0099 Perry v. Besiktas

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FIBA Arbitral Tribunal (FAT)
ARBITRAL AWARD
(0099/10 FAT) rendered by FIBA ARBITRAL TRIBUNAL (FAT) Mr. Raj Parker in the arbitration proceedings
Mr. Marque Perry vs. Besiktas Jimnastik Kulubu, Süleyman Seba Caddesi, No. 48 BJK Plaza, Akaretler, Besiktas 34357 Istanbul, Turkey. -Claimant -Respondent –

Av. Louis Casaï 53 Tel: (+41-22) 545 0000

P.O. Box 110 Fax: (+41-22) 545 0099

1216 Cointrin / Geneva info@fiba.com Switzerland www.fiba.com

 

1. The Parties

1.1. The Claimant

1. Mr. Marque Perry (hereinafter the “Claimant” or the “Player”) is a US citizen and a professional basketball player. He is represented by Mr. Michael Naiditch of NET, 331 S Peoria #102, Chicago, IL. 60607, USA.

The Respondent

  1. Besiktas Jimnastik Kulubu (hereinafter the “Respondent” or the “Club”) is a Turkish basketball club. It is domiciled at Süleyman Seba Caddesi, No. 48 BJK Plaza, Akaretler, Besiktas 34357 Istanbul, Turkey. The Respondent is represented by Mrs Basak Akbas, attorney at law in Istanbul, Turkey. 

2. The Arbitrator

  1. On 17 June 2010, the President of the FIBA Arbitral Tribunal (the “FAT”) appointed Raj Parker as arbitrator (hereinafter the “Arbitrator”) pursuant to Article 8.1 of the Rules of the FIBA Arbitral Tribunal (hereinafter the “FAT Rules”). 
  2. By email dated 17 June 2010, the Arbitrator accepted his appointment and signed a 

declaration of acceptance and independence provided by the FAT Secretariat. Neither

of the Parties has raised objections to the appointment of the Arbitrator or to the

declaration of independence issued by him.

3. Facts and Proceedings

3.1. Background Facts

5. On 22 February 2010 the Player and the Club signed an employment contract

(hereinafter, the “Contract”). The Contract contains, among others, the following

provisions:

“2. The Club agrees to pay Player a fully guaranteed Base Salary of $140,000.00 USD for the 2009/2010 basketball season in accordance with the payment schedule set forth below. The payments to Player hereunder must be made in United States Dollars in accordance with wire transfer instructions or other instructions to be provided by the Player from time to time. The payment schedule is as follows:

Upon Passing the Physical Check $20,000 USD March 25, 2010 $40,000 USD April 25, 2010 $40,000 USD May 25, 2010 $40,000 USD

[…]

  1. The Club agrees to make all payments of Turkish taxes any nature on behalf of the Player with respect to all base salary referenced in Paragraph 2 above in 2009-2010 basketball season. All bonuses payments hereunder shall be fully net of all Turkish taxes. It is fully understood that the Club shall be required to provide to Player a tax certificate evidencing all Turkish taxes paid by the club on behalf of the player as provided in this Paragraph 4 when requested by the Player or agent. 

  2. a) Transportation. The Club The Club (sic) will provide Player, free of charge, (one) 

business class non-stop and 1 (one) economy class round trip airplane tickets ChicagoIstanbul-Chicago to be used by Player or persons of Player’s choice.

[…]

6. BONUSES: In addition to the agreed Base Salary to be paid to the Player in Paragraph 2 above, the Club shall pay Player the following bonuses […]

Each Round in Play-Offs Won5,000 USD

  1. On 12 March 2010 the Club paid 30,000.00 USD to the Player, however no further payments were made to the Player until 16 August 2010. 
  2. On 2 April 2010 the Player purchased an economy class return airline ticket from Istanbul to Chicago, leaving on 12 April 2010. 
  3. On 16 August 2010 the Club made a payment of USD 21,775.00 to the Player. 

