C-77/99

OPINION OF MR ALBER — CASE C-77/99

OPINION OF ADVOCATE GENERAL ALBER delivered on 25 January 2001 1

I — Introduction dant l'), NCC Siab Bau GmbH, a company under German law (hereinafter: 'Defen- dant 2'), and Esbensen Consulting Engi- neers, a company under Danish law (here- 1. This dispute concerns the reimbursement inafter: 'Defendant 3'). Under the preamble of an advance paid by the Commission as to the contract, the three contractors 3are part of the Thermie Programme. 2Reim- jointly and severally liable. In addition, bursement is demanded because the con- Defendant 1 assumed the role of 'coordi- struction project of the joint and several nator' under Article 1.4 of the contract. defendants, subsidised by the Commission, was not implemented, as the land in question could not be acquired.

3. The contract provisions relevant to these proceedings read as follows: I I — Facts and legal background

A — The contract between the parties 'Article 1 — Subject of the contract

2. On 15 September 1992 the European Community, represented by the Commis- sion, concluded Contract No BU/1048/91 as part of the THERMIE programme with Oder-Plan Architektur GmbH, a company under German law (hereinafter: 'Defen- 1.1 The contractors undertake to execute the work described in Annex I, titled 1 — Original language: German. 2 — Council Regulation (EEC) No 2008/90 of 29 June 1990 concerning the promotion of energy technology in Europe 3 — This refers to the three defendant companies Oder-Plan, (Thermie programme), OJ 1990 L 185, p. 1). Siab and Esbensen under the contract.

2.2 The Commission shall be informed immediately of any delays in implementing the project. The contractors or the Com- — one advance of ECU 69 930 (European mission may terminate the contract, subject Currency Unit), corresponding to 30% to the conditions set out in Article 8 of of the sum specified in Article 3.2 of Annex II. the contract;

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Article 9 — Applicable law, and entry into force of the contract

4.3 The Commission shall make all pay- 9.1 This contract shall be subject to GER- ments to the coordinator, who shall be MAN law. responsible for forwarding the appropriate amounts to the other contractors without delay. The Commission shall not be held liable for any irregularities on the part of the coordinator in this connection.

Article 5 — Reports Article 10 — Annexes

of its individual provisions giving a specific the energy calculations, a net floor area of description of the project are: 5 200 m2 has been used.

'Annex 1 — Part B

B.1 Aim of the project 5. Under Section B.7(a) of Annex I to the contract, the project is divided into five phases. The first phase is referred to as 'preliminary design' and its duration is The aim of the project is to implement a given as 1 June 1992 to 30 November low-energy design office building. The 1992. The second phase, 'detailed design', building has a volume of 6 200 m2 and was planned to last from 1 November 1992 20 000 m 3and is situated near the river to 30 April 1993. The subsequent phases Oder. are not relevant for the present case.

6. Table 2 on page 18 of Annex I to the contract shows the estimated costs, exclu- sive of tax, for the various phases of the project. Preliminary design is quoted as B.5 Detailed description of the project DEM 96 600, while DEM 64 400 is stated for detailed design.

This office building is designed around an integrated atrium. The building is situated 7. Pages 19 to 25 of Annex I to the contract near to the river Oder, the eastern border of contain plans showing the site and the Germany towards Poland, see Appendices dimensions of the 'Oderhaus' building. 2 and 3.

The gross floor area of the building is 6 200 8. The provisions relevant to these pro- m2, and it has a volume of 20 200 m3. For ceedings of the General Conditions con-

Article 2 — Joint and several liability 1.1 The contractors shall provide the per- sonnel, facilities, equipment and materials necessary for the proper performance of the work under the contract. Where the contract is to be carried out by more than one contractor the contractors shall be jointly and severally liable to the Commission for any failure on the part of any of them to discharge their responsibil- ities. The contractors shall discharge the responsibilities of defaulting or withdraw- ing contractors to such extent as is reason- able in all the circumstances through the completion of the work under this contract 1.3 The contractors shall be responsible for by themselves or with the assistance of taking the necessary steps to obtain any third parties in accordance with Articles 3 permit or licence required for the perfor- and 8 of this Annex, unless the contract is mance of the work under the contract by terminated in accordance with Article 8 of law and regulations in force in the place or this Annex. A contractor shall not be liable places where the work is to be carried out. in respect of a defaulting contractor: Contractors shall inform the Commission immediately if they are unable to obtain any such permit or licence. The contracting parties shall jointly review the effect of this situation on the performance of the con-

