62002CC0294_EN
Opinion of the Advocate-General
Opinion of the Advocate-General
Table of contents
I –  Introduction
II –  The contract
A – The contract (stricto sensu)
B – Annex I (Project description)
C – Annex II (General Conditions)
III –  Facts
IV –  Procedure before the Court and forms of order sought
V –  Admissibility of the action
A – Jurisdiction of the Court of Justice
B – Admissibility of the action against InterTeam
1. Arguments of the parties
2. Legal assessment
C – Admissibility of the action against A-Consult and Ision
1. Arguments of the parties
2. Legal assessment
a) Principal relief sought
b) Alternative relief sought
VI –  Merits
A – Joint and several liability
1. Submissions of the parties
a) Commission
b) Defendants
2. Legal assessment
B – Claim for repayment of the advance against AMI, Intracom, Euram and Nordbank
1. Claims under the contract
a) Claim under the second sentence of Article 1.2 of the contract (liability for contributing to a breach of the contract committed by other contractors)
b) Claim under Article 23.3 of Annex II (reimbursement of overpayments)
i) Termination of the contract
ii) Payments made by the Commission
iii) Reimbursable costs
– Commission’s approval of the six-month report
– Commission’s discretion
– Whether the contractors are bound by the review team’s assessment
– Burden of proof
2. Claim on the ground of unjustified enrichment
3. Interim conclusion
VII –  Counterclaim
VIII –  Costs
IX –  Conclusion
I – Introduction
1. Pursuant to a contractual arbitration clause as provided for in Article 238 EC, the Commission has brought an action against
– AMI Semiconductor Belgium BVBA, formerly Alcatel Microelectronics NV, Oudenaarde, Belgium (‘AMI’),
– A-Consult EDV-Beratungsgesellschaft mbH, Vienna, Austria (‘A‑Consult’), (2)
– Intracom SA Hellenic Telecommunications & Electronic Industry, Athens, Greece (‘Intracom’),
– Ision Sales & Services GmbH & Co. KG, Hamburg, Germany, formerly AllCon Gesellschaft für Kommunikationstechnologie mbH (‘Ision’),
– Euram-Kamino GmbH, Halbergmoos, Germany, (‘Euram’),
– InterTeam GmbH, in liquidation, Itzehoe, Germany (‘InterTeam’) and
– HSH Nordbank, formerly Landesbank Kiel Girozentrale, Hamburg and Kiel, Germany (‘Nordbank’)
for repayment of EUR 317 214.00 plus interest.
2. That amount constitutes part of an advance paid by the Commission to the defendants under a contract concluded in 1998. The contract falls within the framework of the specific programme for research and technological development, including demonstration (RTD), in the field of information technologies (1994 to 1998) (the ‘Esprit programme’), (3) which itself forms part of the Community’s fourth RTD framework programme. (4)
3. The subject-matter of the contract was assistance for the project entitled Electronic commerce fulfilment service for the electronics industry (ECFS/E)
– Esprit project 26927 (‘the project’). The purpose of the project was essentially to establish and put on the market an internet-based trading platform for electronic components.
4. Having taken the view that the services provided by the defendants were defective, the Commission terminated the project prematurely and is now suing the defendants, as joint and several debtors, for repayment of the advances, in so far as they do not correspond to approved deliverables. The first question which arises in this dispute is whether the Court of Justice has jurisdiction, since, on the basis of its wording, the arbitration clause designates only the Court of First Instance as the competent court. Further issues relating to admissibility stem from the fact that the action was brought against a defendant which had already been wound up when the proceedings were initiated, as well as against two other defendants in respect of whose assets insolvency proceedings had already been opened at that time.
5. The dispute in this case concerns, inter alia, the extent to which the services provided did not satisfy the requirements of the contract and whether the Commission was justified in terminating the contract. The parties are also in dispute as to whether the defendants are jointly and severally liable for repayment. If they were not, and the Commission could accordingly claim only pro rata reimbursement from each defendant, the action would be largely unsuccessful, not least because the undertakings which were the main beneficiaries of the assistance are insolvent or have been wound up.
II – The contract
6. In the contract concluded on 8 June 1998 between the European Community, represented by the Commission, and the defendants, the latter undertook to develop and put on the market an e-commerce platform in the field of microelectronics for the exchange and sale of surplus semiconductors between undertakings in the electrical manufacturing industry. (5) The platform was intended to allow the undertakings to reduce their warehouse stock, and to sell surplus semiconductors quickly or procure components which they do not have in stock. The logistics, that is to say the dispatch of the components being traded, and the payment systems were to be incorporated into the platform at the same time.
7. The Project was to be completed within 18 months from 1 May 1998. The Community undertook to bear up to half of the estimated overall costs of ECU 1 080 000. (6)
8. The contract, which was drafted in English, is based on a model which the Commission always uses in the field of research and technological development. (7) It consists of three parts: the contract itself (‘the contract’), Annex I (information on the undertakings involved in the Project and a detailed project description) and Annex II (General Conditions) (hereinafter ‘Annex I’ and ‘Annex II’).
A – The contract (stricto sensu)
9. Article 1 defines the scope of the contract as follows:
‘1.1 The Contractors shall carry out this contract jointly and severally towards the Commission for the work set out in Annex I up to the milestone at month 18 (“the Project”) .
1.2 Subject to force majeure [ (8) ]
(including strikes, lockouts and other events beyond the reasonable control of the Contractors ), the Contractors
shall use reasonable endeavours to achieve the results intended for the Project
and to fulfil the obligations of a defaulting Contractor. A Contractor shall not be liable to take action beyond its reasonable control or to reimburse money due from a defaulting Contractor
unless it has contributed to the default. Measures to be taken in the event of force majeure shall be agreed between the contracting parties’.
10. In addition, the contract contains, inter alia, provisions relating to allowable costs (Article 3), payment of the Community’s contribution (Articles 4 and 9.2.2), the submission of cost statements and the defendants’ reporting requirements (Articles 5 and 6). Finally, Article 10 provides that the contract is to be governed by German law. (9)
B – Annex I (Project description)
11. Annex I is divided into two parts. Part 1 begins with the following summary of the project’s objectives:
‘– integration of multiple key services for the electronics industry,
– design of appropriate interfaces for an efficient brokerage system to be integrated into the professional IT-environment of future users and service providers,
– stimul ation of increased electronic commerce in the electronics industry, including developing means for rewarding usage (“bonus component”) and for quantitatively determining the cost-efficiency gained through implementation of ECFS/E’.
12. Part 1 of Annex I also contains forms providing detailed information on the undertakings involved in the project, including the costs which each undertaking is expected to incur.
13. The project’s objectives are described in greater detail in Part 2 of Annex I. Then, the centrepiece of Part 2 is a Project Workplan comprising eight workpackages. Each workpackage is in turn subdivided into individual tasks. Each task is intended to produce a specific deliverable. This may be a report, software, technical specifications, etc. For each task, the plan specifies the time within which the work is to be executed, the project participants who will contribute and the effort (expressed in man-months) involved, and the project participant responsible for producing the deliverable. Details of the workpackages provided for are as follows:
Workpackage 1 : Specification of relevant business procedures (Task 1.1 – 1.3), Months 0 to 2,
Workpackage 2 : Detailed definition of ECFS/E software (Task 2.1 – 2.5), Months 2 to 6,
Workpackage 3 : Server specification (Task 3.1 – 3.2), Months 2 to 3,
Workpackage 4 : Realisation of software (Task 4.1 to 4.6), Months 3 to 15,
Workpackage 5 : Field user tests (Task 5.1 – 5.4), Months 11 to 15,
Workpackage 6 : Cross border beta-test (Task 6.1 – 6.4), Months 15 to 18,
Workpackage 7 : Dissemination and acceptance activities (Task 7.1 – 7.4), Months 15 to 18 and
Workpackage 8 : Project management (Task 8.1 – 8.3), Months 0 to 36.
14. The nature and extent of the defendants’ involvement vary according to their role as potential future users of the system, providers of ancillary services within the context of the system or developers of IT tools (web design, interfaces, databases and other software).
15. As undertakings which manufacture and sell electronic components, AMI and Intracom come under the category of users. Euram is a shipping agency which could take on the job of transporting the components being traded and, like Nordbank, which, as a bank, could process payments, falls into the second category. The tasks of AMI, Intracom, Euram and Nordbank consist essentially, in the early stages, in helping to draw up a requirement profile and, at a later stage, in conducting trials using prototypes.
16. By contrast, InterTeam, Ision and A-Consult, smaller undertakings in the IT sector, were responsible for the actual technological development of the system. In addition, InterTeam, as coordinator, had a number of specific tasks, such as compiling reports and organising measures to exploit and distribute the product on the market.
17. Annex I, Part 2, Section 3 is devoted to project management. In particular, it defines the role and tasks of InterTeam as project coordinator. Section 4 relates to the drawing up of an exploitation plan. Section 5 states that, pursuant to Article 6 of the contract and Article 10 of Annex II, the project participants, under the direction of InterTeam, are to submit short six-month reports, a detailed one-year report, a mid-term review report and a final report. Finally, the last section provides that the project participants are to conclude between themselves a consortium agreement to supplement the provisions contained in Annex II.
C – Annex II (General Conditions)
18. The General Conditions contained in Annex II are likewise based on the Commission’s model contract.
19. Article 2.1 of Annex II reads inter alia:
‘The Coordinator shall:
(a) be the channel for submitting all documents and for general liaison between the Contractors and the Commission. All general communications with the Commission shall be through the Coordinator;
(b) subject to any special conditions in Article 9 of the contract, receive and distribute all payments which shall be made to the Coordinator in trust for the Contractors. The Coordinator shall immediately transfer the appropriate amount of each payment to each Contractor. The Coordinator shall not be the beneficial owner of any payment …’.
20. Article 5.3 provides as follows in respect of the immediate termination of the contract by the Commission:
‘The Commission may immediately terminate the contract, or the participation of any Contractor, by written notice:
(a)(i) where remedial action to rectify non-performance within a reasonable period of time (being not less than one month) specified in writing has been requested by the Commission and has not been satisfactorily taken …’.
21. The consequences of terminating the contract are provided for in Article 5.4:
‘The Community contribution to costs, on termination, shall be paid if they relate to Project Deliverables accepted by the Commission and such other costs which are fair and reasonable, including expenditure commitments.
…
For termination under Article 5.3(a), interest may be added to any amount to be reimbursed, upon written request, at 2% above the rate applied by the European Monetary Institute for ECU operations … for the period between the receipt of the funds and their reimbursement’.
22. With regard to jurisdiction, Article 7 provides:
‘The Court of First Instance of the European Communities, and in the case of appeal, the Court of Justice of the European Communities shall have exclusive jurisdiction in any dispute between the Commission and the Contractors concerning the validity, application and interpretation of this contract’.
