JUDGMENT OF THE CIVIL SERVICE TRIBUNAL

(First Chamber)

23 April 2008

Case F-112/05

**Neil Bain and Others**

**v**

**Commission of the European Communities**

(Civil service – Officials – Remuneration – Correction coefficients – Transfer of part of remuneration out of the country of employment – Pensions – Default procedure – Temporal application of the Tribunal’s Rules of Procedure – Pay slips – Plea of illegality)

**Application:**brought under Articles 236 EC and 152 EA, in which Mr Bain and three other Commission officials seek annulment of their pay
slips for the months of February, March and April 2005, and of all subsequent pay slips, in so far as they apply the allegedly
unlawful provisions of Council Regulation (EC, Euratom) No 723/2004 of 22 March 2004 amending the Staff Regulations of Officials
of the European Communities and the Conditions of Employment of Other Servants of the European Communities (OJ L 124, p. 1),
of Council Regulation (EC, Euratom) No 856/2004 of 29 April 2004 fixing from 1 May 2004 the correction coefficients applying
to the pensions of officials and other servants of the European Communities (OJ L 161, p. 6), and of Council Regulation (EC,
Euratom) No 31/2005 of 20 December 2004 adjusting, with effect from 1 July 2004, the transfers and pensions of officials and
other servants of the European Communities and the correction coefficients applied thereto (OJ 2005 L 8, p. 1), since those
provisions, first, reduce the part of the remuneration that may be transferred outside the country of employment and the correction
coefficients applicable to the transfer, second, reduce the correction coefficients applicable to pension rights acquired
prior to 1 May 2004, introduce a new residence requirement for the application of those reduced correction coefficients and
abolish the correction coefficients for pension rights acquired from 1 May 2004; furthermore, the applicants seek, in so far
as is necessary, annulment of the appointing authority’s decisions of 29 July 2005 rejecting the complaints they had lodged
against their pay slips.

**Held:**The action is dismissed. The parties are ordered to bear their own costs.

**Summary**

1.      *Procedure – Time-limits – Defence submitted out of time – Plea of inadmissibility submitted properly and in good time – Admissibility
– Default procedure not applied – Comments on the substance of the case submitted on the day of the hearing – Inadmissible*

*(Rules of Procedure of the Court of First Instance, Arts 48(2) and 122)*

2.      *Officials – Actions – Act adversely affecting an official – Definition – Salary statement*

*(Staff Regulations, Arts 90(2) and 91(1)*

3.      *Officials – Actions – Prior administrative complaint – Time-limits – Point at which they start to run*

*(Staff Regulations, Arts 90 and 91)*

4.      *Officials – Actions – Plea of illegality – Incidental nature*

*(Art. 241 EC; Council Regulations Nos 723/2004,  856/2004 and 31/2005)*

5.      *Officials – Actions – Interest in bringing proceedings*

1.      Where a defendant submits a plea of inadmissibility properly and in good time, the fact that the defence was not lodged within
the time-limit prescribed for that purpose does not provide grounds for the application of the default procedure provided
for in Article 122 of the Rules of Procedure of the Court of First Instance. By virtue of submitting the plea of inadmissibility
the defendant cannot be regarded as having failed to respond to the application in the proper form and within the time prescribed.

However, comments on the substance of the action submitted by a defendant on the day of the hearing are not admissible. Where
no defence has been lodged during the written procedure within the time prescribed, the defendant’s oral submissions on the
substance of the action are tantamount to the submission of new pleas, which is prohibited by Article 48(2) of the Rules of
Procedure of the Court of First Instance; allowing an a contrario interpretation would amount to accepting that the defendant,
having raised a plea of inadmissibility by separate document, is not subsequently bound by the time-limit which the Court
sets for the lodging of his defence.

However, an intervener is fully entitled to submit arguments on the substance of the action in the course of both the written
and oral procedures. In the particular case of an application relying on the unlawfulness of regulations adopted by the intervener,
it would be contrary to the principles of the rights of the defence and of proper administration of justice if, for reasons
beyond its control and for which the defendant is responsible, the intervener, whose claims seek exactly the same outcome
as those of the defendant in his plea of inadmissibility, namely the dismissal of the action, were not allowed to submit arguments
on the substance of the action, and in particular observations intended to defend the lawfulness of the disputed regulations.

