Sports Law in the United Kingdom - Assignment Example

Sports Law Name Institution Date Sports Law Introduction Sports Law in UK serves to regulate sporting activities, organisations and players. It serves to provide a guideline on the best practices and discipline for teams and their players. This assignment discusses sports law in relation to contracts between teams and players, the regulation of drugs in sports and the influence of transfer window in restricting freedom of movement under EU law and its legality.   Question 1 1. You are the legal advisor for the Sky Pro-Cycling Team (Sky).  The Team is a UCI professional continental team andhas a schedule to compete in a number of events on the UCI World Tour.   There is a team of 28 riders and an additional team of coaches and specialist experts. One of the star riders, Henri Tevez, who was a key rider in 2011, has been receiving interest from a number of other professional teams during the season.  It is reported that Tevez has walked out from the team and is negotiating with Radioshack-Nissan (RN) Team. Tevez has claimed through his agent that Sky have not been asking him to ride in a number of races and have failed to pay him his expenses on time.  You have been asked to evaluate what legal powers Sky may have to force Tevez to honour the remaining nine months of his contract.  It transpires that Tevez had been asked to attend a meeting with RN who had indicated that they wanted him to join them. You are aware that it is prohibited under the regulations of the International Cycling Union (UCI) for one professional team to approach players under contract to another team. You are asked to provide advice as to what legal remedies are available to enforce Tevez to honour his contract with Team Sky. Answer The case of Henri Tevez is one that relates to breach of a contract. Henri is seen to be in breach of a contract by moving from his original team and starting new negotiations with another team with first clearing with Sky pro-cycling team with whom they already have signed a contract. The contract made between the Sky pro-cycling team and the player, Henry, is a restrictive covenant. A restrictive covenant is usually a clause that is included in a contract that is made between parties so as to prohibit an employee from competing with other teams by joining them while still in contract with the current team1. It is evident that, the existence of a restrictive covenant is a prima facie as being in restraint of trade. The employee cannot trade with a different team a part from the one under contractual terms2. His original team Sky pro-cycling wants him back. The contract between Tavez and Sky pro-cycling team is one of a restrictive covenant in nature. Originally, the contract had various restrictions that were set out between the parties that should not be breached. The restrictive covenant is classified as restraint to trade. Restrictive covenants are legal agreements that cannot be breached by the parties to the contract. This argument was supported in the case of Leeds Rugby Ltd v Harris & Bradford Rugby [2005] EWHC 1591 whereby the court held that, the contracts entered between a player and a team are valid and their terms are clear and sufficient to be enforced3. Therefore, Tavez was in breach of contract by moving from Sky pro-cycling team and starting new negotiations with a competing team. When handling restrictive covenants, it is important for the courts to be reasonable in the course of employment. Considering these covenants as unreasonable by the courts will mean that, it is a void contract. Therefore, as presented in the case of Leeds Rugby Limited vs Harris& Bradford Rugby [2005] EWHC1591, the court will classify it as a restraint to trade. The court will apply and evaluate the specific clauses of strictness in making the decision of reasonableness. Meaning that, the terms of the contract will guide the decision made by the court. In making the decision, there are various remedies that the court can award to the aggrieved party. If the court thinks that, the restrictive covenant is restrained to trade, it will not issue a negative enforcement of injunction. By awarding an injunction, the court will be supporting the public policy principle to protect the player by restricting the team from barring him to make negotiations to play for the other team4. On the other hand, if the court thinks that, it is reasonable, then it will enforce the contract so as to protect the interest of the employer and in our case the Sky pro-cycling team. Here, Henry will have to work under the terms set out in the contract agreement with the team up to the expiry of nine months. Failure to meeting these terms, Henry will be required to compensate the team for a breach of contract. Considering that, Henry had completed the nine months that were left for his contract with Sky pro-cycling. Then the court will face difficulties in enforcing the contract to justify the restrictive covenant. The reason is that, under such a situation, Henry has met the set terms of the contract with the employer. In our scenario, the Sky pro-cycling team is seen to oppress Henry by denying him several times to ride in a number of races and have failed to pay him his expenses on time. Paying on time to a player is a statutory requirement and it will be implied into employment contract please. Under article 21 of the UCI joint agreement rules, every player should be paid in full their minimum wages5. By failing to pay Henry his salary, the Sky pro-cycling team will be in breach of a contract. There are legal actions that the Sky pro-team can take in the event that, Henry makes the decision to withdraw completely from the team before the expiry of 9 months. First, the Sky pro-cycling team has the right to sue Henry Tavez. A player as an employee of the team must perform to receive their compensation. This means that, the court’s decision will be based on the matching of performance and salary. Secondly, the Sky pro-team can also sue the RadioShack-Nissan (RN) for making negotiations with a player who is already in a contract with another team and the time of contract has not expired. To respond to Sky pro-cycling team claims, the court will place