C-449/99

OPINION OF MR GEELHOED — CASE C-449/99 P

OPINION OF ADVOCATE GENERAL GEELHOED delivered on 1 February 2001 1

1. This appeal was lodged by the European Bank, which it did on 20 April 1960 (here- Investment Bank (hereinafter also: 'the inafter: 'the Staff Regulations'). 2 The staff Bank') against the judgment of the Court of the Bank are subject to the provisions of First Instance of 28 September 1999 in contained in the Staff Regulations. Case T-140/97 Hautem v EIB [1999] ECR- SC I-A-171 and II-897 (hereinafter: 'the contested judgment'). The Court of First Instance annulled the decision of the Bank of 31 January 1997 to dismiss Mr Hautem on disciplinary grounds, and ordered the Bank to pay him the remuneration which he should have received since his dismissal. The Bank is now seeking partial annulment 3. In the present proceedings Articles 1, 4, of that judgment. 5, 13, 38, 41 and 44 of the Staff Regula- tions are of particular relevance.

Legal background Article 1 of the Staff Regulations reads as follows:

2. The Statute of the Bank is incorporated into a protocol which is annexed to the original EEC Treaty (now the EC Treaty) and forms an integral part thereof. Pur- suant to the Statute, the Board of Gover- nors approved the Rules of Procedure of 'Members of staff shall conduct themselves the Bank on 4 December 1958 and amen- in the discharge of their duties and outside ded them on many occasions thereafter. working hours in a manner befitting the Under Article 29 of the Rules of Procedure, international character of the Bank and the Board of Directors must prescribe the their duties.' regulations concerning the staff of the

(3) summary dismissal for grave miscon- duct, with or without severance grant;

As regards family members of the Bank's staff, Article 5 of the Staff Regulations states: ...'

'Members of staff shall declare their family circumstances once yearly, and whenever Article 13 of the Staff Regulations governs there is any change in them, together with, the relationship between the Bank and its where appropriate, mention of their spou- staff: se's profession and any post or appointment in which the latter is gainfully employed.

'Relations between the Bank and the mem- bers of its staff shall, in principle, be ...' governed by individual contracts in con-

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OPINION OF MR GEELHOED — CASE C-449/99 P

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EIB v HAUTEM

7. On 28 October 1996 the Bank received L-4994 Schouweiler'. In this letter by fax a letter dated 1 October 1996 with Mr Yasse provided information about the letterhead of SARL Skit-Ball, estab- the undertaking Mon de l'Evasió, that lished in Marseille, which was signed by a is to say a commercial register number, Mr Ingargiola. The letter was addressed to a VAT number and the address of an Mr Chevlin, the head of the Bank's person- intermediary undertaking. nel department. The reference section of the letter read as follows:

— a cheque in favour of the undertaking Skit-Ball drawn on an account of the 'Litige concernant une transaction commer- undertaking Mon de l'Evasió with ciale entre la société Skit-Ball et les per- Crédit Andorrà, signed by Mr Yasse sonnes citées: M. Yasse Bernard se disant on 9 September 1996, for the amount directeur financier, M. Hautem Michel se of FRF 46 5000; disant responsable du secteur informatique de cette dite Bank.' 3

— a letter of 27 September 1996, addressed to Mr Ingargiola, apparently Mr Ingargiola asked the addressee to written and signed by Mr Hautem, in ensure that an amount of FRF 46 500 be which he describes certain problems transferred to the sender's undertaking in with the Skit-Ball stand acquired by the payment of the purchase of a Skit-Ball, a undertaking Mon de l'Evasió. mobile exhibition stand used for sales and advertising, information or sales cam- paigns. In the event of failure to do so, he threatened to take legal proceedings against Messrs Yasse and Hautem. The letter was — a communication from the Société accompanied by copies of a number of Marseillaise de Crédit of 30 September documents, namely: 1996 notifying the undertaking Skit- Ball of the rejection of a cheque for FRF 46 500.