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(c) to make any reimbursement under Arti- reports in a single consignment (in separate cle 8.4 of this Annex if it can show to the documents), in 4 copies covering exactly reasonable satisfaction of the Commission the same period and in the two languages that it has not contributed to the default stipulated in Article 5.4 of the contract, to and has complied with Article 1.4 of this the Commission for approval: Annex.

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8.4 Subject to... , if the contract is termi- nated pursuant to Article 8.2... (d) the Commission may require the reimburse- ment of all or part of its financial contribu- tion.

Article 8 — Termination of contract

Interest may be added from the date on which payments were received by the contractor at the rate applied by the European Monetary Cooperation Fund for its operations in ECU increased by 2 percentage points, such rate being pub- 8.2 The Commission may terminate the lished in the Official journal of the Eur- opean Communities on the first working contract: day of each month.

8.5 Where the contract is being performed by more than one contractor the Commis- sion may determine not to terminate the contract under Article 8.2, but only the (d) in the event of non-performance by one participation of the contractor to which the or more of the contractors, except for aforesaid termination provisions apply, reasonable and justifiable technical or upon such terms and conditions for such economic reasons, of any of their contractor as the Commission considers to obligations after giving notice in writ- be reasonable. Unless there are reasonable ing by recorded delivery or registered grounds for not proceeding with the con- post to the contractors requiring per- tract, the Commission shall terminate only formance of the obligations and the the participation of such defaulting con- contractors are still in breach of their tractor. obligations one month after the receipt thereof;

— labour

17.2 The financial contribution of the Commission shall be paid in instalments as follows unless otherwise specified in the — overheads contract:

— travel and subsistence (a) a single sum specified in Article 4 of the contract shall be paid by the Commission as an advance payment within two months of the signature by all parties of the contract. This advance — durable equipment

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— consumables Article 27 — Other costs

'Where performance is owed by a number of persons, such that each person under- Subject to Article 3 of this Annex costs of associated contracts, subcontracts and ser- vices shall be allowable costs as external 4 — Law of 18 August 1896 (RGBL. p. 195, BGBl. III p. 400-2), services. as last amended on 27 June 2000.

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takes to effect performance in full but the C — The conduct of the contracting par- creditor may only demand performance ties, in particular the correspondence con- once (joint and several debtors), the cred- ducted with the Commission itor may, at his discretion, demand perfor- mance from each creditor in whole or in part. All the creditors remain liable until performance has been effected in full.'

10. The Commission was aware when the contract was concluded that the site for the project had not yet been acquired by the defendants. In November 1992 it paid an advance of ECU 69 930 to Defendant 1 in its capacity as coordinator.

Paragraph 425 of the BGB (Effect of other events) provides:

and demand reimbursement of the financial subsidy under the Thermie programme. subsidy plus interest. The letter was The consequent efforts on the part of the addressed to each of the three contractors. contractors to investigate alternative loca- tions to the land originally envisaged and to revise the project in the light of this were described. In particular, these efforts neces- sitated negotiations with the respective owners and with the authorities involved, 13. By letter of 27 March 1995, Defen- studies regarding the acquisition of the land dant 1 informed the Commission that the and its suitability for building, and funda- project could no longer by implemented for mental revisions of the energy engineering economic reasons, as it had not proved and the design of the project. The report possible to acquire either the land origin- disclosed total costs amounting to DEM ally envisaged for the Oderhaus or an 282 790. According to the breakdown, alternative plot, and stated that a break- these costs were incurred as part of the down of the costs incurred so far would be revision of the original design concept and sent shortly. the redesign work caused by the planned change of location.