an injunction for Henry by restricting him from making any playing negotiations with RN team. The reason is that, the contract between Henry and Sky pro-cycling team is still valid. This argument was supported by the judges in the case between Warren vs Mendy[1989] 1 WLR853 whereby the court held that, any negative stipulations in a contract either express or implied, they are statements of practice that must be applied by all the parties to the contract6. Therefore, by making negotiations with Henry, RadioShack will be inducing Henry to enter into an illegal contract that cannot be enforced. Therefore, Sky pro-cycling team will sue RN on the basis of inducing Henry to enter into negotiations with under the law of Tort. In the case of Lumley vs Gye, the court established that, under an employment contract, an employee is usually prohibited from performing elsewhere during the time of contract service. When a third party operates by moving towards a competing venue, with the intention of harming the employer’s business by maliciously enticing the employee to perform elsewhere who finally accepts other employment, the third party is said to induce the employee to breach of contract that has caused the former employer loss in form of business harm. Therefore, the employer has a right of bringing a case against the third party for damages7. In our scenario, it is clear that, RadioShack Nissan is interested in Henri Tavez to joining their team and has induced Henry to join them as a player. They are also aware of the existing contract between Henry and Sky pro-cycling, and are intending to induce the breach of contract. The induce knowledge, intention and breach is sufficient evidence to consider RN liable for damages caused to Sky pro-cycling. In the case between Leeds Rugby Limited vs Harris& Bradford Rugby[2005] EWHC 1591, the court held that, when a third part already knows of the existing contract between an employer and an employee and goes ahead to induce a breach of contract, the employer can sue the third party for damages8. The UCI rule on transfer of players requires that, players should not breach the terms of the existing contract9. Under Article 1 of the UCI joint agreement rules, a contract between a team who is the employer and the player who is the employee is binding. However, this rule will not apply to riders who are employed by the team and do not participate in international races. A player who participates in a single international race will be enough to regard the agreement applicable to him for the rest of the contract period10. In this contract, Henry has not been participating in the races. Therefore, the UCI rule does not apply to him. Therefore, he can terminate the contract before the completion of 9 months. The claims of Henry that he was not asked to participate in a number of races and the team has not paid him his expenses do hold in this case. The reason is that, such terms are usually implied terms in the original employment contract with the team. However, it is always important to put such terms in writing when making the contract agreement to avoid future problems in case a dispute arises. Therefore, the written contract goes beyond the express employment terms and it is important to put all the clauses in writing for them to be enforceable in the time of breach11. Due to the breach of contract, the contract will be terminated under constructive dismissal and ask RN to negotiate another contract. In the case of Macari v Celtic Football and Athletic Club Co Ltd [1999] I.R.L.R. 787, Constructive dismissal arises when an employer breaches trust and confidence to an employee by refusing to pay his expenses.12 The Sky Pro-cycling team has not been paying Henry his expenses on time. In the case of Kevin Keegan vs New Castle FC [2009], the court held that, an employee who breaches contract terms based on him not being paid his expenses, he can be dismissed constructively with partial compensation of damages13. The law requires that, employee should be paid on time and it is an implied term in the employment contract. In article 21 of the UCI joint agreement rules regarding compensation of salary, insurance and benefits, a player who is prevented from carrying out his activity for no mistake of his own, is entitled to his full remuneration by the team. The entitlement to compensation will come to an end after the completion of the contract14. In our scenario, the team has not asked Henry to participate in many of the matches. Failing to pay Henry his salary will be in breach of contract. If Henry fails to claim for constructive dismissal, he will not be a free agent since he still has 9 months remaining to complete his contract. A free agent is one whose appropriate protected period has expired and is allowed to unilaterally terminate his existing contract and move to another team after the completion of this period15. Claiming constructive dismissal means, Henry is not under the contract with Sky Pro-cycling team and has become a free agent. Henry does not have the duty to provide work; however, the fact that the team has not asked him to take part in a number of races is diminishing his skills. Based on him losing cycling skills due to failure of participation, Henry can claim for breach of contract by the team for failing to give him work16. Additionally, the team can take disciplinary action towards Henry due to the stability of the contract. Even though the contract does not stipulate duty to provide work, Henry can claim for a breach of contract if he feels that his skills will be diminished as a result of not being asked to take part in the races. On the other hand, the Sky team can still discipline Tavez due to the stability of the contract which is proportionate and was still valid17. However, the Sky team cannot force Henry to play for them since it is considered as restrained to trade as presented in the case of Ashley Cole v. Football Association Premier League (FAPL), award of 24 January 2006, whereby the court held that, if a team does not provide for the rights in its statutes regulations or in the terms of the employment contract, then the team does not have a right to enforce such rights18. The scenario at hand also raises the issue of monopolistic position of RN –Nissan whereby, in competition law, such a monopolistic position is dangerous to other clubs. The reason is that, most talented players in a club find themselves favourable in the monopolistic clubs19. Question 2 The UCI is very aware that in the wake of the Lance Armstrong scandal and on-going concerns about financial manipulation, they need to boost the sporting integrity of international cycling and adopt a zero tolerance approach.  