C-14/63

3. Ferrous scrap Equalization within the meaning of Decision No — 22/54 —

Bought ferrous scrap Concept Community allocation as criterion — —

4. Costs — Payment of own costs — Exceptional circumstances (Rules of Procedure, Article 69 (2))

1. A legal interest in making an applica­ 22/54 is the ferrous scrap purchased tion for annulment is assessed at the for use in Community production; day on which the application is made. this allocation to Community use is not determined until the time of 2. It is necessary to adopt a common

determine the receipt by undertakings. criterion to commence­

ment of the effects of the equalization 4. If the defective drafting of a measure system, both for the application of adopted by an institution has been the levy on bought ferrous scrap and the decisive factor in the making of for the allocation of grants for im­ application, this amounts to an ex­ an ported ferrous scrap. ceptional circumstance allowing the

applicant,

v

High Authority of the European Coal and Steel Community, represented by its Legal Adviser, Dr ItaloTelchini, acting as Agent, assisted by Paul Orianne, advocate at the Brussels Cour d'appel, with an address for service in Luxembourg at its offices, 2 Place de Metz, defendant,

Application for annulment of an individual Decision of the High Authority of 5 December 1962, notified to the applicant on 23 January 1963, including in the tonnages used as the basis for the assessment of the contribution 20 682

metric tons of ferrous scrap which the applicant claims to have bought before 1 April 1954, the date of the entry into force of Decision No 22/54 of 26 March 1954, but which it received after that date;

THE COURT

A — The applicant claims that the to the applicant by letter of notified

Court should: 23January 1963, by which the High Authority decided upon the inclusion (a) In its application: of the disputed 20 682 metric tons in 'Annul, by reason as being vitiated the tonnages used as the basis of

of infringement of the Treaty and/ assessment of the contribution of

or of any rule of law relating to its the applicant;

CLABECQ v HIGH AUTHORITY

order the High Authority to pay the the disputed 20 682 metric tons in the basis costs.'

parties summarized as Court should:

'Dismiss the application as inadmiss­ A — Admissibility ible or, alternatively, as unfounded; The defendant disputes the admissibility order the applicant to pay the costs.' of the application on the basis of the

three following heads — the statement of

the grounds on which the application is

II facts based, the offers of proof and the appli­ —

Summary of the cant's legal interest in taking pro­

culated in proportion to the tonnages of which it is based. In the present case

ferrous scrap bought by each under­ the application declares the disputed

taking during the period for which this Decision to be 'vitiated by reason of Decision remains in force . . .' infringement of the Treaty and/or any According to the applicant company it rules of law relating to its implementa­ had received after 1 April 1954 20 682 tion'. But the only submission put for­ metric tons of ferrous scrap in execu­ ward relates to infringement of Decision tion of contracts concluded before that No 22/54 of 26 March 1954 and is date. It therefore considered that these couched in vague and laconic terms.

20 682 metric tons could not appear The applicant confines itself in fact to

among the tonnages forming the basis stating on the one hand that Decision for the payment of the contributions No 22/54 does not apply to ferrous provided for by Article 3 of Decision scrap bought before 1 April 1954 and, No 22/54. on the other, that such is the case with

After an exchange of. letters with the the disputed 20 682 metric tons since

judgment of 16. 12. 1963 — case 14/63

The applicant replies that it has adhered the disputed Decision or the statement

Article defence inter­ strictly to the requirements of of that the Court, any 38(1) of the Rules of Procedure and veners and the defendant itself must look that the defendant cannot reasonably to find the exact terms of the legal have any doubt as to the subject matter dispute. The applicant is required to

of the action or the matters of complaint include in its statement of claim suffi­

alleged. In fact, the applicant states that ciently precise subject matter for it to

the application makes it clear that it is be irrevocably bound by the purpose of the Decision communicated by the letter its application. It is for this reason that

missions made shows that it has fully 2. Offers of proof understood the applicant's point of view.