23. With respect to the reports to be submitted by the contractors, Article 10 provides as follows:
‘10.1 Submission of reports
The Contractors shall submit to the Commission for approval the following reports … :
(a) progress reports (the progress, resources employed, deviations to the work plan, and results). Each 12 months, or such other period specified in the contract, the information in the relevant report must enable the Commission to evaluate the progress and cooperation, within the Project and with any related project;
(b) a final report covering all the work, the objectives, the results and the conclusions, including a suitable summary of all these matters;
…
10.3 Each progress report shall be submitted within one month of the end of the relevant reporting period.
A final report shall be submitted within two months following the period specified in Article 2.1 of the contract, or the completion of the work, if earlier.
Unless there are observations by the Commission the final report shall be deemed to be approved within two months of its receipt and within one month in the case of other reports’.
24. In connection with the payments made by the Commission, Articles 23.2 and 23.3 provide as follows:
‘23.2 Subject to Article 24 of this Annex, all payments shall be treated as advances until acceptance of the appropriate Project Deliverables, or, if none are specified, until acceptance of the final report.
23.3 Where the total financial contribution due for the Project, including the result of any audit, is less than the payments made for the Project, the Contractors shall immediately reimburse the difference, in ECU, to the Commission’.
III – Facts
25. Execution of the Project began in May 1998. On 8 June 1998, the Commission paid an initial advance of EUR 270 000 to InterTeam.
26. In a report covering six months produced on 15 December 1998, the defendants stated that they had supplied in full the individual services provided for in workpackages 1, 2 and 3.
27. On 29 March 1999, the Commission proposed to InterTeam that a review team be set up consisting of Messrs Guida and Ouzounis and sent InterTeam their curricula vitae. By e-mail of 8 April 1999, InterTeam gave its consent to the appointment of the experts proposed.
28. After the defendants had submitted cost statements for the initial six-month period, following submission of the six-month report, the Commission paid a further advance of EUR 191 394 on 6 May 1999 for the period from 6 May to 31 October 1999, which meant that payments up to that date amounted to EUR 461 394 in total.
29. At a meeting on 11 June 1999 in Brussels, which was attended by representatives of the defendants, the Commission and the review team, the defendants gave a progress report on their work. Having taken the view that there were serious defects in the implementation of the project, the review team announced that the project would be suspended until 1 July 1999 and asked that, by that date, the contractors provide it with additional information to show that the defects complained of had been rectified.
30. By letter of 18 June 1999, the Commission sent the defendants the first review report, which was based on the progress report of 11 June 1999, and reiterated, in summary form, the criticisms of the reviewers. The letter also contained the following passage:
‘These are the reasons why we agreed to suspend the project until 1 July 1999, during which time the consortium has agreed to deliver additional information … . This information shall be assessed immediately after 1 July 1999, additional information and remedial actions to rectify non-performance will be taken into account in accordance with the period of time specified in Article 5.3 (a)(i) of Annex II to the contract, effective immediately. Please note that in accordance with the relevant Articles of Annex II to the contract (in particular Article 5) the Commission hereby has given termination notice’.
31. By letter of 29 June 1999, the Commission sent InterTeam a version of the first review report containing a supplementary annex and again criticised the way in which the contract had been executed. The annex contained the reviewers’ assessment of the first prototype of the internet-based platform, which they had tested after being granted the necessary access rights by the defendants.
32. On 5 July 1999, InterTeam provided additional information – drafted partly in German – and supplied the deliverables due in the 12th month of the project. Shortly afterwards, it also submitted the one-year report provided for in the contract.
33. By letter of 23 July 1999, the Commission sent InterTeam a second review report taking into account the information provided on 5 July and the one-year report, and invited the defendants to a further meeting on 8 September 1999 in Brussels. In the second review report, the reviewers maintained their fundamental criticisms of all the deliverables. They approved only deliverables 2.4, 3.1, 4.1, 4.2, 4.3, 4.5 and 4.6, despite considering them to be of poor quality. Even after hearing the explanations given by the defendants at the meeting of 8 September 1999, the review team did not depart from its conclusion.
34. By registered letter of 21 December 1999 addressed to InterTeam, the Commission terminated the contract with retroactive effect from 8 September 1999. In that letter, which was copied to the other defendants, the Commission announced that it would be dispatching a request for payment in the amount of EUR 317 214. According to the Commission, that figure corresponded to the total amount paid by way of advances, EUR 461 394, minus the cost contribution in relation to the approved deliverables of EUR 144 180. Furthermore, the Commission gave a breakdown of those approved costs detailing what share of them had been incurred by each individual contractor.
35. According to the information provided by the Commission, if the approved costs are set against the advance paid to each of the contractors, the following picture emerges:
>lt>1
A: maximum award under the contract; B: amount actually paid; C: approved award; D: amount to be reimbursed (Intracom is in credit).
36. Finally, after a further exchange of correspondence, the Commission, by letter of 17 July 2000, asked InterTeam to pay it EUR 317 214 within seven days. Since no payment was received within the time-limit set, the Commission, by letter of 18 June 2001, demanded payment of EUR 317 214 plus interest from each of the defendants individually.
IV – Procedure before the Court and forms of order sought
37. The Commission initially brought its action on 12 August 2002 before the Court of First Instance. However, the application was forwarded to the Court of Justice. After consultation with the Registry of the Court of First Instance, the Commission indicated by letter of 14 August 2002 that its action was indeed being brought before the Court of Justice.
38. The Commission takes the view that the contract was effectively terminated pursuant to Article 5.3(a)(i) of Annex II because the services provided by the defendants were defective, as the review reports, which are binding upon the defendants, show, and because the defendants failed to rectify the defects within the time-limit set. Under Article 23.3 of Annex II, the Community is entitled to claim reimbursement of the advance in so far as that claim does not relate to approved deliverables. Pursuant to Article 5.4 of Annex II, interest is payable on the claim as from the date of payment of the advances. A right to repayment also accrues on the ground of unjustified enrichment as provided for in Paragraph 812 of the Bürgerliches Gesetzbuch (German Civil Code, hereinafter ‘the BGB’). Under Article 1 of the contract and Paragraph 420 et seq. of the BGB, the defendants have an obligation to make the repayment as joint and several debtors.
39. The Commission claims that the Court should:
– order the defendants, as joint and several debtors, to pay the Commission EUR 317 214 plus interest at the rate of 2% above the rate applied by the European Monetary Institute for euro transactions on the sum of EUR 125 820 since 8 June 1998 and on the sum of EUR 191 394 since 6 May 1999.
At the hearing, the Commission also claimed, in so far as the action is directed against A-Consult and Ision, that the Court should, in the alternative:
– find that A-Consult GmbH and Ision GmbH, as debtors jointly and severally liable with the other defendants, have an obligation to pay the Commission EUR 317 214 plus interest at the rate of 2% above the rate applied by the European Monetary Institute for euro transactions on the sum of EUR 125 820 since 8 June 1998 and on the sum of EUR 191 394 since 6 May 1999,
or, in the further alternative, in the event that the Court does not consider the defendants to be jointly and severally liable,
– find that A-Consult GmbH has an obligation to pay EUR 20 862 plus interest and Ision GmbH EUR 8 797 plus interest to the Commission.
Moreover, the Commission claims that the Court should in any event order the defendants to pay the costs.
40. AMI, Euram and InterTeam contend that the Court should:
– dismiss the action in so far as it is directed against them; and
– order the Commission to pay the costs.
41. A-Consult contends that the Court should:
– dismiss the action; and
– order the Commission to pay the costs.
42. Intracom contends that the Court should:
– dismiss the action;
– order the Commission, in the context of the counterclaim, to pay it EUR 6 022; and
– order the Commission to pay the costs.
43. Nordbank contends that the Court should:
– dismiss the action in so far as it is directed against it; and
– order the Commission to pay the costs.
44. The defendants dispute the claim that the services they provided were defective and offer expert evidence in support of their contention. They are not bound by the assessment of the review team. In any event, the deliverables documented in the six-monthly report cannot be at issue, since that report is deemed to have been approved, the Commission having failed to raise any objections within the prescribed time-limit. Moreover, the termination of the contract is ineffective because it was not directed at all the defendants but only at InterTeam.
45. They consider that joint and several liability to repay advances does not exist, as is clear from Article 1.2 of the contract. Intracom and Nordbank take the view that each contractor is liable only in so far as it is to be held responsible for any defects. However, they made their contribution in the manner prescribed.
46. Since Ision did not defend the action, the Commission claimed in its reply that the Court should enter judgment by default against Ision. As a result, Ision submitted a rejoinder in which it contended that the Court should dismiss that claim.
47. The Commission also submitted in its reply that Intracom’s counterclaim should be dismissed.
48. The other arguments raised by the parties, in so far as they are significant, are set out in the legal assessment.
V – Admissibility of the action
A – Jurisdiction of the Court of Justice
49. Article 7 of Annex II states that the parties have designated the Court of First Instance as the court with jurisdiction at first instance in any dispute arising from the contract. Accordingly, the Commission initially brought the action before the Court of First Instance.
50. The question is whether that arbitration clause (10) can be interpreted, in the case of the action brought by the Commission, as also conferring jurisdiction on the Court of Justice as a court of first instance. Under Article 225(1) EC, the Court of First Instance does have jurisdiction, inter alia, to give judgment under an arbitration clause within the meaning of Article 238 EC which is contained in a contract concluded by the Community. However, this is subject to derogating provisions in the Statute of the Court of Justice, Article 51 of which, as amended by the Treaty of Nice, transfers jurisdiction to hear and determine actions brought by the institutions of the Communities to the Court of Justice. (11)
51. Moreover, the position is no different where the rules taken to be relevant are not those in force at present but those in force when the action was brought. (12) At that time, the Court of Justice had jurisdiction in principle under Article 238 EC. Under Article 3(1)(c) of the decision establishing the Court of First Instance, (13) only actions brought by private persons under an arbitration clause were to be referred to the Court of First Instance; actions brought by the institutions of the Communities remained within the jurisdiction of the Court of Justice.
52. If interpreted solely on the basis of its wording, the clause would therefore be contrary to the provisions governing the jurisdiction of the Community Courts. If, for that reason, the clause were held to be ineffective, the dispute would have to be settled before the national courts or tribunals, pursuant to Article 240 EC.
53. It is true that none of the parties has contested the jurisdiction of the Court of Justice. Indeed, in response to a question put by the Court of Justice on that issue, the parties expressly confirmed that the dispute falls within the jurisdiction of the Court of Justice. However, the Court of Justice would, if necessary, be under an obligation to declare the arbitration clause to be ineffective and therefore to decline jurisdiction of its own motion. (14)
54. Some of the parties suggest that Article 7 of Annex II was implicitly amended after the event as a result of the written correspondence from the contractors expressing unanimous support for the idea of jurisdiction falling to the Court of Justice.
55. However, it is doubtful whether this is possible. First, under Article 38(6) of the Rules of Procedure of the Court of Justice, the applicant is required to submit a copy of the arbitration clause with the application. What the wording of that provision makes clear, apart from the fact that the arbitration clause must be in writing, (15) is that agreement must be reached before the action is brought. Second, under Article 8 of the contract, the contract may be modified only by ‘written agreement’ between duly authorised representatives of the parties. However, this question can ultimately be left unanswered if it is already clear from an interpretation of the current version of the arbitration clause that the Court of Justice has jurisdiction to hear and determine actions brought by the Commission which arise from the contract.
