C-101/74

JUDGMENT OF 26. 2. 1976 —CASE 101/74

In Case 101/74

Dietrich KURRER, a former official of the Council of Ministers, represented by Marcel Slusny, Advocate at the Cour d'appel, Brussels, with an address for service in Luxembourg at the office of H. Steinfort, 15, boulevard Grande-Duchesse Charlotte,

applicant,

Council of the European Communities, represented by R. O. Dalcq, Advocate of the Brussels Bar, acting as Agent, with an address for service in Luxembourg at the chambers of Mr Loesch, 2 rue Goethe, defendant,

Application for the payment of certain sums under Article 73 of the Staff Regulations for Officials,

Facts

The facts and arguments expounded by 'An official is insured, from the date of the parties in the course of the written his entering the service, against the risk procedure may be summarized as of occupational disease and of accident follows: subject to rules drawn up by common agreeement between the Institutions of the Communities after consulting the I — Facts and procedure Staff Regulations Committee. He shall contribute to the cost of insuring against Article 73 (1) of the Staff Regulations of non-occupational risks up to 0-1 % of his Officials provides that: basic salary'.

KURRER v COUNCIL

be granted. Those memoranda indicate informed the administration that 'with the risks covered but do not set out all reference to your request I beg to inform the details of the policy. you that I hereby agree to the rate of 20 % proposed by the insurers in Mr Kurrer was an official with the settlement of the allowance for the Council from 1958 to 1973 when he permanent invalidity which I have resigned from the service under the suffered. Kindly note that the sum procedure then introduced, as a result of obtained by calculation at the rate of the accession of the new Member States. 20 % should be paid to my account'. At the time of his resignation he was 50 years old and classified in Grade A 4. By a note of 10 March 1974 Mr Kurrer requested the administration to transfer On 7 July 1968 Mr Kurrer was involved the allowance to his bank account in in a traffic accident, outside the Germany on the same basis and on the performance of his duties, which entailed same conditions as the other his partial permanent invalidity. In order emoluments governed by the provisions to initiate the procedure for obtaining of the second and third paragraphs of the invalidity benefits payable to him Article 63 of the Staff Regulations, that is under Article 73 (2) (c) of the Staff to say, the application of the par values Regulations he signed an accident accepted by' the International Monetary declaration on the form issued by the Fund in 1965 (Bfrs 12-50 = DM 1) for insurer. the conversion of this allowance into

According to him the In accordance with the provision in the Council had never disputed the rate insurance policy which provides for of 30 %; arbitration in cases of dispute the (2) complained that the Council had Council requested Mr Kurrer to appoint transferred the sum to Germany his representative for the arbitration leaving it to be converted into procedure. On 30 November 1972 Mr Deutschmarks by the bank at the Kurrer notified the administration that: daily rate and not on the basis of the 'Doctor A. Olmechette has agreed .

JUDGMENT OF 26. 2. 1976 —CASE 101/74

(3) complained that the Council had compensation calculated on the interpreted Article 73 (2) (b) of the difference between the rate of 20 % Staff Regulations restrictively with which was accepted and the rate of regard to the salary to be taken into 30 % which should have been account in calculating the allowance. accepted, that is to say, subject to adjustment in the course of the By a letter of 20 September 1974 the proceedings, Bfrs 360000. Council expressly rejected Mr Kurrer's 5. Declare and adjudge that the sums offical complaint. remitted to the applicant should have been calculated on the basis of On 20 December 1974 he lodged the the conversion rate provided for by present application against the decision Article 63 of the Staff Regulations; expressly rejecting his official complaint. 6. Order the defendant to pay under this head forthwith a supplement On hearing the report of the estimated at Bfrs 100000 subject to Judge-Rapporteur and the views of the calculation by the defendant; Advocate-General, the Court (Second 7. Declare and adjudge that all sums Chamber) decided to open the oral still due by the defendant to the procedure without any preparatory applicant must be remitted to him at inquiry. his residence, taking account of the abovementioned conversion rate; 8. Order the defendant to pay applicant II — Conclusions of the parties the sum of DM 49-60 which was wrongly witheld; The applicant claims that the Court 9. Taking note of the wrongful acts or should: Commissions referred to by the 1. (a) Rule null and void the express applicant order the defendant to pay refusals met with by the applicant him damages to be fixed ex aequo et in the reply of the defendant bono; dated 20 September 1974; 10. Order the defendant to bear the costs