It is quite clear, in addition, from the The defendant states that, although the

actual terms of the disputed Decision application offers to prove the conclusion

which was notified by the letter of 23 before 1 April 1954 of 'contracts relating January 1963 from the defendant that to the disputed ferrous scrap with firm

the latter: prices and conclusive indications that

(i) Knew perfectly well the interpre­ delivery was to be effected, it neverthe­

1 April 1954, had been sider questions relating to the form of cant after applications (Judgment of 15 December bought by it before that date; 1961. Rec. 1961. p­ . 588) (iii) has never advanced any reason The applicant that, although in replies for the inclusion of the disputed its application it limited itself to offering tonnage as part of the basis of dis­ 'as far necessary'

as proof that the contribution other than its own puted tonnage had been bought before interpretation of Article 3 of De­ 1 April 1954, it is because the fact was cision No 22/54, that is to say never disputed by the High Authority bought' that 'tonnages should be and that even the disputed Decision understood as meaning 'tonnages In expresses no reservations on the point. received'. reply to the objection of the defendant, The defendant replies that it is to the which it regards as 'unexpected', the application and not to the grounds of applicant produces (schedules 3 to 33 to

CLABECQ v HIGH AUTHORITY

the statement in reply) 31 orders with the disputed ferrous scrap was bought dates from 10 April 1953 to 31 March before 1 April 1954, and the date of

1954 in respect of 34 150 metric tons. these purchases has not been the subject

It explains that although this total ex­ of any justification either before pro­

the applicant has failed to justify the delay it would be necessary to revise all the

in its (Rules Com­ preparation of Procedure, equalization accounts of all the

Article 42(1)). munity undertakings for the period from The defendant states that only in its 1 April 1954 to 1 April 1955. Con­

reply did the applicant maintain that, sequently, since the total levy is fixed the facts not being disputed, it was and the tonnages subject to levy would pointless to prove them and that the decrease for all undertakings, the rate of proceedings dealt only with the interpre­ levy per metric ton would increase pro­

tation of Decision No 22/54. In this portionately, thus nullifying any benefit connection, it cites a sentence from the which might accrue to the applicant

application: 'The contracts had been through the exemption of the disputed concluded before this date with firm 20 682 metric tons. Further if it were

the making of contracts of purchase legal interest necessary for taking pro­

could not be taken into consideration in ceedings.

making the equalization calculations. The applicant replies that its interest But, as from the time when the appli­ in bringing the proceedings is clear: if cant disputed this principle and the it succeeds it will have no contribution

decision taken in application of it before to make for the disputed 20 682 metric

the Court, it is required to justify its tons. As to the argument that the re­

claims both in fact and in law and the de­ vision of the basis of contribution would

are future and uncertain; tem. Moreover, the defendant adds, still — the defendant has not shown that from the same standpoint, that if it is the revision would nullify the ad­ agreed that the same tonnage cannot

vantage which would accrue to the twice be the subject of a levy it would applicant from a favourable decision be the second imposition and not the

of the Court: first which should be prohibited. The —

the applicant is entitled to require applicant thus contradicts itself in claim­ that the calculation of its contribu­ ing to exempt from equalization both tion be made in accordance with the the tonnage bought before and received

existing law and not in accordance after the beginning of the period during with rules of law which may pos­ which Decision No 22/54 remained in sibly be developed later. force and the tonnage bought during As to the argument that the applicant, and received after the end of the period should its case be accepted, would have for which that same Decision remained to pay a supplementary contribution for in force. It concludes that the system

the tonnages bought by it during the recommended by the applicant would

constitute a real abuse and the appli­ heads : cant cannot therefore be said to have a (1) Article 3 of Decision No 22/54; legitimate interest in bringing the pro­

(2) the background to Article 3; ceedings.