10. By letter of 7 November 1996 the Bank suspended Mr Hautem for three months. During those three months a joint commit- tee was to deal with the matter in confor- mity with Article 38 of the Staff Regula- tions. His salary was to be maintained but — a fax identical to the above in terms of he was denied access to the offices of the format, sender, date and signature, Bank. addressed to an exhibition centre, con- cerning the participation of the under- taking Mon de l'Evasió in a trade fair;

11. By letter of 19 November 1996, addressed to the Bank, Mr Ingargiola with- drew the accusations he had made against Messrs Hautem and Yasse in the fax of — a fax addressed to Mrs Schruger, at 28 October 1996. Mr Ingargiola stated Pegastar SA, dated 7 November 1996, that Messrs Hautem and Yasse had never with the letterhead 'World Escape — made use of the offices or name of the Bank Mon de l'Evasió' and concerning the and that they had had no commercial consignment of 12 books. The 'sender' contacts with the undertaking Skit-Ball on section stated 'Yasse Bernard-Mon de their own account or on behalf of the Bank. l'Evasió SL';

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EIB v HAUTEM

— a reference for Crédit Andorra recom- — Mr Hautem made use, for his commer- mending Messrs Yasse and Hautem as cial activities, of the property of the clients. Bank. In certain cases, such as the use of the fax, the Bank's own references were not covered up, thus possibly giving the correspondents the impres- sion that the Bank was involved in his activities. 13. The list of telephone calls showed that in the months of August and September 1996 Mr Yasse telephoned the undertaking Skit-Ball five times and Crédit Andorra eight times from his workplace at the Bank. Mr Hautem called the undertaking Skit- Ball once in August and once in September.

— As the joint committee observed, Mr Yasse. Infringements of Articles 1 and Mr Hautem's engagement in commer- 4 of the Staff Regulations were alleged cial activities, without having obtained against him. permission from the Bank, constitutes an infringement of Article 4 of the Staff Regulations. This breach is all the more serious because in engaging in these commercial activities Mr Hautem referred to his connection with the 17. On 29 April 1997 Mr Hautem lodged Bank and made use of the Bank's a appeal against the dismissal decision with means of communication. the Court of First Instance. The appeal was registered under case number T-140/97. On the same date Mr Yasse lodged an appeal against the decision to dismiss him. In its judgment of 28 September 1999 in Case T-141/97 Yasse v EIB [1999] ECR- SC I-A-177 and II-929 the Court of First — The failure to report the functions Instance dismissed Mr Yasse's application which Mr Hautem's spouse performs for annulment of the decision to dismiss constitutes an infringement of Article 5 him and for damages (hereinafter 'the Yasse of the Staff Regulations. judgment').

— Furthermore, his general conduct is, as 18. The Court of First Instance joined is evident from the abovementioned Cases T-140/97 and T-141/97 for the facts, not consistent with the conduct purpose of the hearing. During the pro- expected of a servant of the Bank. This ceedings Messrs Hautem and Yasse were conduct constitutes an infringement of originally represented by the same counsel, Article 1 of the Staff Regulations. but on account of supervening conflicting interests of both counsel, Mr Hautem was represented by another counsel.

20. The Court of First Instance states that it is necessary to consider whether the Bank made a manifestly incorrect assessment of the facts in adopting the dismissal decision. Such a decision necessarily entails a careful consideration on the part of the institution which must have regard to the serious and 23. Contrary to the matters stated in the irrevocable consequences thereof. The insti- contested decision and to the submissions tution has wide discretion in that respect of the Bank, the Court of First Instance and the role of the Court of Justice is considered that it had not been established limited to ascertaining whether the facts on that the appellant made incorrect use of the which the decision is based are materially Bank's name or that he took advantage of accurate and whether there has been any his connections with the Bank in a manner manifest error in the assessment of the facts inconsistent with the Staff Regulations. In (contested judgment, paragraph 66). his letter, sent by fax on 28 October 1996, Mr Ingargiola described Mr Hautem as 'the official responsible for the computer section' of the Bank. However, in his statement to Interseco Mr Ingargiola him- self conceded that during their sole meeting 21. In the contested decision the Bank took Mr Hautem had told him that he was account of various complaints in respect of 'employed as a messenger at the Bank'. the appellant without stating specifically Furthermore, Mr Ingargiola stated that: the matters on which they were based. In 'Mr Yasse passed himself off as someone order to establish whether or not a manifest important in the finance department and I error was made in the assessment of the based my assumption of Mr Hautem's

