C-142/78

JUDGMENT OF II. 10. 1979 — CASE 142/78

In Case 142/78

Marcelle Exner, nee BERGHMANS , an official of the Commission of the European Communities, residing at 28 Rue Gatti de Gamond, Uccle, 1180 Brussels, represented and assisted by Marcel Slusny, of the Brussels Bar, 272 Avenue Brugmann, Uccle, 1180 Brussels, with an address for service c/o Mr Cassaignau, 24 Rue du Nord, Luxembourg-Helmsange, applicant, v

Commission of the European Communities , represented by Joseph Griesmar, acting as Agent, assisted by Daniel Jacob, of the Brussels Bar, 36 Rue de Praetere, 1050 Brussels, with an address for service in Luxembourg at the office of its Legal Adviser, Mario Cervino, Jean Monnet Building, Kirchberg, Luxembourg, defendant,

APPLICATION for the recognition of the applicant's right to the household allowance and, accordingly, for the annulment of the Commission's decision of 6 February 1978 refusing to recognize that right and, in implementation of Article 85 of the Staff Regulations, continuing to claim recovery of the sums which it regards as overpaid, as well as for the reimbursement of those sums, which have already been repaid to the Commission,

THE COURT (Second Chamber)

The facts of the case, the procedure, the her husband. The applicant claims that conclusions and the submissions and when she filled in her questionnaire she arguments of the parties may be was informed by Hugo Sterck, an summarized as follows: official in Grade A 4 in Directorate- General IX, "that the fact that her husband drew a head of household allowance at Eurocontrol did not prevent her from drawing the household I — Facts and procedure allowance in her own name".

The Commission states, on the other On 1 June 1974 Mrs Exner was recruited hand, that that official "formally denies by the Commission in the post of ever having informed the applicant that it assistant switchboard-operator as a was not necessary to take account of the probationer in Grade C 5, step 3. At 'other benefits' received by her husband present she is established in Grade C 4, from Eurocontrol". step 3.

JUDGMENT OF 11. 10. 1979 — CASE 142/78

since 1 January 1975. In fact, a letter May 1977 which stated that the from Eurocontrol dated 10 October household allowance and the dependent 1977 informed the Commission that child allowances were no longer paid on that allowance had been paid from the ground that as those two allowances 1 February 1974. As a result of the first paid by Eurocontrol were equal to or letter the Commission decided no longer greater than those paid by the to pay the household allowance previ Commission, the latter was not required, ously granted to the applicant with effect by virtue of Article 67 (2) of the Staff from December 1976 and requested the Regulations, to make "any payment on that account".

She which she asks for "an explanation of was, however, informed by a the reduction in the amount of [her] memorandum of 23 August 1977 that the remuneration". The Director for overpayment to her amounted to Bfr Personnel replied by a memorandum of 22 218. The same memorandum also 4 March 1977 in which he stated "that fixed the arrangements for the recovery the difference ascertained between [the] of that sum. remuneration for February 1977 and that for November 1976 is explained by the fact that the household allowance and By letter of 6 February 1978 from Mr the dependent child allowance are no Tugendhat, the Commissioner with special responsibility for personnel, longer paid as from 1 December 1976". which was notified to the applicant on 20 March 1978, the Commission rejected Following that reply the applicant wrote the complaint against the application of on 15 March 1977 and 20 April 1977 to Article 85 of the Staff Regulations.

EXNER v COMMISSION

The procedure followed the normal In the alternative course. Upon hearing the report of the Judge-Rapporteur and the views of the Order the following facts to be proved Advocate General the Court (Second by witnesses: Chamber) decided to open the oral (a) When the applicant saw Mr Sterck procedure, to ask Geoffrey Campey, an official in DG/IX/A/I to give evidence for the purpose of filling in the declaration as to allowances he at the hearing and to request Mrs Exner informed her that the fact that her to appear. husband received a head of household allowance at Eurocontrol did not prevent her drawing the II — Conclusions of the parties household allowance in her own name; In her application the applicant claims that the Court should: Witness called: Hugo Sterck, an official in DG/IX/A/4; "(1) Rule that the applicant is entitled to payment of the household (b) When, after submission of her allowance, with all the legal complaint, that is, after 15 July 1977, consequences, in particular as the applicant saw Mr Campey, a regards the allowances due from the date on which the defendant lawyer, he informed her that she was right and that she ought to win her suspended payment; case;