They have introduced a (fictitious) new rule that a finding of involvement by riders and team management in doping or financial corruption including race fixing will result in a lifetime ban.  Evaluate such an approach to these issues and determine on what grounds such a sporting rule could be legally challenged. Answer So as to boost the sporting integrity of the international cycling and adopting a zero tolerance approach, the UCI needs to put strict rules that ensure players are responsible for their unlawful actions in sport. Any player who violates the rules will be liable for breach of integrity of sport. One of the rules that need to be upheld is the ban of drugs in sports. They also need to adopt an anti-doping code that restricts players from using illegal substances in sports. Substances such as Stimulants, Narcotics and Glucocorticosteroids must be prohibited. Additionally, methods of drug abuse like blood doping must be prohibited. This means that, the adoption of strict liability by the ICU must be implemented to ensure that players are punished for their rule violations. This will involve banning players from the sporting career. Strict liability means that, for the 1st violation, players will a player will be punished by a two year ban. For a second violation, a player will be given a life time ban. The punishment given to players through strict liability was justified in the case between Gasser v Stinson (1988) whereby the court held that, the use of drugs by players is regarded as a disease in sport and illegal for that matter. Therefore, a player need not take part in the sport since they are simply cheating by using drugs to enhance their performance20. Lifetime ban is considered as a restrain to trade. Evidently, life time ban has a legal relationship with restrain to trade since the player is restricted and cannot take part in matches. It is true that, a player has a contractual relationship with the governing body that has the responsibility for its doping regime. Therefore, the doping regulations are derived from this relationship. Any sport that is permeated by drugs becomes a common knowledge that, the participants make use of drugs and have a likeliness of suffering in its public image as well as reputation. Strict liability should be enforced for those players who are guilt of ingesting banned substance to enhance their performance. The reason is that, such players usually induce unfair competition in sports. Strict liability is a reasonable restraint to trade since it serves to control doping in sport in relation to substances that are used by players to enhance performance. It is a policy which aims at maintaining fair balance in competition21. Considering the Global sports law, the principle of proportionality in sports should be applied when making decisions to punish guilt players22. International sporting federations should not be allowed to freely apply the principle of strict liability as they wish23. It is seen that, there is inconsistency with the strict liability rule. The defendant in the case argued that, the substance was taken with an innocent intention. Strict liability was challenged due to its inconsistency of not considering the intention of the guilt player. In the case of Raducan v IOC (2000) CAS, inconsistencies of the strict liability rule was established when the defendant appealed the decision of the CAS to be reviewed by the Federal Tribunal without any success. The judges argued that, they are not able to interfere with the decision of the CAS since it was not inconsistent with the public order24. Strict liability in the anti-doping rule is also misleading in the sense that, in law, strict liability is liability without intention or negligence. This implies that, there was no intentional element and the sanction and intent are the same. However, in doping, strict liability means that the sanction is inevitable as long as violation of the anti-doping rule is established. It does not consider the culpability25. The test for doping warrants a player an absolute liability whereby, such a player is completely banned from the sport. However, when a player can prove that the substance used is not performance enhancing then, the ban can be reduced or void. These are the exceptional circumstances whereby, the player is not fault or negligence involving specified substances. In case of Aanes v FILA (2001) CAS, the court of arbitration held that, the sanction for the violation an anti-doping rule in sports is not considered as a criminal punishment in criminal law, but a disciplinary sanction in sport under private law. In such cases, the principles of criminal law do not apply. Therefore, the burden of proof is important to proof the facts and prevent the risk of succeeding to the court. The rights of the appellant should not be violated and should be given a fair hearing before the CAS. The strict liability cannot be relied on, players who have broken the rules with the intention or negligence should not be punished26. The UCI can also ban Olympic Games to reduce incidences of players’ use of drugs to enhance performance. However, questions have been raised in relation to life time ban. The big question is that, is Olympic life time ban justified. In the case of LaShawn Merritt CAS 2011/0/2422 USOC v IOC, the court decided that, it is illegal and unenforceable to prohibit players who have been suspended for a period of over six months as a result of violating the anti-doping rule from participating in Olympic Games after the expiration of their suspension. Therefore, a life time ban rule on Olympic Games is not enforceable27. In the case of CAS 2011/A/2658 British Olympic Association (BOA) v. World Anti-Doping Agency (WADA) the court held that, the claims of banning players from participating in Olympic Games is dismissed on the basis that, parties to the contract can give effect to the present award in good faith and according to the Olympism spirit of the parties28. Question 3 There is a transfer window operated by the UCI. A number of riders have argued that it operates as a restriction on freedom of movement under EU law.   