C-136/92

2. The officials had made certain claims before the Court 2 concerning the alleged belated adoption of Regulation No 3294/88, 3 (b) to pay default interest from the date when the said arrears fell due until the 6 date of their actual payment. * Original language: German. 1 — [1992] ECR II-293. 2 — The claims were originally brought before the Court of Jus­ tice which by orders of 15 November 1989 after completion of the written procedure referred the cases to the Court of 4 — Council Regulation of 26 November 1986 correcting the First Instance. Concerning particulars of the procedure see weightings applicable in Denmark, Germany, Greece, paragraphs 1 and 12-18 of the contested judgment. France, Ireland, Italy, the Netherlands and the United King­ dom to the remuneration and pensions of officials and other 3 — Council Regulation of 24 October 1988 correcting the servants of the European Communities (OJ 1986 L 336, weightings applicable in Denmark, Germany, Greece, p. 1). France, Ireland, Italy, the Netherlands and the United King­ dom to the remuneration and pensions of officials and other 5 — Judgment in Case 7/87 Commission v Council [19881 ECR servants of the European Communities (OJ 1988 L 293, 3401. p. 1). 6 — Paragraph 19 of the contested judgment.

I - 1984

COMMISSION v BRAZZELLI LUALDI AND OTHERS

9. The Court considered that the legislation contained in Regulation No 3294/88 could have been and therefore ought to have been 1 6. The Court of First Instance, however, adopted as early as 1 January 1984. 2 The fact that a valid regulation was adopted only upheld the daim for compensation for dam- in October 1988 infringed the general prin­ age resulting from loss of purchasing power. ciple according to which decisions in that sphere should be adopted without unjustifi­ 13 able delay and must therefore be regarded 1 as constituting a fault. 4 TheCouncil pos­ sessed already in 1986 all the information 7. That claim was based on infringement of needed to adopt a regulation in accordance Articles 64 and 65 of the Staff Regulations. The officials argued before the Court that the Commission had infringed those articles in 9 — See paragraphs 29-31 of the contested judgment. that it had simply paid the nominal value of 10 — See paragraph 2 above. 11 — Paragraphs 32 and 33 of the contested judgment; the obser­ vation relates to paragraph 25 of the judgment in Case 7/87. 12 — Paragraph 39 of the contested judgment. 7 — Paragraphs 23 to 25 of the contested judgment. 13 — Paragraph 36 of the contested judgment. 8 — Paragraph 26 of the contested judgment. 14 — Paragraph 39 of the contested judgment.

I- 1985

OPINION OF MR LENZ — CASE C-136/92 P

with the requirements of the Staff Regula­ power which affected their arrears of remu­ tions. Even if the Council had adopted neration during the period in question.' such a regulation by 1986, the procedure which led to the various Commission pro­ posals to the Council had already been 16 excessively long.

I - 1986

COMMISSION v BRAZZELLI LUALDI AND OTHERS

the conduct of another institution (the (iii) award costs as provided for in law. Council). On the latter issue the Court had wrongly applied Community law (third part). By its third plea in law the Commis­ sion objects to paragraph 40 (cited above) of the contested judgment and alleges that the Court 'wrongly interpreted and applied Community law on the requisite proof of damage for the payment of compensatory interest'. The officials contend that the Court should:

(i) principally

14. The Commission claims that the Court should: (a) dismiss the Commission's appeal against the judgment of the Court of First Instance of 26 February 1992 in Joined Cases T-17/89, T-21/89 and T-25/89 as inadmissible;

(i) set aside the judgment of the Court of First Instance of the European Commu­ nities in Joined Cases T-17, T-21 and T-25/89 in so far as it orders the Com­ (b) order the Commission to pay the mission 'to pay the applicants compen­ costs; satory interest for the damage suffered by them, when their arrears of remuner­ ation were calculated, as a result of the loss of the purchasing power thereof between 1 January 1984 and November 1988'; (ii) alternatively, should the Court of Jus­ tice give judgment on part or the whole of the substance of the appeal:

19. In the light of that it seems appropriate in the following observations to distinguish between the two categories of objection and to refer to them in separate sections.

16. The parties waived the oral procedure. Section 1: The objections relating to the Commission's liability for the period after 1986

20. I. Those objections are contained in the 18 19 second part and third part of the second 17. I shall refer to further particulars of the facts and legal position as well as the obser­ vations of the parties, as need be, in the fol­ 17 — Paragraphs 12 et seq. lowing opinion. Furthermore, I refer to the 18 — P. 26 et seq., point 31 of the appeal. Report for the Hearing. 19 — P. 27 et seq., points 33-35 of the appeal.

