C-1/55

4. Servants of the Community — Abolition of a post — Powers of the Administration — Reassignment of the servant The administration has the power to organize its services as it wishes and in the inter­ ests of the service. It acts in the full exercise of its powers when it abolishes a post which it considers unnecessary. The abolition of a given post cannot, on that count alone, result in the dismissal of the servant who occupied it. Rather, it renders that servant free to occupy another post (Treaty, Article 31).

5. Liability ofthe Community — Wrongful act on the part ofthe Administration — Injury — Obligation to make good Where, in circumstances which are irregular, a contract ofemployment is not renewed, this may constitute a wrongful act on the part of the administration in the performance of its duties entailing liability which involves the obligation to make good the injury caused (Treaty, Article 40).

In Case 1/55

ANTOINE KERGALL, represented by Pierre Chareyre, Advocate at the Conseil

1 — Language of the Case: French.

JUDGMENT OF 19. 7. 1955 — CASE 1/55

THE COURT

composed of: M. Pilotti, President, L. Delvaux and A. van Kleffens (Presidents of Chambers), P. J. S. Serrarens and O. Riese, Judges,

Advocate General: K. Roemer Registrar: A. Van Houtte

gives the following

JUDGMENT

Facts

Order the Common Assembly to pay the Procedure of the Court concerning conten whole costs'. tious cases were observed during the proce dure in the present case. In its statement of defence the Common Assembly contends that the Court should: 2. From the documents submitted by the parties, it appears that the facts are as fol 'Reject Mr Kergall's application lodged on lows: 14 January 1955, with all consequences at law, in particular as regards payment of The applicant held a contract of employ fees, costs and any other expenses'. ment dated 10 January 1953 (with effect from 6 December 1952) valid for two years The appointing ofthe agent and of counsel (annual salary: 7800 European Payments took place in accordance with the pre Union units of account), under which he scribed formalities. entered the service of the Common Assem The parties lodged a reply and a rejoinder bly. respectively in which they persist in their The applicant's contract of employment conclusions. refers to the Internal Rules in force.

Accor relevant documents concerning the facts dingly, it will not be possible for me to re mentioned in the said order. new your contract. . .'. The preliminary inquiry took place in On 3 November 1954, Vice-President camera before the First Chamber on 14 Fohrmann informed the applicant that in June 1955. view of the practical difficulties which the The defendant lodged definitive written latter would have to face as head of a large conclusions in which it persists in its pre family after leaving the service of the As vious conclusions. sembly;the Bureau had decided to grant At the hearing in open court on 27 June him, in addition to the allowances to 195 5, the parties submitted their oral argu which he was entitled under the staff rules ments. and under his contract, the sum of four At the hearing on 28 June 1955 Mr Advo twelfths of his remuneration. cate General Roemer stated as his opinion By letter of 24 November 1954, addressed that: to the President of the Common Assem bly, the applicant made it known that he

4. The defendant should be ordered to pay 24 November, as the Bureau had asked the whole or the greater part of the him to do, and that in those circumstances costs. the benefit of an additional allowance which had been granted and which he had All the formalities required by the Rules of not accepted was withdrawn.

3. The arguments which the parties put Furthermore, the applicant is of the opin forward in support of their claims during ion that since the post was not mentioned the procedure before the Court may be in the contract, the abolition of that post summarized as follows: cannot result in the applicant's dismissal. The measure is vitiated by misuse of pow ers, because the abolition of the post was 1. On the regularity of the decision not to only a pretext. renew According to the defendant, the applicant has not proved that the abolition took The applicant claims that he entered the place for the purpose suggested.

The ap not appear either from the circumstances plicant points out that the observations of his engagement or from the individual concerning his professional competence clauses of his contract that the applicant are based on his activity subsequent to the was eligible for such treatment, since he decision to dismiss him. did not receive any promise, whether oral or in writing, that his contract would be 2. On the grant for which Article 15 of the renewed. contract makes provision According to the applicant, the decision not to renew was taken at a time when it The applicant argues that by letter of 3 No was impossible to ascertain whether the vember 1954 the Bureau of the Common duties in question were or were not to be Assembly granted him an additional pay continued in 1955. The applicant men ment of four-twelfths of his annual remun tions a judgment of the French Conseil eration, and that the said grant was with d'État which annulled a decision not to re drawn because he persisted in making an new because it was adopted too long in ad application to the Court.