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I I I— Procedure and forms of order sought (2) order the applicant to pay the costs of the action.

18. By application of 2 March 1999, regis- tered at the Court of Justice on 3 March 1999, the Commission brought an action, 20. Defendant 1 has not entered an appear- asking the Court to ance. The application was sent to it by registered post with acknowledgement of receipt on 9 March 1999, and the acknowl- edgement form shows that the application was delivered to the defendants on 25 March 1999. However, on 7 April (1) order the defendants jointly and sever- 1999 the registered letter with the applica- ally to pay the European Commission tion was returned to the Registry, with the EUR 54 510 plus interest in the sum of unopened envelope inscribed in handwrit- EUR 20 798.70 for the period from ing 'Please return to sender — Oder-Plan 1 January 1993 to 15 January 1999; Architektur GmbH was dissolved on 15 November 1996 — there is no longer any director named Christian Schlote.'

(2) order the defendants jointly and sever- ally to pay the European Commission interest on the principal of EUR 54 510 21. At the request of the Registrar, the at the rate used by the European Commission submitted its observations by Monetary Cooperation Fund for its letter of 20 April 1999 regarding the matter euro transactions plus two per cent as of service of the application. It stated that from 16 January 1999; and Defendant 1 was in liquidation, the pre- vious managing director having been appointed liquidator. It was still entered in the Commercial Register at the address given in the application.

(2) order Defendant 1 to pay the European 25. In particular, Defendant 1, as a com- Commission interest on the principal of pany which has only been dissolved but not EUR 54 510 at the rate used by the yet been removed from the Commercial European Monetary Cooperation Fund Register, can still be sued. It is still dom- for its euro transactions plus 2 percen- iciled at the same address, as a company in tage points, as from 16 January 1999; liquidation, and is represented by its former managing director as liquidator under Paragraphs 66 and 67 of the GmbHG [Law on limited liability companies]. 5

(3) order Defendant 1 to pay the costs of the proceedings.

26. In the oral proceedings the Commission argued that these conditions still obtained.

23. This application was sent to Defen- dant 1 on 21 July 1999. The registered letter was returned to the Court Registry, however, marked 'Addressee moved, address not known'. 27. The application is also well founded, on grounds analogous to those relied on with regard to Defendants 2 and 3.

IV — The arguments of the parties B — The merits of the claim against Defendants 2 and 3

A — Judgment by default against Defen- dant 1 28. Both the defendants and the applicant understand the termination regulated in

31. The Commission relies in particular on non-performance by the contractors of the following contractual obligations set out in Article 8.2 of Annex II to the contract: 29. The Commission is of the opinion that its letter of 17 October 1995 brought the contract to an end, especially as Defen- dants 2 and 3 also received the notice of 17 October 1995. — non-implementation of the project, contrary to Article 1.1 of the contract, and

30. Defendants 2 and 3 deny that the contract was ended by the letter of — non-fulfilment of the obligation to 17 October 1995, claiming that the Com- submit reports under Article 5 of the mission has not furnished sufficient proof contract, in conjunction with Article 6 that they received the notice of 17 October of Annex II to the contract. 1995. The acknowledgement of receipt relating to Defendant 2 submitted by the Commission was not signed by the recipi- ent, and there was no acknowledgement of receipt at all as regards Defendant 3. The 32. As a defence to non-fulfilment of the notice of termination of the contract to obligation to submit reports as grounds for Defendants 2 and 3 was invalid under termination, Defendants 2 and 3 plead that Paragraph 130(1) of the BGB, as it had Defendant 1 in its role as coordinator was not been received. Moreover, under the rule solely responsible for meeting this obliga- in Paragraph 425 of the BGB, notice of tion, inasmuch as Article 1.4 of the con- termination to all joint and several debtors tract represents a special rule, derogating from the joint and several liability of the contractors laid down in Article 2 of 6 — The first sentence of Paragraph 346 (Effects of termination) reads as follows: Annex II to the contract. The breach of 'If one party to a contract has reserved the right of contractual obligations by Defendant 1 termination, upon termination each party is obliged to return any performance or consideration received.' cannot therefore be imputed to Defen- The remaining statutory provisions regarding termination are not relevant to the present case. dants 2 and 3.