27. As to the letter of 27 September 1996 which is ascribed to Mr Hautem, the Court 25. As regards the inferences to be drawn of First Instance stated that it provided no from Mr Ingargiola's letter, sent by fax on evidence to show that it was written and 28 October 1996, the Court of First signed by his spouse, as he claimed. The Instance noted that the appellant himself reasons which, according to Mr Hautem, in fact admitted to his part in the commer- led his spouse to write this letter as if he cial transaction which Mr Ingargiola were the author were not plausible. At the brought to light. However, Mr Ingargiola hearing Mr Hautem stated that his spouse told Interseco that Mr Yasse and Mrs had preferred to act thus because he had Hautem had presented themselves as the been the one who had taken Mr Ingargio- Owners of the undertaking Mon de l'Eva- la's telephone call regarding the Skit-Ball sió', that they had a promotion project for stand. Mr Ingargiola, for his part, con- the Skit-Ball stand and that they had firmed the existence of this telephone call purchased a Skit-Ball stand. Mr Ingargiola with Mr Hautem during which Mr Hau-

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EIB v HAUTEM

30. Consequently, the Bank made a man- ifest error in the assessment of the facts. Therefore, the Court of First Instance 28. Furthermore, both the documents upheld the appeal and annulled the con- attached to Mr Ingargiola's letter sent by tested decision without considering it fax on 28 October 1996, that is to say the necessary to examine the complaint con- letter of 6 September 1996 from Mr Yasse cerning the appellant's failure to report the and cheque No 6 555 542 signed by him, activities of his spouse in connection with and the documents presented by the Bank the undertaking Mon de l'Evasió or the as attachments to the rejoinder, that is to other pleas in law put forward in the action say the faxes of 24 September and 2 Octo- for annulment (contested judgment, para- ber 1996, both of which were signed by graph 76). Mr Yasse, in no way established that Mr Hautem was engaged in commercial activities (contested judgment, para- graph 74). 31. Since, under Article 41 of the Staff Regulations, the Court of First Instance had jurisdiction in disputes of any nature between the Bank and individual officials thereof, it was appropriate to apply, by analogy, Article 91(1) of the Staff Regula- 29. The Court of First Instance concluded tions of Officials of the European Commu- from the foregoing that the evidence nities under which the Court of First

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OPINION OF MR GEELHOED — CASE C-449/99 P

Instance has unlimited jurisdiction in dis- (5) ordered the European Investment Bank putes of a financial character. Conse- to bear its own costs and pay the costs quently, the Bank was ordered to pay of the appellant. Mr Hautem the remuneration which he should have received since his dismissal (contested judgment, paragraph 77).

EIB v HAUTEM

Mr Hautem contends that the Court First plea in law should:

36. The Bank essentially contends that the Court of First Instance erred in its assess- ment of the facts and in its statement of — declare the appeal inadmissible or, in the alternative, unfounded; reasons in regard to Articles 1, 4 and 5 of the Staff Regulations. Its claims may be summarised as follows:

— uphold points 1 and 2 of the operative part of the judgment delivered by the (a) The Court of First Instance wrongly Court of First Instance on 28 Septem- considered that the actions carried out ber 1999 in Case T-140/97; by Mr Hautem could not be regarded as professional activities of a commer- cial nature within the meaning of Article 4 of the Staff Regulations;

— order the appellant to pay the entirety of the costs in the two instances;

37. Mr Hautem contends that the first plea in law is inadmissible because it requires a fresh examination of the facts by the Court of Justice and the claims do not seek a legal analysis by the Court of Justice. Essentially 40. None the less, the Court of Justice has Mr Hautem argues that the Court of First accepted a number of circumstances in Instance interpreted the Staff Regulations which a factual assessment is nevertheless correctly. possible in an appeal. This is the case in particular where the substantive inaccuracy of the findings of the Court of First Instance is apparent from the documents submitted to it. The Court of Justice has jurisdiction to review the manner in which the Court of 38. Before examining the arguments put First Instance characterised the facts in case forward by the Bank, I consider it useful and determined the legal consequences first to recall the settled case-law of the thereof. Moreover, the question whether Court of Justice concerning the admissibil- the reasoning of the judgment of the Court ity of appeals. 4 of First Instance is contradictory or insuffi- cient is also a point of law which, as such, can be raised on appeal.

