Information;Judgment — ECLI:EU:T:2023:305
Date: 2023-06-07
Language of the case: English
Court formation: First Chamber
Based on: Merger Treaty (1965)
Subject matter: Staff regulations and employment conditions - EC
Procedure: Staff cases - unfounded;Action for damages - unfounded;Staff cases - successful

JUDGMENT OF THE GENERAL COURT (First Chamber) 7 June 2023 (*) (Civil service – Members of the temporary staff – Members of Staff of EUIPO – Contract for a fixed period – Non-renewal – Competent authority – Principle of sound administration – Right to be heard – Liability – Non-material damage) In Case T‑650/20, KD, represented by S. Pappas, D.-A. Pappa and A. Pappas, lawyers, applicant, v European Union Intellectual Property Office (EUIPO), represented by A. Lukošiūtė, K. Tóth and V. Ruzek, acting as Agents, defendant, THE GENERAL COURT (First Chamber), composed, at the time of the deliberations, of H. Kanninen (Rapporteur), President, N. Półtorak and M. Stancu, Judges, Registrar: P. Cullen, Administrator, having regard to the written part of the procedure, further to the hearing on 15 March 2022, gives the following Judgment 1 By her action under Article 270 TFEU brought on 23 October 2020, the applicant, KD, seeks, first, annulment of the decision of the European Union Intellectual Property Office (EUIPO) of 1 April 2020 not to renew her contract (‘the contested decision’) and, secondly, compensation in respect of the non-material damage she claims to have suffered. Background to the dispute and events subsequent to the bringing of the action 2 On 16 July 2015, the applicant joined EUIPO as a member of the temporary staff for a five-year period, under Article 2(f) of the Conditions of Employment of Other Servants of the European Union (‘the CEOS’). She was assigned to the ‘Academy’ Department of EUIPO. 3 On 15 February 2016, the applicant was appointed as a team leader. 4 From 2015 onwards, the applicant experienced difficulties related to her personal life and health problems. Those difficulties meant [confidential]. (1) The applicant also had the opportunity to [confidential]. 5 On 5 February 2020, a formal dialogue was held between the applicant, the Director of the ‘Academy’ Department and an official from the Human Resources Department of EUIPO. In the course of that meeting the applicant was informed that ‘considering the irregular performance over the duration of the contract, the results expected from the grade and the issues related with the respect of the rules and processes on working time and [confidential] for certain periods of the contract, there [were] doubts about the regularity of the level of the performance, reliability and resilience in case the contract is prolonged for 5 additional years’. In the light of those weaknesses and of the applicant’s appraisal reports, the ‘Academy’ Department of EUIPO ‘[did] not feel comfortable in recommending the renewal’ of the applicant’s contract to the Authority Authorised to Conclude Contracts (‘the AACC’). 6 On 7 February 2020, the Director of the Human Resources Department of EUIPO, in her capacity as AACC informed the applicant of her department’s recommendation not to renew her contract and invited her to submit her comments on this matter by 21 February 2020 at the latest. 7 By email of 21 February 2020, the applicant submitted comments to the Director of the Human Resources Department in which she asked her to ‘reconsider [her] case and proceed to the renewal of [her] contract’. She invited the AACC ‘to refer to the appraisal reports [for the] 2015 to 2018 [exercises], which have to be thoroughly and objectively examined and taken into consideration, prior to adopting the decision regarding the renewal of [her] contract’. She noted that her appraisal report for 2019 was not finalised until 1 March 2019 but that she had received very positive comments during her appraisal dialogue. By not taking into account that report, the Director of the department did not take into account all the factual circumstances in order properly to assess her case and to make a recommendation as to the renewal of her contract. 8 On 11 March 2020, the applicant received her appraisal report for 2019 (‘the 2019 appraisal report’). 9 On 1 April 2020, the Director of the Human Resources Department, acting as AACC, notified the applicant of the contested decision. In that decision, the Director of the Human Resources Department stated that she was aware of the 2019 appraisal report. 10 On 22 May 2020, the applicant brought an action before the Court seeking, first, annulment of the 2019 appraisal report and, secondly, compensation in respect of non-material damage that she had suffered as a consequence of that report. That action was registered under reference T‑298/20. 11 On 25 May 2020, the applicant lodged a complaint against the contested decision under Article 90(2) of the Staff Regulations of Officials of the European Union (‘the Staff Regulations’). 