56. It follows from the judgment of the Court of Justice in Feilhauer (16) that its jurisdiction under an arbitration clause must be assessed solely in accordance with Community law and the clause itself. That is consistent with the generally recognised principle that each court applies its own procedural rules, including rules on jurisdiction. (17) Consequently, the choice of law made in the contract relates only to the substantive provisions. Accordingly, the interpretation of the arbitration clause, on which the jurisdiction of the Court of Justice ultimately turns, is not subject to the principles of German law governing the interpretation of contracts, as laid down in particular in Paragraphs 133 and 157 of the BGB, even where the clause is contained in a contract which is subject to German law.
57. However, the principles of Community law likewise require that a contract should not be interpreted solely by reference to its wording. Rather, the will of the contracting parties and the context in which the contract was concluded must also be taken into account. (18)
58. It is clear from the wording of the clause first of all that the contractors did not wish to rule out the possibility of referring matters to the Court of Justice. Indeed, its jurisdiction as a court of appeal is expressly mentioned. Moreover, through the clause, the parties made it clear that they did not in any event wish to confer jurisdiction at first instance on the national courts, but on the Community Courts. The parties confirmed that this was their wish at the time when the contract was concluded in their submissions before the Court of Justice.
59. There is also the fact that the Court of First Instance and the Court of Justice together form the institution known as ‘the Court of Justice’. This is apparent from the fact that Article 7(1) EC, which lists the institutions of the Community, mentions only the Court of Justice and does not refer separately to the Court of First Instance. In addition, the section of the EC Treaty containing the provisions governing the Court of Justice and the Court of First Instance is entitled ‘[t]he Court of Justice’. Consequently, it is not inconceivable that the designation ‘Court of First Instance’ should also include the Court of Justice on the basis that a reference to a part may be deemed to be a reference to the whole.
60. Finally, consideration must be given to the fact that the contract was concluded in the context of the Esprit programme. B y awarding subsidies under such programmes, the Community pursues objectives in the fields of research and industrial policy. It is appropriate that jurisdiction to hear and determine disputes in connection with such contracts should be transferred to the Community Courts. This ensures that such contracts, which are concluded on the basis of a standard model, are in turn interpreted uniformly and in the context of Community law, in so far as this is permitted by the national law applicable to the contract in question.
61. The view expressed here is not at odds with the Court of Justice’s finding that its jurisdiction under an arbitration clause must be interpreted restrictively because it derogates from the ordinary rules of law. (19) That statement by the Court of Justice has to do with which claims can be pursued before the institution of ‘the Court of Justice’ in an action under Article 238 EC, not with the division of powers between the Court of Justice and the Court of First Instance.
62. Moreover, Community institutions have on numerous occasions brought actions under an identical or similar clause before the Court of Justice. (20) In none of those cases did the Court call its jurisdiction in question on account of the wording of the clause, although it would have been under an obligation to decline jurisdiction of its own motion if that had been necessary. The only conclusion that can be drawn from this is that the Court of Justice interpreted the clause in the manner proposed here.
63. Consequently, on an interpretation of Article 7 of Annex II which takes into account the will of the parties and the context, the Court of Justice has jurisdiction to hear and determine actions brought by the Commission under the contract at issue here.
B – Admissibility of the action against InterTeam
64. At a meeting on 22 December 1999, InterTeam’s shareholders resolved to dissolve the company. The dissolution was entered in the commercial register on 18 January 2000. Then, on 8 November 2001, completion of the liquidation was recorded and the company was removed from the commercial register.
1. Arguments of the parties
65. The Commission is of the opinion that the action against InterTeam is admissible. The applicant’s contention that the defendant still has assets in its view renders the action admissible. Otherwise, a defendant could evade impending legal action by having itself removed from the commercial register.
66. However, AMI, Euram and InterTeam consider the action against InterTeam to be inadmissible. Given that it has ceased trading and therefore has no assets, InterTeam is defunct. Having been removed from the commercial register, it can no longer be a party to legal proceedings.
2. Legal assessment
67. The action against InterTeam would be inadmissible if InterTeam had no longer had legal capacity or the capacity to be a party to legal proceedings when the action was brought. In its judgment in Commission
v Oder-Plan, the Court of Justice determined the question of a company’s legal capacity and capacity to be a party to legal proceedings by reference to the law of the country where the company has its registered office. (21) In this case, the law of the country where the company has its registered office is German law. Under German law, a limited liability company (GmbH) ceases to exist on being removed from the commercial register following the completion of liquidation. From a procedural point of view, the effect of the company’s termination is that its capacity to be a party to legal proceedings likewise lapses; actions against the company are therefore inadmissible. (22)
68. Unlike in this case, the defendant in Commission
v Oder-Plan
was still in liquidation and had not yet been removed from the commercial register. It cannot therefore be inferred from that judgment, as the Commission contends, that the action against InterTeam, which had already been fully liquidated and removed from the commercial register before the proceedings were initiated, is admissible.
69. However, even a limited liability company which has been wound up and removed from the commercial register can, exceptionally, still be sued if the claimant can substantiate its assertion that the company still has assets. (23) In those circumstances, the defendant company regains to that extent its existence as a party and its capacity to take part as such in legal proceedings. The precondition for this, however, is that the claimant should at least be able to furnish evidence of the existence of realisable assets. (24) An unfounded contention that the limited liability company still has claims to assets, on the other hand, is not sufficient to support the admissibility of such an action. (25)
70. The Commission’s argument that the mere contention that the defendant still has assets must be sufficient to support the admissibility of an action against a limited liability company which has been removed from the commercial register, since a defendant could otherwise evade legal action by being removed from that register, is unconvincing. The fact is that the removal of a company from the commercial register takes place only on completion of a statutory procedure which takes into account the protection of creditors. (26) Exceptions to the principle of the inadmissibility of actions against liquidated and de-registered companies should, for reasons of legal certainty, be permitted only on condition that the claimant can furnish evidence to substantiate its claim as to the existence of assets.
71. Since the Commission has merely made a general assertion that InterTeam still has assets, but has not furnished any more detailed evidence in support of that claim, the Commission’s action against InterTeam must be dismissed as inadmissible. (27)
C – Admissibility of the action against A-Consult and Ision
72. The Commission brought its action on 12 August 2002. Before then, more specifically on 25 July 2002, follow-up insolvency proceedings (Anschlusskonkursverfahren) under Austrian law had been opened in respect of the assets of A-Consult, and, on 19 July 2002, insolvency proceedings (Insolvenzverfahren) under German law had been opened in respect of Ision’s assets.
1. Arguments of the parties
73. The insolvency administrator for A-Consult contends that the action brought against A-Consult is inadmissible. Under Paragraph 6 of the Konkursordnung (Austrian Insolvency Code, hereinafter ‘the KO’), actions involving claims on assets forming part of the insolvency estate cannot be brought or continued once the insolvency proceedings have been opened. Pursuant to Articles 16 and 17 of Council Regulation (EC) No 1346/2000 of 29 May 2000 on insolvency proceedings (28) (‘Regulation No 1346/2000’), the opening of insolvency proceedings in one Member State of the European Union is to be recognised in all the other Member States, and is to produce the same effects in those Member States as under the law of the State of the opening of proceedings.
74. Ision likewise considers the action brought against it to be inadmissible. When insolvency proceedings were opened on 19 July 2002, Ision had lost its right to bring or defend legal proceedings. From that point onwards, the right to bring or defend legal proceedings in relation to the assets involved in the insolvency fell to the insolvency administrator, in accordance with Paragraph 80 of the Insolvenzordnung (German Insolvency Code; ‘the InsO’). However, the application was not served on the insolvency administrator. Consequently, the administrator was not joined to the proceedings.
75. The Commission is of the opinion that the actions are admissible. The exclusive jurisdiction of the Court of Justice to give a ruling in this case follows from Article 238 EC in conjunction with the arbitration clause. It is clear from the case-law of the Court of Justice that national law cannot operate in opposition to such exclusive jurisdiction. Regulation No 1346/2000 concerns only the effects of insolvency proceedings in the Member States; it has no effect whatsoever on the admissibility of an action before the Court of Justice. In addition, the Commission was not informed of the insolvency proceedings relating to A-Consult until 23 September 2002, that is to say two and a half months after they had been opened. This cannot be regarded as ‘immediately’ within the meaning of Article 40 of Regulation No 1346/2000.
2. Legal assessment
a) Principal relief sought
76. The admissibility of actions against companies whose assets are the subject of insolvency proceedings, like the admissibility of actions brought against companies in liquidation, could be regarded as an issue relating to legal capacity and the capacity to be a party to legal proceedings. Support for that view could be found in the fact that the opening of insolvency proceedings immediately results in a change to the status of a company, which can no longer act through its own organs. It becomes a separate collection of assets and liabilities (the insolvency estate) managed by an administrator. Accordingly, the law of the country where the company has its registered office would have to be applied, that is to say Austrian or German law. (29)
77. On the other hand, as a further procedural issue, admissibility could also be determined by reference to the law of the place of the competent court, that is to say the Rules of Procedure of the Court of Justice, although these do not make any express provisions for situations such as this. In any event, in accordance with the judgment in Feilhauer, (30) provisions of national procedural law which exclude the jurisdiction of the Court of Justice could not be relied on against it.
78. However, the question whether the issue is one of capacity to be a party to legal proceedings or of admissibility in general could be left unanswered if the Rules of Procedure of the Court of Justice were interpreted, by reference to Regulation No 1346/2000, as meaning that the effects of insolvency proceedings opened in the Member States must also be taken into account in proceedings before the Court of Justice.
79. Under Article 4(2)(f) of Regulation No 1346/2000, the law of the State in which the insolvency proceedings have been opened is to determine the effects of the opening of those proceedings on the proceedings brought by individual creditors. Consequently, the admissibility of proceedings brought before national courts or tribunals would be determined by German and Austrian law.
80. Under German law, Paragraph 87 of the InsO provides that, once insolvency proceedings have been opened, insolvency creditors may pursue their claims against a debtor’s assets only in accordance with the provisions governing insolvency proceedings. The rules governing the bringing of civil actions are replaced by those governing the filing of claims in insolvency laid down in Paragraph 174 et seq. of the InsO. A direct action for enforcement against the insolvent company or the insolvency administrator must be dismissed as inadmissible. (31)
81. In Austrian law also, Paragraph 6(1) of the KO provides that actions aimed at enforcing or securing claims on assets forming part of the insolvency estate cannot be brought once insolvency proceedings have been opened.
82. Consequently, if national law were applied, the actions in question would have to be dismissed as inadmissible.
83. The Commission is right to say that Regulation No 1346/2000 does not contain any provision expressly prescribing its application to proceedings before the Court of Justice. The Rules of Procedure of the Court of Justice likewise do not make reference to the regulation. However, on an interpretation of the regulation in accordance with its spirit and purpose, no exception to the principles laid down in Regulation No 1346/2000 is applicable to proceedings before the Court of Justice.
