Heart of Midlothian v Webster & Wigan Athletic FC
Reference: CAS 2007/A/1298-1300
Court: Court of Arbitration for Sport
Judge: Byrne-Sutton (President) and Bertrand and Beloff QC (Arbitrators)
Date of judgment: 30 Jan 2008
Summary: Sports law - Contract - Unilateral termination - Compensation - Article 17, FIFA Regulations - Unilateral termination of contract by football player - Appropriate compensation to be paid to club
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Football player Andy Webster signed a four-year contract with Hearts shortly before his 19th Birthday on 31 March 2001. Hearts entered into negotiations with Webster in January 2006 to retain him at the Club long-term. Agreement could not be reached, and there was a breakdown in relations between Webster and the Club, and in particular, the majority shareholder, Vladimir Romanov. Webster gave notice to Hearts on 26 May 2006 that he was unilaterally terminating his contract on the basis of article 17 of the FIFA Regulations for the Status and Transfer of Players (the “FIFA Status Regulations”). His termination occurred outside the Protected Period of three years commencing from the date he was first employed by Hearts. The Fifa Dispute Resolution Centre (“DRC”) found there had been a breach by Webster, and assessed compensation at £625,000. Both sides appealed to CAS.
(1) What is the correct interpretation and application of Article 17 of the FIFA Regulations?
(2) What is the correct approach to assessing compensation under Article 17?
(1) Article 17 did not allow a club or Player to unilaterally terminate an employment contract without cause even outside the Protected Period. The only question in this case was therefore how much was due under the system designed by article 17 to deal with the consequences of unilateral termination without cause.
(2) In assessing compensation, the amounts claimed to have been spent on training and developing the player were irrelevant. The alleged estimated value of Webster on the transfer market (of £4million) had not been agreed contractually and would cause unjust enrichment to the Club and would be punitive of the Player. Compensation was assessed at £150,000 (representing the residual value of the Player’s contract remaining after its termination).
This case has been hailed as the “new Bosman” in reference to the 1995 decision by the European Court of Justice on the player Jean-Marc Bosman’s claim for restraint of trade against his then Club who had refused to let him move on because the transfer fee offered was too low. The CAS decision has been welcomed by the Scottish Professional Football Player’s Association and Fifpro, the world player’s union who believe that the decision will enable players to enjoy greater freedom of employment and will rationalise the transfer market (which at the top end has seen Clubs claiming ever more exorbitant transfer fees for their players).