62001CC0162_EN
Opinion of the Advocate-General
Opinion of the Advocate-General
I – Introduction
1. The two present appeals, which have been joined for the purposes of the judgment, are brought against the judgments of the Court of First Instance in Cases T-533/93 (2) (hereinafter: ‘ Bouma ’) and T-73/94 (3) (hereinafter: ‘ Beusmans ’) dismissing the actions for damages brought against the Council and the Commission by the Netherlands milk producers Edouard Bouma and Bernhard Beusmans.
2. These actions form part of a whole series of disputes which, in general, concern the position within the milk quota scheme of so-called ‘SLOM producers’, (4) that is to say milk producers who undertook, pursuant to Regulation (EEC) No 1078/77, (5) not to market milk or milk products (hereinafter: ‘non-marketing undertaking’) or to convert their dairy herds to meat production (hereinafter: ‘conversion undertaking’) for a period of five years.
3. This problem stems from the fact that no account was taken of the situation of SLOM producers when the milk quota scheme – which provided for the establishment of certain reference quantities to restrict milk production and levies in the event that those quantities were exceeded – was introduced as from 1 April 1984. Under the original version (6) of Council Regulation (EEC) No 857/84 of 31 March 1984 governing the calculation of reference quantities in each individual case, the reference quantities were to be established on the basis of milk deliveries during a reference year which, it transpired, coincided in whole or in part with the periods covered by the non-marketing undertakings entered into by the SLOM producers. Consequently, such milk producers could not be allocated a reference quantity – as they had produced no milk during the reference year – and were therefore unable to produce any milk exempt from levies.
4. The resulting, unfavourable situation of SLOM producers, which was prolonged in part by subsequent ‘corrective measures’ by the Community legislature and ‘enriched’ by further legal aspects, has occupied the Community courts in various forms for over a decade and also been reflected in a number of acts of secondary law. These judgments and measures of secondary law, which – and this difference should be borne in mind precisely in the present cases – relate in part to the (validity of the) rules relating to the allocation of reference quantities per se and in part to compensation for the damage suffered by SLOM producers as a result of those provisions, form the legal background to the present cases which is set out in detail below.
5. The present appeals raise in particular the question whether the Court of First Instance was right in the judgments under appeal to conclude, in the light of the relevant case-law, that Community liability is subject to the condition that the producers clearly manifested their intention to resume milk production upon expiry of their non-marketing undertaking.
II – Legal background
A – Participation of SLOM producers in the milk quota scheme
6. In 1977, in view of surplus milk production in the Community, the Council adopted Regulation No 1078/77 of 17 May 1977 introducing a system of premiums for the non-marketing of milk and milk products and for the conversion of dairy herds. (7) That regulation gave producers the opportunity of undertaking not to market milk, or undertaking to convert their herds, for a period of five years, in return for a premium.
7. Since overproduction continued into 1983, even though many producers had entered into such non-marketing undertakings, on 31 March 1984, the Council adopted Regulation (EEC) No 856/84 amending Regulation (EEC) No 804/68 on the common organisation of the market in milk and milk products (8) and Regulation (EEC) No 857/84 adopting general rules for the application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector. (9) Those regulations introduced, from 1 April 1984, a system of additional levies on milk (hereinafter: ‘rules on levies’) requiring each milk producer, on penalty of an additional levy, only to market the quantities of milk corresponding to the milk quota allocated to him (hereinafter: ‘reference quantity’). That reference quantity reflects the quantity of milk produced during a reference year, which for the Netherlands was 1983.
8. Any producers who produced no milk during that year because of the non-marketing undertaking that they entered into under Regulation No 1078/77 could consequently not be allocated a reference quantity and were therefore also unable to market any quantity of milk exempt from the additional levy.
9. By its judgments in Mulder (10) (hereinafter: ‘ Mulder I ’) and Von Deetzen, (11) the Court declared Regulation No 857/84, as supplemented by Regulation No 1371/84, (12) to be invalid for breach of the principle of protection of legitimate expectations ‘in so far as it does not provide for the allocation of a reference quantity to producers who, pursuant to an undertaking entered into under Regulation No 1078/77, did not deliver milk during the reference year adopted by the Member State concerned’.
10. The Council subsequently adopted Regulation (EEC) No 764/89 of 20 March 1989 amending Regulation No 857/84. (13) It thus inserted into Regulation No 857/84 Article 3a, which made it possible, on certain conditions, to allocate to the milk producers who delivered no milk during the reference year because of a non-marketing undertaking and were therefore previously excluded from the milk quota scheme a specific reference quantity (Article 3a(1)) which was to be equal to 60% of the quantity of milk (Article 3a(2)) delivered or sold by the producer during the 12 calendar months before the non-marketing or conversion undertaking was entered into (hereinafter: ‘reference production’).