With regard to the argument of the (3) the application of national law; applicant that the principle prohibiting (4) the general scheme of the Decision; a double levy does not allow tonnages (5) practice and usage; purchased during the period for which (6) the date of purchase of the disputed Decision No 22/54 remained in force 20 682 metric tons. and received when Decision No 14/55 had come into force to be the subject 1. Article 3 of Decision No 22/54 of a supplementary contribution, the

defendant states that the applicant's The first subparagraph of Article 3 of

Decision No 22/54 is worded as fol­ system, based on a literal construction

Decision No lows: of 22/54, would have the effect of imposing a double levy, and 'The amount of the contributions shall

that what should be taken into account force within the Community on 1 April 1955.'

for the calculation of the contributions

bought Decision No 14/55, and particularly are the tonnages during the

period for which the Decision remained Article 3 thereof, does not appear there­

in force and hence bought after 1 April fore as an interpretative provision in­

1954. It follows necessarily from this tended to clarify the meaning and the that those which have been bought scope of Decision No 22/54. It sets up

describe the tonnages which will replace purchase, but only as ing period'

the to

of ferrous scrap bought (received) dur­ from the same date. Decision No 14/55 thus confirms three ing the period for which the Decision points: in the first place that the High remained in force. It is inconceivable, in Authority has chosen two different fact, that in its anxiety to simplify the criteria—'purchase' 'receipt'

High first, there­

sentence, the Authority would

have it com­ after—in order to organize equalization; made express something different in the second place that, when the pletely from that which it criterion chosen is 'receipt', the High wished to say, especially as this simpli­

is confirmed by Decision No 14/55 of tion. 26 March 1955, which came into force To equalize means to apportion charges on 1 April 1955. The first subpara­ an­ equitably, to adjust values to one graph of Article 3 of this Decision is other. worded as follows: In the present case, since it is a matter

'The amount of the contributions shall of adjusting all the ferrous scrap bought be calculated proportionately to the ton­ to the same price, it is obvious that the

nages of bought ferrous scrap received concept of purchase must be applied in by undertaking during the period each a uniform manner to all categories of

for which this Decision remains in force, ferrous scrap whether imported or

less its own sales. In those cases where originating from the internal market.

JUDGMENT OF 16. 12. 1963 — CASE 14/63

tween consumers, which equalization is give rise later on to much litigation, was intended to abolish, comes into being that of arisings of ferrous scrap used by and can be established. It is really a undertakings. These it was considered, matter of an economic transaction and were not to be taken into account for not of a legal system; it is necessary to equalization. Equalization was to apply make provision for compensation be­ only to bought ferrous scrap. It was

tween actual payments which have taken necessary to take account therefore only place and not between obligations which, of the 'Zukaufschrott', which is literally at the moment they come into existence, additional (zu) ferrous scrap (Schrott) do not result in any immediate economic obtained by purchase (Kauf). charge. In the French, the concept expressed in How does the wording of Decision No German by the word zu was regarded

22/54 achieve the system which was as subordinate and only the concept of

clearly desired by its authors? 'bought ferrous scrap'

as opposed to 'arisings' Article 2 puts it in a clear and logical was retained.

manner: it is necessary to make the The result was however practically the

Article 3 is less happily drafted. puted 20 682 metric tons ought to be As for the calculation of the amount or taken into consideration in applying the equalization contributions, it is equalization. These dates, according to

necessary, according to the French the applicant, were distinct from those 'ton­ in­ wording, to take into account the of the receipt of the goods and the bought' nages of ferrous scrap during voices. In Belgian law, in fact, sale is a the relevant period 'by each undertak­ consensual contract which is made by ing, whether within the Community or the consensus of wills of the parties, by imports from third countries.'

