Luis Suarez case highlights confusing contractual clauses

It may be surprising to some that there can be contractual disputes in sport considering that most sports have a standard contract that must be used between clubs and players. However, there can be, and often are, disputes between clubs and players regarding the “extra” contractual clauses that are often inserted into contracts.

In football, these contractual clauses are often in relation to additional bonuses or financial incentives due to the player. One recent example is that of Charlie Adam, who took his dispute over an unpaid bonus to a Premier League Board hearing. This dispute highlights the potential serious ramifications of these disputes; Adam alleged that the non-payment of the bonus amounted to a repudiatory breach of his contract – one so serious that he could deem his contract as being terminated. Other examples include those in relation to “buy-out” clauses, an example being that of Luis Suarez, in which the player believed that an offer from an other club over a certain amount triggered a clause that enabled him to transfer to that club. Instead it was agreed that the clause obligated the club to enter discussions with the player about his future at the club that was triggered - two fundamentally different things!

From our experience most disputes are in relation to the interpretation of a clause, so it’s important to understand the context behind the clause too. There is often ambiguity in these clauses. For the sums at stake, it’s amazing how few have been drafted by lawyers!

The issue for any player or club is that contractual ambiguity can be costly, with legal costs being significant and in some instances surpassing the amount at dispute. It is therefore sensible to run any contracts past a lawyer before signing them to avoid costly disputes down the line.