C-34/77

JUDGMENT OF THE COURT (FIRST CHAMBER) OF 11 MAY 19781

Jozef Oslizlok v Commission of the European Communities

"Retirement in the interests of the service"

Case 34/77

Officials — Retirement — Discretionary power of the administration — Extent — Decision not to assign the official to another post — Defence of the interests of the servant concerned

(Staff Regulations of Officials, Article 50)

v

Commission of the European Communities, represented by its Legal Adviser, Giorgio Pincherle, acting as Agent, assisted by Denise Sorasio- Allo, a member of the Legal Department, with an address for service at the office of its Legal Adviser, Mario Cervino, Jean Monnet Building,

defendant,

Application, first for the annulment of the decision of the Commission of 21 July 1976 adopted in pursuance of Article 50 of the Staff Regulations, retiring the applicant from his post as Director of Directorate A of Direc­ torate General XVI, Regional Policy, and dismissing him, secondly, in so far as it may be necessary, for the annulment of the decision of the Commission of 21 July 1976 reorganizing Directorate General XVI and adopting a new detailed list of posts, as well as, thirdly, for the annulment of the implied decision rejecting his complaint lodged on 7 October 1976,

THE COURT (First Chamber)

composed of: G. Bosco, President, J. Mertens de Wilmars and A. O'Keeffe, Judges,

B: Co-ordination and Programmes, were either vacant or likely to become directed by Mr de Castelbajac; so within a short period but finally decided to retire him in the interests of C: Development and Conversion Operations, directed by Mr Solima. the service in pursuance of Article 50 of the Staff Regulations and to award him In 1975-1976 the Commission decided the allowance provided for in that article. on the initiative of Mr G Thomson, the Member of the Commission responsible On 30 September 1976 the applicant for regional policy, to carry out a reor­ lodged a complaint within the meaning ganization of that directorate general, of Article 90 (2) of the Staff Regu­ which led to the drawing up, on 21 July lations against: 1976, of a new detailed list of posts 1. The decision of 21 July 1976 retiring amalgamating Directorates A and B into him from his post and dismissing him one new directorate, with the result that in implementation of Article 50 of there were thenceforward only two the Staff Regulations; directorates, that is: 2. In so far as necessary, the decision of — Directorate A: Co-ordination, 21 July 1976 reorganizing Direc­ Programmes, Studies and Analyses, torate General XVI (Regional placed under the authority of a Policy), and adopting a new detailed director, assisted by a chief adviser, list of posts therefor. both posts being in Grade A 2; — Directorate B: Development and The complaint was received on 7 Conversion Operations, placed October 1976.

JUDGMENT OF II. 3. 1978 — CASE 34/77

post of director and dismissing him submitting any effective observations in implementation of Article 50 of (judgment of the Court of 30 June the Staff Regulations; 1971, Case 19/70, Almini v 2. In so far as necessary, annul the Commission, [1971] 2 ECR at p. 631); decision of the defendant of 21 July 1976 reorganizing Directorate 2. Infringement of Article 25 of the General XVI and adopting a new Staff Regulations of Officials, as detailed list of posts therefor; there was no statement of the reasons on which the decision to 3. Annul the implied decision rejecting retire him was based; his complaint which was registered on 7 October 1976 under No 4496; In this respect the applicant requests the Court to give further 4. Order the defendant to pay the costs. consideration to its judgment in Reinarz v Commission (judgment of 6 The defendant contends that the Court May 1969, Case 17/68, [1969] ECR should: 61);

OSLIZLOK v COMMISSION

of the Commission dated 1 July 1976 he from the post must imply dismissal, had not been given any opportunity of ruling out the possibility of the replying in full knowledge of the facts applicant's being assigned to another or of submitting any effective obser post in his category corresponding to vations on the expressed intention to retire him in the interests of the service his grade. A statement of reasons is even more necessary since the post of "chief and he asked to be enabled to submit adviser" assigned to the new Direc appropriate observations. torate A, which corresponds to the applicant's grade and is in a directorate In particular, the applicant was unaware of a fan which was only to be revealed which has, in particular, taken over the tasks of the former Directorate A of by the decision of 21 July 1976 which the applicant was Director, has concerning the reorganization of Direc remained vacant and is at present torate General XVI and the adoption of