12 By email of 10 June 2020, the applicant indicated that she was lodging a complementary request, under Article 90(1) of the Staff Regulations, asking the AACC to consider the possibility of postponing the application of the contested decision or extending her contract until a final decision was taken. The Executive Director of EUIPO classified that request as complementary to the complaint of 25 May 2020. 13 On 15 July 2020, the Executive Director of EUIPO adopted a decision rejecting the applicant’s complaint (‘the decision rejecting the complaint’). 14 On 26 October 2022, the Court delivered its judgment, KD v EUIPO (T‑298/20, not published, EU:T:2022:671), by which it annulled the 2019 appraisal report. 15 By order of 5 December 2022, the Court decided, on the basis of Article 113 of the Rules of Procedure of the General Court, to reopen the oral part of the procedure in the present case, in order for the Judge-Rapporteur to examine the possibility of resolving the dispute by means of an amicable settlement. By letter of 5 December 2022, the Judge-Rapporteur contacted the parties to explore the possibility of resolving the dispute by amicable settlement, pursuant to Article 50a(2) of the Statute of the Court of Justice of the European Union and Article 125a(2) of the Rules of Procedure of the General Court. 16 By letter of 17 February 2023, the Judge-Rapporteur made a proposal for amicable settlement of the dispute to which the parties replied by letters lodged at the Court Registry on 17 March 2023. 17 Following those replies, the Judge-Rapporteur noted that the attempt to reach an amicable settlement had been unsuccessful. Forms of order sought 18 The applicant claims, in essence, that the Court should: – annul the contested decision; – annul the decision rejecting the complaint; – order EUIPO to pay her the sum of EUR 20 000, in compensation for the non-material harm that she had suffered; – order EUIPO to pay the costs. 19 EUIPO contends that the Court should: – dismiss the action; – order the applicant to pay the costs. Law The claim for annulment 20 The applicant relies on five pleas in law in support of her claim for annulment. The first to fourth pleas are raised in support of the application for annulment of the contested decision and the application for annulment of the decision rejecting the complaint, whereas the fifth plea, which relates specifically to the proper conduct of the pre-litigation procedure, is raised only in support of the application for annulment of the decision rejecting the complaint. 21 At the hearing, the applicant raised a new plea in support of her application for annulment of the decision rejecting the complaint, formal note of which was made in the minutes of the hearing. 22 For the purposes of examining the first to fourth pleas, it should be noted that the administrative complaint and its rejection, whether express or implied, constitute an integral part of a complex procedure and are no more than a precondition for bringing the matter before the judicature, except where the rejection of the complaint has a different scope from that of the measure against which the complaint was lodged. That is the case where the decision rejecting the complaint contains a re-examination of the applicant’s situation in the light of new elements of law or of fact, or where it changes or adds to the original decision. In such circumstances, the rejection of the complaint constitutes a measure subject to review by the judicature, which will take it into consideration when assessing the legality of the contested measure or will even regard it as an act adversely affecting the applicant replacing the contested measure (see judgment of 21 May 2014, Mocová v Commission, T‑347/12 P, EU:T:2014:268, paragraph 34 and the case-law cited). 23 In the present case, it should be noted that the decision rejecting the complaint confirms the contested decision after recalling the relevant factual and legal context, identifying the elements that the AACC took into account in the context of her examination and replying to all of the applicant’s comments. The AACC did not rely on new elements of fact or law, but, as EUIPO acknowledged before the Court, supplemented the reasoning for the contested decision. She thus referred, in particular, to the case-law concerning the duty to have regard for the welfare of staff and its obligation to conduct an overall assessment of the applicant’s performance. 24 It is true that, in the decision to reject the complaint a position was also taken on the applicant’s email of 10 June 2020, in which the applicant requested the AACC to examine the possibility of postponing the application of the non-renewal decision or extending her contract until a final decision was made. 25 However, it must be noted that the AACC’s refusal to give a positive follow-up to that email is not the subject of the present action. 26 It follows that for the purposes of the examination of the first to fourth pleas, the present action must be understood as being directed against the contested decision, the legality of which will be examined taking into account the grounds for rejecting the complaint. 