I - 1988

COMMISSION v BRAZZELLI LUALDI AND OTHERS

22. 1. The officials consider that the Com­ mission is challenging parts of the judgment in which the Court assessed the extent of the delay attributable to the Commission. They 25. That argument is also invalid. The forms consider that the observations on that issue of order which the Commission seeks at the are therefore inadmissible because they con­ end of its appeal correspond precisely to cern the assessment by the Court of the Article 113. The Commission's objections facts. which are in question here directly concern the justification of those forms of order. Should they be upheld, it would lead to the setting aside of the contested judgment at

20 — See Article 168a of the EEC Treaty and Article 51 of the Statute of the Court of Justice of the EEC and the similar provisions concerning the two other communities. 23. That argument must be rejected. It is 21 — See the judgment in Case C-238/90 P Vidranyi v Commis- admittedly true that appeals are confined to sion [1991] ECR I-4339, paragraph 12).

I - 1989

OPINION OF MR LENZ — CASE C-136/92 P

least in part and/or to the partial success of 30. In the present case the Commission con­ the form of order sought by the Commission siders that rule to be infringed because there before the Court of First Instance (dismissal is a complete absence of grounds. There is of the application). Thus neither expressly therefore a 'grave defect' in the contested nor by implication has the Commission 23 judgment. sought forms of order other than those which were sought at first instance.

31. On considering that objection it is apparent that in fact the Court of First Instance has not stated how the delay 26. 3. The result is that there can be no after 1986 could make the Commission li­ doubt about the admissibility of the Com­ able. In principle there is a need for such mission's contested objections. explanation, however, in order to understand the Court's argument.

28. 1. In that respect I consider it appropri­ ate first to consider the question whether the Court of First Instance's grounds meet the applicable requirements. 33. Furthermore, it follows from that para­ graph of the judgment that the Court of First Instance considers the basis of the claim which it upheld to be in the general rules on compensation — rightly so, for even in the event of belated adoption of retroactive mea­ sures of adjustment the Staff Regulations 29. From the point of view of principle the provide for no increase in the nominal Court of Justice has already referred in the 22 Vidranyi judgment to the rule that every court must give grounds for its decision. 23 — Point 35, p . 28 of the appeal. 24 — See the judgment in Case 28/64 Müller v Council of the EEC and the Council of the EAEC [1965] ECR 237, 247 and the judgment in Case 307/85 Gavanas v ESC and 22 — Previous footnote, paragraph 29 of the judgment. Council [1987] ECR 2435, paragraph 7.

I - 1990

COMMISSION v BRAZZELLI LUALDI AND OTHERS

25 Regulation No 3619/86 were based on the amount. Where there is doubt, however, claims for compensation must be made same Commission proposal and that the against the person responsible for the con­ Court of Justice declared the latter regulation 26 void precisely on account of the provisions duct causing damage. which departed from the Commission's pro­ 28 posal.

I-1991

OPINION OF MR LENZ — CASE C-136/92 P

38. An explanation for what, as has been provide the requisite explanation on the shown, does not appear, prima facie, to be a issue. logical attitude on the part of the Court of First Instance, cannot be found in the judg­ ment of the Court of Justice in the Meyer- 31 Burckhardt case, to which reference is made in the contested judgment at paragraph 35. It is true that pursuant to the Meyer- Burckhardt judgment a dispute between an official and his institution concerning com- 40. Nor is it possible to say on the basis of pensation for damage is pursued, where it earlier case-law in similar cases that the defi­ originates in the relationship of employment ciencies I have indicated do not amount to a between the person concerned and the insti­ failure to state reasons and thus a ground for tution, under Article 179 of the Treaty and 32 setting aside the contested judgment. Articles 90 and 91 of the Staff Regulations. It is also true that the Court of Justice applied a broad criterion in relation to the question whether it 'originates in the rela­ 33 tionship of employment'. There is on the other hand nothing in that judgment to sup­ port the proposition that the appointing authority in a situation such as the present is responsible for the conduct of another insti­ 41. From that point of view the Court of tution. First Instance could have dispensed with explanation of the issue only if the legal position had been clearly in accordance with long-standing practice of the Court of Jus­ 39. It is thus apparent that the grounds of tice. We are however far from such a posi­ the contested judgment do not in themselves tion.

I - 1992

COMMISSION v BRAZZELLI LUALDI AND OTHERS

43. The Court stated in that respect: could therefore not be declared illegal until after the applicant had challenged the rele­ vant salary slip.

'Having regard to the circumstances of the case, in particular the excessive slowness of the Community institutions in discharging their duties ... the Court fixes the interest in respect of the delay in settling the applicant's pecuniary claims at 6% per annum.'