11. However, under subparagraph (1) of inserted Article 3a, these provisions concern only producers ‘whose period of non-marketing or conversion, pursuant to the undertaking given under Regulation (EEC) No 1078/77, expires after 31 December 1983, or after 30 September 1983 in Member States where the milk collection in the months April to September is at least twice that of the months October to the March of the following year’.
12. Such producers are to receive provisionally, if they so request, a special reference quantity if they inter alia ‘establish in support of their request, to the satisfaction of the competent authority, that they are able to produce on their holding up to the reference quantity requested’ (Article 3a(1)(b) of Regulation No 857/84, as supplemented by Regulation No 764/89).
13. Under subparagraph (3) of inserted Article 3a, the special reference quantity is to be definitively allocated to the producers, if, within two years from 29 March 1989, they can prove to the satisfaction of the competent authority that they have actually resumed direct sales and/or deliveries, and that such direct sales and/or deliveries have attained during the previous 12 months a level equal to or greater than 80% of the provisional reference quantity. Should this not prove to be the case, the provisional reference quantity is to be returned in its entirety to the Community reserve. (14)
14. By the judgment in Spagl, (15) Article 3a(1) of Regulation No 857/84, as amended by Regulation No 764/89, was declared invalid for breach of the principle of protection of legitimate expectations in so far as ‘it excludes from the grant of a special reference quantity under that provision producers whose period of non-marketing or conversion, pursuant to an undertaking given under Council Regulation ( EEC ) No 1078/77 ..., expires before 31 December 1983 or, in some cases, before 30 September 1983’. In this judgment and in the judgment of the same date in Pastätter, (16) the Court also declared subparagraph (2) of this Article to be invalid in respect of the restriction provided for therein of the special reference quantity to 60% of the reference production.
15. The Council subsequently adopted Regulation (EEC) No 1639/91 of 13 June 1991 amending Regulation No 857/84 (17) which, by removing the conditions which had been declared invalid, made it possible for the producers concerned to be granted a special reference quantity.
16. Finally, by its judgment in Wehrs (18) the Court declared invalid the rule commonly known as the anti-accumulation rule laid down in the second indent of Article 3a(1) of Regulation No 857/84, as amended by Regulation No 764/89. This rule, which also appeared in the second indent of the first subparagraph of Article 3a(1) of Regulation No 857/84, as amended by Regulation No 1639/91, barred SLOM producers who had already obtained a reference quantity (for another holding) pursuant to Article 2 of Regulation No 857/84 from being allocated a special reference quantity.
17. Following this judgment, the Council adopted Regulation (EEC) No 2055/93 of 19 July 1993 allocating a special reference quantity to certain producers of milk and milk products. (19) Regulation No 2055/93, which entered into force on 1 August 1993, permits producers who had entered into a non-marketing or conversion undertaking under Regulation No 1078/77 and who – because of the rule against overlapping – had until then not been entitled to a special reference quantity to obtain such a quantity in addition to an original reference quantity.
B – Compensation for losses caused by the Community milk quota scheme
18. By interlocutory judgment in Mulder and Others v Council and Commission (20) (hereinafter: ‘ Mulder II ’), the Court held the Community liable for the loss suffered by certain milk producers in so far as this regulation did not provide for the allocation of a reference quantity to producers ‘who, pursuant to an undertaking given under Council Regulation (EEC) No 1078/77 ..., did not deliver any milk during the reference year adopted by the Member State concerned’. As regards the amounts of damages payable, the Court ordered the parties to arrive at an agreement or, in the absence thereof, to transmit to the Court a statement of their views with supporting figures.
19. Following that judgment, the Council and the Commission published Communication 92/C 198/04 (21) on 5 August 1992. After setting out the implications of the Mulder II judgment, and in order to give it full effect, the institutions stated therein their intention to adopt practical arrangements for compensating the producers concerned.
20. In order to comply with Mulder II
the Council subsequently adopted Council Regulation (EEC) No 2187/93 of 22 July 1993 providing for an offer of compensation to certain producers of milk and milk products temporarily prevented from carrying on their trade. (22) This regulation offered producers to whom a special reference quantity was definitively allocated (23) flat-rate compensation for all the damage that they suffered from the provisions referred to in Mulder II .
21. Finally, by its judgment in Mulder and Others v Council and Commission, (24) (hereinafter: ‘ Mulder III ’) the Court of Justice determined definitively the amount of compensation to be paid to the applicants in these cases who had not taken up the abovementioned offer of compensation. (25)
III – Facts
22. The following facts are evident from the judgments under appeal. (26)
23. The applicants, Messrs Bouma and Beusmans, are milk producers in the Netherlands who, in the context of Regulation No 1078/77, gave non-marketing undertakings, which expired on 20 April 1983 and 23 December 1983 respectively.