In fact, paragraph of Article 25 of the the applicant's post has not been Staff Regulations abolished within the context of the reor ganization and continues to exist under Even though under the second the "chief adviser", which, according to paragraph of Article 25 any decision the table of descriptions of basic posts relating to a specific individual which is provided for in Article 5 of the Staff taken under the Staff Regulations is to Regulations, corresponds to the basic be communicated at once in writing to post of director in Career Bracket A 2. the official concerned and any decision Furthermore, the tasks carried out by adversely affecting an official is to state the former Directorate A continue to the reasons on which it is based, the exist in the new Directorate A, with the decision to retire the applicant contains result that there are no objective no statement of reasons which is requirements justifying the retirement of sufficient in law. the applicant.

The applicant states that it is in case the to reorganize the Directorate General. Secondly, it observes that misuse of decision of 21 July 1976 to reorganize powers must be proved by objective, Directorate General XVI and adopt a new detailed list of posts should appear relevant and consistent factors showing to be inseparable from that relating to that the administration used its powers his retirement and dismissal and should for purposes other than those for which they were conferred upon it (judgment therefore be wholly or partly affected of the Court of Justice of 5 May 1966, by unlawfull elements vitiaung the latter Joined Cases 18 and 35/65, Gutmann, — in particular that of misuse of powers — and/or in case the Court considers [1966] ECR at p. 117). The arguments that the lawful nature of the decision put forward by the applicant do not in any way satisfy those conditions. rearing and dismissing the applicant is conditional upon the lawful nature of The improbability of the applicant's the decision to reorganize Directorate argument is also shown by the General XVI and adopt a new detailed consideration that the Commission has list of posts that the application also a discretionary power as regards the seeks the annulment of the latter. application of Article 50 of the Staff Regulations, since it is hard to see why the Commission and its officers should Defence have involved themselves for more than The Commission contests the 18 months in a parody of reorgani­ admissibility of the application in so far zation, solely in order to cover up an as it seeks the annulment of the decision individual decision which the modifying the detailed list of posts for Commission was empowered to adopt

at any time, independently of any question to submit observations before a operation of a more general scope. decision to retire him is adopted, the applicant can only plead the alleged The Commission emphasizes that violation of the general principles of law Article 50 of the Staff Regulations is acknowledged by the case-law of the exceptional in nature. It maintains that Court and, in particular, by the Almini it is, with other provisions (Article 29 judgment referred to above, according (2), Article 34 (1), Article 43), clear evidence of the desire to allow the to which the official concerning whom a retirement decision is contemplated appointing authority a largely discret­ must first have an opportunity of ionary power as regards the posts in effectively defending his interests. Grades A 1 and A 2 by subjecting the exercise of that power solely to a The Commission notes that none of the consideration of the interests of the factors whose presence in the service. Furthermore, it clearly appears aforementioned case led the Court of as the corollary and, as it were, as the Justice to consider that the official price of recruitment without concerned had been unable to submit competition (Article 29 (2)). his observations effectively is present in The Commission considers that the this instance. In the present case, foregoing considerations allows two therefore, it cannot be claimed that the principles to be laid down: time-limits fixed were too short, since the period of 15 days fixed as a guide in — The reasons which may justify a the letter of 1 July 1976 was reasonable retirement under Article 50 may lie in every respect. in a consideration of the abilities, in the widest sense of the term, of the Furthermore, when it is realized that the official concerned just as much as in reorganization of Directorate General a reorganization resulting in the XVI had been agreed in principle since abolition of a specific post the beginning of 1975 and that active (judgment of the Court of Justice of preparations had been going on for 30 June 1971, Case 19/70, Almini, more than a year, it is impossible to [1971] ECR 623); believe that the applicant knew nothing of the operation contemplated, if only — As regards the implementation of such a measure, in the absence of because his duties entitled him to study the minutes of the meetings of the special protection provided for by Commission. As regards the details of the Staff Regulations the officials concerned cannot be entided to the reorganization, which were drawn up under the authority of his immediate expect more from the Commission superior, it is unlikely that the applicant than observance of the guarantees was not informed of them orally and which apply even in the absence of any specific provision. unofficially.