84. The purpose of insolvency proceedings is to distribute the available assets on the basis of equality among the creditors in a single procedure in which all the creditors take part. It is for that reason that national law precludes the bringing of separate legal proceedings once insolvency proceedings have been opened. Creditors can neither bring a direct action to obtain a separate entitlement nor levy individual execution on the basis of an existing entitlement. (32) If that were not the case, some creditors could secure an advantage over others. Article 4(2)(f) of Regulation No 1346/2000 ensures that that principle cannot be circumvented by the bringing of actions in other Member States.
85. Regulation No 1346/2000 is directly applicable in all Member States and is binding on all national courts and tribunals. I can see no reason why the principles laid down in that regulation should not also have to be observed in proceedings before the Community Courts. If those principles were not applied mutatis mutandis in actions brought by the Commission before the Court of Justice, the Commission would have an unjustifiable advantage over the other creditors, who can enforce their claims only within the framework of the insolvency proceedings. (33) If the practical effect ( effet utile ) of the regulation is not to be called in question, it must be the case for the Commission also that, once insolvency proceedings have been opened, it can enforce its claims under a contract only within the framework of the national insolvency proceedings.
86. The findings of the Court of Justice in Feilhauer (34) and the principle that a court or tribunal must apply its own rules of procedure do not rule out the solution advocated here. The national provisions which preclude the admissibility of the action before the Court of Justice are applied pursuant to a Community-law conflict-of-laws provision (Article 4(2)(f) of Regulation No 1346/2000). Community law itself therefore accepts, or even requires, that the admissibility of actions before the Court of Justice should be restricted on account of the national provisions to be applied.
87. In the alternative, the Commission argues that, even if Regulation No 1346/2000 is applicable, the action against A-Consult is admissible in any event given that, contrary to Article 40 of that regulation, it was not informed of the insolvency proceedings until two and a half months after they had been opened and, therefore, not ‘immediately’ within the meaning of that provision.
88. That submission is untenable. Article 40 of Regulation No 1346/2000 does not contain any penalty provision to the effect that, in the event of a failure to inform creditors immediately, the effects of opening the insolvency proceedings are to apply only to those creditors who were informed immediately. Furthermore, the opening of insolvency proceedings is entered in the Handelsregister (German commercial register) or the Firmenbuch (Austrian register of companies) and made public, with the result that the Commission was in a position to be aware that proceedings had been opened even though it was not so informed.
89. It must therefore be concluded that the action against A-Consult and Ision is inadmissible because Austrian and German insolvency law, which are applicable in this regard, preclude individual creditors from bringing legal proceedings once insolvency proceedings have been opened.
b) Alternative relief sought
90. At the hearing, the Commission, by way of an alternative submission, changed the object of its action against A-Consult and Ision from enforceable to declaratory relief. At that time, the claim against A-Consult had not yet been entered on the list of claims submitted to the Austrian insolvency court. The claim against Ision, on the other hand, according to information provided by both the Commission and Ision’s insolvency administrator at the hearing, was entered on the list of claims submitted to the German insolvency court at an unspecified time and was disputed by the insolvency administrator.
91. If a claim entered on the claim list is disputed by the insolvency administrator or another creditor at the hearing for the examination of claims, the creditor may, under Austrian law, bring an action for declaratory relief, pursuant to Paragraph 110 of the KO. Under Paragraph 111 of the KO, the court with jurisdiction to hear and determine such actions is the insolvency court. The same applies in German law under Paragraph 179 et seq. of the InsO.
92. The fact that both legal systems confer jurisdiction to hear and determine such actions for declaratory relief on the respective insolvency courts does not mean that a similar action cannot be brought before the Court of Justice. Under Paragraph 110(1) of the KO, an action for declaratory relief may be brought before the (Austrian) insolvency court only in so far as the action is admissible. The same applies in German law under Paragraph 185 of the InsO. Since, in accordance with Article 238 EC, the Court of Justice is to have exclusive jurisdiction in cases involving an arbitration clause, an action before the national courts would be inadmissible in such cases. Furthermore, it is recognised in German law that, in derogation from Paragraph 180 of the InsO, an action for declaratory relief in respect of disputed insolvency claims can also be brought before an arbitration tribunal agreed on by the parties. (35)
93. However, the bringing of an action for declaratory relief is in any event subject to the condition that the claim must have been entered on the claim list and disputed. That has not yet happened in the case of the claim against A-Consult. Consequently, the alternative relief sought is inadmissible in so far as it relates to claims against A-Consult. For so long as there is no certainty that a claim is disputed, no relief is required. If the claim were to remain undisputed, the Commission would not need to bring an action to obtain declaratory relief.
94. It is true that the claim against Ision was entered on the claim list. (36) However, the alternative relief sought might be inadmissible in relation to Ision also because it is not directed against the proper defendant and/or because it was sought belatedly.
95. The action for declaratory relief in respect of the claim list must be brought against defendants different from those against whom the original action for enforcement was brought, that is to say that it must be directed against persons who dispute the existence of the claim. This may be the insolvency administrator or another creditor. There are doubts as to the admissibility of the alternative relief pursued against Ision not least because the Commission has not sought to redirect the action against the insolvency administrator or another insolvency creditor who has disputed the claim. Accordingly, the proceedings were not formally served upon the insolvency administrator either.
96. Even if the relief sought were interpreted extensively as meaning that it is intended to be directed against the insolvency administrator, the fact that it was not sought until the hearing indicates that it is inadmissible. It must be assumed that the declaration as to the validity of a claim forms part and parcel of a judgment enforcing that claim. However, since the action for a declaration as to the validity of a claim entered on the claim list is directed at defendants other than those against whom the original action for enforcement was brought, that is to say those who dispute the existence of the claim, the application in this case would have to be amended.
97. The Rules of Procedure of the Court of Justice do not expressly state whether and, if so, up to what point an application may still be amended. However, under Article 42(2) of the Rules of Procedure, no new plea in law may be introduced in the course of proceedings unless it is based on matters of law or of fact which come to light in the course of the procedure. That provision must be applied mutatis mutandis to amendment of the application in this case, including the changes to the submissions of fact which are necessary for such a revised application, in particular those relating to the entry of the claim on the claim list and the disputing of the claim by the insolvency administrator.
98. The insolvency proceedings in respect of Ision’s assets were opened on 19 July 2002. Even if the Commission had still been unaware of the opening of those proceedings, despite the public notification, when it brought its action on 12 August 2002, it none the less became aware that they had been opened no later than when it received the letter dated 26 September 2002 produced by Ision’s insolvency administrator in the context of these proceedings.
99. Thereafter, the Commission had the opportunity to enter the claim on the claim list and – once that claim had been disputed by the insolvency administrator – to seek declaratory relief. However, it did not in fact seek such relief until the hearing on 8 July 2004, and gave no reasons for its delay in doing so. One of the effects of this was that Ision’s insolvency administrator was not duly joined to these proceedings. Before the claim was entered on the claim list and the application was served on him, the insolvency administrator had no reason to be involved in the proceedings before the Court of Justice.
100. Consequently, the action brought against A-Consult and Ision is also inadmissible in so far as the Commission thereby seeks, in the alternative, a declaration as to the validity of claims entered on the respective Austrian and German claim lists.
VI – Merits
101. Relying on the provisions of the contract, in particular Article 23.3 of Annex II, and alleging unjustified enrichment as provided for in Paragraph 812 of the BGB, the Commission seeks repayment of the advances from the defendants as joint and several debtors. Since the action against InterTeam, A-Consult and Ision is inadmissible, it now remains to be considered only whether the action against AMI, Intracom, Euram and Nordbank (37) is well founded.
102. Under Paragraph 421 of the BGB, joint and several liability is characterised by the fact that each of the debtors has an obligation to effect performance in full. Only if the contractors were jointly and severally liable would the action brought by the Commission have any prospect of succeeding in its entirety. Otherwise, the Commission could demand only part performance from each of the contractors.
A – Joint and several liability
1. Submissions of the parties
a) Commission
103. The Commission essentially submits that the joint and several liability of the contractors follows from Article 1 of the contract and Article 23.3 of Annex II. The fact that the work was divided into packages and distributed to individual contractors does not preclude joint and several liability, since the individual deliverables are intended to satisfy one and the same interest in performance of the contract.
104. Furthermore, it also follows from the contract that each of the defendants is liable, under Paragraph 425(1) of the BGB, for another defendant’s failure to fulfil its obligations. (38) Joint liability of this kind for default on the part of other joint and several debtors is normally accepted under German law where, as in this case, a number of undertakings give a commitment to carry out works (Paragraph 427 of the BGB).
105. Article 1.2 of the contract does not concern the situation at issue in this case, but determines to what extent the contractors are liable to third parties (e.g. subcontractors) for default on the part of a contractor. Even if the situation in this case constituted an exception to the joint and several liability of the contractors vis-à-vis the Commission, the fact remains that the defendants did not do everything in their power to remedy the defaults documented in the review reports. In any event, all the defendants failed to fulfil their obligation of mutual cooperation and, contrary to Article 2.3(c) of Annex II, failed to inform the Commission of the unsatisfactory progress of the works.
b) Defendants
106. A-Consult and Intracom take the view that Article 1.1 of the contract does not in any event establish joint and several liability in relation to the repayment obligation laid down in Article 23.3 of Annex II. Rather, liability in relation to ancillary services is governed exclusively by Article 1.2 of the contract.
107. Intracom rules out the existence of joint and several liability not least because not one of the debtors possesses the necessary expertise to perform the contract in full. Furthermore, in cases of doubt the provisions of the contract take precedence over the rule laid down in Paragraph 427 of the BGB.
108. AMI, Euram and InterTeam, which have submitted joint observations, and Nordbank are of the opinion that the joint and several liability laid down in Article 1.1 of the contract in relation to the obligation to effect the principal act of performance is substantially modified in Article 1.2.
109. The defendants further submit that the Commission did not specify precisely which obligations each contractor is accused of having failed to fulfil under Article 1.2 of the contract. Nordbank and Intracom add that they fulfilled all their obligations until the works were suspended. On account of the early termination of the contract, the work they had in fact undertaken to perform could not be completed.
110. Nordbank and Intracom dispute the claim that they failed to fulfil their reporting obligations. Article 2.3(c) of Annex II provides only that the contractors must notify the Commission, through the coordinator, of difficulties in their area of responsibility. In any event, they were not aware that any of the other contractors might have been in default.
111. Nordbank takes the view that it follows from the nature of the contract as a subsidy contract that each contractor has an obligation to repay only in so far as it actually received public funds to which it was not entitled.
2. Legal assessment
112. The existence or otherwise of joint and several liability must be determined primarily by reference to the contractual provisions themselves. In this connection, joint and several liability might obtain because this is directly provided for in the contract. On the other hand, the joint and several liability of the contractors might follow from the fact that they might constitute a Gesellschaft bürgerlichen Rechts (civil law partnership, hereinafter ‘GbR’), within the meaning of Paragraph 705 of the BGB, the object of which would be to implement the project. (39) Each partner in a GbR is in principle incidentally liable for obligations entered into by the partnership; he is so liable for the amount of the obligation in full, not just for the amount of the relative share of it falling to him within the partnership. (40)
113. However, the incidental liability of partners, like contractually-agreed joint and several liability, presupposes that the contract actually creates a right to repayment of the advances from the partnership (and not just from the individual contractors) and that the personal liability of the partners was not limited in the contract.