38. Defendants 2 and 3 are of the view that they are not jointly and severally liable 35. Defendant 2 also claimed in the oral under Article 2(c) of Annex II to the con- proceedings that under the division of work set out in Table B.4 of Annex I to the contract, its contractual obligations only 7 — The first sentence of Paragraph 812 (Principle) (1) of the applied to the 'Construction 1' and 'Erec- BGB reads as follows: 'A person who obtains something from another person by tion' phases of the project. Defendant 2 way of performance or in some other way at their expense, cannot therefore be held liable for the non- without legal basis therefor, is bound to restore it to that person.' implementation of the project in the prior Paragraph 818(3) (Extent of the enrichment claim) reads: 'The obligation to restore or make restitution of the value 'Engineering/design' phase. does not apply if the recipient is no longer enriched'.

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42. Moreover, the Commission was aware 40. The Commission is of the view that the at the time it concluded the contract that allowable costs of the project amounted to the land originally envisaged for the project

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had not yet been acquired by the defen- tract, the first report should have been dants. In the view of Defendants 2 and 3, submitted in January 1993, whereas the the resulting problems fall therefore not first time the applicant drew attention to only within their area of risk, but also the failure to fulfil the obligation to report within that of the Commission. Since it was in January 1995. If Defendants 2 and 3 paid the advance despite knowing of the had known earlier of the failure by the status of the planning, it must have coordinator to fulfil its duties under the expected to have had to finance the costs contract, they would have exerted influence of any redesign of the project. on it and could have disclosed the failure of the project in 1993; and had the Commis- sion reacted earlier, the advance paid would not have been completely used up. By waiting two years the Commission had failed to monitor the subsidy and thereby 43. Consequently, Defendants 2 and 3 are breached its duty of care towards Defen- claiming an a d d i t i o n a l g r a n t of dants 2 and 3. EUR 25 129.50 and therefore a matching reduction in the applicant's claim.

(5) Contributory fault on the part of the Commission (6) The interest claimed

44. The applicant is of the opinion that Defendants 2 and 3 cannot plead contrib- utory fault on the part of the Commission. 46. The Commission is claiming interest on Since Defendants 2 and 3 both failed to the reclaimed sum as from 1 January 1993, discharge their own contractual obliga- the final amount of which, for the final tions, their argument that the Commission time period starting on 16 January 1999, tolerated non-fulfilment of the obligation still has to be calculated in accordance with to submit reports for too long is in breach Article 8.4(2) of Annex II to the contract. of good faith and thus immaterial.

(1) The claim for reimbursement

50. The Commission regards this defence as too late and therefore to be dismissed. Moreover, Appendices K10 to K12 of the application show that the Commission 53. The claim for reimbursement presup- demanded reimbursement on several occa- poses effective termination of the contract sions after May 1996. by the Commission.

(a) Effective notice of termination V — Opinion

51. The Court has jurisdiction to decide the 54. The letter from the Commission of case under Article 12 of the contract. 17 October 1995 could constitute delivery

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57. In this connection, the arguments of Defendants 2 and 3 that Paragraph 425 of 59. It can therefore be held that the Com- the BGB prevents such an 'overall effect' of mission has given effective notice of termi- receipt by Defendant 1 being valid in nation to Defendants 2 and 3. I - 7374

