Can Football Participants Opt Out
of Seemingly Prescribed Dispute Resolution Mechanisms?
21st August 2024
One of the biggest frustrations and concerns for many football participants (e.g. players, agents, managers, clubs) comes in regard to what happens if they are engaged in a dispute with another football participant.
This frustration isn’t so much based on the dispute itself, as this can always be resolved by the parties themselves privately, but what happens should the parties to the dispute not be able to come to a resolution by themselves? They may ultimately wish to have a structured means of dispute resolution without a third-party passing judgment or imposing a reward or settlement.
I will hold my hand up and say I
have used the possibility of a football arbitration proceeding (e.g.’ Rule K’
in England with the FA) to my advantage as an agent in the past, when in
dispute with another participant. Not so much as a ‘large stick’ to
threaten, but moreso a means of declaring I am serious about the dispute, and saying
‘if you want to do this, then let’s
do it, but do it properly’, and resolve it through an official, fair and structured
process.
In general, the lesser football disputes (as well as some more significant ones) are usually resolved privately, as the parties either:
(i) Know how laborious the arbitration (or litigation) process can be,
(ii) Know how costly it can be,
(iii) Would prefer not to have the unnecessary distraction, and/or
(iv) Do not want the matter to come to the attention of others (e.g. rivals, media, authorities or the general public).
Legitimacy of Prescribed Football Dispute Resolution Mechanisms
Now don’t get me wrong on this, I am not totally opposed to the use of a prescribed dispute resolution mechanism that FIFA and other football governing bodies outline in various regulations and governing documents. Not least as aspects of dispute resolution are a standard element of any meaningful contract; as are such things as governing laws, jurisdiction, etc. As such, subsequently, standardisation of this in the first instance (especially in standard contracts), is just common sense and offers the parties to the agreement a degree of certainty (if not protection) should a dispute arise in the future.
However, there is seemingly in some cases a certain amount of resentment amongst many in the football industry for having to adhere to such a seemingly fixed and prescribed way of resolving disputes. In many cases, those in dispute would probably prefer to mutually agree on an alternative means of resolving their dispute, rather than involve the football authorities and have them impose a judgment and award.
Although, it is widely accepted that in most standard litigation procedures (i.e. through the courts), the costs can far exceed the financial and time implications, when compared to that of a managed arbitration process, as is the method in many football disputes (both through FIFA and national member football associations).
Only in recent years, have I come to question whether such prescribed football dispute processes are mandatory, or whether they are effectively ‘advised’ procedures (by the likes of FIFA) that cannot be mandatory and imposed unless supported by laws and legislation (either nationally or internationally).
The Option to ‘Opt-Out’
It wasn’t until the FIFA Annual Law Review (FLAR) last year that I heard a FIFA presenter (a recognised and respected sports lawyer, not a FIFA employee), talk about the legitimacy of a football participant who is a party to a dispute ‘opting out’ of a prescribed FIFA dispute resolution procedure.
Granted, this was not in terms of football participants opting out completely from their dispute being heard within the football framework. Instead, it was in terms of the parties opting out of the FIFA DRC (Dispute Resolution Chamber) for a dispute of an ‘International Dimension’ in favour of a NDRC (National Dispute Resolution Chamber).
I share the seeming reservations of the presenter at the FLAR as to why the parties would ‘opt out’ of the DRC in favour of an NDRC in regards to such a dispute. Quite rightly, that is, in my view, a matter for the disputant parties to decide upon, and them alone, in their initial agreement/contract.
However, if this approach is permitted by FIFA, in ‘explicitly’ declaring that in a contractual agreement between the parties, and the subsequent ‘fall-back’ arrangement is to revert to the prescribed mechanism if the dispute is unresolved, then what is there to legitimately forbid parties stating in an agreement that they, as parties to the agreement, will ‘opt out’ of FIFAs prescribed dispute resolution mechanism in favour of any other legal dispute resolution mechanism as a first option?
A Simple Mediation Clause in Representation Agreements/Contracts
As such, and with this notion of an ‘opt-out’ in mind; it seems perfectly feasible, legitimate, lawful, and permitted for parties to a football related agreement, to explicitly ‘opt-out’ of any standard dispute resolution mechanism prescribed by FIFA or any other related football governing body (e.g. National Member/Football Association).