3.2. The Proceedings before the FAT

  1. On 2 June 2010 the Claimant filed a Request for Arbitration in accordance with the FAT Rules. 
  2. By letter dated 18 June 2010, the FAT Secretariat invited the Respondent to file the Answer to the Request for Arbitration. By the same letter the Parties were invited to pay EUR 4,000.00 each as the Advance on Costs. 
  3. The Claimant paid his share of the Advance on Costs on 2 July 2010. 
  4. On 9 July 2010 the Respondent filed its Answer with the FAT. 
  5. By Procedural Order dated 12 July 2010, the Arbitrator informed the Parties that the Respondent had failed to pay its share of the Advance on Costs and fixed a time limit of until 21 July 2010 for these to be paid by the Claimant. The Claimant paid the Respondent’s share of the Advance on Costs on 19 July 2010. 
  6. On 4 August 2010 the Arbitrator issued a Procedural Order, requesting further information from the Claimant. The Arbitrator fixed a time limit of until 16 August 2010 for this information to be provided. 
  7. On 6 August 2010 the Claimant filed his reply to the Procedural Order along with two exhibits. 
  8. Since none of the Parties filed an express application for a hearing, the Arbitrator decided in accordance with Article 13.1 of the FAT Rules not to hold a hearing and to deliver the award on the basis of the written submissions of the Parties. 
  9. By Procedural Order dated 13 August 2010 the Arbitrator closed the proceedings, subject to the Parties submitting their accounts of costs. 
  10. On 16 August 2010, the Claimant submitted the following account of costs: 

“Hours DESCRIPTIORate AMOUNT

1 May 13, 2010 Prep of Notice to Plaintiff 200,00 $200,00 2 May 27, 2010 Meeting with client to discuss case 200,00 400,00 2 May 30, 2010 Document Prep, RFA 200,00 400,00 1 August 6, 2010 Document Prep, Procedural Order 200,00 200,00

SUBTOTA1.200,00 $1.200,00”

19. On 25 August 2010, the Respondent submitted the following account of costs:

Legal representation costs 2,000.00 USMiscellaneous expenses cost 200 USD

  1. On 31 August 2010, the Respondent sent an email to the FAT, stating that it had made a payment of USD 22,000.00 to the Claimant on 16 August 2010, and requested that the Arbitrator take this into account when rendering the Award. 
  2. By letter dated 28 September 2010, the Arbitrator asked the Claimant to confirm whether the Claimant had received the payment of USD 22,000.00 from the Respondent. 
  3. On 3 October 2010, the Claimant confirmed that he had received USD 21,775.00 from the Respondent. 

4. The Parties’ Submissions

4.1. The Claimant’s Submissions

  1. The Claimant submits that the Club is in breach of the Contract, by failing to pay the Player all salary and bonus payments due under the Contact. The Claimant claims that he is entitled to a bonus payment of USD 5,000.00 because the Club advanced one round in the playoffs. 

  2. The Claimant also claims that the Club provided him with one business class airplane ticket, but failed upon request to purchase one economy class ticket for a person of the Player’s choice to use. The Claimant states that he purchased a ticket on 2 April 2010 from Istanbul to Chicago at his own expense. The Claimant claims that he is entitled to USD 766.00 as reimbursement for the cost of this ticket. 

  3. The Claimant claims that he is entitled to a tax certificate confirming that all payments of Turkish taxes applicable to his base salary and bonus have been paid by the Club. 

  4. The Claimant’s request for relief states: 

Claimant(s) request(s):

a.
Immediate payment of unpaid salary of $110,000 US net of all taxes.
b.
Immediate payment of earned bonus of $5000.
c.
Tax certificate evidencing all Turkish taxes paid by the club on behalf of the player.
d.
Immediate reimbursement of $766 US representing the unreimbursed cost of one economy airplane ticket.
e.
Immediate reimbursement of EUR 2,000, representing the FAT non-reimbursable handling fee.
f.
Immediate reimbursement of any and all other costs related to the proceedings.