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(b) Existence of grounds for termination would be entitled to repudiate the contract as against all the contractors. None the less, the defences of Defendants 2 and 3 are examined below as they are of importance in relation to subsequent remarks concern- ing the joint and several liability of the contractors. 60. The question remains as to whether the Commission was entitled to terminate. It relies on two main grounds for termination, namely non-fulfilment of contractual obli- gations, and non-implementation of the project. 63. The obligation to report of all the defendants arises from the contract, and from Annex II to the contract. Articles 5.1 and 5.4 of the contract, and Article 6.1 of Annex II to the contract, consistently refer to 'the contractors' in connection with the 61. Under Article 8.2(d) of Annex II to the production and submission of reports, and contract, the Commission may terminate never to one of them, or to the 'coordina- the contract if one contractor fails to fulfil tor', alone. It follows from Article 1.4 and its obligations. It is undisputed that the Article 5 of the contract that the 'coordi- defendants have neither submitted the nator' is only responsible for presenting or technical and financial reports due to the forwarding the reports. These are purely Commission under Article 5, nor imple- organisational provisions that have no mented the project as a whole. Conse- effect on the duties to produce reports. In quently, at least two contractual obliga- view of this unambiguous wording, the tions have been breached. view of Defendants 2 and 3 that the contractual obligation to report was solely the responsibility of Defendant 1 is uncon- vincing. Rather, the duty to fulfil this obligation was incumbent upon all defen- dants equally. The breach of the obligation to report can therefore be imputed to (i) Non-fulfilment of the obligation to Defendants 2 and 3 as their own breach report of contract.

dants 2 and 3 due to their own breaches of 27 March 1995. Moreover, at no time did contract. Secondly, Article 8.5 of Annex II the defendants state that they still intended to the contract places any partial termina- to implement the Oderhaus' project. A tion of the contract within the discretion of notice to implement the project issued the Commission: 'Unless there are reason- between March 1995, the time of becoming able grounds for not proceeding with the aware of the grounds for termination, and contract...'. In view of the failure at the end October 1995, the time of the notice of of 1993 of the project that was the subject termination, would therefore no longer of the contract, reasonable grounds existed have achieved its objective under the rule for terminating the contract as a whole in Article 8.2(d) of Annex II to the con- with regard to all contractors. tract, namely that of enabling the contrac- tors to discharge their contractual obliga- tions and thus avoid the consequences of termination of the contract. A prior notice for fulfilment of the contractual obligations would therefore seem superfluous. (ii) Non-implementation of the project

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68. Accordingly, it must be found that both Defendants 1, 2 and 3 are joint and several the non-fulfilment of the obligation to debtors, and reference is made to Article 2 report and the non-implementation of the of Annex II for the details. Under the first project entitled the Commission to termi- sentence of Article 2 of Annex II to the nate. contract, the defendants are in principle all liable as joint and several debtors for the discharge of all contractual responsibilities. An exception to joint and several liability is provided for in Article 2(c) only when the (c) Legal consequences as regards the obli- following cumulative conditions are met: gation to reimburse

69. The question thus arises of the obliga- tion to reimburse of Defendants 2 and 3. — the contractor can show to the reason- able satisfaction of the Commission that it has not contributed to the default of the other contractor, and

(i) Existence of the claim for reimburse- ment

(aa) Joint and several liability — the contractor has complied with its notification obligations under Arti- cle 1.4 of Annex II to the contract.

73. Moreover, it should be noted that they Defendant 1 was passed on to subcontrac- did not inform the Commission of the final tors. From a legal point of view, it should abandonment of the project at the end of be pointed out here that as a basic princi- 1993. They have therefore also breached ple, the right to claim reimbursement in their obligation under Article 1.4 of association with the termination of a con- Annex II to the contract, so that the second tract is not limited to any enrichment still condition for exemption from liability for enjoyed, and that Paragraph 818(3) of the Defendants 2 and 3 is not met either. Their BGB is in principle not applicable. 8 defence based on the position of Defen- Although agreement may be reached that dant 1 as 'coordinator' is consequently the first sentence of Paragraph 346 of the unsound. BGB shall not apply, so that the obligation to reimburse is limited to any permanent enrichment, no such agreement is included in the contract concluded between the Commission and the defendants.