The Commission observes that the either in the new detailed list of posts applicant was, in any event, informed in for Directorate General XVI or to a the course of the proceedings before the post in the same grade vacant in Court of the real cause of the proposed another department the Court of Justice measure, that is, the reorganization of has in somewhat similar cases laid down Directorate General XVI, a direct the principle that the Commission consequence of which was the cannot be expected to give particulars of applicant's retirement. its assessment of an official in comparison with others or, more generally, make known complex value- C — Absence of any statement of judgments relating to individual cases reasons (judgment of the Court of Justice of 2 July 1969, Case 27/68, Renckens, [1969] ECR 255 at p. 264). Even if the Court As regards the inadequacy of the of Justice should wish to reconsider statement of reasons alleged by the well-established case-law, a procedural applicant, it has been established since defect in the form of an insufficient the judgment of the Court of 6 May statement of the reasons on which a 1969 (Case 17/68, Reinarz, [1969] ECR decision is based cannot alone lead to at p. 70) that reasons do not have to be the annulment of the contested decision given for decisions applying Article 50. if it appears that that decision can be In fact, the reasons which appear in the confirmed in substance in the absence of contested decision are more than a mistake of law or of fact (judgment of sufficient and indeed refer, first, to the the Court of Justice of 29 September reorganization of Directorate General 1976, Case 9/76, Morello, [1976] ECR XVI and, secondly, to the absence of at p. 1422). any assignment to another post in the same grade.

— Moreover, a comparison of the old torate General XVI or as to the and new detailed lists of posts shows interests of the service which required that although the total number of the applicant to be retired from his post Grade A 2 posts is the same, the and even dismissed in the context of posts themselves, considered from that reorganization. the point of view of the duties The fact that the defendant's arguments attaching to them, are different. on that point are based on hypotheses ("it is impossible .

irregular. Neither the applicant's general as well, but he was kept in previous training and experience nor his complete ignorance of the details of the career within the Commission — which reorganization as proposed to the was of short duration and limited to the defendant and accepted by it until after the contested decisions had been occupation of a single post — appears a priori to qualify the applicant for one of adopted. those posts. The fan that in his letter of 12 July 1976 the applicant was able to Reply contemplate the consequences of a The applicant maintains that the possible application of Article 50 does application for the annulment of the not imply that he was in a position to reorganization decision is admissible or, submit appropriate observations on the at the least, that its admissibility is actual details of the reorganization. linked with the substance of the Finally, the applicant questions the just application, with the result that it ification for the defendant's statement cannot be held inadmissible in the that by their nature "the reasons based absence of any consideration of the on the interests of the service which

fulfilled. The letter from the entitled to give his opinion on what the Commission of 1 July 1976 gave no interests of the service require or imply preciseinformation either as to the and if it is not even necessary that he be reasons for and details of the informed of the nature of those contemplated reorganization of Direc interests?

B — Absence of any statement of made the defendant decide not to assign reasons him to another post. Finally, the applicant replies to the defendant's According to the applicant there is still argument based on the judgment of the some uncertainty over the question Court of 29 September 1976 (Morello, whether a decision applying Article 50 Case 9/76, [1976] ECR 1415 et seq.), of the Staff Regulations must contain a according to which a procedural irregu statement of the reasons on which it is larity consisting in an inadequate based. statement of reasons cannot alone bring about the annulment of the contested In contrast to the Reinarz judgment (judgment of the Court of Justice of 6 decision if it appears that that decision could be confirmed in substance in the