Regulations which are, in my view, inad- was true in particular of the recommenda- missible on account of their factual nature, tion of Messers Hautem and Yasse as before going on to consider the substance customers of Credit Andorra in respect of of the arguments put forward by the Bank. the opening of a line of credit. As regards the drafting and use of the other docu- ments, the Bank points out that in his defence Mr Hautem made statements about these documents which were untrue. A — Alleged infringement of Article 4 of In its view, these false statements were the Staff Regulations necessary to obscure Mr Hautem's interest in the undertakings' activities. However, at paragraph 70 of the contested judgment the Court of First Instance did not char- acterise Mr Hautem's activities in law in the same way as it did identical actions in 42. The Court of First Instance held that respect of Mr Yasse at paragraphs 65 and Mr Hautem rendered no more than inci- 77 of the Yasse judgment. Moreover, the dental and limited assistance both to his reasoning of the contested judgment in this wife and Mr Yasse in the conduct of a respect must be regarded as insufficient and commercial activity (paragraphs 70 to 73 contradictory since the Court of First of the contested judgment). On the other Instance took no account of the fact that hand, the Bank contends that the docu- Mr Hautem's statements regarding these ments which the Court of First Instance documents, like those of Mr Yasse, 'in no considered were central to the commercial way tally with the reality of the facts' activities of the undertaking Mon de l'Eva- (paragraph 66 of the Yasse judgment). sió and of its partners at the time when Mr Ingargiola's letter was sent to the Bank by fax on 28 October 1996. It claims that the preparations and decision-making relat- ing to these actions and the performance thereof involve, of necessity, the conduct of a professional activity of a commercial nature both in respect of Mr Hautem and Mr Yasse. The Court of First Instance 44. Secondly, the Bank argues that characterised the actions of Mr Yasse as although Mr Hautem did not sign any such but not those of Mr Hautem. More documents which were sent to Credit specifically, the Bank argues that the Court Andorra, there is, on the other hand, no of First Instance characterised Mr Hau- evidence to show that he was not involved tem's actions incorrectly in law on account in the decision-making process concerning of the circumstances set out below. the sending and use thereof. After all, he had a direct interest in sending and using at least two documents relating to the refer- ence in which he and Mr Yasse were recommended as customers to Crédit Andorra with a view to opening up a line 43. Firstly, the Court of First Instance was of credit and which were faxed from the wrong not to acknowledge Mr Hautem's Bank. It was wrong to characterise active involvement in regard to the docu- Mr Hautem's participation as concrete ments found in Mr Yasse's computer. This involvement in the performance of 'actions

45. Thirdly, the Bank considers that Mr In- gargiola's statement to Interseco (see para- — Assessment as regards admissibility graph 71 of the contested judgment) seek- ing to minimise Mr Hautem's role in the Skit-Ball affair, contradicts the fax sent by Mr Ingargiola on 28 October 1996. Nor is that statement consistent with the letter of 48. The Bank's allegation referred to at 27 September 1996 which was drawn up to paragraph 43 above is essentially that, in create the impression that it came from failing to characterise Mr Hautem's assis- Mr Hautem as 'administrateur délégué, tance in sending the documents to Crédit management et marketing' of the under- Andorra as a commercial transaction, the taking Mon de l'Evasió. Court of First Instance provided insuffi- cient reasoning and, moreover, gave an assessment of the facts which was incorrect in law. The Court of First Instance is thereby construing too narrowly the 46. Fourthly, as regards the consistency expression 'activity... of a commercial between the fax of 28 October 1996 and nature' within the meaning of Article 4 of Mr Ingargiola's letter of retraction of the Staff Regulations. 19 November 1996 (see paragraph 72 of the contested judgment), the Bank refers to paragraph 70 of the Yasse judgment which, it claims, shows that the Court of First Instance did not attach credence to the 49. However, at paragraph 70 of the con- spontaneity of this retraction. Therefore, tested judgment the Court of First Instance there is a contradiction between the value already held that, on the basis of the placed on this retraction in the context of evidence adduced, Mr Hautem's limited the judgment relating to Mr Hautem and involvement in the creation of the four that placed on Mr Ingargiola's same retrac- documents on Mr Yasse's computer could tion in the case of Mr Yasse. not be characterised as a systematic use of the Bank's property for commercial pur- poses. The fact that the Court of First Instance did not consider Mr Hautem's possible intentions as regards the docu- 47. Finally, the Bank argues that the rea- ments is in itself a factual assessment which soning of the Court of First Instance at cannot be challenged on appeal. Moreover, paragraph 73 of the contested judgment the Bank has put forward no legal argu-