114. As regards the principal contractual obligation, that is to say the implementation of the project, Article 1.1 of the contract clearly seems, on the basis of its wording, to establish joint and several liability. The choice of the phrase ‘ jointly and severally ’ in the text of the contract reflects the existence of such liability. Accordingly, the corresponding passage in the German language version of the model contract reads as follows: ‘Die Vertragspartner führen die in Anhang I dieses Vertrags genannten Arbeiten … als Gesamtschuldner … aus’ (literally: ‘[t]he Contractors shall carry out the works referred to in Annex I of this Contract as joint and several debtors’).
115. However, where, as in the present case, an indivisible contractual duty cannot be performed by any single contractor, joint liability rather than joint and several liability might be intended, since it cannot be assumed that the contractors meant to undertake to do something impossible. (41) Joint liability is characterised by the fact that the creditor cannot require any single debtor to perform a contractual duty in its entirety, but only that performance should be effected through cooperation between all the debtors. (42)
116. It follows from Article 1.2 of the contract that – contrary to the wording of paragraph 1 – joint liability was in fact agreed: Article 1.2 requires the contractors only to use reasonable endeavours to achieve the results intended for the project and to assume the obligations of a defaulting contractor. Furthermore, no contractor is to be liable for events over which it does not normally have control. Since no single contractor is therefore required to effect performance in full, joint and several liability is precluded.
117. However, this case no longer concerns the principal contractual obligation, that is to say the implementation of the project and the creation of a trading platform for electronic components. Rather, the Commission is demanding the repayment of advances to which, in its opinion, the defendants are not entitled. The fact that joint and several liability does not exist in relation to the principal contractual obligation itself is an indication of how the contractors intended to spread the risks associated with the contract in general. However, it does not necessarily follow from this that joint and several liability likewise does not exist in relation to the repayment obligation.
118. Repayment of the advances is a divisible obligation to which the following principles laid down by statute apply. If several debtors are subject to a divisible obligation such as the making of the contested repayment, they are, in cases of doubt, liable only pro rata, pursuant to Paragraph 420 of the BGB. However, in derogation from that provision, Paragraph 427 of the BGB provides that, even in the case of divisible acts, joint and several liability exists, in cases o f doubt, where several debtors make a contractual undertaking to perform an obligation jointly. Those rules of interpretation are nevertheless subject to the reservation that the contract did not provide otherwise, a question which must be examined next. Joint and several liability could also exist in the context of an undertaking entered into by a GbR, for which the partners are incidentally liable on a joint and several basis.
119. The central provision of the contract concerning the repayment of advances which exceed the approved costs is Article 23.3 of Annex II. That provision does not expressly provide for the joint and several liability of all the contractors. However, the Commission’s claim for repayment could be directed against an – implied – partnership or the contractors as a whole, for undertakings entered into by which each contractor is jointly and severally liable. It is equally conceivable that each individual contractor is liable only for the amounts which it received.
120. In Article 23.3, the contractors are designated as the persons subject to the obligation to effect repayment. This is not necessarily indicative of a joint obligation and, therefore, of joint and several liability. The wording of that article can also be interpreted as meaning that all the contractors must each reimburse the amount by which what they have received exceeds the cost reimbursement to which they are entitled.
121. The use of the verb ‘to reimburse’ shows that the contractors are required to pay back only those amounts which they have in fact previously received. Article 23.3 is therefore essentially a contractual provision relating specifically to unjustified enrichment. The purpose of claims on the ground of unjustified enrichment under Paragraph 812 of the BGB is to recover that which the person against whom the claim is directed (himself) received. Consequently, joint and several liability does not generally exist between a number of contractors who have an obligation to return that which they have received, for example under a contract which is void. (43) However, the position may be otherwise where the enrichment has accrued to an association of persons exercising undivided co-ownership, such as a GbR. (44)
122. The key to understanding the repayment obligation is therefore to ascertain to whom the payment was made, since only persons who received the payments are subject to an obligation to reimburse them.
123. The Commission may conceivably have paid the amounts stipulated in the contract to the contractors jointly and indivisibly, more specifically to a GbR constituted by the contractors. At first glance, that view appears to be supported by the fact that the Commission paid the coordinator and not each contractor pro rata.
124. However, it follows from Article 2.1 of Annex II that the coordinator receives the payments in trust and must transfer them immediately to the contractors without itself becoming the beneficial owner of the funds. The payments do not therefore become part of the assets of a partnership constituted by the contractors or any other association in undivided co-ownership. Payment is actually received by each individual contractor, and amounts to the share of funding due to that contractor on each occasion, as predetermined by reference to the cost plan provided for in the contract. The coordinator acts merely as a point of transfer which saves the Commission having to make payments to quite a large number of beneficiaries.
125. Accordingly, under Article 23.3 of Annex II, each contractor has an obligation to pay back only that share of the advances which it has itself received. Since no enrichment has accrued to the assets of a partnership, joint and several liability on the ground that the contractors may have constituted a partnership is likewise precluded.
126. That conclusion is borne out by Article 23.3 of Annex II read in conjunction with Article 1.2 of the contract. Under the second sentence of Article 1.2 of the contract, a contractor is not to be liable to reimburse money due from a defaulting contractor unless it has contributed to the default.
127. The Commission takes the view that that provision concerns only obligations incumbent on individual contractors, that is to say, for example, obligations to subcontractors or obligations to pay as between one contractor and others. The second sentence of Article 1.2 of the contract is not, however, in the Commission’s submission, applicable to claims directed against all the contractors jointly.
128. However, that interpretation is unconvincing. As the fundamental provision of the contract, Article 1 lays down the defendants’ obligations to the Commission: paragraph 1 refers expressly to the work to be provided ‘towards the Commission’ and paragraph 2 makes provision for any disruption to the fulfilment of those obligations. Thus, the contractors must cover for defaulting contractors within certain limits (first sentence of Article 1.2). Those limits are further specified in the second sentence of Article 1.2. However, there is still the question of how far the contractors’ obligations towards the Commission extend.
129. If the second sentence of Article 1.2 of the contract meant what the Commission contends that it means, it would relate to the obligations of the contractors to one another and towards third parties. The provision it contains would therefore fall completely outside the context of Article 1 of the contract. Such a provision would be more appropriate in a consortium agreement between the defendants than in the contract with the Commission.
130. On a correct interpretation, the second sentence of Article 1.2 in conjunction with Article 23.3 of Annex II should rather be understood as meaning that a contractor is not under an obligation to reimburse advances which another contractor has received unduly, either because the latter contractor failed to provide or provided defectively the services owed by it, or because it failed properly to document the costs incurred.
131. However, a contractor may be held liable in so far as it contributed to the breach of the contract. In this context, the second sentence of Article 1.2 of the contract also entitles the Commission to recover advances from a contractor which did not itself receive them. The condition for its doing so is that the debtor should have contributed to the defective fulfilment or the non-fulfilment of obligations. Crucially, however, that provision does not establish joint and several liability in relation to claims for repayment. Rather, consideration must be given in each case to whether and, if so, to what extent a contractor must, by way of exception, pay back advances which it did not itself receive. (45)
132. Even assuming, contrary to the line of argument put forward in points 119 to 125, that there is in this case an undertaking entered into by a partnership, it must be borne in mind that the personal liability of partners for the partnership’s obligations under contracts concluded with third parties can be limited. (46) Article 1.2 of the contract would have to be regarded as placing such a limitation on liability, with the result that joint and several liability on the ground that the contractors constitute a partnership is therefore likewise precluded.
133. An examination of the contract as a whole confirms that joint and several liability in relation to repayment was not agreed. The respective contributions of the contractors differ markedly in terms of size and quality. In particular, Euram and Nordbank were to have made only an ancillary contribution by ensuring the incorporation of supplementary services into the system (logistics and payment systems). Their share in the financial assistance was correspondingly small. Consequently, it cannot be assumed that individual undertakings intended to assume joint and several liability, even though they were entitled to only a small share of the financial assistance, were involved only peripherally in the implementation of the project and therefore had little influence on its success. (47)
134. Account must also be taken of the specific nature of the contract as a means of promoting research, a characteristic which the Commission was at pains to emphasise – albeit in a different context – at the hearing. The promotion of research and development involves significant risks. (48) It is precisely because private investors are generally unwilling to take on such risks that publicly-funded assistance is necessary. The fact that smaller undertakings in the research and development sector do not survive economically is one of those risks which the Commission knowingly undertook when concluding the contract for assistance. It would be unfair of the Commission, in such cases, to shift the risk of default entirely to other contractors. The Commission may reasonably expect that undertakings will no longer take part in research projects funded by the Community if, in so doing, they are to enter into obligations as extensive as those which the Commission seeks to infer from its model contract.
135. In support of its reading of the contract, the Commission refers finally to the findings of the Court of Justice on the existence of joint and several liability in its judgments in Commission
v Oder-Plan (49) and Commission
v Manuel Pereira Roldão & Filhos and Others . (50) However, those findings cannot be transposed to this case, since the terms of the contracts at issue in those proceedings were completely different from those of the contract at issue here.
136. First, the contracts in Commission
v Oder-Plan
and Commission
v Manuel Pereira Roldão & Filhos and Others
left no doubt whatsoever as to the existence of joint and several liability in respect of the obligations to effect the principal act of performance. (51) In addition, a contractor could escape the joint and several liability to reimburse overpayments only by proving that it had not contributed to the non-performance of the contract and that it had satisfied its reporting obligations under the contract. Under that clause, joint and several liability is therefore the general rule, from which a contractor against whom a claim is made can escape only in exceptional cases, the burden of proof resting with the contractor in this regard.
137. Under the contract in this case, however, a contractor is liable only by way of exception for third-party reimbursement obligations, that is to say where it has contributed to the breach of the contract. In this connection, the proper fulfilment of obligations to provide the Commission with information is not a condition for the exclusion of joint and several liability. The fact that the Commission, in reliance on the judgment in Commission
v Oder-Plan, seeks to infer joint and several liability from the failure to fulfil reporting obligations is therefore immaterial in this case.
138. However, irrespective of the foregoing considerations, there are in any event, as has been shown, numerous inconsistencies in the wording of the contract which raise considerable doubts as to the existence of joint and several liability. Such doubts operate to the detriment of the Commission.
139. The Commission drew up the model contract, including Annex II, in advance for use with contractors in a wide variety of situations. Consequently, it contains standard terms and conditions of business within the meaning of Paragraph 1 of the Gesetz zur Regelung des Rechts der Allgemeinen Geschäftsbedingungen (German Law governing standard terms and conditions of business, hereinafter ‘the AGB-Gesetz’). Under Paragraph 5 of the AGB-Gesetz, which, pursuant to Paragraph 24 thereof, is also applicable to contractual terms used in connection with undertakings, doubts as to the interpretation of standard terms and conditions of business are to operate to the detriment of the user. Joint and several liability is favourable to the Commission but unfavourable to the defendants. In order for the Commission to be able to rely on contractual terms which establish joint and several liability, this would have to follow with the necessary clarity from the contract. As the foregoing comments have shown, the contractual provisions at issue lack such clarity.