24. The applicants did not resume milk production when their undertakings expired. However, Mr   Beusmans continued to rear and fatten cattle, which he had begun to do while the undertaking was in force.
25. Following the adoption of Regulation No 1639/91, the applicants applied for a provisional reference quantity, which was allocated to Mr   Bouma on 28 October 1991 and to Mr   Beusmans on 25 November 1991.
26. As a result of an inspection by the Algemene Inspectiedienst (General Inspectorate Service) to check the circumstances in which the applicants had resumed milk production, the provisional reference quantities were withdrawn again from the applicants by decision of 19 April 1993 (in the case of Mr   Beusmans) and by decision of 4 May 1993 (in the case of Mr   Bouma).
IV – Proceedings before the Court of First Instance and judgments under appeal
27. By applications lodged at the Registry of the Court on 30 September 1993 and 14 February 1994 respectively Messrs Bouma and Beusmans (hereinafter: ‘the applicants’) each brought an action for compensation against the Council and the Commission – under Article 178 and the second paragraph of Article 215 of the EC Treaty (now Article 235 EC and the second paragraph of Article 288 EC) – for damage suffered by them as a result of them having been prevented from marketing milk by virtue of Regulation No 857/84, as supplemented by Regulation No 1371/84.
28. The applicants sought compensation in respect of the period after 1 April 1984, the date of the entry into force of the rules on levies which prevented them from being allocated a reference quantity and consequently from producing milk until milk production resumed or, more precisely, until a provisional reference quantity had been granted pursuant to Regulation No 1639/91. (27)
29. As grounds the applicants submitted (28) inter alia that they disputed the defendants’ argument that there was no entitlement to compensation because the applicants did not resume milk production upon expiry of the non-marketing undertaking. They also stated reasons why milk production could not resume upon expiry of the non-marketing undertaking in 1983. With reference to Spagl
they furthermore disputed the defendants’ argument that SLOM producers whose non-marketing period expired in 1983 and who did not resume milk production before 1 April 1984 were not entitled to compensation. They stated that the reasons why the plaintiff in Spagl
had not resumed milk production were not relevant to the ruling in that case.
30. By orders of 31 August 1994, the Court of First Instance stayed the proceedings in Cases T-533/93 and T-73/94 pending delivery of judgment in Mulder III .
31. By orders of 11 March 1999, the Court of First Instance ordered that proceedings be resumed.
32. The Court of First Instance dismissed the applications in the judgments of 31 January 2001 under appeal. As grounds it essentially stated as follows:
33. After noting the general conditions relating to the non-contractual liability of the Community, the Court of First Instance firstly rules that the Community’s liability for loss suffered by a producer owing to the fact that he was prevented from delivering milk by Regulation No 857/84 is based on infringement of the principle of protection of legitimate expectations. (29)
34. The Court of First Instance then notes that, according to the case-law of the Court of Justice, that principle may be relied on only to the extent that the Community itself has previously created a situation which can give rise to a legitimate expectation. (30) Thus, in relation to an economic operator who has entered into a non-marketing undertaking, this means that he may legitimately expect ‘not to be subject, upon the expiry of his undertaking, to restrictions which specifically affect him precisely because he has availed himself of the possibilities offered by the Community provisions (Mulder I, paragraph 24, and Von Deetzen, paragraph 13)’. On the other hand, ‘the principle of protection of legitimate expectations does not preclude, in the case of a scheme such as that concerning the additional levy, the imposition of restrictions on a producer by reason of the fact that he has not marketed milk or has marketed only a reduced quantity of milk during a period prior to the entry into force of that scheme, in consequence of a decision which he freely took without being encouraged to do so by a Community measure ( Kühn, paragraph 15).’ (31)
35. The Court of First Instance then makes the following examination of Spagl : (32)
‘43. Furthermore, it follows from Spagl
that the Community could not without infringing the principle of protection of legitimate expectations automatically preclude from the grant of quotas all producers whose non-marketing or conversion undertakings had expired in 1983, in particular those who, like Mr   Spagl, had been unable to resume production for reasons connected with their undertaking. The Court of Justice thus held in paragraph 13 of that judgment:
[t]he Community legislature was able validly to set a cut-off date by reference to the expiry of the period of non-marketing or conversion of the persons concerned, with a view to excluding from the benefit [of the provisions on the allocation of a special reference quantity] those producers who had not delivered milk during the whole or part of the reference year for reasons unconnected with the undertaking as to non-marketing or conversion. On the other hand, by virtue of the principle of the protection of legitimate expectations, as interpreted in the cases cited above, the cut-off date cannot be set in such a way that it has the effect of also excluding from the benefit [of those provisions] producers whose failure to deliver milk for the whole or part of the reference year derives from the fulfilment of an undertaking given under Regulation No 1078/77.