Whilst ‘pistols at dawn’, or a ‘fight to the death’ is not an option for obvious reasons, if the parties in dispute so wish, it is possible that a game of chess, the ‘toss of a coin’, a round of ‘rock paper scissors’, or even a ‘penalty shoot-out’ if defined adequately in the agreement, could arguably be a means of preferred dispute resolution. Whilst these less conventional suggestions for resolving a dispute may be feasible, they are not a sensible or practical means to resolve what may be a dispute of high value or importance.
Hence, it is ‘beyond me’ as to why parties to a football related agreement/’contract; whether between player and club, player and agent, manager and club, club and agent, agent and agent, etc, do not define a mediation clause in their agreements. And also, ultimately why any responsible legal adviser to such parties, does not suggest such a suitable clause?
Such mediation clauses for dispute resolution can still be underwritten by a prescribed arbitration clause, should a resolution not be reached through mediation. However, the success rates for mediation suggest it may rarely be required to revert to a further means of dispute resolution such as arbitration, a tribunal, or even litigation; given that a resolution to the dispute is highly likely to be achieved through mediation in the first instance (according to CEDR research).
The Benefits of Mediation in a Dispute
Whilst ‘mediation’ is still a concept that is widely misunderstood and underappreciated in the commercial world (not just sport and football), the benefits of it as a form of ADR (‘Alternative dispute resolution’) are widely acknowledged by many, including many responsible practitioners in the legal profession.
Just as an overview, possibly the four most widely acknowledged benefits of mediation in dispute resolution are:
TIME – the process from agreeing to mediation and either reaching a resolution or ‘walking away’ is often quicker than any prescribed arbitration process, and certainly far more expedient than any formal litigation.
COST – the costs of mediation can be quite accurately predicted, if not in many cases, limited or fixed. And even when they aren’t, the costs are widely acknowledged to be considerably less than those associated with both litigation and arbitration.
FREEDOM – comes in three parts (i) it is up to the parties involved in the dispute whether they engage in mediation and when they want to walk away, (ii) it is the parties who decide jointly on any resolution to the dispute. The mediator(s) is impartial and doesn’t pass or impose any judgment. And (iii) the resolutions to the dispute are limited only by the creativity of the disputant parties (and in some cases the mediator), whereas litigation and arbitration are often limited to a limited set of sanctions and/or awards (e.g. money, goods).
CONFIDENTIAL – even though arbitration in many cases does have an element of confidentiality to it, this is not always the case. Whereby a finding or ruling is in the interest of others (e.g. other sporting participants or stakeholders), some details can be published, even without the consent of those who are party to any such dispute. In addition to this, it is not uncommon for the matters of the dispute and the arbitration hearing to be made available in full, to the football authorities. Thus detailing matters that the parties would prefer the governing bodies not to be aware of. However, mediation is a totally confidential process, unless the parties to the dispute and the mediator(s) explicitly agree otherwise.
Even FIFA Now Recognise ‘Mediation’ and In Effect offer an ‘Opt-Out’
It is interesting to note that even in the last year or so, FIFA have also come to recognise mediation as a plausible addition to its own dispute resolution mechanisms (i.e. arbitration and DRC), and ultimately encourage many of those in dispute to consider mediation as an alternative.
However it is worth pointing out that many do find FIFAs approach to mediation somewhat questionable. In my opinion it is not ‘true’ mediation, but more a form of ‘quasi-arbitration’ that forgets some key values and principles of mediation, as I wrote about in the following article :
However, on this basis, it gives yet further weight to the argument that by FIFA permitting football participants a means of ‘mediation’ to resolve their disputes as an alternative to a previously prescribed method of dispute resolution – even FIFA is offering an ‘opt-out’ to mediation, albeit indirectly.
An Uncomplicated Alternative
Some may read this article and believe that whilst a mediation opt-out clause is an attractive option, it would prove to be complicated and expensive. However, when compared to many of the clauses added or amended to a football-related contract, such a clause is arguably very straightforward and should not trigger huge additional legal costs or any unnecessary complications.
A mediation opt-out clause in the likes of a playing contract, a representation agreement, an employment contract, etc is a worthwhile safety net for all parties to an agreement/contract, which leaves them in total control.
It does not determine the means of resolution should a dispute unfortunately arise, as any disputant parties should have to mutually agree to mediation in the case of a dispute.
Or alternatively revert to the prescribed FIFA methods of dispute resolution in the agreement/contract (i.e. arbitration), which come with their own problems including cost, time, exposure, scrutiny, and distraction.