46. It is thus apparent that the Roumengous Carpentier judgment is no justification for 44. In that case however the conduct at issue the failure to state reasons in the present was in fact that of the Commission. The case. applicant had claimed:

I - 1993

OPINION OF MR LENZ — CASE C-136/92 P

ment. Furthermore, they claimed compensa­ that those applicants had claimed interest tion in full for the loss of purchasing power. from the date from which there was retroac- tive effect. A claim so defined and based is logically directed against the appointing authority.

48. The Court considered the action against the appointing authority to be admissible (albeit without the claim in respect of loss of purchasing power since there was no men­ 51. In the present case, however, the Court tion of it in the preliminary procedure). On of First Instance did not regard the retroac- the other hand it dismissed the action against tive effect of the measure of adjustment (to 1 the Council for payment of interest as inad­ January 1981) as decisive, but the delay in missible since it concerned 'only the Eco­ the adoption of the measure. Consequently it nomic and Social Committee'. ordered the payment of interest from the date from which an appropriate period for that adoption was exceeded.

49. That result seems prime facie to indicate that the Court considers actions for the pay­ ment of interest in cases of that nature as in 52. I do not overlook the fact that the appli­ principle coming within the employment cants in the Culmsee case also alleged a delay relationship which again could mean that in the adoption of the salary increase, 42

from the substantive point of view it consid­ without however drawing the necessary con­ ers the appointing authority to be the debtor. clusion regarding the commencement of the obligation to pay interest (dies a quo).

56. Within the confines set for this section it seems to me expedient first to deal with the third plea in law. Thereafterit will be neces­ sary to discuss the first plea in law and the relevant parts 1 and 2 of the second plea in 55. 2. In my opinion that infringement is law . ground for setting aside the judgment of the Court of First Instance (to the extent defined 43 by the plea in law in question). It does not seem to me appropriate to go on to discuss the objection of infringement of Community The third plea in law law. Since there is a complete absence of a statement of reasons by the Court of First Instance on a basic issue, in conducting such a review the Court of Justice would be assuming the role of a court of first instance and weaken the duties of the Court of First 57. I. The Commission's plea in law essen­ Instance in that respect. It might perhaps be tially challenges the fact that the Court of possible to disregard that objection if the First Instance awarded compensation to the solution to the issue and the considerations extent of the loss of purchasing power arising in relation thereto were obvious. shown in the statistics as a consequence of There can, however, be no question of that in the delay in the adoption of Regulation No view of the complicated and difficult conse­ 3294/88. There are three parts to the plea in quences arising from the unfortunate divi­ law — despite the somewhat laconic heading, sion of responsibilities between the appoint­ which mentions only one. ing authority and the legislative institutions as far as concerns the legal remedies and the capacity to be sued.

t 45 59. In the second par the Commission not capable of resolving the problems in the argues that the Court of First Instance same manner as the third part. infringed general principles in relation to the requisite evidence whereby evidence must be adduced of alleged damage and proved. The Court of First Instance considered that it was obvious that the officials had suffered damage even though they had not even alleged it. 63. In that respect it may be observed first of all that the present case relates to a quite specific situation, namely the belated adop­ tion of a measure for the five-yearly adjust­ 46 ment of weighting in the realm of civil ser­ 60. In the third part the Commission does vice law. The third part of the plea in law not deny that indexing is technically feasible deals with just that special feature: the Com­ on the basis of the purchasing power of the mission relies on the fact that the Commu­ currency. Many countries have in the past nity rules applicable to the situation do not had recourse to that means. Indexing of the provide for compensation for loss of pur­ value of the currency can however be based chasing power and therefore it cannot as only on a measure adopted by the Commu­ such be granted. The two other parts of the nity legislature and there is none such here. plea on the other hand are based on general rules of the law of compensation although the present case does not involve the prob­ lem of compensation for loss of purchasing power in the law on compensation in that 61. II. All three parts of this plea in law general form. serve the same purpose: as regards the so-called compensatory interest the Com­ mission seeks to have the contested judg­ ment set aside and the form of order it sought at first instance upheld, namely that the application be dismissed. By means of the present plea it seeks to show that loss of purchasing power cannot be the subject of a 64. Furthermore, it is scarcely possible to claim for compensation. consider the question whether the fact that loss of purchasing power can on its own be regarded as 'damage' or 'proof of damage' without determining the positive require­ ments of such terms. According to the con­ tested judgment, however, the officials in 62. HI. It is apparent however from a com­ order to show their damage at first instance parison of these three parts of the plea in law simply referred to the fact of depreciation in question that the first and second parts are and selected their evidence (statistic material) correspondingly. The definition of the posi­ tive requirements within the abovemen- 45 — Pages 30-32, points 41-50 of the appeal. tioned meaning would therefore serve no 46 — Page 32, point 54 of the appeal. useful purpose in the present case.

