The Emiliano Sala Tragedy: Litigation on the Horizon?

As the general public and wider sporting world express their sympathies regarding the tragic loss of the newly inbound Premier League football player Emiliano Sala, brewing in the background is the potential legal embroilment between Cardiff City and FC Nantes. The dispute began when Nantes demanded the first of three yearly transfer fee instalments for Emiliano Sala, who was on board a plane that went missing a little over a fortnight ago. Cardiff City Chairman Mehmet Dalman has confirmed that the French club have billed the Bluebirds £5.27m for the first instalment of the forward’s transfer fee. On 5 February, Nantes also threatened legal action if the payment was not received within the following ten days. It is thought that Cardiff will do the right thing with regards to any transfer fee, but they have currently frozen payments pending an investigation into Sala’s death. This includes a full disclosure of the facts surrounding his disappearance. From a basic legal perspective, Nantes may succeed in bringing a claim for breach of contract if four main elements have been established. To be a valid contract, there must have been an offer, acceptance, an intention to create a legal relationship and a consideration (in this case money). Applying this, the above was satisfied during and after contract negotiations, as the offer of £15m was made by Nantes prior to Sala signing, and accepted by Cardiff. Although one would assume that Nantes can rightly claim the monies owed to them on a breach of contract basis, there are other legal issues to consider. Having taken legal advice themselves Cardiff believe that they have sufficient grounds to withhold the payment pending the investigation. This includes the issue as to whether Sala was officially registered or not as a Cardiff player. It is thought that Sala’s name was likely added onto Cardiff’s club insurance policy when the transfer was completed on 19 January 2019. However other sources suggest that Sala’s international documents were in fact lodged with the Football Association of Wales but were not registered with the Premier League, meaning that Sala may not have been on Cardiff’s insurance policy. There also seems to be confusion surrounding where the money for the payments will come from. It is thought that Cardiff have £16 million of personal accident protection per player to which 84% of this limit is funded by Lloyds Bank, the other 16% are to come from China Re Syndicate 2088 and brokered by Miller. Although this amount of money will cover Sala’s initial transfer fee, Cardiff may still incur excess when it comes to covering the salary for the duration of Sala’s three-and-a-half-year contract as well as the lost revenue that was anticipated for their club record signing. This would likely take the overall value of the transfer to around £25m. What further adds to the potential litigation, is that Ligue 1 club Bordeaux are supposedly entitled to a 50% cut of the fee, as Sala was on their books from 2012 to 2015 before joining Nantes. There is also jurisdictional confusion since the plane crashed between the two countries. With the possibility of these two club locking horns in a legal dispute, there are a number of solutions available. The first one is that the matter is litigated in a French or English court. The second option is that both clubs can establish to take the issue to FIFA and, in such a case, the matter is then submitted to the Players’ Status Committee in the first instance, with the possibility of an appeal to the Court of Arbitration for Sport (this is an independent institution based in Switzerland involved in resolving legal disputes in the sporting world (CAS)). There is also the possibility that the clubs decide to skip FIFA and go direct to the CAS. Although Nantes are clearly adopting a hard-nosed stance, this unique case could well be resolved amicably around a negotiation table, mitigating the dispute getting leaked into the public domain. Whilst Nantes could well be missing out on some valuable interest from the transfer money not sitting in their bank account, many have questioned the French club’s morality demanding payment so soon. One could say that this event has shown the true motives and underlying principles of the football business – and it’s not over yet. Jonny Coser, Paralegal, FrontRow Legal

Published February 8, 2019

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