27 Amongst those four pleas, the first alleges that the Director of the Human Resources Department of EUIPO lacked competence to adopt the contested decision. The second plea alleges an infringement of essential procedural requirements during the dialogue prior to the adoption of the contested decision. The third plea, alleging, in essence, infringement of the requirements of sound administration, breach of the duty to have regard for the welfare of staff or manifest errors of assessment, is divided into three parts. The first relates to EUIPO’s failure sufficiently to take into account the applicant’s health problems and the criteria of competence, conduct in the service and other components of productivity. The second concerns the failure of the AACC to take into account the 2019 appraisal report. The third relates to the failure by the AACC to take into account all the elements which are relevant for evaluating the applicant. The fourth plea alleges manifest errors in the assessment of compliance, by the applicant, with the rules on working time and [confidential]. 28 The Court considers that, first of all, it is necessary to examine the first plea, then the second plea and the second part of the third plea together, which both relate to the 2019 appraisal report and, lastly, if necessary, the first and third parts of the third plea and the fourth plea. It is only in the event that the contested decision is not annulled, following the examination of those four pleas, that the fifth plea, alleging the irregularity of the examination of the complaint, and the plea put forward during the hearing (paragraph 21 above), alleging that the Executive Director of EUIPO lacked competence to adopt the decision rejecting the complaint, would retain their purpose and that it would be necessary to adjudicate on those pleas (see, to that effect, judgment of 2 September 2020, IR v Commission, T‑131/20, not published, EU:T:2020:381, paragraph 123). The first plea, alleging the lack of competence of the Director of the Human Resources Department of EUIPO 29 The applicant maintains that the Director of the Human Resources Department was not competent to adopt the contested decision. Primarily, the applicant submits that it is apparent from the applicable legislation that the Executive Director of EUIPO is the Appointing Authority. However, it is not provided that the Executive Director may subdelegate the powers he or she has on that basis and no express act of subdelegation was adopted concerning the renewal of the contracts of temporary agents. 30 In the alternative, the applicant submits that, in the event that Decision ADM-17-34 of 8 May 2017 concerning the internal structure of EUIPO served as the legal basis for the contested decision, EUIPO was incorrect to base itself on that decision. That decision does not, in effect, provide for any delegation concerning the renewal of contracts. 31 EUIPO replies that the present plea is inadmissible for non-compliance with the rule of correspondence and is not, in any event, well founded. 32 It should be observed at the outset, as does the applicant, that the plea alleging lack of competence of the author of the measure is a matter of public interest (see judgment of 13 July 2006, Vounakis v Commission, T‑165/04, EU:T:2006:213, paragraph 30 and the case-law cited), including where it relates, as does the present plea, to the existence of a lawful delegation granted to the author of the measure (judgments of 13 December 2006, de Brito Sequeira Carvalho v Commission, F‑17/05, EU:F:2006:132, paragraphs 51 to 57, and of 18 May 2009, Meister v OHIM, F‑138/06 and F‑37/08, EU:F:2009:48, paragraphs 147 to 150). It is thus, in any event for the Court to raise that plea of its own motion. 33 Therefore, EUIPO’s plea of inadmissibility must be rejected. 34 On the substance, it must be noted that Article 2(1) of the Staff Regulations and Article 6 of the CEOS provide that each institution is to determine who within it is to exercise the powers conferred by the Staff Regulations on the Appointing Authority and by the CEOS on the AACC. 35 Within EUIPO, the first paragraph of Article 153(2) of Regulation (EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the European Union trade mark (OJ 2017 L 154, p. 1) provides for the delegation by the Management Board of the powers conferred on the Appointing Authority by the Staff Regulations and on the AACC by the CEOS in favour of the Executive Director. The second paragraph of that provision provides that the Executive Director is authorised to subdelegate those powers. 36 It is on that basis that, on 21 March 2017, the Management Board adopted Decision MB-17-01, delegating to the Executive Director the powers conferred on the Appointing Authority by the Staff Regulations and on the AACC by the CEOS. Article 2(1) of that decision provides that the powers conferred by the CEOS on the AACC are delegated to the Executive Director, subject to three exceptions, none of which is relevant in the present case. Article 3 of that decision provides that the Executive Director may subdelegate those powers to an official or temporary agent designated on the basis of their position in EUIPO or ad personam. 