In May 2020, Football Club Mamelodi Sundowns and coach Pitso Mosimane inked a fresh four-year deal negotiated through Mosimane's agency, Moira Tlhagale Sports Marketing ("TSM"). Sundowns paid TSM an upfront ZAR8.6 million commission and added a "clawback" clause: if the coach left early, a pro-rata chunk of that commission had to be repaid. Four months later, Mosimane resigned for a big move to Egyptian club Al-Ahly. Sundowns sued both TSM and Mosimane for ZAR7.9 million - the unused portion of that commission, plus interest and costs.
Legal issues
- Jurisdiction – Did the Premier Soccer League's Dispute Resolution Chamber ("DRC") or the High Court have the power to hear the fight?
- Contract validity – Are those clawback clauses enforceable or "unconstitutional, unfair and discriminatory"?
- Mutual vs. breach – Was the exit a friendly, mutual parting that killed the clawback, or a breach triggered by Mosimane?
- Constructive dismissal & discrimination – Did Sundowns create intolerable working conditions?
- Costs – Who foots the (hefty) legal bill?
Findings
- Jurisdiction: The dispute centered on an agent's commission, not an on-field issue, so the NSL Handbook pushed it outside sport arbitration and squarely into court.
- No written release = no escape: Press statements and handshakes are nice, but the contract said any variation had to be in writing. None existed.
- No constructive dismissal: The judge found no evidence Sundowns forced Mosimane out; he chose a bigger gig abroad.
- Clawback clause stands: Both agreements were voluntarily signed after legal advice; enforcing the payback wasn't "unfair, unreasonable or against public policy."
- No discrimination proved: TSM actually negotiated a higher commission than two other agencies cited for comparison.
As such, the court held that TSM and Mosimane are jointly and severally liable for ZAR7 912 905 plus 7% interest from 10 May 2021 plus costs, including two counsel.
Key takeaways
Clawback clauses are valid. In this case, both parties
signed the contracts willingly, with legal advice. The clauses were
clear, fair, and enforceable.
Clawback clauses are a very useful tool in securing performance. This has particular importance in the realm of sponsorships, endorsements and influencer agreements where there is often little control and any harm suffered is typically very public. If it is undesirable for the parties to continue their collaboration a clawback also allows for a practical remedy to reduce the harm suffered.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