(2) Accordingly, declare null and void the decision of the Commission of Witness called: Geoffrey Campey, an 6 February 1978; official in DG/IX/A/I;

(3) Order the defendant to repay to the The Commission contends that the Court applicant the sum of Bfr 22 218 with interest at the normal rate should: from the submission of the "— Dismiss the application as inad­ complaint on 15 July 1977. missible and in any event unfounded; In the alternative:

that it "had always been her intention to challenge the legality of the adminis­ The applicant states that in view of the tration's decision to recover the sums fact that on 4 March 1977 the already paid by way of the household Commission replied that the reduction in allowance and not simply the decision the amount of her salary was caused by itself. the fact that the household allowance was no longer paid it cannot claim that it The Commission states that the did not know of her complaint as complaint of 15 July 1977 only regards the fact that it was no longer concerned the decision to recover the paid. Moreover, she expressed her overpayments and that as a result the complaint orally during her discussions application lodged against the with Mrs Nicora and Mr Campey (the Commission's refusal to grant the latter also told her "that she was right to household allowance to Mrs Exner was request payment of the household not preceded by a complaint. allowance, since she was entitled to it"). The Commission considers, furthermore, that it was unable to know of the Furthermore, the letter from Mrs applicant's complaints concerning the Delauche of 18 May 1977 in reply to the fact that the household allowance was no applicant's memoranda shows that the defendant "had understood what the longer paid and that, accordingly, the reference to the judgment in the Sergy complaint was". case was "irrelevant", since it is stated not only in paragraph 32 of the decision Finally, the defendant has never in that judgment that the primary considered opening a discussion with a purpose of the prior complaint is to view to an amicable settlement of the enable the administration to be in a dispute, since in its defence it "states that position "to know the complaints or the applicant is not entitled to the requests of the person concerned" but household allowance". In those circum­ also in paragraph 33 that although "it is stances a complaint would have been a not the purpose of that provision to bind useless formality and is therefore no strictly and absolutely the contentious longer to be regarded as an essential stage of the proceedings" it is procedural requirement since it serves no nevertheless essential "that the claims purpose. The applicant accordingly asks submitted at that stage change neither for the case-law of the Court in the von the cause nor the subject-matter of the Wüllerstorff und Urbair case, Ritter von complaint". The Commission further Wüllerstorff und Urbair v Commission, maintains that the subject-matter of the Case 7/77 [1978] ECR 769) and in the

The Commission "strongly objects" to the application in this instance of the Alternatively: the belated nature of the case-law laid down in the von complaint Wüllerstorff und Urbair case, in which it was accepted that the prior complaint The Commission states that even if it was "devoid of purpose where a were necessary to accept that the ground complaint is directed against the of complaint concerning the fact that the decisions of a selection board in a household allowance was no longer paid competition since the appointing was contained by implication in the authority is not empowered to review formal complaint the latter was such decisions", and maintains that the submitted out of time, since the fact that lodging of a prior complaint is a that allowance was no longer paid was condition of admissibility, as was stated notified by means of the pay slip for by the Court in its judgments in the de December 1976 which showed that that Lacroix and Reinarz cases (Joëlle de allowance was no longer paid. The Lacroix v Court ofJustice of the European Commission considers that the applicant Communities, Case 91/76 [1977] ECR could not have been unaware of the 225, Reinarz v Commission and Council significance of the headings on her salary of the European Communities, Case statement since "officials are regularly 48/76 [1977] ECR 291). Moreover, in reminded of it" and that the pay slip the defendant's opinion the applicant's accordingly constitutes "an act adversely reasoning results in a paradox since an affecting" an official. In that connexion official would only be obliged to lodge a the Commission refers to the judgments prior complaint if "it appeared to him in Case 1/76 (Wack v Commission of the that the decision of the administration European Communities, [1976] ECR was not firmly adopted". Furthermore, 1017) and in Joined Cases 15 to 33, 52,

53, 57 to 109, 116, 117, 123, 132 and had explained to her "that she was not 135 to 137/73 (Schots, nee Kortner, and entitled to the household allowance Others v Council and Commission of the because her husband was an official of a European Communities and European European organization" did she become Parliament, [1974] ECR 177). aware for the first time of the reasons for the fact that her household allowance Even if that argument is not accepted the was no longer paid.