37 On 22 March 2017, the Executive Director took, on the basis of Decision MB-17-01, Decision ADM-17-17 on the Exercise of Powers of the Appointing Authority and of the AACC delegated to the Executive Director (‘the subdelegation decision’). Article 2 of the subdelegation decision provides: ‘The [AACC] powers in respect of … the temporary staff referred to in Article 2(b), (c) and (f) CEOS … are described in the table annexed to this decision, by subject matter and the competent authority.’ 38 It is apparent from the first line of point 2 of that table, which is an integral part of the subdelegation decision, that the powers concerning ‘recruitment of [temporary agents] and [contractual agents], including conclusion of contracts and amendments’ are subdelegated to the Director of the Human Resources Department. The same line expressly refers to Article 8 of the CEOS, which is the legal basis for renewal of the contracts of temporary agents engaged for a fixed period. 39 Contrary to what the applicant submits in the reply, the decision to grant to the Director of the Human Resources Department such a subdelegation remains valid after a change in the person to whom the authority was delegated and the person who delegated it, even where the internal rules of EUIPO do not make express provision to that effect. The purpose of such a decision is to allocate powers within EUIPO and does not amount to proof that confidence is placed in a particular natural person (see, to that effect, judgment of 14 January 2016, Tilly-Sabco v Commission, T‑397/13, EU:T:2016:8, paragraph 203). 40 As a result, EUIPO’s Management Board delegated powers concerning the renewal of the contracts of temporary agents engaged for a fixed period to the Executive Director, who, in turn, subdelegated those powers to the Director of the Human Resources Department. It is therefore on the basis of a valid subdelegation that the Director of the Human Resources Department took the contested decision. 41 The applicant’s argument based on decision ADM-17-34 does not demonstrate the contrary. That decision is, in effect, irrelevant for the purpose of examining the present plea. As EUIPO rightly points out, it is clear from Article 16 of that decision that it relates to the delegation to directors of the necessary administrative and financial powers for the management of the daily operations of their departments, with the exception of issues relating to the Staff Regulations such as the issue in the present case. 42 The present plea must therefore be rejected. The second plea and the second part of the third plea, concerning the 2019 appraisal report 43 In support of the second plea and the second part of the third plea, the applicant puts forward, in essence, three complaints concerning the taking into account of the 2019 appraisal report in the context of the proceedings for the renewal of her contract. The first, and main complaint relied on, alleges EUIPO’s failure to take that report into account. The second and third complaints, relied on in the alternative, concern, in essence, respectively, the failure of EUIPO to hear the applicant concerning the report in the context of the renewal procedure and the fact that the references to that report in the contested decision are merely a pretext. – The first complaint concerning the failure of EUIPO to take the 2019 appraisal report into account 44 The applicant, in essence, criticises EUIPO for having failed to fulfil the requirements of sound administration and for having made a manifest error of assessment or a breach of the duty to have regard for the welfare of staff by failing to take into account the 2019 appraisal report, which was of particular importance on account of its proximity in time to the contested decision. The only references to that report that appear in the contested decision and in the decision rejecting the complaint were made in response to the applicant’s arguments alleging failure to take that report into consideration. 45 EUIPO challenges the applicant’s line of argument. 46 It should be noted that the applicant is mistaken when she maintains that EUIPO did not take the 2019 appraisal report into account in the renewal procedure. As the applicant herself acknowledges in the reply, the contested decision contains the following statement: ‘the AACC considered also the 2019 [appraisal] report that was finalised in the meantime and shared with you on 11 March 2020’. 47 Similarly, in the decision rejecting the complaint, the following is stated: ‘all the elements of your appraisal reports [for the] 2015, 2016, 2017, 2018 and 2019 [exercises] that you highlight in your complaint have been duly considered by AACC in the assessment of the interest of the service on the possible renewal of your contract. … Contrary to your allegation, your appraisal report of 2019 has been taken into account in the [contested] decision after having been finalised on 11 March 2020. It was duly considered as you mentioned in your comments that it may have some elements in favour of the renewal of your contract’. 