71. The principle which the Court has con­ sistently laid down in civil service law, according to which liability presupposes 68. Finally, the officials' argument that the maladministration, damage and a causal con­ 51 principles on which the Commission bases nection between the two factors, basic- its third plea in law have never been recog­ nized and in particular have no support in the case-law must also be rejected. That 48 — See paragraph 35 of the contested judgment. argument does not concern admissibility but 49 — Judgment in Case 264/83 Delhez v Commission [1986] the merits of the plea, which I shall consider ECR 2749, paragraph 16. 50 — See the express remarks to that effect in the Opinion of in the next paragraph. Advocate General Sir Gordon Slynn in Joined Cases 169/83 and 136/84 Leussink v Commission [1986] ECR 2812 and 2814. 51 — See for example the judgment in Joined Cases 19/69, 20/69, 25/69 and 30/69 Richez-Parise v Commission [1970] 47 — See paragraph 61 above. ECR 325.

I - 1997

OPINION OF MR LENZ — CASE C-136/92 P

ally corresponds to the wording used in text in which the problem of liability in Article 215 of the EEC Treaty. Furthermore, 57 question arises. The consequence of that is 53 in the Leussink case the Court of Justice that in certain cases regarding the Commun­ described the claims for compensation of an ity's legislative activity its liability has been official arising from the relationship of made subject to restrictive conditions employment and those of his family pursu­ derived from the laws of the Member ant to Article 215 of the EEC Treaty uni­ 58 States. 54 formly as claims 'based on general law'. 55 As regards the latter claims it then drew, for the purposes of the system of non­ contractual liability, conclusions from the 'laws of the Member States', to which the second paragraph of Article 215 of the EEC Treaty refers.

56 States, regard must also be had to the con applying another criterion and to disregard the context within which the question of 60 liability arises in assessing the compensation. Furthermore, the terms of liability which the 52 — The relationship between the terms 'unlawfulness' and 'service-related fault' has not as yet been comprehensively context requires may be sought not only in defined. In many contributions by writers the view is taken that any 'unlawfulness' for the purpose of the phrasing used the laws of the Member States but also in the in Article 215 of the EEC Treaty implies at the same time a service-related fault (see the evidence in Huglo, Juris Clas seur, Europe, part 370, No 21). Cf. also the judgment in Case 111/86 Delauchev Commis- sion [1987] ECR 5345, paragraph 30, where in the field of 57 — As regards the ECSC Treaty the criterion of context has civil service law the Court laid down the condition of 'the illegality of the allegedly wrongful act committed by the been expressly recognized in two recent judgments: judg institutions'. See further the judgment in Case 137/79 Kohl ment in Joined Cases C-363/88 and C-364/88 Finsider and v Commission [1980] ECR 2601, paragraph 16, where (also Others v Commission [1992] ECR I-359, paragraph 24 and in the field of civil service law) the Court refers to Arti in Case C-220/91 P Commission v Stahlwerke Peine- cle 215 of the EEC Treaty. Salzgitter [1993] ECR I-2393, paragraph 29. In the present connection I prefer the concept of maladmin 58 — See most recently the judgment in Joined Cases C-104/89 istration, for the infringement found by the Court of First and C-37/90 Mülder and Others v Council and Commission Instance concerns an unwritten rule which is to be applied [1992] ECR I-3061, paragraph 12. according to the circumstances of the particular case: see Regarding the criterion applied by the Court see generally: paragraphs 36 and 37 of the contested judgment. Joliet, Le Droit Institutionnel des Communautés Euro-

I -1998

COMMISSION v BRAZZELLI LUALDI AND OTHERS

content and object of the Community provi­ application of a later date more favourable to 61 64 sions in the relevant field. the officials. They may be looked upon as the antithesis of the wide interpretation pre­ viously mentioned.

74. 3. It is therefore necessary to enquire whether in the light of the laws of Member States and the context in which the officials seek compensation for loss of purchasing 77. (b) I think account must be taken of the power the claim appears unfounded. last view also as regards compensation for damage resulting from belatedness. The rule for the application of which the belatedness in question arose depends, as just described, on the context of the claim put forward. It may be that adjustment by the Court of the amount to reflect the decrease in purchasing 75. (a) The Court of Justice has had so far power would represent an alien element no opportunity to consider the question so within the system. framed. Some of the judgments on the Staff Regulations relating to the adjustment of purchasing power are devoted to the inter­ pretation of the mechanism pursuant to Art­ 62 icles 64 and 65 of the Staff Regulations. In general it may be observed that those provi­ sions were given a wide interpretation in 63 accordance with their objective. 78. That is the position in the present case.