4.2. The Respondent’s Submissions

  1. The Respondent has acknowledged its liability to pay USD 115,000.00 for the unpaid salary and bonus payments. The Respondent states that it has not paid these sums due to the recent global economic crisis, but submits that it will do so. 
  2. The Respondent submits that the amount of 766 USD for a plane ticket claimed by the Claimant is not reimbursable. This is for two reasons: firstly the Player did not claim a plane ticket from the Club and secondly the Player did not follow the correct procedure 

for obtaining plane tickets. The Respondent submits that the correct procedure is for players to make a request to the Club’s manager for a ticket. Tickets are then provided for by the Club’s sponsor. The Respondent states that the Contract does not permit the Player to purchase a plane ticket himself and then claim the cost back from the Club.

5. Jurisdiction

5.1. The jurisdiction of the FAT

  1. Pursuant to Article 2.1 of the FAT Rules, “[t]he seat of the FAT and of each arbitral proceeding before the Arbitrator shall be Geneva, Switzerland”. Hence, this FAT arbitration is governed by Chapter 12 of the Swiss Act on Private International Law (PILA). 

  2. The Respondent did not challenge the jurisdiction of FAT. Hence the Arbitrator asserts jurisdiction over the present dispute (Art. 186(2) PILA). For the sake of completeness, the Arbitrator will nevertheless examine the validity of the arbitration agreement contained in the Contract (see paragraphs 34 -35 below). 

5.1.1 Arbitrability

  1. The jurisdiction of the FAT presupposes the arbitrability of the dispute and the existence of a valid arbitration agreement between the parties. 

  2. The Arbitrator notes that the dispute referred to him is clearly of a financial nature and 

is thus arbitrable within the meaning of Article 177(1) PILA.1

5.1.2 Formal and substantive validity of the arbitration agreement

33. The existence of a valid arbitration agreement is to be examined in light of Article 178

PILA, which reads as follows:

“1 The arbitration agreement must be made in writing, by telegram, telex, telecopier or any other means of communication which permits it to be evidenced by a text.

2 Furthermore, an arbitration agreement is valid if it conforms either to the law chosen by the parties, or to the law governing the subject-matter of the dispute, in particular the main contract, or to Swiss law.”

34. Clause V of the Contract states:

“Any dispute arising from or related to the present contract shall be submitted to the FIBA Arbitral Tribunal (FAT) in Geneva, Switzerland and shall be resolved in accordance with the FAT Arbitration Rules by a single arbitrator appointed by the FAT President. The seat of the arbitration shall be Geneva, Switzerland.

“The arbitration shall be governed by Chapter 12 of the Swiss Act on Private International Law (PIL), irrespective of the parties’ domicile.

“The language of the arbitration shall be English.

“Awards of the FAT can be appealed to the Court of Arbitration for Sport (CAS), Lausanne, Switzerland. The parties expressly waive recourse to the Swiss Federal Tribunal against awards of the FAT and against decisions of the Court of Arbitration for Sport (CAS) upon appeal, as provided in Article 192 of the Swiss Act on Private International Law.

“The arbitrator and CAS upon appeal shall decide the dispute ex aequo et bono.”

Decision of the Federal Tribunal 4P.230/2000 of 7 February 2001 reported in ASA Bulletin 2001, p. 523.

  1. The Contract is in written form and thus the arbitration agreement fulfills the formal requirements of Article 178(1) PILA. 

  2. With respect to substantive validity, the Arbitrator considers that there are no indications which could cast doubt on the validity of the arbitration agreement under Swiss law (cf. Article 178(2) PILA). In particular the wording “[a]ny dispute arising from or related to the present contract” clearly covers the present dispute. Accordingly, the Arbitrator finds that the FAT has jurisdiction over the dispute. 

6. Discussion

6.1. Applicable Law – ex aequo et bono

37. With respect to the law governing the merits of the dispute, Article 187(1) PILA provides that the arbitral tribunal must decide the case according to the rules of law chosen by the parties or, in the absence of a choice, according to the rules of law with which the case has the closest connection. Article 187(2) PILA adds that the parties may authorize the arbitrators to decide “en équité”, as opposed to a decision according to the rule of law referred to in Article 187(1). Article 187(2) PILA is generally translated into English as follows:

“the parties may authorize the arbitral tribunal to decide ex aequo et bono”.