(see paras 48, 52-54)

See:

C-34/04 *Commission* v *Netherlands* [2007] ECR I‐1387, para. 49

T-459/93 *Siemens* v *Commission* [1995] ECR II‐1675, para. 21; T‐125/96 and T‐152/96 *Boehringer* v *Council and Commission* [1999] ECR II‐3427, para. 183

2.      A pay slip, by its nature and purpose, does not have the characteristics of an act adversely affecting an official within
the meaning of Article 90(2) and Article 91(1) of the Staff Regulations, since it merely expresses in financial terms the
effect of earlier legal decisions concerning the official’s situation. Thus, while it is true that pay slips are commonly
regarded as acts adversely affecting an official in so far as they show that his financial rights have been adversely affected,
in reality the act which actually adversely affects the official is the decision by the appointing authority to reduce or
abolish a payment which the official received hitherto and which was shown on his pay slips.

Nevertheless, the pay slip remains very important for determining the official’s procedural rights as laid down in the Staff
Regulations. In particular, the forwarding to the official of his pay slip fulfils a dual function, one informing him of the
decision taken and one relating to time-limits, so that, provided the slip clearly shows the existence and scope of the decision
taken, its communication sets the time-limit running for challenging that decision.

(see paras 73, 76)

See:

262/80 *Andersen and Others* v *Parliament* [1984] ECR 195, para. 4

T-536/93 *Benzler* v *Commission* [1994] ECR-SC I‐A‐245 and II‐777, para. 15

F‐101/05 *Grünheid* v *Commission* [2006] ECR-SC I‐A‐1‐55 and II‐A‐1‐199, para. 33 and the case-law cited therein, and para. 42; F‐27/06 and F‐75/06 *Lofaro* v *Commission* [2007] ECR-SC I-A-1-0000 and II-A-1-0000, currently the subject of an appeal before the Court of First Instance, T‐293/07 P

3.      In cases where the adverse effect on the disputed financial entitlement takes the form of the abolition of a payment or a
reduction in its amount, applied every month and shown in all pay slips subsequent to the first in which that abolition or
reduction was shown, it is the receipt by the official of the first pay slip showing that abolition or reduction which alone
sets the time-limit for complaint running.

Where a number of pension statements or pay slips drawn up for successive periods are unlawful in the same way, an initial
complaint lodged only against the first disputed statement or slip and raising the relevant plea of illegality should normally
be enough to ensure that the applicant, if successful in the action he brings following the rejection of that complaint, also
receives financial satisfaction for the periods following that covered by the disputed statement or slip. That should, *a fortiori*, be the case if the applicant makes clear that he is not contesting the pension statement or pay slip as such, but the decision
affecting his rights, expressed in the statement or slip in question by the abolition of a payment or a reduction in its amount.

(see paras 77, 92)

See:

C-82/98 P *Kögler* v *Court of Justice* [2000] ECR I‐3855, para. 49

T-160/96 *Kögler* v *Court of Justice* [1998] ECR-SC I‐A‐15 and II‐35, para. 39

4.      Article 241 EC gives expression to a general principle conferring upon a party which is not entitled under Article 230 EC
to institute direct proceedings against an act of general application the right to challenge, for the purpose of obtaining
the annulment of a decision of direct and individual concern to it, the validity of acts of general application by which it
is affected without having been able to seek their annulment. However, Article 241 EC does not create an entitlement to take
action independently and may be relied on only as an incidental plea in an admissible action, rather than constituting the
subject of an action.

A plea of illegality raised in the course of an inadmissible action is thus inadmissible.

(see paras 96, 99)

See:

92/78 *Simmenthal* v *Commission* [1979] ECR 777, para. 39

T‐35/05, T‐61/05, T‐107/05, T‐108/05 and T‐139/05 *Agne-Dappe and Others* v *Commission and Others* [2006] ECR-SC II‐A‐2‐1497, para. 42 and the case-law cited therein

5.      An official who is still in active employment cannot establish a present, vested interest in obtaining a decision on the weighting
to be applied to his future retirement pension, for by reason of the condition concerning the choice of country of residence,
which can be determined only upon the cessation of the employment of the person concerned, the weighting cannot be fixed by
a decision taken in advance which immediately and directly affects the legal situation of the person concerned. Such a finding
also applies to a case where the complaints relate not to the weightings fixed, but to the weightings system itself.

(see para. 102)

See:

T-6/91 *Pfloeschner* v *Commission* [1992] ECR II‐141, para. 27