80. Both provisions are aimed at the adop­ tion of roles relating to remuneration leading to the payment of particular nominal amounts. Should those amounts lose pur­ 83. In the light of that I cannot agree that chasing power during the validity of the the Community judicature should award rules adjustment may be made only by new compensation for loss of purchasing power measures under Articles 64 and 65 supple­ where there is belated adjustment. Such a menting or replacing the earlier measures. result would contrast with the exhaustive nature of the rules, the Commission's and Council's powers and the significance of the staff participation in the proposal stage.

86. The judgment followed a 1979 interim 67 judgment in which the Community was held liable for the abolition of refunds for maize gritz. As the basis for the calculation of the compensation the Court of Justice at 89. Secondly, the Court of Justice had the time had considered the amount of the recourse to a conversion rate which was part refunds which the applicants would have of the Community refund procedure instead received but for the unlawful abolition of the of undertaking an independent adjustment to rules. In the final judgment in 1982 the the purchasing power of the various curren­ Court then found that the payments which cies. the Community owed the applicants on that basis should be converted from ECU into the particular national currency at the rate prevailing on the date of the interlocutory judgment. 90. Thirdly, it is apparent that the Court of Justice was concerned to ensure equality of treatment among those to whom refunds were due, a factor which is not in question in the present case. 87. In my opinion there is no sufficient par­ allel between that case and the present which might appear to justify the decision of the Court of First Instance to order compensa­ tion for loss of purchasing power. 91. The solution I propose causes no prob­ lems from the point of view of the laws of the Member States, which in addition to the criterion of context which has been so far 88. First, it was not then a question of the dealt with are relevant to the applicable sys­ increase in the nominal amount of the tem of liability. unpaid refunds (by application of a rate of interest) but the conversion of the unaltered nominal amounts into national currency. The

93. In contrast, the Court of First Instance, apparently having regard to the laws of cer­ tain Member States (for example Belgium and Italy), made a distinction between those 96. The third plea in law should therefore be two cases and linked a claim for 'compensa­ upheld. tory interest' equal to the loss of purchasing power to the belated determination of the amounts owed, while, in the view of the Court, 'default interest' was reserved for the period after such determination. However The first plea in law that definition of 'compensatory interest' as specific compensation for the loss of pur­ chasing power is primarily conceived for cases in which the Court has to calculate the compensation for continuing damage and thus takes into account the period elapsing 97. I. The essence of the Commission's between the damage and the (final) judg­ 68 argument in that respect is that the case-law ment. of the Court of Justice does not distinguish (or no longer distinguishes) sharply between default and compensatory interest. Tradi­ tionally the award of default interest depended on the fact that the relevant debt was certain, ascertained or ascertainable and due. On the other hand, according to the tra­ 94. Finally, it is to be stressed that the award ditional definition, compensatory interest was of interest claimed for the lapse of time and awarded to a creditor who could show con­ based solely on loss of purchasing power tinuing damage. A condition is that there determined statistically is rejected in certain should be an intentional or negligent act, a Member States or granted only in excep­ damaging event and a causal link between the act and event. The case-law has now replaced that dual concept with an indepen­ dent and uniform concept based on the def­ 68 — See the Opinion of Mr Advocate General Van Gerven of 26 January 1993 in Case C-271/91 Marshall judgment of inition of default interest but which goes fur­ 2 August 1993 [1993] ECR I-4367, I-4381, point 23, and the Opinion of Mr Advocate General Tesauro of ther than the traditional definition of default 16 September 1993 in Case 308/87 Grifoni v EAEC interest. Interest for the purpose of that con­ judgment of 3 February 1994 [1994] ECR I-341, I-343, points 22 and 24. cept represented simply compensation for