In application was inadmissible, he that connexion the Commission relies on nevertheless considered the substance of the judgments in Case 56/72 (Goeth-Van the case in order — according to the r Schueren v Commission of the applicant's interpretation "either to European Communities [1973] 1 ECR persuade the official that he was wrong" 181), Case 33/72 Gunella v Commission or "to make the institution aware of its of the European Communities [1973] 1 responsibilities, at least as regards the ECR 475) and Case 1/76 (Wack v future".

The memorandum of 4 March 1977 provided Mrs Exner with Finally, while not denying the jurispru no explanation, which caused her to dential interest of the applicant's obser make subsequent approaches to the vation regarding the absence of a time administration. Only after Mrs Nicora bar in relation to recurring rights, the

defendant states that those that the Court held in Case 106/76 considerations cannot apply in the (Gelders nee Deboeck v Commission of the present case, since what is at issue is a European Communities [1977] ECR "contested right" and not a "ludicrous 1623) and Case 14/77 (Emer nee van den example". In any event Mr Advocate Branden v Commission of the European General Mayras had himself given Communities [1977] ECR 1683) that different reasons to justify the purpose of "the manifest objective of Article 67 (2) considering the merits of the Gunella is to prevent a couple from receiving case, as follows: family allowances twice in respect of the same children". There is thus no legal "However, if, without dwelling on the basis for that submission. inadmissibility, you were to decide to examine the merits of the action, we The applicant abandons that part of her believe that you would likewise be led to submission while observing that the reject the appeal. For this reason we feel case-law referred to is not applicable in it worth while to give you our opinion in this instance since the overlapping of this connexion." household allowances is provided for in Article 1 (3) to Annex VII. Thus, the applicant's interpretation of that opinion was incorrect. Principal submissions — second part B — The substance of the case Infringement of Article 1 (3) and (4) of Annex VII to the Staff Regulations The applicant relies principally upon a submission which is divided into two parts, one of which is based on the The applicant maintains that by virtue of infringement of Article 67 (2) of the Annex VII, which is applicable in this Staff Regulations and the other on the instance by virtue of the general principle infringement of Article 1 (3) and (4) of specialia generalibus derogant, an official is entitled to receive the household Annex VII to those regulations. She also allowance unless the husband or wife is relies, in the alternative, on a submission based on the inapplicability to the also employed by the Communities. She present case of Article 85 of the Staff also recalls that her husband is employed Regulations. at Eurocontrol which, despite statements made by the defendant's officials, is an organization separate from the Principal submission — first part Communities.

The applicant recalls, first of all, that The defendant considers, finally, that the Mrs Nicora informed her that her applicant's argument would result in household allowance was no longer paid inequality since, to take the example of a owing to the fact that as her husband couple with dependent children, if both works at "Eurocontrol, which is a husband and wife were employed by the European organization" both spouses are Communities they would receive only employed within the Communities. She one household allowance whereas if one then contests the defendant's argument of the spouses worked outside the that Article 67 applies, since such a Communities they would receive two. proposition thereby upsets "all the traditional rules of interpretation whose application is in particular expressed in Alternative submission the maxim specialia generalibus derogant". She states that Article 67 lays down general rules and that the conditions are stipulated in Article 1 of Annex VII to Inapplicability of Article 85 of the Staff the Staff Regulations, which provides Regulations that if the spouses have dependent children "the official is in any event entitled to the household allowance". In The applicant maintains that as she was accordance with that interpretation not aware that the payment might be therefore the applicant is entitled to the irregular and since it cannot be regarded household allowance in this instance. as so patent that she could not have been unaware of it "there are no grounds for applying Article 85 of the Staff Regu­ lations".