38. As set out in paragraph 35 above, the Contract stipulates that any disputes arising out of the Contract shall be resolved by the FAT “in accordance with the FAT Arbitration Rules”. Under the heading “Applicable Law”, Article 15.1 of the FAT Rules reads as follows:

“Unless the parties have agreed otherwise the Arbitrator shall decide the dispute ex aequo et bono, applying general considerations of justice and fairness without reference to any particular national or international law.”

  1. Clause V of the Contract also stipulates that “[t]he arbitrator shall decide the dispute ex aequo et bono.” Consequently, the Arbitrator shall adjudicate the claim ex aequo et bono. 
  2. The concept of équité (or ex aequo et bono) used in Article 187(2) PILA originates from Article 31(3) of the Concordat intercantonal sur l’arbitrage(Concordat),under which Swiss courts have held that arbitration en équité is fundamentally different from arbitration en droit : 

“When deciding ex aequo et bono, the arbitrators pursue a conception of justice which is not inspired by the rules of law which are in force and which might even be contrary to those rules.”4

41. In substance, it is generally considered that the arbitrator deciding ex aequo et bono receives “a mandate to give a decision based exclusively on equity, without regard to legal rules. Instead of applying general and abstract rules, he/she must stick to the

That is the Swiss statute that governed international and domestic arbitration before the enactment of the PILA. Today, the Concordat governs exclusively domestic arbitration.

P.A. KARRER, Basler Kommentar, No. 289 ad Art. 187 PILA.

JdT 1981 III, p. 93 (free translation).

circumstances of the case”.5

  1. This is confirmed by Article 15.1 of the FAT Rules in fine according to which the arbitrator applies “general considerations of justice and fairness without reference to any particular national or international law”. 
  2. In light of the foregoing matters, the Arbitrator makes the following findings: 

6.2. Findings

6.2.1 Salary and bonus payments

  1. The Respondent has accepted liability to pay the Player USD 115,000.00 (comprising unpaid salary payments of USD 110,000.00 and an unpaid bonus payment of USD 5,000.00). The Arbitrator finds that the recent global economic crisis is not a defence to late payment of salary and bonus payments. 
  2. The Respondent has submitted that it paid USD 22,000.00 to the Claimant as part payment of the outstanding debt. However, the Claimant has produced evidence to show that he has only received USD 21,775.00 from the Respondent. The Claimant submits that the discrepancy of USD 225.00 may be due to bank transfer charges. The Arbitrator accepts that the Player has only received USD 21,775.00 and finds that the Respondent should pay any transfer fees. This is because the Contract makes no provision for deductions to the Player’s salary or bonuses on account of bank transfer 

POUDRET/BESSON, Comparative Law of International Arbitration, London 2007, No. 717, pp. 625-626.

fees.

46. Accordingly, the Arbitrator finds that the Claimant is entitled to the outstanding salary and bonus payments of USD 115,000.00 less USD 21,775.00, thus the Claimant is entitled to USD 93,225.00.

6.2.2 Reimbursement for the plane ticket

  1. The Claimant submits that “[s]hortly before April 2 2010, Mr Perry made a verbal request to his translator, “Shenma,” an employee of the Respondant (sic), that the Respondant provide an economy class airplane ticket for Brady Henderson. Later, after continued prodding, the translator replied that the travel agent was out of the office and unable to meet his request.As a result, the Claimant purchased a plane ticket on his own account, at a cost of USD 766.00 and maintains that he is entitled to be reimbursed for this amount. 
  2. The Respondent submits in its Answer that “the claimant did not claim any plane tickets from the Club.” The Arbitrator finds that the Claimant has not provided any evidence to prove that he requested a plane ticket from the Club. In any event, the Arbitrator notes that the Contract does not permit the Player to purchase a plane ticket on his own account and be subsequently reimbursed for the cost of the ticket. Clause II 5(a) of the Contract provides that “[t]he Club will provide Player” with plane tickets. Accordingly, the Arbitrator finds that the Player’s claim for USD 766.00 as reimbursement for a plane ticket fails. 