ment at all to show that the Court of First activity of a commercial nature. In essence, Instance erroneously construed the expres- the Court of First Instance concluded that sion 'activity... of a commercial nature' too the facts, as established by it, could not narrowly. support the conclusion that Mr Hautem was guilty of a prohibited professional activity of a commercial nature within the meaning of Article 4 of the Staff Regula- tions. That view based on the facts cannot 50. The assessment of Mr Ingargiola's be challenged on appeal. statements and the authorship of the letter of 27 September 1996 are central to the parts of the first plea in law set out at paragraphs 45 and 47 above, which essen- tially claim that the Court of First Instance was wrong not to conclude that the acts 51. I therefore consider that those parts of imputed to Mr Hautem constituted a pro- the plea in law are inadmissible. fessional activity of a commercial nature. In the contested judgment account was taken of Mr Ingargiola's successive statements both in the setting out of the factual background and the assessment of that 52. On the other hand, the Bank's argu- background by the Court of First Instance. ment at paragraphs 44 and 46 of this From Mr Ingargiola's letter of 19 Novem- Opinion is essentially that in the Hautem ber 1996, in which he withdrew the and Yasse judgments the Court of First accusations made in the fax communica- Instance drew mutually contradictory infer- tion of 28 October 1996, and from similar ences from the same or analogous facts in statements made to Interseco, the Court of each case as regards the (false) statements First Instance concluded that the fax com- of Mr Yasse and Mr Hautem respectively munication of 28 October 1996 did not and the value placed on Mr Ingargiola's provide sufficient evidence to show that statements in the two judgments. These Mr Hautem engaged in a professional contradictions may be regarded as a possi- activity of a commercial nature. In respect ble flaw in the statement of reasons and of the letter of 27 September 1996 to that in itself is a question of law which may Mr Ingargiola the Court of First Instance be raised on appeal. found that Mr Hautem adduced no evi- dence at all to support his contention that it was written and signed by his spouse. It considered that the reasons which, accord- ing to Mr Hautem, led his spouse to write this letter as if as he were the author thereof — Assessment as regards substance are improbable. However that may be, it is claimed that this letter confirms Mr Hau- tem's involvement in a commercial transac- tion consisting in the purchase of a 'Skit- Ball' stand. However, in the view of the Court of First Instance, that involvement 53. However, the Bank's line of argument was not sufficient to establish that cannot be accepted as regards the sub- Mr Hautem engaged in a professional stance.

54. The manner in which the false state- sion to the outside world that the Bank ments were assessed in each case may itself was involved in them. Therefore, in appear to be contradictory. This relates to the view of the Court of First Instance, the trie incorrect statements made by Messrs Bank correctly concluded that Mr Yasse Yasse and Hautem in regard to the docu- engaged in a professional activity of a ments found in Mr Yasse's computer. The commercial nature within the meaning of Court of First Instance found that these Article 4 of the Staff Regulations. statements do not accord with reality (paragraphs 65 and 66 of the Yasse judg- ment). However, contrary to the contention of the Bank, the Court of First Instance did not draw different legal inferences from those untrue statements but from the facts 56. In respect of Mr Hautem the Court of relating to the preparation and creation of First Instance found at paragraph 70 of the the documents concerned. On that basis the contested judgment that he collaborated Court of First Instance found that the with Mr Yasse in drawing up the docu- nature of Mr Yasse's involvement in the ments which were found on Mr Yasse's affairs of Mon de l'Evasió was more computer. However, the Court of First extensive and more structured than that Instance consequently concluded that his of Mr Hautem. mere involvement in the drafting of the documents concerned, even if that could be described as assistance in the conduct of a commercial activity, could not be charac- terised as engagement in a professional activity of a commercial nature within the meaning of Article 4 of the Staff Regula- 55. It is clear from paragraph 65 of the tions. Yasse judgment that this ex-employee admitted that he drew up the documents concerned, which were of a clearly com- mercial nature, and that he faxed them from the Bank. However, he denied that he himself signed the documents which were 57. On the basis of the factual context the sent since that was the task of Mrs Hau- Court of First Instance was able to establish tem. At paragraph 66 of the Yasse judg- that Mr Yasse's involvement in regard to ment the Court of First Instance stated that the documents in question found in his this claim was inconsistent with the actual computer was of a different nature from facts. Mr Yasse's active involvement and that of Mr Hautem. Mr Yasse was discern- his commercial interest are subsequently set ibly engaged more intensively in the affairs out in detail at paragraphs 67 to 76 of the of Mon de l'Evasió than Mr Hautem. That Yasse judgment. The conclusion at para- is confirmed, inter alia, by the statements graph 77 of the Yasse judgment is that the by Mr Ingargiola, as mentioned at para- Bank did not err in its assessment of the graphs 71 and 73 of the contested judg- facts in concluding that Mr Yasse had ment. In its assessment of Article 4 of the engaged in activities of a commercial Staff Regulations the Court of First nature without the permission of the Bank, Instance drew a distinction between the that he had used the property of the Bank structured pursuit of professional activities to that end, and had conveyed the impres- of a commercial nature and incidental

