In decision 4A_502/2017, the Swiss Supreme Court rejected a challenge to set aside a Court of Arbitration for Sport award based on an alleged violation of the right to be heard and breach of substantive public policy. In a French-language decision dated 25 June 2018, but only recently published, the Swiss Supreme Court rejected a challenge to set aside a Court of Arbitration for Sport (CAS) award for alleged violation of the right to be heard and breach of substantive public policy.

In the underlying arbitration, the CAS panel (Panel) had to decide in appeal proceedings, further to a first instance decision by FIFA's Dispute Resolution Chamber, on the amount of salaries / compensation due to a professional football player (Player) following the immediate termination of his employment contract by an Egyptian football club (Club). In its award, the Panel ordered the Club to pay the Player a sum of USD 254,000 for outstanding salaries as well as a sum of USD 650,000 as a compensation for unfair dismissal.

The Club filed a challenge against the award arguing that its right to be heard and substantive public policy had been violated. More specifically, the Club invoked the following arguments, each of which was dismissed by the Court:

  • The Club first argued that its right to be heard had been violated, because the Panel did not take into account some checks allegedly demonstrating that a number of interim salary payments had been effected, while at the same time the Panel admitted the relevance of other checks. The Club contended that this difference in treatment applied to similar evidence preventing the Club from properly presenting its case. The Court dismissed this argument, holding that the different weight given to evidence of the same nature does not pertain to the right to be heard, but relates to the Panel's assessment of the evidence which falls beyond the scope of review of the Court in setting aside proceedings.
  • The Club further contended that its right to be heard had been violated on the ground that the Panel ignored a piece of evidence validly submitted and, in reaching its decision, the Panel also gave an excessive probative value to written testimonies filed by the Player. The Court held that both issues also pertain to a tribunal's assessment of the evidence, which the Court does not review in setting aside procedings. Further, the Club argued that the Panel erred when it applied the contra proferentem doctrine to the Club's detriment in relation to a document that allegedly applied to the employment relationship between the Club and the Player. Rejecting this argument, the Court confirmed that it does not review how abitral tribunals apply the law (except when there is a breach of public policy).
  • The Club also invoked a violation of public policy, claiming that the Panel's interpretation of the employment contract was contrary to the principle pacta sunt servanda. Dismissing this argument, the Court recalled that, as a rule, it does not review matters related to contract interpretation.
  • Finally, the Club alleged that the Port Said Stadium riot ─ in which 74 people were killed and more than 500 were injured, and following which the Egyptian football league was suspended for two years
  • amounted to a force majeure event causing a sharp decrease in the Club's revenues and preventing it from paying the Player's salary. The Club contented that the Panel's refusal to apply the force majeure principle in the case at hand violated substantive public policy. Considering that the Panel carefully examined the issue in the award and then rejected it, the Court refused to review the Panel's findings and thus did not decide on the question of whether material public policy also includes force majeure.

This case is a confirmation that in setting aside proceedings, a party may not purport to argue a violation of its right to be heard when in reality it is merely criticizing the assessment or weighing of evidence by the arbitral tribunal. This case is also a confirmation that the concept of substantive public policy is very narrow in setting aside proceedings. The Supreme Court does not review the findings of fact or the application of the law by the arbitrators, unless public policy within its narrow meaning is breached.

Case: Decision 4A_502/2017 (Swiss Supreme Court).

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