Email from the Claimant’s counsel to the FAT Secretariat dated 6 August 2010.

6.2.3 The tax certificate

49. Clause II 4 of the Contract states:

“It is fully understood that the Club shall be required to provide to Player a tax certificate evidencing all Turkish taxes paid by the club on behalf of the player as provided in this Paragraph 4 when requested by the Player or agent.”

50. The Claimant submits that, until filing his Request for Arbitration, he had not requested a tax certificate from the Respondent. However, the Claimant requests a tax certificate from the Respondent in his request for relief. The Arbitrator finds that the request contained in the prayers for relief is a valid one for the purposes of clause II 4 of the Contract. Accordingly, the Arbitrator finds that the Club is required to provide the Claimant with a tax certificate evidencing all Turkish taxes paid by the Club on behalf of the Claimant.

7. Costs

  1. Article 17.2 of the FAT Rules provides that the final amount of the costs of the arbitration shall be determined by the FAT President and may either be included in the award or communicated to the parties separately. Furthermore Article 17.3 of the FAT Rules provides that the award shall grant the prevailing party a contribution towards its reasonable legal fees and expenses incurred in connection with the proceedings. The Arbitrator notes that the Claimant requests reimbursement of the non-reimbursable handling fee. The Arbitrator considers it appropriate to take into account the nonreimbursable fee when assessing the expenses incurred by the Claimant in connection with these proceedings. 
  2. On 31 October 2010, considering that pursuant to Article 17.2 of the FAT Rules “the FAT President shall determine the final amount of the costs of the arbitration which shall include the administrative and other costs of FAT and the fees and costs of the FAT President and the Arbitrator”, and that “the fees of the Arbitrator shall be calculated on the basis of time spent at a rate to be determined by the FAT President from time to time”, taking into account all the circumstances of the case, including the time spent by the Arbitrator, the complexity of the case and the procedural questions raised, the FAT President determined the arbitration costs in the present matter at EUR 7,200.00. 
  3. The Arbitrator notes that the Claimant paid both its own share of the Advances on Costs and that of the Respondent, totaling EUR 8,000.00. The Arbitrator notes that the Claimant was successful in establishing his claim in relation to salary and bonus payments owing under the Contract, but unsuccessful in establishing his claim in relation to the plane ticket. Thus, the Arbitrator decides that in application of Article 

17.3 of the FAT Rules:

(i)
FAT shall reimburse EUR 800 to the Claimant, being the difference between the costs advanced by him and the arbitration costs fixed by the FAT President;
(ii)
The Respondent shall pay to the Claimant EUR 6,480.00 being 90 % of the difference between the costs advanced by him and the amount he is going to receive in reimbursement from the FAT;

(iii) The Club shall pay to the Claimant EUR 2,700 in respect of his legal fees and expenses.

8. AWARD

For the reasons set forth above, the Arbitrator decides as follows:

I. Besiktas Jimnastik Kulubu is ordered to pay to Mr. Marque Perry USD 93,225.00.
II. Besiktas Jimnastik Kulubu is ordered to provide to Mr. Marque Perry a tax certificate evidencing all Turkish taxes paid by the Besiktas Jimnastik Kulubu on behalf of Mr. Marque Perry.
III. Besiktas Jimnastik Kulubu is ordered to pay to Mr. Marque Perry EUR 6,480.00 as a reimbursement of the arbitration costs.
IV. Besiktas Jimnastik Kulubu is ordered to pay to Mr. Marque Perry EUR 2,700.00 as a contribution towards his legal fees and expenses.
VI. Any other or further-reaching claims for relief are dismissed.

Geneva, seat of the arbitration, 3 November 2010

Raj Parker (Arbitrator)