reau. According to the defendant, the ap According to the applicant, the Internal plication of Article 78 of the Treaty has Staff Rules of 12 January 1953 annexed to been provisionally suspended by the last his contract of employment gave him the paragraph of Article 7 of the Convention right to a quarterly car allowance. Pay on the Transitional Provisions. The de ment of that allowance was unlawfully sus fendant also argues that the applicant is pended on 15 July 1953. The defendant confusing the power to organize depart points out that under the Provisional Staff ments, which belongs to the Assembly, Rules a special decision is necessary in or and the power to fix the number of ser der to obtain the allowance.

KERGALL v COMMON ASSEMBLY

Law

1. Jurisdiction

The Court has jurisdiction to hear the present case.

The jurisdiction of the Court is based on Article 42 of the Treaty, relied on by the applicant in his application, together with Article 17 of the contract of em­ ployment and Article 27 of the Internal Staff Rules of the Common Assembly of 12 January 1953. Article 17 of the contract of employment provides that all the clauses of the Internal Rules in force are applicable to the relationship be­ tween the servant and the Common Assembly in so far as they are not contrary to the provisions of the contract of employment. Article 27 of the Internal Staff Rules provides that any dispute of an individual character to which the appli­ cation of the Rules or the performance of contracts of employment may give rise shall be brought before the Court of Justice. Article 50 of the Provisional Staff Rules of 1 July 1953 contains an analogous provision. The Court also finds that the argument with which the Advocate General sup­ ported his opinion, based on the general principle of liability laid down by Ar­ ticle 40 of the Treaty, is well founded. That article was also relied on by counsel for the applicant during the oral procedure. The Court notes that the defendant has not raised any objection of inadmissibi­ lity. The Court rules that the present application is admissible.

2. Substance

1. The preamble to the said contract of employment refers to the third para­ graph of Article 7 of the Convention on the Transitional Provisions, which pro­ vides : 'Until the Committee provided for in Article 78 of the Treaty has decided upon the size of the staff of the Community and has laid down staff regulations, the personnel required shall be engaged on a contractual basis'. The reference to that provision clearly establishes the fact that the contract of employment was the precursor of the Staff Regulations.

2. Articles 1 and 2 of the contract of employment provide that 'Mr Kergall shall enter the service of the Common Assembly. This contract shall take effect on 6 December 1952 and is valid for two years'. The words 'enter the service' and the fact that the applicant was engaged as a servant in the first grade—which included the Secretary General, the Assistant Secretary General, the Heads of Service and persons holding similar posts—in­ dicate, or in any event, constitute reasonable grounds for taking the view that what was involved here can only have been the applicant's engagement as an of­ ficial who was eligible, subject to certain conditions, for stability of employment, that is to say for establishment under the Staff Regulations.

3. Furthermore, the limitation of the duration of the said contract to a period of two years does not necessarily mean that the parties intended that the engage­ ment under the contract should be of limited duration.

Rather, it means that they shared the general opinion of the institutions of the Community which, at that time, considered that two years would suffice in order to prepare and adopt the Staff Regulations of Officials. Accordingly, the Court takes the view that the engagement of the applicant created a legal relationship which is wider than that arising under a contract of employment governed by private law.

6. As regards the professional inadequacy alleged by the defendant, the Court is of the opinion that it is normally the administration which assesses profession­ al competence, but it notes that no decision of the Bureau of the Common As­ sembly mentions any professional inadequacy on the part of the applicant. Fur­ thermore, the applicant was not given the opportunity ofproving his profession­ al competence, since he occupied the post in question only for a very limited pe­ riod. Moreover, no complaints were ever made to the applicant. The first com­ ment concerning the quality of his work was addressed to him on 11 June 1953. A further point is that his personal file does not contain any comments either on his professional ability, or on his conduct from the disciplinary point of view. Professional incompetence has not been put forward in respect of the applicant as a reason for the decisions not to renew his contract of employment. No finding as to professional inadequacy has been reached by means of a regular procedure such as must be followed by any administration. In these circumstances, the alle­ gation as to professional incompetence made for the first time by the defendant in its statement ofdefence in order to justify its decision not to renew the contract cannot be taken into consideration.