The and not a real contract which does not

German however 'inner­ into text speaks of come existence until the delivery halb der Gemeinschaft gekaufte oder of the subject matter.

dritten Ländern eingeführte Schrott­ The in aus problem, law, consequently

CLABECQ v HIGH AUTHORITY

conformity with the intentions of the thecarrying out of the legal transaction. authors of the Decision, according to its Receipt is nothing other than the carry­ scheme and following an established ing out of the purchase; it might even

practice, can and must give rise to the be called its accomplishment. Thus, use of the equalization scheme in re­ when in respect of an economic trans­

lation to ferrous scrap obtained by action orfact, there is a question of undertakings otherwise than from their goods bought, this refers necessarily to own resources? goods which have been subject to a

The High Authority considered that the transfer which has actually been car­

expression 'ferrous scrap bought during ried out, that is to say to delivery and the period'

means bought ferrous scrap receipt.

for the old, since it was a question of present case, it is a matter of setting two systems applied successively. up a scheme of an economic nature.

The applicant might be right if that

were the only difference between the 2. The background to Article 3 wording of Decisions Nos 22/54 and 14/55. But there are many others, some Article 2 of Decision No 22/54 is of them essential ones (see particularly worded as follows: 'The undertakings

Articles 2 and 5 and the system of referred to in Article 80 of the Treaty, premiums set up in 1955). as consumers of ferrous scrap, shall be It is not possible, therefore, to claim obliged to make payment of contribu­

that the novelty of the system is to be tions necessary for the equalization

im­ found just in the slight modification of transactions affecting ferrous scrap the wording of Article 3, by which the ported from third countries or treated

ciple is enunciated by Article 1; Article Article 3. For it would no longer be the 2 indicates the undertakings which are recipient undertakings but the 'pur­

liable; whilst Article 3, which lays down ferrous scrap which would as chasers'

of

the basis of contribution, makes pro­ such be subject to payment. It would

vision in its turn for the transactions suffice during the period in question to giving rise to the application of the have made a contract of purchase, even

levy. including a condition of delivery a year The precision given to Article 3 was later, to be obliged to contribute for the necessary because, although it is true benefit of those who, at the same time, that importation suggests the crossing had imported ferrous scrap. Such a of a frontier by the ferrous scrap, this system would be absurd and in express

benefit fer­ of undertakings consuming undertakings consuming ferrous scrap rous scrap, in relation to imports effec­ but also to limit this imposition to ted during the period for which the imports effected during the relevant

decision remained in force. period; According to the defendant, it follows from this Article that it is the receipt — it ignores the wording of Article 3 of ferrous scrap, following a purchase the object of which, according to the on the domestic market or by importa­ text, is not at all to give content to

tion, which results in the application of the obligation prescribed by Article 2, equalization. The date of the making but simply to define the method of

of a contract of purchase is not taken calculating the amount of the con­

into account, because it is in itself unim­ tributions; portant and, moreover, difficult to verify both in respect of the tonnages actually —

lastly, if, as the applicant states, the 'importation'

bought' expression 'ferrous scrap a cial transaction that of the conclusion

meaning different from that of 'bought of a legal act independently of its ferrous scrap received', there would be execution.

CLABECQ v HIGH AUTHORITY

3. The application of national law With regard to the first hypothesis one

would have to agree that there is a radi­

The applicant states that the meaning cal change between the scheme of Article which it gives to the expression 'pur­ 2 and that of Article 3. The High in Article 3 of Decision No 22/54 Authority chase'

The Court, by deciding in its judgments and not to the legal transaction, or more

of 17 July 1962 (Rec. 1962, pp. 646 precisely to consider the legal transaction at the stage of its completion, that is to and 705) that

say at the time of its execution. 'Purchase need not necessarily fulfil all

the conditions required by the appro­

4. The general structure of Decision priate national civil law for the validity No 22/54 and effectiveness of a contract of sale',

emphasized particularly that in principle The applicant states that there is no 'purchase' the expression to the in going, event, into the relates point after the concept of contract in civil law. It respective merits and disadvantages of

that the national laws of the six coun­ disputed tonnages.

