CAS Case Digest · Verified against the full award text

CAS 2024/A/10441 & CAS 2024/A/10442 — Jairon Andrés Charcopa Cabezas & Liga Deportiva Universitaria de Quito (L.D.U.) v. FC Lugano & FIFA

"Charcopa / LDU v. Lugano" · CAS upheld CHF 158,221.55 compensation for breach of the Lugano employment contract but annulled sporting sanctions on both the player and LDU.

What happened in Charcopa / LDU v. Lugano

Ecuadorian player Jairon Charcopa signed a transfer agreement and a future employment contract with Swiss club FC Lugano on 8 February 2022, with the employment contract (LFC Contract) set to run from 1 July 2023 to 30 June 2026 at CHF 5,400 per month. After his Ecuadorian club CASD was relegated in October 2022, the player terminated his CASD contract and, on 15 January 2023, signed with LDU Quito without informing or consulting Lugano. Lugano sent five formal letters warning of the breach; the appellants did not respond. Lugano filed a DRC claim; on 14 February 2024 the DRC ordered the player and LDU jointly and severally to pay CHF 158,221.55 plus 5% p.a. interest from 15 January 2023, imposed a four-month playing ban on the player, and banned LDU from registering players for two consecutive transfer windows. Both appellants appealed to CAS. The panel confirmed the compensation in full, finding the LFC Contract remained valid and enforceable, the player breached it without just cause, and the averaging methodology was appropriate. However, the panel annulled both sporting sanctions: the player's because the unusual deferred-start structure and his economic vulnerability mitigated the gravity of the breach, and LDU's because the presumption of inducement under Article 17(4) RSTP was rebutted — the LFC Contract was unregistered and Lugano had not yet notified LDU of its existence when the LDU Contract was signed.

Procedural history of CAS 2024/A/10441

On 3 November 2023 FC Lugano filed a claim before the FIFA Dispute Resolution Chamber (DRC) against the player and LDU, seeking compensation for breach of the LFC Contract under Article 17 RSTP, primarily USD 325,000 as liquidated damages or alternatively USD 467,764.20. On 14 February 2024 the DRC partially upheld the claim, ordering CHF 158,221.55 plus 5% p.a. interest from 15 January 2023, a four-month playing ban on the player, and a two-window registration ban on LDU. The DRC grounds were notified on 8 March 2024. The player filed his CAS appeal on 15 March 2024 (CAS 2024/A/10441) and LDU on 21 March 2024 (CAS 2024/A/10442). The parties agreed to consolidate the two procedures. The CAS Deputy President stayed the player's playing ban on 24 April 2024; the panel stayed LDU's registration ban on 30 May 2024. A videoconference hearing was held on 25 October 2024.

Key holdings in CAS 2024/A/10441

• The LFC Contract was not terminated by the termination of the Transfer Agreement; it remained in force when the player signed with LDU on 15 January 2023, because the LFC Contract contained no condition precedent linked to the Transfer Agreement and had its own autonomous termination grounds.
• The LFC Contract was valid and enforceable despite its deferred entry into force of approximately 17 months after signing; Article 18(3) RSTP's six-month window does not apply where the employment contract flows directly from a transfer agreement.
• The player breached the LFC Contract without just cause by signing the overlapping LDU Contract, and compensation of CHF 158,221.55 plus 5% p.a. interest from 15 January 2023 — calculated by averaging the salaries under the LFC Contract and the LDU Contract — is confirmed as appropriate under Article 17(1) RSTP.
• The four-month sporting sanction on the player is annulled because the unusual deferred-start contractual structure, the player's economic vulnerability after CASD's relegation, and the fact that the breach occurred six months before the contract entered into force collectively justify departing from the default sanction.
• The registration ban on LDU is annulled because the Article 17(4) RSTP presumption of inducement is rebutted: the LFC Contract was unregistered and Lugano had not yet notified LDU of its existence at the time the LDU Contract was signed on 15 January 2023.