Article 25 states that obligation in very general terms, with C — Misuse of powers and the result that it was not necessary to infringement of Article 50 of the state it again subsequendy in Article 50 Staff Regulations in the case of particularly adverse decisions. The decision retiring the The applicant refers to the applicant contains no statement of aforementioned judgment in the Almini reasons which is sufficient in law, since case and notes that, since in this case it refers neither to the factors which there is no reference in the were taken into consideration in Commission's letter of 1 July 1976 to adopting the decision to retire him nor the specific qualities of the applicant, to those preventing his assignment to the objective requirements of the service another post in the same grade which can alone justify his retirement and was available or about to become so. dismissal. Such a statement of reasons does not in The applicant contests the existence of any way mean, as the Commission such requirements and observes that the wrongly suggests, that particulars need publication, after the events in dispute be given of its assessment of the took place, of Vacancy Notice No applicant in comparison with other COM/382/77 relating to the post of officials of equal rank.

OSLIZLOK v COMMISSION

disregard of the rights of the The Commission also notes that the defence new Directorate A results from the amal­ gamation of the two Directorates (A As regards the submission to the effect and B) which existed previously and that the applicant has not been able to that, in the main and having regard to defend his interests effectively, the the aims of the reorganization, the Commission objects that there is duties attaching to the new post of confusion between its decision of a director combined those attaching to general nature and that of an individual two earlier posts. The reality of the nature addressed to the applicant. abolition of the applicant's post and, The requirement laid down in the therefore, of the reasons on which the Almini judgment is justified by the fact contested decision is based is therefore that a decision to retire an official has established. The fan that that decision particularly serious consequences as was adopted after consideration of the regards his position but that merits of the official concerned in

JUDGMENT OF 11. 5. 1978 — CASE 34/77

The statement of the reasons on which A decision which is based solely on an the contested decision was based is assessment of the specific qualities of sufficient, even assuming that the Court the offical in relation to the objective intends to subject the decisions adopted requirements of the service cannot in applying Article 50 to comparable or constitute a misuse of powers. If the identical requirements to those laid interests of the service had required the down for decisions terminating service, applicant to be retired, then even the legal bases for which are different. though the post continued to exist The Court of Justice does not expect without any change of function in the the Commission to give particulars of its detailed list of posts of the Commission assessment of an official in comparison the corresponding decision would not with others and to make known be vitiated by misuse of powers. complex value-judgments relating to The applicant, represented by E. Lebrun individual cases. Furthermore, the duty of the Brussels Bar, and the Commission to state reasons must be appraised by of the European Communities, reference to other decisions which may represented by its Agent, G. Pincherle, have affected the party concerned and presented oral argument at the hearing to all the circumstances surrounding the on 27 October 1977. adoption of the decision at issue (judgment of the Court of Justice of 9 The Advocate General delivered his July 1969, Case 1/69, Government of opinion at the hearing on 13 April 1978.

OSLIZLOK v COMMISSION

5 Although the applicant does not make any submission expressis verbis against the decision relating to the reorganization of the Directorate General for Regional Policy, it appears from the arguments put forward in support of the third submission that it is also directed against that decision, which, he alleges, was adopted only in order to permit his exclusion.

6 Thus formulated that submission is admissible also as regards the decision to reorganize Directorate General XVI, since it seeks to show that under the appearance of a measure of reorganization of the office that decision was in fact aimed at removing him from his post.

JUDGMENT OF 11. 5. 1978 — CASE 34/77

7 It is first necessary to consider the application in so far as it is directed against the decision to reorganize Directorate General XVI.

(a) The reorganization of the Directorate Generalfor Regional Policy

8 Until the contested decisions were adopted, Directorate General XVI comprised three Directorates, that is: A (Analysis, Documentation and Objectives), B (Co-ordination and Programmes) and C (Development and Conversion Operations), the first of which was directed by the applicant.

12 Finally, according to the evidence of the witness R. Ruggiero, from the time the European Regional Development Fund was set up in March 1975 (Regu­ lation No 724/75 of the Council of 18 March 1975, Official Journal No L

OSLIZLOK v COMMISSION

73 of 21 March 1975, p. 1), it became necessary to assign to it a number of officials from Directorate A, which helped to justify the amalgamation of Directorates A and B, both of which were responsible for planning and co­ ordination, whilst Directorate C was essentially to assume responsibility for the management of the Fund.

