The panel partially upheld the Club's appeal, modifying the original decision to specify the net amount payable to the coach, while rejecting ancillary claims. The decision reinforced the importance of contractual clarity, procedural discipline, and the autonomy of parties in resolving sports-related disputes. The case underscores the complexities of employment terminations in professional football and the role of arbitration in adjudicating such conflicts.