7. Finally, the Court finds that the intentions of the Community in respect of its servants are clearly evident in the proposed definitive Staff Regulations of the Community, drafted by mutual agreement by the Committee ofPresidents ofthe four Institutions. The text of the draft distributed in September 1954 already in­ cluded provisions concerning non-active status.

(d) On the basis of the foregoing considerations, the Court concludes that the Bureau of the Common Assembly, having decided in the circumstances esta­ blished by the procedure before the Court not to extend the applicant's contract ofemployment, has put forward in support ofits decision a reason which cannot, of itself, justify that decision, and that the Bureau has not taken sufficient ac­ count of the legal position of the applicant. Moreover, the Court is of the opinion that in adopting its decisions and quan­ tifying the grant provided for by Article 15 of the applicant's contract of employ­ ment, the Bureau ofthe Common Assembly ought to have had regard to the pro­ visions of the draft Staff Regulations of the Community governing the conse­ quences of assignment to non-active status. Accordingly, the Court finds that the circumstances in which the applicant's contract ofemployment was not renewed appear to be irregular, and that the Bu­ reau ofthe Common Assembly has committed a wrongful act in the performance of its duties as regards the execution of the said contract. The Common Assem­ bly is liable as the result ofthat wrongful act, which caused the applicant damage which must be made good.

KERGALL v COMMON ASSEMBLY

B — On the payments claimed by the applicant

1. The so-called car allowance

The Court finds that it is not the applicant's contract of employment but Article 3 of Annex I to the Internal Staff Rules of 12 January 1953 which makes pro­ vision for this allowance. Those Rules were replaced on 1 July 1953 by the Pro­ visional Staff Rules, Article 34 of which requires a special decision of the Secre­ tary General of the Common Assembly for the grant of that allowance. No such decision was taken in respect of the applicant. The Court rejects the applicant's argument that the supplementary advantages which existed when he entered the service of the Community must be regarded as additional remuneration forming part ofwhat is laid down by the contract and not capable of being altered unilaterally. The Court finds, in agreement with the Advocate General on this point, that the applicant's claim for the payment of a car allowance is unfounded.

JUDGMENT OF 19. 7. 1955 — CASE 1/55

the said Bureau fixed the grant due to the applicant at six months' remuneration. By a decision of the Bureau of the Common Assembly of 3 December 1954, that grant was reduced to two months' remuneration. In justification of that measure it has been alleged that the applicant did not accept the additional four months' remuneration and that he had shown evidence of his intention to bring an ap­ plication before the Court of Justice. It is the Court's view, in agreement on this point with the opinion of the Advo­ cate General, that it does not appear from the documents that the applicant re­ fused that grant, and that the fact that he intended to bring a case before the Court is not a valid reason for altering the decision ofthe Bureau ofthe Common Assembly to the applicant's disadvantage, as has happened in the present case. The Court concludes that the applicant's claim for payment ofthe four addition­ al months' remuneration which had been granted by the Bureau ofthe Common Assembly is well founded. Furthermore, the Court finds that the Bureau of the Common Assembly fixed the amount of the said grant at four-twelfths of his remuneration in addition to the two-twelfths laid down by Article 15 of the contract as a minimum, by taking into account the following factors:

(a) The material difficulties which the person concerned would have to face as the head of a large family after leaving the service of the Common Assembly;

(b) The expenses that he would have to meet in looking for a new post.

Upon reading the pleadings; Upon hearing the parties; Upon hearing the opinion of the Advocate General; Having regard to Articles 40 and 42 of the Treaty and to Article 7 of the Con­ vention on the Transitional Provisions; Having regard to the Protocol on the Statute of the Court; Having regard to the Rules of Procedure of the Court and to the Rules of the Court on costs,

THE COURT

hereby:

Orders the defendant to pay the applicant a sum equal to sixteen months' remuneration, calculated according to the method used by the Common As­ sembly in order to fix the amount of the two months paid to the applicant as compensation for the termination of his contract.

Declares that the applicant is entitled to reimbursement of two-thirds of his costs by the defendant, and orders the latter to bear its own costs.

Delivered in open court in Luxembourg on 19 July 1955.