98. II. The object which the Commission pursues on that basis with the first plea in law pursues is not readily apparent. On the one hand the Commission challenges the part of the judgment awarding 'compensat­ ory interest' to the officials: it claims that nei­ 100. Although at first glance that argument ther in relation to the Staff Regulations nor is surprising in view of the Commission's in any other field has the Court of Justice interest, nevertheless it becomes apparent accepted an independent claim for adjust­ (with some effort) what is ultimately behind ment of a belatedly paid amount to take it. In that respect I refer to the Commission's 69 answer to an objection of the officials to the account of loss of purchasing power. Con­ trary to the grounds given in the judgment effect that the first plea in law was inadmis­ 70 sible since the Commission had no interest of the Court of First Instance, the Com­ mission alleges that there is no case-law on in pursuing it, for the Commission had not the adjustment of arrears of salary in accor­ been unsuccessful in relation to default inter- 71 est (cf. second paragraph of Article 49 of the dance with the trend in the cost of living. Statute of the Court of Justice of the EEC). In its answer thereto the Commission alleged that it was interested in 'a return to a, in its view, pertinent interpretation of Community 74 law in relation to compensatory interest'. The first plea in law has thus the same object 99. However, it also criticizes the part of the as the third plea, namely that the contested judgment dealing with the claim for payment judgment should be set aside in so far as the of 'default interest'; as is known, the Court Court of First Instance awarded compensa­ of First Instance rejected that claim in accor­ tion for the belatedness found based solely dance with the Commission's contention. on statistical trends in purchasing power.

102. III. Against that background I do not consider it appropriate to discuss the first plea in law separately. As we have seen, the Commission's purpose is achieved already with the third plea in law. Furthermore, I shall be able to deal with the alternative 105. II. 1. First of all the Commission alleges (according to which in a case such as the that the grounds of the contested judgment present no compensation is awarded for loss are contradictory in two respects. First, the of purchasing power evidenced by statistics result which the Court of First Instance but only 'default interest' at 'a rate laid down reached does not accord with the alleged by law') proposed in the first plea in law vis- (traditional) distinction between default à-vis the Court of First Instance's solution interest and compensatory interest. Secondly when I consider the cross-appeal. the Court of First Instance did not achieve a cogent application of the Community con­ cept.

The first and second part of the second plea in law

106. The officials repeat in that respect their view that the Commission could not make those objections because it had not been 103. I. As with the first plea in law these adversely affected, having been successful in objections relate to both parts of the judg­ relation to default interest. It is sufficient in ment (default interest and compensatory that respect to observe that the Commis­ interest). On the basis of a view which it sion's objections are based on the view that 76 considers in that respect correct, the Com­ there is a failure to state reasons which per­ mission criticizes the Court of First Instance meates the whole of the judgment and thus covers the part relating to compensatory interest in respect of which the Commission 75 — Above, paragraph 100. was unsuccessful. The officials' argument 76 — Above, paragraph 97. must therefore be rejected.

109. 2. The Commission sees a further breach of the duty to state due reasons for the judgment in connection with the fact that the Commission had put forward its pro­ posal for rules corresponding to those of 111. The conclusion which I draw from my Regulation No 3294/88 by the end of 1985. consideration of the Commission's plea in The Commission bases itself on the conclu­ sion which the Court of First Instance drew 79 — 'In the present case ... the legal basis for the five-yearly adjustment should have been established by 1986 at the lat­ est, having regard to the fact that at that time the Council possessed all the information needed to adopt a regulation 77 — Paragraphs 23-25 of the contested judgment. in accordance with the requirements of the Staff Regula­ 78 — Above paragraph 97. tions.'

I - 2005

OPINION OF MR LENZ — CASE C-136/92 P

law is that its criticism is well founded in so be fulfilled. I shall therefore consider the far as: officials' cross-appeal below.

Respect of the time-limit under the first para- — there lack sufficient grounds for the claim graph of Article 49 of the EEC Statute of the for interest from 1986 (second and in par­ Court of Justice ticular third part of the second plea in law);

113. The Commission is of the opinion that — the Court of First Instance infringed the cross-appeal (as a whole) is inadmissible Community law by recognizing a claim since the period of two months laid down in for compensation for the statistical loss the said provision has not been observed. of purchasing power by reason of the The Rules of Procedure do not provide that delay which was found (third plea in the opportunity created by the due lodging law). of an appeal may be used to question in the response parts of the judgment unaffected by the appeal.

— the same form of order, in whole or in The conflict between the grounds of the judg- part, as that sought at first instance and ment and the operative part of the judgment shall not seek a different form of order.' and infringement of the prohibition of dis- crimination

115. That provision shows clearly that the other party is indeed given an opportunity for an independent counter-attack. The 118. I. The officials' arguments on this issue present case, in which the Court of First relate mainly to the fact that the Court of Instance upheld one of the claims made by First Instance determined the commence­ the officials at first instance while rejecting ment of the obligation to pay interest ( dies a the other, shows, moreover, that for reasons quo) as 1 January 1984. The officials com­ of equality of opportunity for the parties plain that the Court of First Instance that is a legitimate objective. As regards the awarded no compensation for the period time-limit for the cross-appeal it follows prior to that. That is incompatible with the from those considerations that the respon­ assumption which the Court of First dent to the appeal is not bound by the first Instance rightly made that any inexcusable paragraph of Article 49 of the EEC Statute delay in establishing the rules must be of the Court of Justice but must simply regarded as constituting a fault 82 and that respect the time-limit for the response. the Commission had already in January 1982 the corresponding documents of the SOEC 8 available. 3 It is said that the judgment therefore reveals an obvious contradiction between its grounds and its operative part and infringes the principle of equal treat­ ment.