Provide a report on the legality of this sporting rule. Answer The freedom of movement rule under the EU law provide that, there should be free movement of workers and this is a fundamental freedom that should be adhered by all organisations whether in business or any other form of undertaking. The freedom of movement rule is clearly stipulated in Article 45 of the Treaty on the Functioning of the European Union (TEFU). The TEFU stipulates various provisions to the Member States that they should eliminate any discrimination that are based on the nationality of workers between the Member States in relation to employment, remuneration as well as other working conditions. Any Member State or any organisation that discriminates against workers due to their Nationality will be in violation of Article 45 of the TEFU29. The TEFU provisions on free movement of workers include; public security, public health limitations that are subject and justified on the public policy grounds as well as various rights to workers. Under TEFU, the workers have rights to their acceptance of made proposals for employment, to freely move in the territory of the Member States for employment, to stay with the Member States for the purpose of employment and according to the provisions that govern the employment of citizens of those States as stipulated by the law. Workers are also allowed to remain within the territory of the Member States after being employed in those States, subject to conditions that are exemplified within the regulations that are set up by the commission. The Freedom of Movement rule is also supported under Article 101 of the TEFU which states that, the TEFU prohibits all agreements that are made on undertakings, any decisions by associations of undertakings as well as concerned practices that may affect trade among Member States as well as which has their objective or effect in preventing, restricting or even distorting competition in the internal market. Any organisation that makes any decision of undertaking against this rule will be in violation of Article 101 of the TEFU30. Any decision by an association of undertakings that is under anti-competitive arrangements is said to be in breach of Article 101 of the TEFU. The reason is that, such a decision can lead to the dominant suppliers adopting strategies for resisting market penetration by their competitors. Under Article 102 of the TEFU, the Freedom of Movement rule is well protected and considered as legal under the European law. Article 102 prohibits companies form abuse of dominant position. The Article stipulates that, “TEFU prohibits abusive conduct by companies that have a dominant position on a particular market.”31 Abuse of dominant position occurs when a company does not compete on the merits like other companies. Such a company is said to be in conduct that distorts competition and thereby in abuse of dominant position. In our case study, transfer windows that are operated by the UCI are considered to operate as a restriction to the freedom of movement rule under EU law. Transfer windows are considered to restrict freedom of movement, in the event where the rules that are laid down by a Member State to prohibit players from participating in other matches in other Member States within the European zone. This is a restriction of free movement and is in violation of the free movement rule32. In the Kolpak (2003) case, the court held that, the Slovakian handball player has rights of EU national for moving in EU to play for other teams. All citizens in countries with agreement with EU possess the same rights as any other European worker. However, there are situations when transfer windows can be considered to be legitimate. The transfer windows operated by the UCI are legitimate. Transfer windows are legitimate when the transfer rule that constitutes a hindrance to freedom of movement pursues a legitimate aim with the Treaty. It should also be justified by reasons that override public interest. In such a case, the transfer rule must be ensured to achieve the objective in question and does not go beyond what was necessary for that purpose33. The transfer windows operated by UCI requires a particular number of players to have been developed locally for at least 3 years between the age of 15 and 21 to play for the national team in in the country club. Article 39 EC Treaty- Freedom of movement for workers provides that, “freedom of movement for workers shall be secured within the Community.” This is consistent with the UCI transfer windows that are aimed at securing the freedom of movement for workers within the community. It is indirectly discriminatory and operating proportionate in the sense that, sporting decisions as well as practices need to be viewed in the context of their objectives as well as rationale. This means that, any effects that are aimed at restricting competition should be determined whether they have the intention of pursuing the set objectives and are proportionate, with which they could not have been achieved effectively using other means. In the Bosman Case, the court held that, the objective of maintaining a balance in clubs by way of preserving equality and uncertainty through recruiting and training young players is a legitimate objective. In the Lehtonen (2000) case, it was held that, the transfer rules regarding the transfer window that sets deadlines for transfers of players is a legitimate objective since it ensures the regularity of sporting competition. In the Bernard (2010) case, the court held that, specific characteristics of the sport in terms of social and educational objectives must be considered and are legitimate objectives34. Conclusion The regulation of sports serves to limit the actions of players and teams and avoids breach of contracts. 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