140. In short, it must be concluded that the joint and several liability of all the defendants for the repayment of advances paid by the Community does not follow unequivocally from the contract. Nor are the contractors jointly and severally liable for undertakings entered into by any GbR which may have been formed for the purpose of implementing the project.
B – Claim for repayment of the advance against AMI, Intracom, Euram and Nordbank
141. Since no joint and several liability exists here, it must be considered whether the Commission has a claim against AMI, Intracom, Euram and Nordbank respectively for repayment of part of the advances made to them. Such a claim could follow from the contract, in particular Article 23.3 of Annex II, and could be based on unjustified enrichment under Paragraph 812 of the BGB.
1. Claims under the contract
142. A claim under Article 23.3 of Annex II is subject to the condition that the total financial contribution due for the Project should be less than the advance payments already made. The legal consequence of this would be that each of the aforementioned defendants would have to reimburse the difference between the advance it received and the cost reimbursement to which it is entitled. Furthermore, the defendants could also be required, under the second sentence of Article 1.2 of the contract, to repay advances made to another contractor. This point must be considered first.
a) Claim under the second sentence of Article 1.2 of the contract (liability for contributing to a breach of the contract committed by other contractors)
143. A claim under the second sentence of Article 1.2 of the contract would arise where the defendant against whom it is pursued has contributed to a breach of the contract (that is to say, for example, defective performance or non-performance) committed by another contractor which creates a right to reimbursement.
144. The use of the word ‘unless’ shows that a claim of this kind is an exception to the general rules of liability under the contract. The burden of proof as to the facts substantiating such a claim on the part of the Community, that is to say proof that a contractor has contributed towards a breach of the contract by another contractor, is borne by the Commission as claimant. (52)
145. It is true that the Commission has submitted, on the basis of the review reports, that the defendants did not cooperate sufficiently or bring any influence to bear on defaulting contractors. They also, in its opinion, failed to comply with their obligation under Article 2.3(c) of Annex II to inform the Commission of undesirable developments. However, a sweeping submission such as this is not sufficient to establish the liability of a contractor for reimbursement claims against other contractors. The Commission should rather have linked its allegations specifically to individual contractors. Furthermore, AMI, Euram, Intracom and Nordbank have made detailed submissions to dispute those contentions, with the result that the Commission should have adduced evidence of its assertions. It has, however, failed to do so.
146. Consequently, a claim by the Commission under the second sentence of Article 1.2 of the contract is precluded.
b) Claim under Article 23.3 of Annex II (reimbursement of overpayments)
147. It is necessary to consider, in accordance with Article 23.3 of Annex II, whether the payments which AMI, Euram, Intracom and Nordbank have each received exceed the cost reimbursement to which they are entitled. If so, a claim for repayment would inevitably arise.
148. It follows from Article 23.3 of Annex II that accounts are settled once all the costs to which the Commission must contribute have been established. After all, the total costs actually incurred can be determined only after the project has been completed or brought to an end in some other way. (53) Since the project was not completed, claims for reimbursement would therefore arise only if the project was brought to an end in some other way. If the project had not yet come to an end, further reimbursable costs could be incurred.
i) Termination of the contract
149. The project could have been ended by the Commission’s termination of it on 8 September 1999. However, there is considerable dispute between the parties as to whether the termination was effective. The defendants take the view that they received no effective notice of termination and were given no reasons for the termination. However, these issues are immateria l for the purposes of a claim under Article 23.3 and need not be resolved if the contract was brought to an end in some other way.
150. Supplementing Article 23.3 of Annex II, Article 5.4 of that annex simply makes it clear that, in the event of termination, the contractors are to retain their right to pro rata reimbursement of the costs associated with the project. Article 5.4 of Annex II does not contain in relation to the termination of the contract any provisions which derogate from Article 23.3 of Annex II. Even in the event of termination, accounts would have to be settled in accordance with Article 23.3 of Annex II.
151. Moreover, there is no need in that connection to take into account the statutory provisions on the non-performance or defective performance of a contract laid down in Paragraph 320 et seq. of the BGB or the specific rules governing contracts for works, since the contract makes definitive provision in this regard in Article 23.3 in conjunction with Article 5.4 of Annex II. It is only in respect of claims for damages on other grounds that the contract makes no provision. However, none of the parties to these proceedings has asserted such a claim.
152. In any event, it is only as regards any right to interest which the Commission might have under Article 5.4 of Annex II in the event of termination that it would be necessary to examine the effectiveness of the termination. However, the question whether the Commission is entitled to interest can be set aside until it is established whether or not it is actually entitled to reimbursement from the defendants in the first place.
153. Terminated or not, the contract has in any event lapsed through the passage of time. Under Article 2.1 of the contract, the project was to be implemented within 18 months. The term of the project therefore ended on 30 November 1999, irrespective of termination. It is true that, under Article 2.2 of the contract, the contract is not to be completed until the Commission makes the final payment. However, under Article 18.1 of Annex II, the contractors may demand reimbursement only of costs incurred during the 18-month duration of the project. The only costs claimable now are those connected with the reporting and evaluation obligations laid down in the contract. There is no indication that the defendants will claim such costs. Moreover, under Article 5.2 of the contract (54) – applied mutatis mutandis to this situation – the contractors could have declared any additional costs only within the three months following supply of the final deliverable. Further payments by the Commission are likewise no longer likely. For that reason at least, therefore, it is possible to make a final settlement of accounts.
154. The ‘suspension’ of the project announced during the review in no way alters that fact. First, suspension was not provided for in the contract; nor was it agreed by the parties in the written form stipulated for amendments to the contract. Second, the suspension of the project lasted until its termination. Even if the period of the suspension is added to the 18-month duration of the project, implementation of the contract still ended in 2000.
155. Observance of the implementation period laid down in the contract is of central importance in the case of contracts concerning assistance for research and development projects. Because of technical progress, such projects can be usefully implemented only within a certain period of time. Moreover, the budgetary resources used by the Commission are available only at certain times.
156. Ultimately, the parties too agree that the contract has lapsed. It is true that the defendants consider the termination by the Commission to be ineffective. However, none of the undertakings has concluded from this that the project could continue to be implemented. Continued implementation would be impossible, not least because the undertakings principally responsible for implementation no longer exist. In addition, it must be assumed that the technical and economic principles underpinning the project are now outdated.
157. Since the contract therefore lapsed through the passage of time, accounts must be settled in accordance with Article 23.3 of Annex II. Any difference between the payments made by the Commission and the Community contribution actually owed would have to be reimbursed.
ii) Payments made by the Commission
158. The Commission has an obligation to furnish evidence of the amounts which the individual contractors have received and which are to be taken into consideration in the settlement of accounts under Article 23.3 of Annex II. Since joint and several liability must be ruled out, (55) it would in principle follow that the amounts which InterTeam received on behalf of each of the contractors pursuant to Article 2.1(b) of Annex II should be regarded as payments for this purpose. Accordingly, the extent to which InterTeam actually transferred those amounts to the contractors would be irrelevant.
159. However, the Commission has supplied no information detailing the extent to which the payments received by InterTeam are attributable to the individual contractors under the cost plan incorporated in the contract. Rather, it has provided a breakdown only of the relative amounts which the contractors should each reimburse ‘without prejudice to joint and several liability’. (56) The Commission bases those figures on the amounts which InterTeam actually transferred to the contractors. Those amounts alone can be taken into consideration by the Court of Justice, the Commission having failed to substantiate claims in relation to any other amounts. Accordingly, the following payments to the individual defendants are to be taken into consideration in the settlement of accounts: AMI: EUR 26 743, Euram: EUR 21 606 and Intracom: EUR 10 362. Since Nordbank did not receive any payments, a claim for reimbursement against that defendant is precluded from the outset.
iii) Reimbursable costs
160. It is necessary to offset against the payments the costs to be reimbursed by the Commission. It is common ground that the Commission approved the costs incurred by AMI in the amount of EUR 26 214.55 and the costs incurred by Intracom in the amount of EUR 16 384.09. In the case of Intracom, there is a balance in its favour, with the result that the Commission is not entitled to any reimbursement. AMI would have to pay back a difference of EUR 528.45 (EUR 26 743 minus EUR 26 214.55). Euram would have to reimburse the advance in full (EUR 21 606) because the Commission did not approve any of the costs claimed by Euram. The only question at issue is whether the Commission is justified in taking the view that the costs claimed by AMI are partly reimbursable and that all the costs claimed by Euram are non-reimbursable.
161. The reason the costs were not approved is that the Commission did not accept the deliverables in connection with which the costs were incurred as services satisfying the requirements of the contract. The Commission relies in this regard on the review reports. The deliverables forming the subject of the final review, conducted while the project was suspended, were those which had also been documented in the one-year report, that is to say: 1.1, 1.2, 1.3, 2.1, 2.2, 2.4, 2.5, 3.1, 3.2, 4.1, 4.2, 4.3, 4.5, 4.6, 5.1. Of those deliverables, only those in which Euram and AMI were to be involved in accordance with the work plan laid down in the Contract are relevant; in the case of Euram, these are deliverables 1.2 and 1.3 and, in the case of AMI, deliverables 1.1, 1.2, 1.3, 4.3 and 4.5. Since deliverables 4.3 and 4.5 were approved by the Commission, the dispute relates specifically to the costs incurred in connection with deliverables 1.1, 1.2 and 1.3.
162. The Commission’s claim for repayment of the advances is based solely on the alleged defectiveness of the deliverables. It has not, however, contested the cost statements produced by the defendants as proof of the costs they incurred.
163. Before we consider whether the Commission was justified in refusing to approve the deliverables, a number of fundamental points of dispute between the parties must be clarified.
– Commission’s approval of the six-month report
164. The defendants are of the opinion that the Commission has already approved the deliverables covered by the six-month report (that is to say, inter alia, deliverables 1.1, 1.2 and 1.3), since it did not raise any objections to that report within the prescribed time-limit.
165. It is true that, under Article 10.3 of Annex II, interim reports are to be regarded as approved if the Commission does not raise any objections within one month. Moreover, the Commission did not in fact contest the report within the prescribed time-limit.
166. That does not, however, represent approval of the deliverables documented in the six-month report. After all, as Article 10.1 of Annex II shows, the progress reports are intended only to provide the Commission with an overview of the proper course or otherwise of the project. On the basis of those reports, the Commission decides, inter alia, whether further advance payments can be made. (57) The administrative expenditure incurred would be excessive if the Commission had to decide immediately upon submission of each interim report, where appropriate having recourse to experts, whether or not to approve the deliverables described in that report.
– Commission’s discretion
167. The Commission points to the specific nature of the contract as a contract concerning a unilateral award of assistance by the Community in connection with a research and development project. It infers from this that the approval of the services provided lies in its discretion. The Court of Justice, it submits, may at most examine whether the Commission has exceeded its discretion and acted arbitrarily.
