The issue of players moving clubs when contracted to a Premier League or Championship club has been the subject of various cases (the Bosman ruling being one example) and FA rules (compensation for youth players being another), and it is now a fact of life that clubs will have to pay a transfer fee in most cases. What has been less of an issue, at least publicly, is the poaching of managers who are under contract.

The case of Crystal Palace FC (2000) Ltd v Dowie gives an interesting insight into how the Courts will look at a situation in which a manager wishes to leave a club and the club's ability to prevent a manager from just "upping sticks" when he wants to join another club.

It is only relatively recently that football clubs appear to have realised the value of a competent manager, which is somewhat surprising given the obvious financial advantages of achieving promotion, and the perils of relegation.

In the case of Mr Dowie and Crystal Palace, the compensation provisions in Mr Dowie's employment contract included a term that £1 million would be paid to Crystal Palace if Mr Dowie left and joined another League or Premier League club before 30 June 2008.

The term was designed to retain Mr Dowie and discourage him from leaving the Club prematurely. It was the operation of this clause which became the focus of the dispute between the parties.

Mr Jordan (the Chairman of the Club) alleged that Mr Dowie made fraudulent misrepresentations (about his intentions on leaving Crystal Palace) which induced the Club to enter into a compromise agreement with him. The main terms of the agreement were that Mr Dowie was released from his employment and agreed to waive his rights to make certain employment claims and the Club reciprocated by waiving its right to pursue any claim for the compensation of £1 million.

The court held that Mr Jordan had been induced by Mr Dowie's fraudulent misrepresentations, but that the usual remedy of rescinding the compromise agreement and returning the parties to their previous positions i.e. reviving Mr Dowie's employment contract, would not be just and equitable in the circumstances – English law takes the view that it is against public policy to grant specific performance of contracts that require personal service. Furthermore, Mr Dowie, on leaving, was employed by Charlton FC and so the rights of the new club had to be considered, along with the fact that the relationship between Mr Jordan and Mr Dowie had broken down. The court also held that the compensation clause would not be revived on its own. The appropriate remedy would be an award of damages or other financial relief.

Following on from this decision, Mr Dowie requested leave to appeal and in the meantime entered into settlement negotiations with Crystal Palace. Once he was granted leave to appeal, Crystal Palace tried and failed to convince the court that a binding settlement had been reached with Mr Dowie pursuant to which he was to pay £350,000 in damages plus costs. The court held that, on the evidence, it was clear that Mr Dowie had made an offer to pay damages and costs, but that his offer was conditional upon the settlement agreement containing a confidentiality clause. Since no mention had been made of such a clause in the final negotiations, there could not be a binding agreement.

Overall an unhappy outcome for Crystal Palace, but it is very difficult to protect against someone who is prepared to dissemble in negotiations.

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