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obligation to reimburse. It states that pages 19 to 25 of Annex I to the contract reimbursement is unconditional, and above consist of layout plans specifying both the all, independent of the use to which the precise location and the scope of the project advance is put. In addition, the costs for construction work. Under Article 27 of services provided by subcontractors are Annex II to the contract (see above, only one of the possible kinds of allowable point 8), additional costs can only be costs under Article 19 of Annex II to the charged to the project with the consent of contract. Accordingly, the payment of sub- the Commission. contractors was neither the only possible use of the money received, nor was it in the foreground of the contract. An exceptional agreement to avoid the rule in the first sentence of Paragraph 346 of the BGB cannot therefore be implied in the present circumstances. Defendants 2 and 3 are consequently liable to reimburse the 80. This shows that the advance was paid advance. by the Commission in respect of a quite specific project and definite costs incurred in connection with it. The contract gives no indication to support the theory of the defendants that the subsidy may be used for other locations without the express consent of the Commission. (ii) Amount of the reimbursement claim

82. The letter from Defendant 1 of discovered the state of the work before the 24 October 1995 shows that the original insolvency of Defendant 1 occurred. The project was abandoned immediately after letter from Defendant 1 of 27 March 1995 confirmation of the application documents shows that on 29 July 1994 the Commis- by the Commission, and that the defen- sion sent a questionnaire relating to the dants made efforts from then on to find an state of the work to Defendant 1, who alternative project location. The break- returned it to the Commission on 28 Sep- down of the costs claimed by the defen- tember 1994. Defendant 1 was not actually dants shows likewise that they were in- dissolved for reasons of insolvency until curred in respect of the change of location 1996. envisaged, and relate to the revision of the original design concept and the changes in project planning. However, neither the contract nor its annexes makes any provi- sion for such costs, and consequently in the absence of express consent by the Commis- 85. Nor can this defence by Defendants 2 sion, they are not allowable. The defence and 3 succeed on legal grounds. The that the allowable costs have been calcu- Commission is not under the duty of care lated too low by the Commission is there- towards Defendants 2 and 3 that the latter fore to be rejected. presume. Firstly, the contract and its annexes do not include any express duty of care or supervision on the part of the Commission. There is merely a obligation on the defendants under Article 5 of the (bb) Possible contributory fault on the part contract, and Article 6 of Annex II to the of the Commission contract to produce the appropriate reports and send them to the Commission, without any corresponding duty of control or to issue notices on the part of the Commis- sion. 83. Finally, Defendants 2 and 3 plead a 'predominant contributory fault' on the part of the Commission as a defence to the reimbursement claim. The Commission is claimed to have had a duty of care 86. Any breach of a duty of care on the towards the defendants, in that as early as part of the Commission would therefore at the beginning of 1993 it should have issued the outside have to be founded on provi- a notice regarding the non-fulfilment of the sions of public law, or the fundamental obligation to report, and demanded reim- principle of good faith. bursement of the advance at a time when Defendant 1 was still solvent.

90. The lateness in raising the claim for reimbursement is due primarily to the fact 88. Finally, the exercise of a right may be that the Commission only became aware of inadmissible under the principle of good the non-implementation of the project in faith if in so doing the beneficiary of that March 1995. To that extent the defen- right infringes duties of cooperation, clar- dants breached their obligation, under ification and/or protection ancillary to the Article 1.4 of Annex II to the contract, to contract. Under this principle, both the inform the Commission without delay of debtor and the creditor in a contractual the abandonment of the project. The relationship are required jointly to create defence of Defendants 2 and 3 that they the preconditions for performance of the were unaware of the breach by Defen- contract and remove impediments to per- dant 1 and consequently had no possibility formance, and to inform each other, with- of exerting any influence is again immater- out being so requested, of any circum- ial here, as the obligation to report is an stances of significance.10 individual obligation incumbent upon Defendants 2 and 3, as stated above.