13 It follows from those factors that the reorganization of Directorate General XVI was inspired by considerations based on the interests of the service, with the result that in so far as the application refers to that decision it must be dismissed.

(b) The decision to retire the applicant

14 In the normal course of events the reduction in the number of Directors of Directorate General XVT from three to two would necessarily result in the retirement of one of them.

19 The defendant observes that the minutes of the meeting of 21 July 1976 show that after deciding on the reorganization of Directorate General XVI the Commission proceeded to carry out "a comparative examination of those officials in Grade A 2 and the official in Grade A 1 on a personal basis who had previously been assigned to the posts of director at the Directorate General for Regional Policy in relation to the requirements for performance of the duties involved in the direction of the new organization" and that "after examining the qualifications of those officials" it decided, on the proposal of the President of the Commission and of the Commissioner responsible for Directorate General XVI and "having regard to the duties to be performed by the two directorates resulting from the reorganization of Directorate General XVI", to exclude the applicant and to make the other two directors responsible for the new Directorates A and B.

20 It emerges clearly from the said minutes that the qualifications of the officials concerned, whose personal files were, moreover, at the disposal of the Members of the Commission, were examined and that the decision which resulted in the exclusion of the applicant was adopted following that comparative consideration.

21 Thus the condition attaching to a correct exercise of the wide discretionary power reserved to the Commission in the matter has been satisfied. Having regard to the nature of the power conferred in that matter by Article 50 the statement that the comparative qualifications of the various officials concerned have actually been examined satisfies the requirements contained in Article 190 of the Treaty and the second paragraph of Article 25 of the Staff Regulations to the effect that decisions shall state the reasons on which they are based.

26 An examination of his reply of 12 July 1976 shows that he was sufficiently informed of the nature and consequences of the measure contemplated to put forward effectively such arguments as might prevent its adoption and it is established that the Members of the Commission were aware of his obser­ vations before they adopted the contested decision.

(c) The Commission's decision not to assign the applicant to another post

27 According to the third paragraph of Article 50 of the Staff Regulations, an official who is retired in the interests of the service is to receive an allowance if he is not assigned to another post in his category and grade.

28 Just as in the case of a decision to retire an official the Commission enjoys wide discretionary powers in the case of a decision to reassign an official to another post in the same grade.

29 However, by reason of the consequences of such a decision for the official concerned a decision not to reassign him to another post cannot follow auto­ matically from the retirement decision itself but must be based on appro­ priate considerations.

30 The exercise of discretionary power, however wide, nevertheless requires that an official concerning whom a decision not to reassign him to another post in his grade is contemplated should first have an opportunity of effectively defending his interests."

36 The contested decision must therefore be annulled in so far as it decided that it was not appropriate to reassign the applicant to another post in his category corresponding to his grade.

37 It will be for the Commission to adopt the measures necessary for the enforcement of this judgment, in particular by allowing the applicant the opportunity of effectively defending his interests in that respect before deciding whether or not it is appropriate to reassign him to another post.

Costs

38 Under Article 69 (2) of the Rules of Procedure, the unsuccessful party shall be ordered to pay the costs.

OSLIZLOK v COMMISSION

39 As the defendant has failed in its submissions it must be ordered to pay the costs.

Delivered in open court in Luxembourg on 11 May 1978.

A. Van Houtte G. Bosco

Registrar President of the First Chamber

OPINION OF MR ADVOCATE-GENERAL WARNER DELIVERED ON 13 APRIL 1978

My Lords, academic appointments at University The Applicant in this case is Mr J. S. College, Cork, and at the University of Oslizlok. He was born in Poland in Bristol. In 1951 he received at

1920. Between 1940 and 1945 he served University College, Cork, the degree of with the Polish Forces in France and in Master of Economic Science. In 1952 Great Britain. After the war he went to he joined the staff of the Central Bank University College, Cork, where he of Ireland as an Economic Assistant. In graduated as a Bachelor of Commerce. 1953 he became, by naturalization, an Between 1949 and 1951 he held junior Irish citizen. By the time of the