48 The applicant was therefore not justified in arguing that EUIPO failed to take into account the 2019 appraisal report in the contested decision. 49 The first complaint must therefore be rejected. – The second complaint concerning the failure of EUIPO to hear the applicant concerning 2019 appraisal report 50 The applicant criticises the administration for having deprived her of her right to be heard under Article 41(2)(a) of the Charter of Fundamental Rights of the European Union, by basing its non-renewal recommendation only on the appraisal reports covering the 2015, 2016, 2017 and 2018 appraisal exercises and on the 5 February 2020 dialogue, during which the 2019 appraisal report was not discussed. The applicant maintains that she was not able to argue in the light of the 2019 appraisal report since she did not receive that report until 11 March 2020 and she submitted her comments on the non-renewal recommendation on 21 February 2020. 51 In accordance with the requirements of sound administration, EUIPO should have established the 2019 appraisal report according to the appropriate timetable, so that the applicant could have been informed of it in sufficient time. 52 The applicant adds that she did not have the opportunity to express her views on the 2019 appraisal report in the event that that report was taken into account in the contested decision. 53 EUIPO challenges the applicant’s line of argument. It submits that, the appraisal exercise and the contract renewal procedure are two distinct procedures that must not be confused. Each of those procedures has a specific purpose and a specific timetable in the context of which the essential procedural requirements, in particular the applicant’s right to be heard, were complied with. 54 With regard to the renewal procedure, EUIPO considers that a non-renewal decision may take the form of a simple announcement of its intention, and the reasons for the decision, as part of a written or verbal exchange, even a brief one, which does not take place until after the person concerned has duly put forward his or her point of view. It classifies the meeting of 5 February 2020 as an ‘advanced warning’ or ‘courtesy explanation’ intended to inform the applicant of the information to be provided to the AACC. It was followed by a written hearing by the AACC. In that context, the applicant was informed of the proposed decision not to renew her contract. She was able to submit her comments in that regard on 21 February 2020. Therefore, the applicant was heard including on her performance in 2019. 55 As to the alleged requirement to take into account the last appraisal report in the context of the dialogue preceding the non-renewal decision, EUIPO maintains that there was no reason for it to deviate, specifically for the applicant, from the timetables for the 2019 appraisal exercise and the contract renewal procedure. Otherwise, there would be unequal treatment of EUIPO staff. 56 Article 41(2) of the Charter of Fundamental Rights provides that the right to sound administration includes, inter alia, the right of every person to be heard, before any individual measure which would affect him or her adversely is taken. 57 Indeed, the decision by an administration not to avail itself of the possibility of renewing the fixed-term contract of employment of a member of staff when it has such an option under the CEOS is not, formally speaking, a decision adopted at the end of a procedure opened against the person concerned (judgment of 24 April 2017, HF v Parliament, T‑584/16, EU:T:2017:282, paragraph 151). 58 Nevertheless, as the internal rules of EUIPO provide for the use in due time, before the expiry of the contract of a member of staff, of a specific procedure for renewal of that contract, the contested decision must be classified as an act adversely affecting the person concerned (see, to that effect, judgments of 12 February 2020, WD v EFSA, T‑320/18, not published, EU:T:2020:45, paragraph 102, and of 14 July 2021, IN v Eismea, T‑119/20, not published, EU:T:2021:427, paragraph 55). 59 According to the case-law, such a decision can be adopted only once the person concerned has been able duly to put forward their point of view, which may be a simple announcement by the [AACC] of its intention and its reasons for not availing itself of that option, as part of a written or verbal exchange, which may even be brief. That exchange must be initiated by the [AACC], who has the burden of proof (judgment of 24 April 2017, HF v Parliament, T‑584/16, EU:T:2017:282, paragraph 153). 60 That right implies that the person concerned has had the possibility of influencing the decision-making process at the stage when the original decision was adopted and not only at the time of lodging a complaint pursuant to Article 90(2) of the Staff Regulations (see, to that effect, judgment of 23 September 2020, UE v Commission, T‑338/19, EU:T:2020:430, paragraph 54 and the case-law cited). 