Some practical tips for sports clubs when settling disputes – with a focus on those issues that regularly arise in a sporting context.
Settlement agreements come in all shapes and sizes. When supporting clubs on a wide range of settlement issues, those responsible internally for settling disputes are often faced with documents which aim to compromise all disputes between the parties.
For those short on time, it can be challenging to navigate unfamiliar drafting whilst ensuring that the agreement: (i) does what it needs to and doesn't leave any gaps – unless by design; but (ii) does so with minimal fuss and redline.
We have therefore produced a tip sheet of 5 key areas to consider when settling sports disputes. It's not an exhaustive list, but helps to focus on what are often the key areas to think about.
Some practical tips
More than just the club: it's common to see drafts of settlement agreements that seek to resolve claims between: (1) a club and its group companies; and (2) the counter-party. Don't forget to check whether you need to settle claims further afield against directors, owners and/or consultants to the club.
We have seen a significant rise in individual directors and officers (including club and company secretaries) becoming embroiled in disputes in a personal capacity. Don't forget that owners and increasingly consultants may also be at risk depending on their day-to-day involvement. Never inadvertently leave a key person behind.
Clean slate: do you want to encompass all potential claims under your settlement agreement? If yes, ensure that the settlement wording makes it clear that it is on a full and final settlement, satisfaction and release basis.
A settlement agreement is often the perfect opportunity to resolve all disputes between the parties (both ways) – having a mutual settlement and release assists in creating a clean slate and encouraging co-operation and collaboration moving forward. It's also good practice to include a no admission of liability clause.
If proceedings have been issued in Court already, make sure you use a consent order to discontinue the proceedings commonly with no order as to costs. Defendants – avoid a Tomlin Order where you can.
Getting everything done: proceedings might have been issued already, or there may be arbitral or disciplinary complaints which have been submitted by one or all parties. Either way, it's a good idea to include a further assurances clause. It's more than just boilerplate wording and creates a specific obligation on the parties to promptly execute and deliver the documents / do the things / procure that things are done which are required to give full effect to the settlement agreement. This can include the withdrawal of complaints made (for example) to the Premier League, EFL or the FA in a football context – a further assurances clause would often sit alongside express obligations to take such steps.
Have confidence: including specific confidentiality obligations in the settlement agreement is a given. However, consider carefully the relevant carve outs and what might be required from a regulatory perspective. If you're an agency settling a dispute with another agency for an intermediary related dispute, you must now disclose a copy of the settlement agreement to the FA – be clear that doing so does not amount to a collateral waiver of confidence. You may also need to disclose confidential information about any numbers involved to accountants and/or auditors or HMRC. Ensure that there are back-to-back obligations on third parties to keep information confidential subject to the usual legal and regulatory carve-outs.
Often key to the issue of confidentiality is for the parties to agree up front what statements are / aren't permitted. This typically comes in the form of agreed statements in an annex, with the settlement agreement expressly calling out any issues that the parties agree not to refer to. This mitigates the risk of disputes arising from public statements made in the heat of the moment.
Settlers' remorse: often the fact that parties have compromised their disputes doesn't mean that they're suddenly the best of friends. Parties may therefore think about including anti-disparagement wording to create a legal obligation on the parties not to make statements that would damage the reputation of the other.
These tips are best used as a crib sheet to sense-check the document in front of you (rather than acting as the starting point for an agreement).