120. Those observations must be rejected Breach of the general principles of compensa- because they challenge in effect the assess­ tion ment of the facts by the Court of First Instance. From 'an examination of the cir­ cumstances surrounding the adoption of the legislation' the Court of First Instance inferred 'that the said legislation could, in fact, — and therefore should — have been adopted from 1 January 1984'. In doing so it 122. The most important part of the cross- took account not only of the availability of appeal concerns the Court of First Instance's the SOEC data but also the regularity of the decision in relation to the claim for 'default preparatory meetings. The officials have interest'. As is known, the Court of First adduced nothing to show that the Court of Instance rejected it on the authority of the 85 First Instance based that assessment on crite­ Ammann judgment, for in the absence of a ria which could be challenged on legal certain or ascertainable claim on the basis of grounds. In particular they have not chal­ objective factors for the period before Regu­ lenged the need to have preparatory meet­ lation No 3294/88 was adopted there could ings after production of the SOEC data. be no delay in the payment of a due debt.

123. I. Before I discuss the officials' criticism of those observations I should like to refer to two, in my opinion important, points.

the statutory interest which obtains in many ation'. For that criticism the officials in Member States (see for example the Belgian, justification of their claim refer to the same French, Italian and German law). The Court facts which the Court of First Instance con­ of Justice also later adopted that interpreta­ sidered, albeit for the purposes of compensa­ tion of default interest as interest at a flat- tion to the extent of the statistical loss of 87 88 rate. On the other hand, as early as 1964 purchasing power, as giving rise to liability. it abandoned the view (still propounded in the Campolongo judgment) that default interest could not be awarded in the absence of any 'legal provision' in Community law. Since then the Court of Justice itself deter­ mines the flat-rate which in recent judgments 89 has generally been 8% p. a. In the follow­ ing I shall therefore assume that the parties and the Court of First Instance interpreted 126. II. In the light of those considerations the term in question in that way. the question raised by the officials' present complaint is whether the delay occurring in the adoption of the adjustment measure, which, as we have seen, does not give entitle­ ment to compensation for the statistical loss of purchasing power, attracts default interest at a flat rate.

I - 2009

OPINION OF MR LENZ — CASE C-136/92 P

redress if the institutions for some reason 93 132. There was in the Campolongo judg­ delayed the adoption of a legal measure ment still a suggestion that default interest beyond a reasonable time. was independent of the existence of malad- ministration and in the nature of an auto­ matic penalty if a debt which had fallen due was not promptly paid.

128. The argument that an ascertainable claim arose only on the adoption of the Council regulation should be no obstacle to compensation in the form of default interest or in some other form if unusual delay occurred in the procedure for the adoption of the measure. In cases of this kind the award of default interest could represent a just solution, if a period justified by the requirements of the procedure were allowed.

93 — See footnote 86. 94 — See for example the default interest which the Court of Jus­ tice fixed in the Berti case for the period after the delivery of a final judgment determining the quantum of the appli­ cant's damage (Case 131/81 Berti v Commission [1985] ECR 645). Such interest is comparable with the interest 131. On the other hand that fact as such which the Court of Justice laid down in the proceedings for a declaration of liability in the field of the common agricul­ does not prevent the award of default inter­ tural policy: first in the so-called Quellmehl and Maize Gritz judgments of 4 October 1979 (see footnote 67 and the est if there is delay in the procedure. similar judgments of the same day) and most recently in the Mulder case (footnote 58). 95 — See for example the judgments in Case 114/77 Jacquemart v Commission [1978] ECR 1697; in Joined Cases 63 and 64/79 Boizard v Commission [1980] ECR 2975; in 92 — See also as regards Article 65 the Ammann judgment and Case 40/79 Pv Commission [1981] ECR 361; and in Case the similar judgments of the same day (footnote 85). 103/81 Chaumont-Barthel v Parliament [1982] ECR 1003.

I-2010

COMMISSION v BRAZZELLI LUALDI AND OTHERS

96 had been carried out more expeditiously. Staff Regulations and thus in maladminis­ tration even if it amounts only to the said Thus in relation to the present case it is not 97 mistaken interpretation. apparent how the content of the Commis­ sion's proposals could have been influenced if its consultations had been carried out more expeditiously. Likewise the Council's atti­ tude to the proposals would not have changed had they been submitted to it ear­ lier.