61 In the present case, it is apparent from paragraphs 46 and 47 above that the 2019 appraisal report is one of the elements on which EUIPO relied in the contested decision. 62 It is true that, as has been stated in paragraph 14 above, that report was annulled by judgment of 26 October 2022, KD v EUIPO (T‑298/20, not published, EU:T:2022:671), and that it is, as a consequence, removed retroactively from the legal order and is deemed never to have existed, in accordance with the first paragraph of Article 264 and the first paragraph of Article 266 TFEU (judgment of 28 March 2019, River Kwai International Food Industry v AETMD, C‑144/18 P, not published, EU:C:2019:266, paragraphs 45 to 47). 63 Having heard the parties at the hearing on the appropriate conclusions to be drawn from any annulment of that decision in respect of the present case, the Court notes, as does EUIPO, that the 2019 appraisal report does not directly constitute a ground for the contested decision and is only a document which contains, inter alia, facts which may be taken into account for the purposes of adopting that decision (see, to that effect, judgment of 13 December 2018, Wahlström v Frontex, T‑591/16, not published, EU:T:2018:938, paragraph 92). 64 First, as EUIPO acknowledged during the hearing, the administration did not hear the applicant concerning the 2019 appraisal report between the date of the adoption of that report and the adoption of the contested decision. Secondly and more importantly, it is not apparent from the documents in the case file that the administration heard her concerning all the facts set out in that report. 65 Contrary to what EUIPO suggests, the fact that it heard the applicant in the context of a procedure the distinct character of which EUIPO itself recognised, namely the 2019 appraisal report, does not address that failure. To comply with the right to be heard, the administration must therefore not only bring to the knowledge of the person concerned the various items of information in question, but also inform him or her in sufficient detail, at the stage when that person is called upon to submit his or her observations, what action may be taken on the basis of that information (see judgment of 3 July 2019, PT v EIB, T‑573/16, EU:T:2019:481, paragraph 266 (not published and the case-law cited)). 66 It follows that EUIPO infringed the applicant’s right to be heard. 67 Nevertheless, it must be noted that a breach of the right to be heard can result in the annulment of a measure only if, had it not been for that irregularity, the outcome would have been different (judgment of 24 April 2017, HF v Parliament, T‑584/16, EU:T:2017:282, paragraph 157). 68 To establish that this is the case, the applicant must explain what arguments and evidence she would have relied on if her rights of defence had been respected and must demonstrate, as appropriate, that such arguments and evidence might have led in her case to a different result (see judgment of 3 July 2019, PT v EIB, T‑573/16, EU:T:2019:481, paragraph 269 (not published and the case-law cited)). 69 However, an applicant who relies on infringement of his or her right to be heard cannot be required to show that the decision of the EU institution concerned would have been different in content but simply that such a possibility cannot be totally ruled out (see, to that effect, judgment of 18 June 2020, Commission v RQ, C‑831/18 P, EU:C:2020:481, paragraph 106 and the case-law cited). 70 In the present case, it is true that the applicant merely stated that she would have been ‘able to argue in the light of [the 2019 appraisal report] in a more convincing manner’, without identifying more precisely the arguments and factors which she could have put forward if she had been given a proper hearing or explained how they could have led, in her case, to a different outcome. 71 It is necessary, however, to observe that EUIPO did not give the applicant the opportunity to do so, as the contested decision does not contain the slightest indication, express or implied, as to the way in which the administration took the 2019 appraisal report into account. EUIPO, when questioned on that subject at the hearing, after stating that that report had been taken into account in its entirety, conceded that it did not appear to be possible to infer from the wording of the contested decision what aspects of the report had been taken into account, formal note of which was made in the minutes of the hearing. 72 Nor was it possible to deduce the manner in which the 2019 appraisal report was taken into account in the contested decision from the context in which that decision was taken. 73 In those circumstances, it cannot be totally ruled out that the contested decision would have been different in content if EUIPO had allowed the applicant to make her views known on the facts set out in the 2019 appraisal report. Consequently, the second complaint must be upheld. 