168. That argument must be rejected. It is contrary to the basic principles of contract law for one party to be given such extensive unilateral decision-making powers. Indeed, a contract is based precisely on a consensus of will between two or more parties acting on an equal footing. It is true that it is permissible under Paragraph 315 of the BGB for a party to specify a service in greater detail before it is provided. However, that paragraph does not provide that the subsequent assessment of the quality of a service which has already been provided lies in the discretion of one of the parties.
169. Even if it is assumed that such extensive unilateral rights can be conferred in theory, specific provision to that effect must in any event be made in the contract. The contract in this case contains evidence of various kinds that the reimbursement of costs is dependent on the Commission’s approval of the service provided. However, it does not follow with the necessary clarity from the contract that the final assessment of the services was intended to lie in the Commission’s discretion. It must be recalled in this regard that ambiguities in the standard terms and conditions of business operate to the detriment of the Commission as the user. (58)
170. The fact that the contract in question relates to the award of a subsidy is not capable of justifying a unilateral right of assessment on the part of the Commission. There is no reason why special rules should apply to such contracts. (59) If the Commission chooses to award financial assistance by means of a contract, it must also observe the principles governing contracts.
171. Moreover, it must be taken into account that the recipient of contractually-agreed assistance in connection with a research and development project makes important financial arrangements of its own in anticipation of the Community’s contribution. In the absence of such an agreement, it does not expect the assessment of the service owed under the contract, and therefore the reimbursement of costs, to fall within the exclusive discretion of the Commission.
– Whether the contractors are bound by the review team’s assessment
172. The Commission takes the view that the review team’s findings are binding on the defendants since they consented to the appointment of the reviewers.
173. Because of its far-reaching consequences, such an arbitration agreement would require an express provision to that effect. However, neither the contract nor the subsequent correspondence between the parties contains any indication that the contractors intended to submit to a binding assessment by third parties of the services provided by them. The use of experts by the Commission is referred to, in Article 8 of Annex II, solely in connection with the safeguarding of confidential information from the contractors. The e-mail correspondence between the Commission and InterTeam prior to the appointment of the review team falls within that context. In that correspondence, InterTeam indicates its agreement with the Commission’s choice of assessors. The question whether their findings would be binding was never discussed.
– Burden of proof
174. Since the assessment of the services provided does not therefore lie within the Commission’s discretion and the contractors have not agreed to be bound by the review team’s findings in this regard, the general principles governing the burden of proof apply. In accordance with those principles, the burden of proof in respect of the facts establishing the right in question lies with the claimant. (60)
175. The Commission is claiming the reimbursement of an advance. It must therefore conclusively demonstrate and, if its claim is disputed, prove that the payments exceed the financial contribution owed.
176. The Commission owes contributions only to the costs of deliverables provided which satisfy the requirements of the contract, and in so far as those costs have been properly documented. If a contractor has provided a deliverable and submitted the relevant cost statements, it falls to the Commission to prove that it owes no reimbursement of costs because the service provided was defective or the cost statements were inaccurate.
177. This allocation of the burden of proof in respect of defective performance is not at odds with the findings of the Court of First Instance in Toditec, (61) to which the Commission refers. In that judgment, the Court of First Instance assumed that it was for the contractors to prove to the Commission that the expenditure had actually been incurred and that other contractual formalities had been observed in order to be able to claim reimbursement of costs from the Commission. Unlike in this case, it was the contractors and not the Commission who were the claimants in Toditec . Accordingly, they had to prove that the conditions governing the existence of a right to reimbursement of costs from the Commission were satisfied.
178. It remains to be considered whether the Commission has conclusively demonstrated that it owes no contribution to the costs of deliverables 1.1, 1.2 and 1.3 because those services were defective.
179. In view of the at times very brief and seemingly superficial presentation of those deliverables, it would also have been appropriate to question whether the work involved had really taken several man-months. At the hearing, the Commission did make reference, in particular with respect to the fact that deliverable 1.3 had been presented on a single page, to the discrepancy between the labour deployed and the modest scale of the deliverable. However, it did not conclude from this that the costs had not been properly documented, but only that the service provided was defective. In any event, it would have been too late for the Commission to seek in this way to dispute the cost statement indirectly as well.
180. In order to demonstrate the defects in the service provided, the Commission makes extensive reference to the review team’s reports. In their second review report, which is decisive here as it is the final report, the reviewers found all three deliverables in the first work package to be unstructured and incomplete. They made detailed comments on points which the contractors should have resolved. In their concluding remarks, they even went so far as to describe deliverables 1.2 and 1.3 as being non-existent, since, according to the contractors, the documents submitted represented only summaries of the services themselves.
181. Under the contract, deliverable 1.2 was to consist in defining the software interfaces
necessary to link the banks responsible for payment transactions and the logistics undertakings responsible for transport activities. That deliverable formed the prerequisite for the detailed specification of the interface
functions which was the subject of deliverable 2.4. The reviewers approved the latter deliverable in their second review report. The Commission has not conclusively demonstrated how deliverable 2.4 could have been provided in an acceptable manner even though the foundation for it in deliverable 1.2 was defective or even non-existent. In particular, it did not take into consideration the fact that, in producing deliverable 2.4, to which express reference is made in the presentation of deliverable 1.2, the contractors may have made up for the work not performed earlier.
182. The Commission has also failed to demonstrate how the amounts to be reimbursed by Euram and Alcatel are apportioned between the various deliverables. Consequently, the conclusion that the Commission has not conclusively established that one of the deliverables to which those contractors contributed is defective forms a sufficient basis on which to dismiss all the claims.
183. Since the Commission has therefore not proved that a difference exists between the payments which AMI and Euram received and the financial contribution made by the Community, there is no right to reimbursement under Article 23.3 of Annex II.
184. In the absence of a principal claim, a claim for interest under Article 5.4 of Annex II is likewise precluded in any event.
2. Claim on the ground of unjustified enrichment
185. A claim for the recovery of unjustified enrichment under Paragraph 812 of the BGB fails for the same reasons as the claim for reimbursement under the contract. For the Commission has not proved that the payments exceed the contractors’ entitlement. Consequently, there is no proof of unjustified enrichment either.
3. Interim conclusion
186. To the extent to which the action is admissible, it is unfounded because the defendants are not liable as joint and several debtors and because the Commission has not conclusively demonstrated that it is entitled to claim repayment pro rata from individual contractors.
VII – Counterclaim
187. By way of a counterclaim, Intracom claims payment of EUR 6 022 from the Commission. That sum represents the difference between the advance actually paid to Intracom by InterTeam, amounting to EUR 10 362, and the share of the costs for approved deliverables attributable to Intracom, amounting to EUR 16 384.09.
188. The Commission takes the view that Intracom cannot alone assert a claim that is open only to all the contractors collectively as ‘joint and several creditors’. The Commission states that it has already deducted the amount in question from its claim against all the defendants as joint and several debtors.
189. Intracom points out that, where there are joint and several creditors as provided for in Paragraph 428 of the BGB, each creditor is specifically entitled to demand performance in full individually. In any event, it submits, after the contractual relationship has ended, each contractor is entitled to demand payment only of its own claims.
190. It must be emphasised first that the Commission has not expressly sought an order dismissing the counterclaim. However, in its reply, the Commission did contest the substance of the counterclaim and submitted that it should be dismissed. The request for an order dismissing the counterclaim is implicit in that submission.
191. The counterclaim would be well founded only if the total amount of the advances paid by the Commission had not already been sufficient to cover the scheduled pro rata costs attributable to Intracom. However, if the Commission paid a sufficient advance to the coordinator InterTeam, but InterTeam failed to distribute the funds among the contractors in accordance with the cost plan, Intracom should have claimed against InterTeam.
192. The amount claimed by Intracom relates to costs incurred in connection with deliverables 4.3 and 4.5, the only deliverables approved by the Commission, to which Intracom made a substantial contribution. (62) Deliverable 4.3 was to be provided by month 6 and deliverable 4.5 by month 12. The cost survey in Annex I (p. 28 of the contract) shows that Intracom’s share of the total scheduled costs in the first 12 months was EUR 28 500. It is common ground, however, that Intracom received only EUR 10 362.
193. Intracom would be entitled to further payments from the Commission only if the advances paid to InterTeam by the Commission by the end of the first 12‑month period had not been sufficient to cover the contractors’ scheduled costs under the cost plan, including Intracom’s share of those costs, up to that point.
194. However, that is not the case. The advance paid by the Commission for the first 12 months should have been 50% of EUR 646 940, that is to say EUR 323 470. (63) Up to 6 May 1999, the Commission actually paid advances of EUR 461 394 to the coordinator InterTeam. Under Article 2.1(b) of Annex II, InterTeam should have immediately transferred the payments pro rata to the other contractors. The share that Intracom would then have received would have been more than sufficient to cover its scheduled costs up to month 12.
195. The Commission cannot be held responsible for the fact that InterTeam retained some of the funds in breach of the contract. Consequently, Intracom cannot now demand any further payment from the Commission. Rather, it should demand payment of its share of the advances paid by the Commission from InterTeam. However, such a demand would seem futile following InterTeam’s liquidation.
196. Consequently, the counterclaim should be dismissed.
VIII – Costs
197. Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Commission has been unsuccessful in its submissions, it should be ordered to pay the costs. Intracom has likewise been unsuccessful in its counterclaim. However, the Commission has not claimed that Intracom should be ordered to pay the costs in respect of the counterclaim. Consequently, each of the parties should bear its own costs in this regard.
IX – Conclusion
198. In conclusion, I propose that the Court should:
(1) dismiss the action;
(2) order the Commission of the European Communities to bear the costs of the proceedings;
(3) dismiss the counterclaim; and
(4) in respect of the counterclaim, order Intracom SA Hellenic Telecommunications & Electronic Industry and the Commission of the European Communities each to bear their own costs.
(1) .
(2)
–	Before the action was brought, an application was made for A-Consult GmbH to be put into court-supervised receivership, and E. Roehlich (Rechtsanwalt) was appointed as the insolvency administrator. Under Austrian law, the action should have been brought against the administrator. However, even after becoming aware of this, the Commission did not redirect its action. A-Consult will therefore continue to be referred to as a party in the remainder of this document.
(3)
–	Council Decision 94/802/EC of 23 November 1994 adopting a specific programme for research and technological development, including demonstration, in the field of information technologies (1994 to 1998), OJ 1994 L 334, p. 24.
(4)
–	Decision No 1110/94/EC of the European Parliament and of the Council of 26 April 1994 concerning the fourth framework programme of the European Community activities in the field of research and technological development and demonstration (1994 to 1998), OJ 1994 L 126, p. 1.
(5)
–	In the meantime, a similar platform has in fact been established: www.excessportal.com.
(6)
–	Since Article 2(1) of Council Regulation (EC) No 1103/97 of 17 June 1997 on certain provisions relating to the introduction of the euro (OJ 1997 L 162, p. 1) requires that every reference to the ECU is to be replaced by a reference to the euro at a rate of one euro to one ECU, the term ‘euro’ will be used exclusively in the remainder of this document, except in direct citations.
(7)
–	The English, French and German language versions of the model contract can be downloaded from the internet at http://europa.eu.int/comm/research/modelc.html.