How the CAS panel reasoned

The panel first confirmed that the LFC Contract and the Transfer Agreement, while related, were legally independent instruments with different parties and subject matters. The LFC Contract contained no condition precedent and its own exhaustive termination grounds; CASD's relegation therefore did not automatically extinguish it. The panel rejected the argument of mutual abandonment, finding that Lugano's conduct — five formal letters, flight tickets purchased, work-permit proceedings initiated — demonstrated a clear intention to perform. On compensation, the panel applied the objective criteria of Article 17(1) RSTP, endorsed the DRC's salary-averaging methodology as reasonable and even favourable to the appellants (since the player's LDU salary was lower than the LFC salary), and rejected subjective reasons for the lower LDU salary as irrelevant. On sporting sanctions, the panel exercised its recognised discretion under CAS jurisprudence (citing CAS 2020/A/7310, CAS 2017/A/4935, CAS 2016/A/4550) to depart from the default rule. For the player, the unusual business structure, the deferred start date, and the economic hardship created by CASD's relegation reduced the gravity of the breach sufficiently that compensation alone adequately protected contractual stability. For LDU, the panel found the Article 17(4) presumption rebutted because the LFC Contract was unregistered, Lugano had not yet warned LDU when the LDU Contract was signed, and the player had expressly warranted in the LDU Contract that no legal obstacles existed.

Why Charcopa / LDU v. Lugano matters in CAS jurisprudence

This award clarifies that a future-dated employment contract signed alongside a transfer agreement retains independent validity even after the transfer agreement collapses, reinforcing contractual stability under Article 17 RSTP. It also demonstrates that CAS panels retain genuine discretion to annul default sporting sanctions where the contractual structure itself created the instability, and that the Article 17(4) presumption of inducement can be rebutted where the employment contract was unregistered and the new club had not been formally notified before signing.

Cases cited in this award

CAS 2008/A/1519-1520 CAS 2010/A/2145-2146-2147 CAS 2020/A/7310 CAS 2017/A/4935 CAS 2016/A/4550 CAS 2008/A/1568

Frequently asked questions about Charcopa / LDU v. Lugano

Why did CAS annul the sporting ban on Charcopa if it confirmed he breached the Lugano contract?

The panel exercised its recognised discretion under CAS jurisprudence (CAS 2020/A/7310; CAS 2017/A/4935; CAS 2016/A/4550) to depart from the default four-month ban. It found that the unusual deferred-start structure of the LFC Contract — which did not take effect until 17 months after signing — combined with the player's economic vulnerability after CASD's relegation and the fact that the breach occurred six months before the contract entered into force collectively reduced the gravity of the breach. The panel concluded that the CHF 158,221.55 compensation adequately protected contractual stability without the additional sporting sanction.

How did CAS calculate the CHF 158,221.55 compensation in the Charcopa v. Lugano case?

The DRC, confirmed by CAS, applied the objective criteria of Article 17(1) RSTP by averaging the player's remuneration under the LFC Contract (CHF 5,400 per month) and the LDU Contract (USD 641.65 fixed plus USD 858.35 conditional per month). The panel found this methodology reasonable and noted it was actually more favourable to the appellants than simply applying the LFC Contract salary alone, since the player's lower LDU salary reduced the overall average. No liquidated damages clause existed in the LFC Contract, and no evidence of replacement costs or market value was produced.

Was LDU's registration ban annulled because it acted in good faith when signing Charcopa?

Yes. The panel found that the Article 17(4) RSTP presumption of inducement was rebutted by the specific circumstances: when LDU signed the player on 15 January 2023, Lugano had not yet sent any communication to LDU about the LFC Contract (the first letter came on 3 February 2023), the LFC Contract was not officially registered anywhere, and the player had expressly warranted in the LDU Contract that no legal obstacles prevented him from signing. Under FEF regulations LDU also had fair reason to believe the player was free following CASD's relegation.

Did the termination of the CASD transfer agreement automatically end Charcopa's employment contract with Lugano?

No. The panel held that the Transfer Agreement and the LFC Contract were legally independent instruments. The LFC Contract contained no condition precedent linked to the Transfer Agreement and had its own exhaustive list of termination grounds in Clause Three, none of which covered the collapse of the Transfer Agreement. The panel also found no unequivocal mutual abandonment by the parties, noting that Lugano sent five formal letters and purchased flight tickets for the player once it learned of the situation, demonstrating a clear intention to perform the LFC Contract.

Topics: Art. 17 RSTP & contract termination at CAS

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