I-2011

OPINION OF MR LENZ — CASE C-136/92 P

which the Court of Justice referred to the is apparent that the Court equated the delay 'excessive slowness of the Community insti­ in the determination of the degree of invalid­ tutions in discharging their duties' is the ity with the belated payment after that deter­ 106 leading case. Although the present case, in mination. which the Commission carried out the pro­ cedure too slowly, is not quite comparable with that case, in which the Commission by causing and tolerating the continuance of an unlawful situation delayed the fixing of the 10 officials' claims, 2 neverthelessthat judg­ ment shows that even events which have delayed the fixing of claims may be regarded 140. The Court of Justice approached the as a basis for default interest. 107 Williams case in the same manner. The appointing authority failed to classify the applicant in that case in accordance with cer­ tain criteria which it had itself laid down (after his appointment). The Court of Justice ordered the appointing authority not only to classify the applicant with retroactive effect 10 'and to observe the criteria laid down' 8but also 'to pay the difference in salary resulting from the correction, increased by interest at the rate of 6% as from the date on which 139. The view which I advocate here is to be each payment fell due'. 10 9 encountered, moreover, in a set of judgments concerning the fixing of the degree of inval­ idity, which is undoubtedly a matter of dis­ 103 cretion. Thus the Court of Justice found in the Leonardini case 'that the Commis­ sion's conduct does not satisfy the said requirements of Article 73 and that it delayed settlement of the case in ques­ tion'. 104 The Court thereupon awarded 141. I now come to the Ammann judgment. 'default interest' (at 8%) from the date on which the matter ought to have been con­ 105 cluded. The case of B v Commission is particularly significant in that connection. From the clear wording of that judgment it

'an excessive and abnormal delay' 0 in the first an unlawful content. The Court may adoption of the measure of adjustment under have considered there was a problem of 1 Article 65 of the Staff Regulations to the liability for legislative measures, 1 2 whichno effect that 'an obligation to pay default inter­ longer arises after the judgment of annul­ est can arise only where the amount of the ment. Those factors, however, are to be principal sum owed is certain or can at least found in the present case only in respect of be ascertained on the basis of established the stage after adoption of the unlawful Reg­ 1 objective factors'. 11 ulation No 3619/86; to that extent the con­ tested judgment should already be set aside in any case on account of the insufficient 1 statement of reasons. 13 For the period from the beginning of 1984 to the end of 1985 it is clearly a question of delay for which the 143. It is apparent however from para­ defendant Commission has to answer, and graph 22 of the judgment that the Court of 'excessive slowness', as the Court of Justice Justice did not consider that rule to be abso­ expressed it in the Roumengous Carpentier lute. In that paragraph the Court dealt with judgment. the situation after delivery of the judgment declaring void an earlier unlawful measure of adjustment:

147. Even the considerations which led to a refusal of a claim for compensation for the 11 statistical loss of purchasing power, 4are no obstacle to the recognition of default inter­ est. Final observation

148. The instrument of default interest rep­ resents a form of compensation which, in contrast to compensation for loss of pur­ chasing power, does not amount to interven­ 150. The contested judgment should be set tion by the Community judicature in the aside on account of the valid objections powers and procedure of the Council and raised in the appeal and cross-appeal. 115 the Commission. After initial hesitation, it has developed in the case-law as a standard judicial instrument. The rate of interest applied expresses no systematic adjustment to purchasing power (which is reserved to the said institutions), but the principle of a flat-rate compensation which does not relate specifically to any particular kind of damage (in particular loss of purchasing power or loss of the possibility of investment). Fur­ 151. In view of the second and third part of thermore, interest of that kind in Commu­ 11 the second plea in law, 8 theCourt of First 116 nity law contains an element of penalty: Instance must reconsider the question of lia­ on the one hand the creditor does not need bility for the period from 1986. Further­ to prove damage and on the other the extent more, in so far as the officials should be 11 of the delay can influence the rate. 7 awarded default interest in respect of their cross-appeal it is necessary to fix an appro­ priate rate of interest. The Court of First Instance should determine it. Pursuant to 114 — See above, paragraphs 77-94. 115 — See paragraph 124 above. 116 — Opinion of Mr Advocate General Mancini of 31 January 1985 in the Ammanti case [1986] ECR 2131, 2140. 117 — See the Leonardini judgment (footnote 103), paragraph 37. 118 — Paragraphs 20-55 above.

— refer the case back to the Court of First Instance for judgment;

— reserve the costs.

I-2015