III — Submissions and arguments between the Council and its insurer; it of the parties cannot be treated as equivalent to the procedure for finding a rate of invalidity The rate of invalidity laid down in the common rules. In fact if the rules had been adopted the applicant The applicant maintains that he suffers would have appeared before a medical from permanent invalidity at a rate of board comprised exclusively of 30 %. The Council adopted the independent doctors and not before a conclusions of the applicant's specialist doctor nominated by a third party. by appointing him to represent the interests of the Council in the arbitration Although the applicant appeared to have proceedings with the doctor appointed accepted the rate of invalidity as by the Council's insurer. determined by the arbitration pursuant to the insurance policy he did so only in Under Article 73 of the Staff Regulations order to facilitate the task of the Council the Council must accordingly provide in obtaining payment under its private the applicant with a lump sum on the insurance policy. Prior to his note of 20 basis of the actual rate of his invalidity, May 1974 he indicated verbally that he that is to say, 30 %. did not abandon any right vis-d-vis the

He thought and was led to believe that the rate of 20 % had been Only that part of the insurance policy decided by a third arbitrator which has been brought to the attention of officals can be considered for the The applicant suggests that if the Court purpose of Article 73 of the Staff does not consider that the Council is Regulations. The arbitration procedure bound to respect the rate of 30 %, the provided for by the policy was not Court should appoint its own experts, to brought to the attention of officials. fill the lacuna in the Staff Regulations. Furthermore, until the adoption of rules for the institutions the insurance policy The Council maintains that it has never must be considered as a measure in concurred in a rate of 30 %.

There are no rules and conclusions of the arbitration therefore no scale exists (the scale commission. The arbitration is a contained in the insurance policy does procedure provided for in the relations not cover the invalidity of the applicant).

The applicant states that the delay in the The amount of the lump sum payment of the lump sum has caused him specific damage. Because of this The applicant asserts that if the rules delay he was unable to benefit, in the had been drawn up between the calculation of the allowance, from institutions he would have been able, increases in salary under Article 65 of the under the second subparagraph of Article Staff Regulations occurring after 1968. 73 (2) of the Staff Regulations, to request Furthermore, Article 73 (2) (b) does not an annuity instead of a lump sum. An expressly provide for the payment of annuity would have had to be adjusted interest which is normally payable from taking into account the depreciation in the day of the accident and compensates the value of money and the rise in for the delay. The non-payment of salaries. The allowance should interest involves specific damage. In fact consequently be increased on an if he had received the allowance sooner equitable basis. he could have invested it to protect himself against inflation. At least the The Council explains that the insurance Council should have paid one or more policy only provides for the payment of a advances voluntarily to the applicant. lump sum. On the other hand since Article 73 of the Staff Regulations The Council maintains that the delay in provides that an annuity may be payment was caused primarily by the substituted for a lump sum the applicant applicant's slow recovery from his could have requested payment of an injuries and also by the medical dispute annuity. It was only after he had received over the rate of invalidity. The applicant the lump sum that the applicant claimed provides no proof as to how this delay is that, because he could have taken an to be imputed to the Council. The annuity related to the cost of living, the Council considers that interest to lump sum should be increased, but no compensate for delay in payment is such provision is made by Article 73 of unjustified either in fact or in law. Such the Staff Regulations. interest is not recognized in Community

The rate of conversion of the allowance should have been calculated on the basis With regard to the banking expenses the Council recalls that Article 17 (1) of of the par values accepted by the Annex VII provides that payment shall International Monetary Fund and in be made to each official at the place and force on 1 January 1965. Given the in the currency of the country where he similarity of the situations referred to in carries out his duties. It also governs the three chapters of Title V of the Staff cases where a transfer may be authorized Regulations the absence of any mention without expenses. The allowances in in Article 73 of the rates of conversion is question do not feature amongst such not significant. cases.

In addition the payment of the lump sum in Germany should have been IV — Oral procedure effected without any deduction of expenses whatsoever. The Council should The parties presented oral argument at have ordered a bank to place at the the hearing on 4 December 1975. disposal of the applicant the equivalent in German marks of Bfrs 720 000 Since an alteration in the composition of calculated on the basis of the par value the Chamber had in the meantime provided for in Article 63 of the Staff occurred the oral procedure was repeated Regulations or, alternatively, in on 5 February 1976. The parties declared accordance with the official rate. that they maintained their positions set out in the previous oral proceedings. In According to the Council, since the the course of this hearing the applicant continued to draw his salary up Advocate-General delivered his opinion.

5 First, the applicant complains that the Council has paid him the allowance provided for in Article 73 (2) of the Staff Regulations of Officials on the basis of a rate of invalidity of 20 % although it has itself conceded that he suffers from 30 % invalidity.