61. As regards the alleged improper use of B — Alleged infringement of Article 1 of the Bank's property by Mr Hautem and the the Staff Regulations considerations of the Court of First Instance at paragraph 70 of the contested judgment, the Bank contends, secondly, that in respect of two documents Mr Hau- tem had a specific interest not only in 59. The Bank submits that the Court of drawing up the texts concerned but also in First Instance failed to establish that sending them, and consequently in the Mr Hautem, as a member of the Bank's processing of them. That, it claims, also staff, conducted himself in such a manner constitutes an infringement of Article 1 of as to infringe the duty of loyalty laid down the Staff Regulations. in Article 1 of the Staff Regulations.

62. Thirdly, the Bank argues that the Court of First Instance failed to discern and 60. In putting forward this argument the Bank is challenging, first, paragraph 69 of the contested judgment in which the Court 5 — Case T-146/89 |1991| ECR II-1293, paragraph 72.

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OPINION OF MR GEELHOED — CASE C-449/99 P

64. The second claim is also inadmissible. 66. Therefore, this part of the appeal must Its intention is to challenge the factual also be declared inadmissible in its entirety.

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EIB v HAUTEM

C — Alleged infringement of Article 5 of because it has already been established on the Staff Regulations other grounds that a manifest error of assessment had been made and that there- fore the dismissal decision had to be declared void. By this plea in law the Bank is attempting to elicit a substantive judg- ment from the Court of Justice as regards 67. The Bank further claims that, in respect an aspect of the decision contested at first of the infringement of Article 5 of the Staff instance on which the Court of First Regulations by Mr Hautem, paragraph 76 Instance no longer had to adjudicate once of the contested judgment contains inade- it had been established that the decision already had to be annulled on other quate reasoning and discloses an error in grounds. law. However, it is left to the Court of Justice to assess, in the context of the acts imputed to Mr Hautem, the significance of this infringement, in particular in the light of the fact that Mr Hautem's spouse herself admitted that she was involved in the management of the undertaking in the month prior to her spouse's dismissal. 70. This attempt by the Bank is, in my view, plainly inadmissible.

Second plea in law ment. The Court of First Instance did not pronounce on the reinstatement of the respondent. That may be because it con- sidered that only the Bank, and not the Court of First Instance, was authorised to 72. The second plea in law is directed at take such a decision or because it took the paragraph 77 of the contested judgment in view that such a measure was not consis- which the Court of First Instance applied, tent with the legal nature of a contractual by analogy, a provision of the Staff Regula- regime under which the employer — in tions of Officials of the European Commu- this case the Bank — cannot be compelled nities in the dispute between the Bank and to enter into a new contract with the party Mr Hautem and ordered the Bank to pay concerned. The contradiction lies in the him the remuneration due to him since his fact that the Court of First Instance applied dismissal. The Bank disputes the lawfulness reasoning based on the Staff Regulations as of this reasoning by analogy. the basis for ordering the Bank to pay the arrears of salary, but failed to express a view on reinstatement. The only legally correct reasoning in the present case, in the event of dismissal without cause, would be to order the Bank to pay compensation for 73. The Bank takes the view that the the damage occasioned to the employee structure and operation of the European dismissed, in accordance with the general institutions differs from that of the Eur- principles of the laws of the Member States. opean Investment Bank and this also applies to legal relations with its staff. On the basis of Articles 13 and 44 of its Staff Regulations and the interlocutory judgment in Mills, 6 the appellant argues that a distinction must be drawn between the 75. By contrast, Mr Hautem argues that staff regulations of the Bank, which are the second plea in law was never referred to contractual, and the rules governing offi- or developed in the proceedings before the cials of the European Communities, which Court of First Instance. It constitutes a new are regulatory. By ordering the Bank to pay plea in law which must be regarded as the arrears of salary from the date of inadmissible. dismissal, the Court of First Instance applied reasoning based on the Staff Reg- ulations which could not be applied to it, as, the Bank claims, the Court of Justice specifically held in Mills. — Assessment