tries are relatively harmonious on this The defendant replies that when, as in

matter is not decisive. Does equalization the present case, it is a matter of things

come into play as a consequence of the described only as to type, the transfer of fact of the legal transaction of purchase, ownership is not possible until the goods and at the moment when it takes place, have been appropriated to the contract. or as a consequence of the fact of im­ Further, in the ferrous scrap trade it is portation and receipt of the bought only at the time of delivery that the

ferrous scrap? That is the problem. exact quantity of goods delivered can be

JUDGMENT OF 16. 12. 1963 — CASE 14/63

duce incontrovertible evidence that it No 14/55 of 26 March 1955 could have dis­ actually made the purchase of the been disputed, because as from 1 April puted tonnage before 1 April 1954. 1955 it substituted the criterion of

The defendant next puts forward the receipt for that of purchase, which had point that the case law of the Court been adopted by Decision No 22/54, (Rec. 1962, pp. 646 and 705) has recog­ but which was rescinded as from exactly nized that the criterion of purchase by the same date. be interpre­ undertakings must broadly Lastly the applicant asserts that the

ted : 'Purchase need not necessarily fulfil Court in its judgments of 13 July 1962 all the conditions required by the appro­ (Rec. 1962, pp. 646 and 705) did not

priate national civil law for the vahdity cast any doubt on this change of criter­

and effectiveness of a contract of sale but ion. It emerges from this judgment that

must rather be applied to every transfer the equalization systems introduced by effected by the undertaking consuming it Decisions Nos 22/54 and 14/55 were

circumstances to those of the applicant, tracts of purchase.

would have agreed that quantities bought It then asserts that there is no distinction

by them before 1 April 1954 were sub­ to be made, in respect of the facts ject to equalization. Their attitude, which give rise to contribution, between which may have been influenced by the Decision No 22/54 and Decisions Nos most diverse reasons, cannot have the 14/55, 2/57 and 16/58: they form a

effect of preventing the applicant itself logical sequence from one to the next

from relying on the law. and they apply to the same transactions. Neither is it possible to adduce any The High Authority cites in support

argument from the system of voluntary the Court's judgment in Joined Cases 17 equalization which existed before De­ and 20/61 (Rec. 1962, pp. 623 and 624). cision No 22/54. The wording of this 'By Decisions Nos 22/54, 14/55, 2/57

bought scrap consumed by each under­ reply under numbers 3, 4, 5, 7 and 15) were to be carried out before 1 April taking over a prescribed period, whilst 1954. If they were carried out within the consumption of "own resources"

was the time limit laid down they are not not subject to this levy (Decision No 4).' proof of delivery effected after 1 April 2/57, Articles 3 and 1954. If, on the other hand, they were The High Authority further cites, to the not carried out within the time limit laid Advocate- same effect, the opinion of Mr it be deduced from down, must this General Lagrange in Case 20/58 (Rec. either that the supplier did not indicate 1958/1959, p. 207). his agreement with the time-limits It points lastly, It points out, lastly, that contrary to the that contrary the

fixed, or that a new agreement modi­

allegations of the applicant, Decision No fying the time-limits was reached. 22/54 was not rescinded as from 1 The defendant points out moreover April 1955; Article 11 of Decision No that the ferrous scrap in dispute con­

14/55 states that Decision No 22/54, as stitutes goodsby weight; it is sold extended by Decision No 2/55, 'shall accordingly governed by the provisions to be as from i April applicable' cease of Article 1585 of the Code Napoleon, 1955: it obviously does not follow that applicable in Belgium, according to the effects of Decision No 22/54, which which, when goods are sold by weight, occurred prior to 1 April 1955, no number or measure, the sale is not longer exist. completed until they are weighed

counted or measured.

the orders and confirmations of orders, matter of the contract.