74 In the light of all of the foregoing, the contested decision must be annulled, without it being necessary to examine the third complaint or the first and third parts of the third plea and the fourth plea. Furthermore, as the contested decision has been annulled, there is no longer any need to examine the fifth plea or the plea raised at the hearing, since those pleas are directed against the decision rejecting the complaint, the annulment of which the applicant no longer has any interest in obtaining. Claim for damages 75 The applicant submits that the contested decision caused her non-material damage, which she assesses at EUR 20 000. She attributes, in essence, that damage to the breach of the duty to have regard for the welfare of staff and to manifest errors of assessment vitiating that decision and which caused her feelings of distress, anxiety, stress, insecurity, fear for the future, humiliation and injustice. 76 The applicant adds that the damage is, first, aggravated by the difficulties she encountered in obtaining unemployment benefit and by the situation arising from the COVID-19 pandemic and, secondly, separable from the contested decision. 77 In its written pleadings, EUIPO maintained that the present application was not founded. At the hearing, EUIPO adds that that application was inadmissible, as it was not raised during the pre-litigation procedure, formal note of which was made in the minutes of the hearing. 78 As a preliminary point, it should be noted that, where there is a direct link between an action for annulment and a claim for compensation, the latter is admissible as incidental to the action for annulment, without necessarily having to be preceded by a request from the person concerned to the administration for compensation for the damage allegedly suffered and by a complaint challenging the validity of the implied or express rejection of that request (see judgment 13 December 2012, A v Commission, T‑595/11 P, EU:T:2012:694, paragraph 113 and the case-law cited). 79 In the present case, the applicant seeks compensation for damage that she claims to have suffered on account of the unlawfulness that, according to her, vitiates the contested decision, namely manifest errors in the assessment of her [confidential] and a breach of the duty to have regard for the welfare of staff which she relied on in support of her claim for annulment. 80 It follows that the present application has a direct link with the application for annulment of the contested decision. The plea of inadmissibility set out in paragraph 77 above must, therefore, be rejected. 81 As regards the substance, it should be noted that the annulment of an unlawful measure may constitute, in itself, adequate and, in principle, sufficient compensation for all non-material damage which that measure may have caused, except where the applicant shows that he or she has suffered non-material damage which is incapable of being entirely repaired by that annulment (see, to that effect, order of 3 September 2019, FV v Council, C‑188/19 P, not published, EU:C:2019:690, paragraph 26, and judgment of 28 April 2021, Correia v EESC, T‑843/19, EU:T:2021:221, paragraph 86). 82 In the present case, the applicant merely claims that the alleged non-material damage is distinct from the unlawfulness of the contested report and that the administration did not take into account all the relevant elements. She does not explain how that damage cannot be repaired in full by the annulment of the contested decision. 83 It must therefore be held that the annulment of the contested decision constitutes in itself adequate and sufficient compensation for the non-material damage alleged, assuming that such damage is established and the unlawfulness that it caused is proved. 84 It follows that the claim for damages must be dismissed. Costs 85 Pursuant to Article 134(3) of the Rules of Procedure, where each party succeeds on some and fails on other heads, the parties are to bear their own costs. However, if it appears justified in the circumstances of the case, the Court may order that one party, in addition to bearing his or her own costs, pay a proportion of the costs of the other party. 86 In the present case, since the application for annulment has been upheld and the application for compensation dismissed, EUIPO must be ordered, in addition to bearing its own costs, to pay three quarters of the costs incurred by the applicant and the applicant must bear one quarter of her own costs. On those grounds, THE GENERAL COURT (First Chamber) hereby: 1. Annuls the decision of the European Union Intellectual Property Office (EUIPO) of 1 April 2020 not to renew the contract of KD; 2. Dismisses the action as to the remainder; 3. Orders EUIPO, in addition to bearing its own costs, to pay three quarters of the costs incurred by KD; 4. Orders KD to bear a quarter of her own costs. Kanninen Półtorak Stancu Delivered in open court in Luxembourg on 7 June 2023. V. di Bucci M. van der Woude Registrar President * Language of the case: English. 1 Confidential data omitted.