Fiduciary duties, football, and the fundamental importance of the contractual relationship

Can a senior employee be ordered to pay back his past contractual remuneration to his employer as a remedy for breach of fiduciary duty, in particular a duty to confess his own wrongdoing? There has been an increasing trend over the past few years for employers, outraged at the belatedly discovered wrongdoing of a trusted senior employee, to not only seek to justify summary dismissal on the basis of after-discovered gross misconduct but also to go a step further and try to recover the salaries or bonuses already paid to the employee prior to discovery of the misconduct.

The potent cocktail of substantial sums of money, murky transactions, volatile employment relationships and mercurial billionaire owners means that football is an inevitable testing ground for the law in this area. This was typified in the recent case of Mauro Milanese v Leyton Orient Football Club Ltd [2016] EWHC 1161 (QB).¹

Misconduct

In Milanese, Whipple J. dismissed the Claimant’s, Mauro Milanese (Leyton Orient’s former Director of Football), claim for wrongful dismissal, finding that the Club was entitled to dismiss him for gross misconduct concerning a third party’s dealings with an Academy Player.