challenge successfully the recovery of the infinitely greater than the applicant's overpayments". To support that as regards the scope of the Staff argument the Commission refers to the Regulations", not only did not ask facts: the applicant failed to provide the for any documents but, furthermore, supporting document relating to the "informed her that she was entitled Frs 3840 declared as family allowances to receive the household allowance". received by her spouse, from which it The administration thus "provoked, would have been easy to ascertain that or encouraged, or even simply the spouse received a household permitted" the conduct on the part of allowance. The applicant cannot Mrs Exner for which she is now therefore claim to have been unaware of criticized. the irregularity of the payment. The applicant also failed to grasp the oppor­ tunity to rectify the situation by sending to the administration the supporting — Secondly, "she was not deemed to be documents relating to the allowances aware of the information contained received by her husband in order to in Administrative Notices and, in any inform it of the increases in those event, since she was convinced that allowances as requested by the she was entitled to the household Commission in Administrative Notices allowance she could not have No 63 of 13 October 1975. In that suspected that that information might connexion the defendant refers to the apply to her particular case. case-law laid down in the Kuhl case (supra) and in the Meganck case (Meganck v Commission of the European Communities, judgment of 30 May 1973, Case 36/72 [1973] 1 ECR 527) in which — Thirdly, assuming that she is not the Court held that officials who had entitled to the household allowance, "the crux of the matter" is whether failed for four months to inform the or not her error was excusable, that administration of changes which had is, in this instance, whether she was occurred in their family situation "were themselves responsible for the irregular justified in believing that she was entitled to the allowance. She recalls payments and the irregularity was therefore patently such that they could that Mr Sterck and Mr Campey not have been unaware of it". "shared her point of view" and that Mrs Nicora explained the fact that the household allowance was no longer paid by the fact that "Euro- The applicant maintains that as the error control was a European organ­ was excusable it is necessary to discover ization" and asks "how, therefore, the circumstances in which the payment the error could be called inex­ was made and, inter alia, to take account cusable". of the applicant's personal situation.

after the administration adopted the IV — Oral procedure decision to recover the overpayments. During the oral procedure the Court It claims that the personal situation of heard the evidence of Mr Campey and the applicant cannot be taken into Mrs Exner. account, since to do so "would amount to preventing Article 85 of the Staff Mr Campey stated, first, that he "does Regulations from ever being applied" not remember Mrs Exner" and, and, furthermore, that in its judgment in secondly, while not disputing that he has the Acton case (Joined Cases 44, 46 and "certainly spoken to her on the 49/74, Acton and Others v Commission of telephone", that there has probably been the European Communities, [1975] ECR a "misunderstanding" and that he does 383) the Court "accepted that Article 85 not believe that he could have told Mrs of the Staff Regulations was applicable Exner that she was right. to the applicants, who numbered more Mrs Exner stated that she "met Mr than 500 and therefore represented all Campey in his office" and that the grades and categories, without making informed her "that he believed that there any distinction on the basis of the level was no problem and that [she] must be at which they performed their duties." right". She did not deny that there may The defendant also states that "the have been a misunderstanding since the principle of good faith which prohibits conversation took place in French — Mr the administration from recovering Campey is British — but she claimed to overpayments having caused or even have "understood Mr Campey to have simply permitted the overpayment of the said that [she] was right in what [she] household allowance" cannot be relied said." on in this instance since "there can be no Mrs Exner also stated that when she doubt that the payment in question was took up her appointment Mr Sterck made as a result of the incomplete informed her that "as Eurocontrol does declarations made by the applicant when not form part of the Commission [she] she took up her appointment and of her could also be entitled to the household failure to provide the supporting docu­ allowance." ments requested." After the witnesses were heard the As a result the defendant concludes that both the conditions laid down in Article parties presented their oral argument at the hearing on 14 June 1979. 85 of the Staff Regulations are satisfied in this instance, although one alone The Advocate General delivered his would have been sufficient to allow opinion at the sitting on 13 September recovery of the overpayments. 1979.

However, in view of the fact that the submissions relied on by the applicant directly challenge the decision adopted by the Commission, namely that the applicant is not entitled to the household allowance, the close links between the material submissions relied on by the applicant and the objections of their admissibility put forward by the Commission require the former to be examined first.

3 The applicant claims that Article 67 (2) of the Staff Regulations, which requires an official to declare allowances of like nature paid from other sources so that they may be deducted from those paid under Articles 1, 2 and 3 of Annex VII, merely expresses a general principle.

However, the special provision contained in the final sentence of Article 1 (3) of Annex VII, which provides that the official shall "however" be entitled to the allowance where the married couple have one or more dependent children takes precedence over that general provision. That provision is limited by Article 1 (4) to the payment of the household allowance to only one of the spouses, the one whose basic salary is the higher, where both are employed in the service of the Communities.

Consequently — according to the applicant — it follows from those provisions that the right to the household allowance exists in any event where the spouses have one or more dependent children and that the prohibition on the overlapping of benefits only applies where both spouses are employed in the service of the Communities.

JUDGMENT OF 11. 10. 1979 — CASE 142/78

4 As against that it must be stated that the clear aim of Article 67 (2), which establishes a general principle applicable in every case, is to prevent a married couple from drawing two household allowances since they are of like nature and paid for the same purpose: to facilitate the life of an official who is married or who, whatever his family situation, has one or more dependent children.