Bank and its staff, in particular by ordering ordered to compensate the other party for the Bank to pay compensation in the form the material and non-material damage of arrears of salary by reference by analogy occasioned to the latter by such illegality' to Article 91(1) of the Staff Regulations of (paragraph 24). Furthermore, the Court Officials. considered that 'although the continuation of the contract depends above all on the mutual consent of the parties which con- stitutes the basic condition for the existence of the contract, this does not prevent both the provisions of the contract and the 77. This plea in law is, in my view, general principles of the law of master admissible. Under Article 42(2) of the and servant, to which the last article of the Rules of Procedure of the Court of Justice, Staff Regulations of the Bank refers, from no new plea in law may be introduced in imposing limits to this intention of the the course of proceedings unless it is based parties' (paragraph 25). The Court then on matters of law or of fact which come to ruled that '[a] termination of a contract light in the course of the procedure. In the which exceeds those limits may be void and proceedings before the Court of First it will be for the court having jurisdiction, Instance the Bank was not in a position to in this case the Court of Justice, to make a be apprised of the reasoning in para- declaration to that effect' (paragraph 26). graph 77 of the contested judgment. There- The Court concluded that '[i]n particular, fore, there can be no question of a new plea termination of a contract taking the form in law which is inadmissible. of "summary dismissal for grave miscon- duct", the penalty prescribed by Article 38 of the Staff Regulations of the Bank, might be declared void if the Court found that such misconduct had not occurred' (para- graph 27). 78. It is established that Article 41 of the Staff Regulations stipulates that the Court of Justice has jurisdiction over disputes of any nature between the Bank and indivi- dual members of its staff. This article lays down no restrictions as to the nature of such disputes, nor is such a restriction to be found elsewhere in the Staff Regulations. 80. In the proceedings at first instance the Court of First Instance declared void the decision to dismiss Mr Hautem 'for grave misconduct' because it took the view that there were insufficient 'legitimate grounds'. Consequently, it had to adjudicate on 79. In the judgment in Mills v EIB the compensation for the damage occasioned Court of Justice stated that '[i]f the contract to the dismissed member of staff by the is terminated contrary to the provisions of unlawful act of the Bank. Moreover, such the individual contract or of the regulations compensation was claimed by Mr Hautem. which are deemed to be an integral part No specific rules or principles which thereof the party having illegally termi- restrict the court in its adjudication on nated the contract must accordingly be compensation to be awarded in the present

82. This is confirmed, in my view, by the 85. Since, in the light of the foregoing, the recently drawn up 'Conditions of Employ- Court of First Instance has unlimited jur- ment for Staff of the European Central isdiction to consider claims for compensa- Bank'. 8The legal relations between the tion for damage, it can also award com- European Central Bank (ECB) and its staff pensation for damage consisting of loss of are also contractual in the context of the income as a result of unlawful dismissal. Conditions which in this regard display The claim for payment of arrears of salary strong similarities with the Staff Regula- frequently forms — in labour disputes tions of the European Investment Bank. under private law as well — part of a However, in the Conditions the jurisdiction claim for compensation. Loss of income is of the Court of Justice in disputes between the primary damage which an employee the ECB and its staff is restricted to the sustains as a result of an unlawfully ordered legality of the measure or decision at issue, unless the dispute is of a financial nature, in which case the Court of Justice has unlim- 10 — It is evident from the judgment of 12 December 2000 in Case T-11/00 Hautein v EIB [2000] ECR II-4019 that the ited jurisdiction. 9 Bank refused to implement the contested judgment of 28 September 1999 because the Court of Justice still has to rule on the present appeal. Since Mr Hautem had still not received the arrears of his salary and had not been reinstated, he claimed damages. The Court of First 7 — Cited above in footnote 6, at p. 979. Instance ordered the Bank to pay EUR 25 000 in compensation for damages. The Court of First Instance 8 — Adopted on 9 June 1998 and most recently amended on can only have assumed — without referring by analogy to 1 July 2000 (hereinafter: 'the Conditions).' the Staff Regulations of Officials — that loss of income 9 — See Article 42 of the Conditions. constitutes a part of the claim for damages.

— reject the pleas in the appeal declared admissible;

— order the European Investment Bank to pay the costs.

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