(8)
– The meaning of the phrase ‘[s]ubject to force majeure …’, which is not entirely transparent in English, is made clear by reference to the French and German language versions of the model contract. They read as follows: ‘[v]orbehaltlich höherer Gewalt …’ and ‘[s]ous réserve des cas de force majeure …’.
(9)
–	The version of the relevant legislation which is applicable is that which was in force at the time when the contract was concluded. Consequently, the amendments introduced, inter alia, by the Gesetz zur Modernisierung des Schuldrechts (Law modernising the Law of Obligations) of 26 November 2001 are not to be taken into consideration (cf. Paragraph 229(5) of the Einführungsgesetz zum Bürgerlichen Gesetzbuch (Introductory Law to the Civil Code)).
(10)
–	In accordance with the wording of Article 238 EC, ‘arbitration clause’ will continue to be used hereinafter, even though this case concerns a jurisdiction clause, the Community Courts being, in a broader sense, national courts, whose jurisdiction is governed by the EC Treaty, rather than private arbitration tribunals.
(11)
–	Article 51 was redrafted by Council Decision of 26 April 2004 (2004/407/EC, Euratom) (OJ 2004 L 132, p. 5) in such a way that the Court of First Instance now also has jurisdiction to hear and determine actions brought by the institutions of the Communities under an arbitration clause. However, in accordance with the transitional provision contained in Article 2 of that decision, proceedings which have already been brought before the Court of Justice are not to be referred to the Court of First Instance if the written procedure has already closed by the date on which the decision enters into force, as it has here. It must be concluded from this that such cases continue to come within the jurisdiction of the Court of Justice.
(12)
–	With regard to the principle that the procedural rules applicable are those in force at the time when the decision is given, see the judgments in Joined Cases 212/80 to 217/80 Salumi and Others
[1981] ECR 2375, paragraph 9, and Joined Cases C-361/02 and C-362/02 Tsapalos and Diamantakis
[2004] ECR I-0000, paragraph 19, and the case-law cited there.
(13)
–	Council Decision of 24 October 1988 establishing a Court of First Instance of the European Communities (88/591/ECSC, EEC, Euratom) (OJ 1988 L 319, p. 1), as amended by Council Decision of 26 April 1999 1999/291/EC, ECSC, Euratom (OJ 1999 L 114, p. 52). The decision was repealed by Article 10 of the Treaty of Nice.
(14)
–	Opinion of Advocate General Mayras in Case 23/76 Pellegrini
v Commission
[1976] ECR 1807, at 1826.
(15)
–	The requirement to submit the arbitration clause in writing is not, however, subject to any strict rules, unless otherwise provided for in the contract. The Court of Justice has therefore held it to be sufficient if the clause was initially contained in an unsigned draft agreement to which the parties then made consistent reference in correspondence (Case 23/76 Pellegrini
v Commission
[1976] ECR 1807, paragraphs 9 and 10).
(16)
–	Case C-209/90 Commission
v Feilhauer
[1992] ECR I-2613, paragraph 13.
(17)
–	Opinion of Advocate General Lenz in Case C-209/90 Commission
v Feilhauer
[1992] ECR I‑2622, point 18. See also the case-law of the Court of Justice on Article 17 of the Brussels Convention (judgments in Case C-214/89 Powell Duffryn
[1992] ECR I-1745, paragraph 37, and Case C-269/95 Benincasa
[1997] ECR I-3767, paragraph 31).
(18)
–	On the requirement to interpret a contract in the light of the context of Community law, see Case C-69/97 Commission
v SNUA
[1999] ECR I-2363, paragraph 19.
(19)
–	Judgments in Case 426/85 Commission
v Zoubek
[1986] ECR 4057, paragraph 11, and Case C‑337/96 Commission
v Industrial Refuse & Coal Energy
[1998] ECR I-7943, paragraph 49.
(20)
–	Judgments in Case C-167/99 Parliament
v SERS and Others
[2003] ECR I-3269, Case C-29/03 Commission
v ITEC
[2003] ECR I-0000, Case C-30/03 Commission
v ITEC
[2003] ECR I-0000 and Case C-127/03 Commission
v Trendsoft
[2004] ECR I-0000, paragraphs 7 and 21.
(21)
–	Case C-77/99 Commission
v Oder-Plan Architektur and Others
[2001] ECR I‑7355, paragraph 28. See also Case 50/84 Bensider and Others
v Commission
[1984] ECR 3991, paragraph 7. On the basis of Case C-208/00 Überseering
[2002] ECR I-9919, regard should probably be had rather to the place of incorporation. Since the place of incorporation and the place where the undertaking has its registered office are the same in this case, that question need not be considered any further.
(22)
–	Cf. Lutter & Hommelhoff, GmbH Gesetz: Kommentar, 15th edition (2000), Paragraph 74, point 17.
(23)
–	Cf. Bundesarbeitsgericht (German Federal Labour Court), judgment of 4 June 2003 – 10 AZR 449/02 – Neue Zeitschrift für Arbeitsrecht
2003, p. 1049.
(24)
–	See to that express effect the judgment of the Bundesgerichtshof of 2 June 1999 (VIII ZR 112/98 – Neue Juristische Wochenschrift
1999, p. 2972), which, in its earlier case-law, had held that the mere contention of the existence of assets was sufficient (judgment of 29 September 1967 – V ZR 40/66 – BGHZ 48, 303, 307).
(25)  –	Cf. Schmidt, in: Scholz, Kommentar zum GmbH-Gesetz, 9th edition (2002), Paragraph 60, point 62.
(26)
–	Thus, for example, the dissolution of a limited liability company must be entered in the commercial register, pursuant to Paragraph 65(1) of the Gesetz betreffend die Gesellschaft mit beschränkter Haftung (German Law on limited liability companies, hereinafter ‘the GmbHG’), and notified to the public three times by the liquidators, pursuant to Paragraph 65(2) of the GmbHG. At the same time, the creditors must be asked to report to the company. The final notification is followed by a one-year waiting period during which none of the company’s assets may be distributed.
(27)
–	There is confusion as to the whereabouts of some EUR 150 000 which InterTeam should, on its own behalf, immediately have passed on to the other contractors or at least have held, on their behalf, separately from its own assets. In this regard, the Commission might have been able to sue the persons liable at InterTeam individually rather than taking action against the liquidated company.
(28)
–	OJ 2000 L 160, p. 1.
(29)
–	Cf. judgment in Commission
v Oder-Plan
(cited in footnote 21, paragraph 28).
(30)
–	Cited in footnote 16, paragraph 13.
(31)
–	Cf. Hess, Weis & Weinberg, Kommentar zur Insolvenzordnung, 2nd edition (2001), Paragraph 87, points 6 and 7.
(32)
–	Cf. in that connection Paragraph 89 of the InsO.
(33)
–	In its judgment in Case C-221/88 ECSC
v Acciaierie e Ferriere Busseni SpA (in liquidation)
[1990] ECR I-495, paragraph 26, the Court has already held that an ECSC recommendation may not be interpreted as entitling the ECSC to preferential status in relation to private creditors in the context of proceedings concerning the rights of creditors.
(34)
–	See in this regard point 78 above.
(35)  –	Hess, Weiss & Wienberg, Paragraph 180, point 2.
(36)
–	In the absence of any documentation, it is, however, unclear what exactly was entered on the claim list: the claim pursued in the first alternative or the claim in the further alternative. Furthermore, there is no information to indicate whether the claim was disputed by the insolvency administrator alone or also by other creditors against whom the action for declaratory relief would, if that were the case, also have to be directed.
(37)
–	Any further reference to the defendants is to be understood as a reference to those four undertakings alone.
(38)
–	In that connection, the Commission refers to the judgment in Commission
v Oder-Plan
(cited in footnote 21, paragraph 61).
(39)
–	Annex I, Part 2, point 6 (p. 70 of the contract) provides for the conclusion of a consortium agreement. If that had not been the case, a partnership agreement, which might have been implied, could have existed between the contractors.
(40)  –	Sprau in: Palandt, Bürgerliches Gesetzbuch, 62nd edition (2003), Paragraph 714, point 12.
(41)  –	Bydlindski in: Münchener Kommentar zum Bürgerlichen Gesetzbuch, Vol. 2a, 4th edition (2003), Paragraph 431, point 3; Noack in: Staudinger, Kommentar zum Bürgerlichen Gesetzbuch, 1999, preliminary remarks on Paragraph 420 et seq., point 24; for an alternative view, see: Heinrichs in: Palandt, preliminary remarks on Paragraph 420 et seq., point 9.
(42)
–	Noack in: Staudinger, preliminary remarks on Paragraph 420 et seq., point 26.
(43)
–	Cf. Noack in: Staudinger, Paragraph 427, point 74.
(44)
–	Noack in: Staudinger, Paragraph 427, point 76; Sprau in: Palandt, Paragraph 718, point 9.
(45)
–	In this connection, see points 143 to 146 below.
(46)  –	Sprau in: Palandt, Paragraph 714, point 18.
(47)
–	The Court of First Instance pursued a similar line of reasoning in its judgment in Case T-340/00 Valnerina
v Commission
[2003] ECR II-811, paragraph 65. It held joint and several liability for the repayment of Community assistance to be disproportionate. However, the assistance in that case had been granted under a decision, not a contract.
(48)
–	Some of the risks associated with the Project are expressly stated in Annex I, Part 2, point 2.1 (p. 37 of the contract).
(49)
–	Cited in footnote 21.
(50)
–	Case C-59/99 [2001] ECR I-8499.
(51)
–	Cf. Article 2 of the contract, reproduced in the Opinion of Advocate General Alber in Case C‑77/99 Commission
v Oder-Plan Architektur and Others
[2001] ECR I-7355, 7356, point 3.
(52)
–	On the general rule in relation to the burden of proof, see point 174 below.
(53)
–	Accordingly, under the third indent of Article 4 of the Contract, the Commission too is not required to pay any balance due until the last deliverable has been provided and the corresponding cost statements have been submitted.
(54)
–	That provision reads: ‘[t]he cost statements for the final period, incorporating adjustments for previous periods, shall be submitted not later than three months after the approval of the last report, document or other Project Deliverable following which no further costs shall be allowable for payments’.
(55)
–	See in particular points 124 and 125.
(56)
–	In this regard, see point 35 above.
(57)
–	Cf. the second indent of Article 4 of the contract.
(58)
–	In that connection, see paragraph 139 above.
(59)
–	In its judgment in Case T-68/99 Toditec
v Commission
[2001] ECR II-1443, paragraph 77, the Court of First Instance likewise refused to attach special consequences to the nature of such contracts.
(60)
–	See, in relation to this principle, the judgment of the Bundesgerichtshof of 14 January 1991 – II ZR 190/89 –, BGHZ 113, 222, 226 and Greger in: Zöller, Zivilprozessordnung, 23rd edition (2002), preliminary remarks on Paragraph 284, point 17, for example.
(61)
–	Cited in footnote 59, paragraph 95.
(62)  –	Regarding Intracom’s contribution to the various deliverables, see the overview in Annex I (p. 55 of the contract).
(63)
–	See the table in Annex I (p. 30 of the contract).