Recovery of the overpayments on the basis of Article 85 of the Staff Regulations

9 On that point the dispute concerns whether the administration of the Commission is entitled to demand the repayment of the overpayments in accordance with Article 85 of the Staff Regulations which provides that "Any sum overpaid shall be recovered if the recipient was aware that there was no due reason for the payment or if the fact of the overpayment was patently such that he could not have been unaware of it." It follows from that provision that for a sum paid without justification to be recovered evidence must be produced to show that the recipient was actually aware that there was no due reason for the payment or that the fact of the overpayment was patently such that he could not have been unaware of it.

10 Since the applicant disputes both that she was aware that there was no due reason for payment and the evidence to show that, it is necessary to consider the circumstances in which the administration was led to pay the household allowance to the applicant.

11 The administration calculates the family allowances payable to its married employees on the basis principally of the reply to point No 18 in the ques­ tionnaire filled in by any person entering its service. Point No 18 is worded as follows: "Give details of the family allowances which you receive from other sources." Under that question there are two dotted lines on the form set close together on which is to be written the reply to the question, which is marked by an asterisk referring to the bottom of the page where it is stated "Attach supporting document."

JUDGMENT OF 11. 10. 1979 — CASE 142/78

13 It must be observed, however, that in the Member States the concept of family allowances is generally understood to mean essentially dependent child allowances and that that is also the meaning given to the term in the Belgian legislation to which the applicant was subject before she entered the service of the Commission. It is therefore difficult to criticize the applicant for having failed to find out the precise definition of the term "family allowances" after entry into service by referring to Article 67 of the Staff Regulations.

14 The administration of the Commission must also be criticized for failing to draw up questionnaires which on that point were sufficiently explicit, unlike in fact those of the other Community institutions; they were even ambiguous since the amount of space reserved for the reply did not allow any details to be given as to the three constituent elements of family allowances within the meaning of the Staff Regulations of Officials of the Communities. It must also be emphasized that the special office of the administration to which the applicant returned the questionnaire did not react either to the wording of the reply or to the absence of any supporting document and that its conduct in this instance was both remiss and negligent.

15 In addition, the conversations which took place between the officials responsible in that field and the applicant were, at the least, capable of giving rise to a misunderstanding on her part as to the extent of her rights so that it must be concluded that it has not been shown that the applicant was actually aware that there was no due reason for the payment to her of the household allowance and that it cannot be complained that she caused the error on the part of the administration by an incorrect statement or an omission.

Furthermore, under Article 70 of the Rules of Procedure, in proceedings by officials or other servants of the Communities, institutions shall bear their own costs.

On those grounds,

THE COURT (Second Chamber)

hereby:

1. Dismisses the application inasmuch as it sought recognition that the applicant was entitled to the household allowance;

2. Annuls the decision adopted by memorandum of 18 May 1977 (Ref. IX/A/4/2995) in which the Commission ordered the applicant to repay the overpayments by way of the household allowance;

OPINION OF MR ADVOCATE GENERAL REISCHL DELIVERED ON 13 SEPTEMBER 1979 1

Mr President, In this connexion the following details Members of the Court, should be borne in mind. The applicant, who has two children (born in 1969 and The proceedings in which I am giving 1971) by a previous marriage, married my opinion today concern, first, the on 16 February 1974 an employee of applicant's claim for payment of a Eurocontrol who had been in Grade B 5, household allowance within the meaning step 1, since September 1972 and who of Article 67 (1) (a) of the Staff Regu­ has been classified in Grade B 4 since lations of Officials and Article 1 of December 1976. In accordance with the Annex VII to the Staff Regulations of Officials, to which inter alia married service regulations of Eurocontrol, which are modelled on those of the European officials are entitled. Secondly, they Communities, the applicant's husband concern the disputed duty of the has, from the date of the marriage, applicant to repay the household drawn a household allowance and an allowance which, it is alleged, was for a allowance for two dependent children. certain period wrongly paid to her, in accordance with Article 85 of the Staff Since June 1975 he has also been drawing an education allowance and Regulations of Officials, which provides since November 1977 a second education that: allowance. "Any sum overpaid shall be recovered if the recipient was aware that there was no due reason for the payment or if the On 1 June 1974 the applicant entered the fact of the overpayment was patently service of the Commission as a such that he could not have been probationer in Grade C 5, step 3. She unaware of it." was established with effect from