JUDGMENT OF 16. 12. 1963 — CASE 14/63

The defendant contends that, even if the During the hearing of 15 July 1963, applicant were right in principle—which upon receiving the preliminary report of the defendant denies—, its case should the Judge-Rapporteur and the opinion nevertheless be dismissed as it has failed of the Advocate-General, the Court to prove the accomplishment in fact of decided to open the oral procedure

the conditions necessary for the appli­ without any preparatory inquiry, but cation of the rule on wh­ ich it relies. to pro­ nevertheless asked the applicant

documents. These docu­ duce certain

IV — Procedure ments were lodged at the Registry on

inadmissible (cf. III above Submissions ject of the proceedings to the reasoning

and Arguments of the parties, A, of the disputed Decision, which is based Admissibility). on the construction of Article 3 of

Otherwise, the written procedure fol­ General Decision No 22/54 of 26 lowed the normal course. March 1954.

Grounds of judgment

Admissibility

The parties have not questioned that the disputed Decision was actually taken

theless done so in a clear and accurate manner.

The first objection of inadmissibility must be dismissed.

CLABECQ v HIGH AUTHORITY

The defendant alleges in the second place that the applicant in its application

merely tendered proof, as far as necessary, that the tonnage of disputed ferrous scrap had been bought before 1 April 1954, the date upon which Decision No 22/54 entered into force, without appending to it the file of documents as

provided by Article 37(4) of the Rules of Procedure.

For the above-mentioned reasons the application is admissible.

On the substance of the case

According to the applicant's statement, Article 3 of Decision No 22/54 of the High Authority setting up the system of compulsory equalization provides that the amount of the contributions is to be calculated proportionately to the tonnages of ferrous scrap bought during the period for which the Decision

remained in force, that is to say from 1 April 1954 to 31 March 1955.

The applicant alleges that the disputed ferrous scrap received by it after 1 April 1954 had been bought before that date and that, in consequence this,

scrap is not subject to equalization contributions.

consequence that a quantity ferrous scrap imported from a third country, of

bought by an undertaking before 1 April 1954 but imported after that date, would benefit from equalization without being subject to the payment of any contribution.

Decision No 22/54, which provided for the creation of 'a permanent scheme

allowing equalization of ferrous scrap imported from third countries', could not have had as its aim or effect the institution of contributions on conflicting

bases, both within the framework of Article 3 alone and in the relationship between Article 3 and Article 2.

Article 3 makes provision in the same sentence for the calculation of contribu­

same meaning in both cases.

The interpretation of this expression in respect of imports is given by Article 2 which throws light upon and completes the concept of bought ferrous scrap by 'effected'

regarding as such scrap the import of which is during the period in which the Decision remained in force.

bought' If such is the meaning placed upon the expression, 'tonnages . . . in the case of importation, the unity of interpretation of this expression implies

the impossibility, because of this context, of giving it a purely literal inter­ pretation.

bought' In order to satisfy the necessity of giving the expression 'tonnages . ..

to provide for ferrous scrap bought for use in Community production.

In fact it has already been held that 'it is not participation in the ferrous scrap market which gives rise to the equalization levy, but the consumption of

ferrous scrap'.

It is evident from the logic of the system described above and confirmed by successive decisions on equalization that an unexecuted contract of purchase

cannot be subject to equalization.

The allocation of ferrous scrap to Community use is not determined until the time of receipt by undertakings.

JUDGMENT OF 16. 12. 1963 — CASE 14/63

Costs

Under the terms of Article 69 (2) of the Rules of Procedure, the unsuccessful

party shall be ordered to pay the costs.

Nevertheless, paragraph (3) of the same Article allows the Court, where the circumstances are exceptional, to order that the parties bear their own costs.

In the present case the defective drafting of Article 3 of Decision No 22/54

Having regard to the Protocol on the Statute of the Court of Justice of the to the the

European Coal and Steel Community;

Having regard to the Rules of Procedure of the Court of Justice of the European Communities;

THE COURT

hereby:

I. Dismisses application No 14/63 as unfounded;