6 Article 73 (1) provides that rules shall be drawn up by agreement between the institutions of the Communities establishing inter alia the conditions on which officials are covered against non-occupational risks.

7 Since those rules had not yet been drawn up the Council, as a provisional measure, took out an insurance policy with an insurance company fixing the conditions on which cover was given against the risk.

8 By various staff memoranda the Council notified its staff that the provisions of the said policy provisionally laid down the conditions under which the benefits provided for in Article 73 would be guaranteed.

KURRER v COUNCIL

9 Thus the rights arid obligations of the institution and of its servants are provisionally determined by Article 73 in conjunction with the policy.

15 On 30 November 1972 the applicant, without raising objections as to the form of the arbitration, addressed to the administration of the Council a note worded as follows:

'Doctor A. Olmechette has agreed ... to defend my interests in the procedure proposed by the insurance company. I should accordingly be obliged if you would communicate directly with him as necessary.'

16 Since the rate of invalidity of the applicant is a question of fact, when the applicant expressly appointed his own doctor to defend his interests he thus had at his disposal all the means necessary to obtain a finding of fact favourable to him.

JUDGMENT OF 26. 2. 1976 —CASE 101/74

17 The doctor appointed by the applicant and the doctor appointed by the insurer agreed on a rate of invalidity of 20 % without its being necessary to have recourse to a third arbitrator.

18 In those circumstances it is unnecessary to consider whether Article 73 of the Staff Regulations would have allowed the applicant to insist on the choice of another method of determining the rate of invalidity since, by appointing his own doctor expressly to defend his interests, he had, in full knowledge of the circumstances, indicated in advance his agreement to the outcome of the arbitration in question.

24 The applicant claims secondly that if the rules provided for by Article 73 (1) had existed he would have been able, under the second subparagraph of paragraph (2) (c), to request an annuity instead of a lump sum.

KURRER v COUNCIL

25 Such an annuity could have been adjusted to take into account the depreciation in the value of money and the rise in salaries.

26 He claims that there are consequently grounds for making ex æquo et bono an increase in the lump sum received by him.

27 However, the applicant accepted without reservation the award of the invalidity benefit on the basis of a lump sum in accordance with Article 73 (2) (c).

28 In those circumstances he cannot rely on arguments based on the method of calculating an annuity which he has not requested in order to claim an increase in the lump sum.

34 However, Article 63 of the Staff Regulations governs only the payment of an official's remuneration.

35 It is clear from the context of Article 62 that this term refers only to the basic salary, increased where appropriate under the conditions laid down in Annex VII.

36 Furthermore, when the Staff Regulations or other regulations provide for the application of the rate prescribed in Article 63 they do so expressly, as for example in Article 82 of the Staff Regulations.

37 As an alternative the applicant requests the application of the rate of exchange given by the latest par value accepted by the International Monetary Fund pursuant to Article 17 (4) of Annex VII to the Staff Regulations.

38 Article 17 (1) of Annex VII lays down as a general rule that: 'Payment shall be made to each official at the place and in the currency of the country where he carries out his duties'.

39 Article 17 (2) together with paragraph (4) lays down an exception with regard to certain regular transfers which may, at the request of the official, be made in another Member State and in its currency.

44 Since this does not constitute one of the exceptional cases coming under Article 63 of the Staff Regulations or Article 17 of Annex VII thereto, the Council was correct in transferring the sums payable to the applicant to his bank account in the Federal Republic of Germany and in having them converted into Deutschmarks at the rate ruling on the day of transfer.

45 This complaint must thus be rejected.

46 Finally the applicant claims that the costs of the transfers to Germany of the sums payable to him under Article 73 of the Staff Regulations should have been borne by the Council.

47 The Staff Regulations do not contain any express provision as to whether the costs of transferring pecuniary benefits payable by the Community to its servants are to be borne by the party liable for payment or by the beneficiary.

48 It nevertheless appears just and reasonable to concede that since the Community is obliged to secure for its servants on final termination of their service the full amounts payable to them, it must itself bear any transfer costs.

49 In those circumstances the competent institution must bear the transfer costs so that the official may receive net, at his place of residence, the equivalent in his national currency of the sum outstanding at the place where he previously carried out his duties.

THE COURT (Second Chamber)

hereby:

1. Orders the Council of the European Communities to reimburse to the applicant the banking expenses incurred in the transfers to the bank account of the applicant in the Federal Republic of Germany of the allowance payable to him under Article 73 (2) (c) of the Staff Regulations of Officials;

2. Rejects all the remaining submissions;

3. Orders the Council to bear its own costs together with one quarter of the costs incurred by the applicant.

Kutscher Sørensen Mackenzie Stuart