89. Even if in the present case one were to consider that there was negligence on the part of the Commission in tolerating non- fulfilment of the obligation to report for two years, the defence of Defendants 2 and 91. Informed by the same considerations, 3 that this amounts to failure by the the argument that the exercise of this right by the Commission is in bad faith due to

92. The outcome is therefore that the Commission is entitled to a reimbursement claim in the sum of EUR 54 510 against Defendants 2 and 3 as joint and several debtors. 95. As regards the question until when the interest accrues, Defendants 2 and 3 have argued in the oral proceedings that interest can only be claimed from them, if at all, until 12 February 1996. However, this is not convincing. Under Article 8.4(2) of (2) The claim for interest Annex II to the contract, in the event of a claim for reimbursement interest may be claimed from the time of receipt of the payment. There are no other provisions regarding a claim for interest. The interest claimed here is precisely not interest for late payment, which ceases to accrue when 93. As well as reimbursement, the Com- payment is made, and it is therefore mission is also claiming interest. immaterial as regards the period in respect of which interest can be claimed that the Commission initially asked in its letter of 12 February 1996 that no payments be made then. Besides, it was open to Defen- dants 2 and 3 to repay the sum owed, 94. The calculation of the amount of despite the Commission's letter of 12 Feb- interest depends on the time from when ruary 1996. The request by the Commis- interest is payable, and for how long. sion not to transfer anything for the time being was made for purely internal admin- istrative reasons. It did not prevent the 12 — Cf. BGHZ 25, 47, 52 et seq. defendants from making repayment, and

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the Commission was not in default as issuing of an invoice, even if the latter regards the acceptance of payment. specifies the sum involved for the first time. 14

13 —Cf. BGHZ 55,340, 341. 14 —Cf. BGHZ 79, 176, 178.

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B — Application for judgment by default (1) Capacity of Defendant 1 to be a party against Defendant 1 to an action

102. According to Article 9.1 of the con- tract, the contract is subject to German law, and the question of the capacity of Defen- dant 1 to be a party to an action must 100. By application of 15 June 1999, the therefore be decided under German law, Commission asked for judgment by default according to which Oder-Plan GmbH is against Defendant 1. Under Article 94(1) capable of being a party to an action unless of the Rules of Procedure the application is it has ceased to exist as a legal person. A well founded if the Commission's action company ceases to exist when liquidation is has been properly raised. Doubts may exist complete and its cessation has been entered in this regard inasmuch as service on in the Commercial Register. A company Defendant 1 of the application is question- which has merely been dissolved, however, able. continues to be capable of being a party to an action and an action can therefore be brought against it. 15

(2) Further conditions for the procedure for judgment by default

104. The application was notified to Defendant 1 in accordance with the first sentence of Article 39 and Article 79(1) of the Rules of Procedure, by registered post with acknowledgement of receipt. This was properly effected at the address stated by the Commission. In the absence of indica- tions to the contrary in the Commercial 106. Judgment by default may be granted Register, it must be assumed that Defen- under Article 94(1) and (2) of the Rules of dant 1, as a company in liquidation, Procedure if no defence is lodged in the remains domiciled at the same address proper form within the time prescribed and and is represented by its former director the applicant's claims appear to be well as liquidator under Paragraphs 66 and 67 founded. The first condition is met: the of the GmbHG. The acknowledgement of defendant has not entered an appearance as receipt shows that the application was regards either the original application or received on 25 March 1999 and was thus the application for judgment by default. properly served. The fact that Defendant 1 returned the envelope containing the appli- cation to the Court Registry a few days later cannot invalidate service once effected. On balance, it must therefore be concluded that the application was prop- erly served and the action was thus prop- erly initiated.

105. In the absence of the appointment of any person authorised to accept service at the place where the Court has its seat, the 107. As regards whether the Commission's application for judgment by default was application is well founded, reference may also properly served under Articles 79, be made to the discussion above. The claim 40(1), 39, and 38(2) of the Rules of against Defendant 1 is as well founded as Procedure by being lodged at the post the claims against Defendants 2 and 3. The

A — Judgment by default against Defendant 1

(1) Defendant 1 is ordered, as joint and several debtor with Defendants 2 and 3, to pay the European Commission EUR 54 510, plus interest in the sum of EUR 20 798.70 for the period from 1 January 1993 to 15 January 1999.

(2) Defendant 1 is ordered, as joint and several debtor with Defendants 2 and 3, to pay the European Commission interest on the principal of EUR 54 510 as

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from 16 January 1999, at the rate charged by the European Monetary Cooperation Fund for its euro transactions plus 2 percentage points.