44. Contrary to what the applicant claims, that judgment can be read only in the light of the facts of the case before the national court. Mr   Spagl was a farmer who, upon the expiry of his undertaking on 31 March 1983, was not in a position to resume milk production immediately because he lacked capital to buy a new dairy herd. Instead, he bought dairy calves and raised them himself, resuming production with 12 cows in May or June 1984 … . Furthermore, it is clear from the Report for the Hearing that while milk production was suspended he carried out maintenance work on the buildings and machinery used for milk production ...’.
36. The Court of First Instance infers from Spagl
‘that producers whose undertaking expired in 1983 can validly base their actions for compensation on infringement of the principle of protection of legitimate expectations only where they show that their reasons for not resuming milk production during the reference year are connected with the fact that they stopped production for a certain time and that they were unable, for reasons to do with the organisation of that production, to resume production immediately.’ (33)
37. It subsequently supports this finding with reference to Mulder II . (34)
‘Furthermore, it follows from Mulder II, and more specifically from paragraph 23, that Community liability is subject to the condition that the producers clearly manifested their intention to resume milk production upon expiry of their non-marketing undertaking. In order for the illegality which led the Court of Justice to declare the regulations giving rise to the situation of the SLOM producers invalid to entitle those producers to damages, the producers must have been prevented from resuming milk production. That means that the producers whose undertaking expired before the entry into force of Regulation No 857/84 resumed production or at least took steps to do so, such as making investments or repairs, or maintaining the equipment necessary for such production (see on that subject the Opinion of Advocate General Van Gerven in Mulder II
at [1992] ECR I-3094, point 30).’
38. After confirming the need for a clear manifestation of intent as regards the resumption of milk production, the Court of First Instance applies this condition to the applicants’ situation as follows: (35)
‘48. As the applicant did not resume milk production between the date on which his non-marketing undertaking expired, 20 April 1983, and the date on which the quota scheme entered into force, 1 April 1984, he must show, in order for his claim for compensation to be well founded, that he had the intention of resuming milk production upon the expiry of his non-marketing undertaking and that he found it impossible to do so owing to the entry into force of Regulation No 857/84.’
39. Accordingly, the Court of First Instance examines in each case whether there is a relevant manifestation of intent:
– In Bouma
(paragraph 49):
‘49. The fact is, first of all, that although his non-marketing undertaking expired more than 11 months before the date of the entry into force of the milk quota scheme, the applicant had not resumed milk production on that date. Furthermore, the applicant has adduced no evidence to show that he contacted the national authorities with a view to obtaining a reference quantity in 1984 when the milk quota system entered into force. Last, he has failed to show that he took any other steps that might evince an intention to resume milk production upon expiry of his undertaking. In that regard, it must be held that the order forms for grass seed dated in part August 1983 do not suffice to show such an intention.’
– In Beusmans
(paragraph 48):
‘48. In that regard, although the applicant owned cows which, according to him, were suitable for the production of either beef or milk, he did not resume milk production after the expiry of his undertaking. Nor has the applicant adduced any evidence to show that he contacted the national authorities with a view to obtaining a reference quantity in 1984, when the milk quota scheme entered into force. Last, he has failed to show that he took any other steps that might evince an intention to resume milk production upon expiry of his undertaking.’
40. The Court of First Instance further rules that, contrary to the submissions made by the applicants, no entitlement to compensation from the Community arises from the fact a provisional reference quantity had been obtained under Regulation No 1639/91. This fact does not in itself prove that upon expiry of their non-marketing undertakings the applicants had the intention to resume milk production. (36)
41. On these grounds the Court of First Instance finally concludes that the Community cannot be held liable to the applicants as a result of the application of Regulation No 857/84 and that no further examination is necessary. (37)
V – The appeals
42. On 31 April 2001 Messrs Bouma and Beusmans (hereinafter: ‘the appellants’) each brought before the Court of Justice an appeal based on five grounds against the judgments of the Court of First Instance. In each case they claim that the Court should:
– set aside the judgment;
– refer the case back to the Court of First Instance;
– order the Council and the Commission to pay the costs of the proceedings before the Court of First Instance and of these proceedings.
43. In both cases the Council contents that the Court should:
– declare the appeal inadmissible in part and in any event unfounded in whole;
– order the appellant to pay the costs of the proceedings.
44. In both cases the Commission contents that the Court should:
– declare the appeal unfounded;
– order the appellant to pay the costs of these proceedings.
45. By order of the President of 20 June 2003 the two cases were joined for the purposes of the judgment.
VI – Legal analysis
A – Preliminary remarks
1. The various groups of producers concerned
46. By way of background to the present cases, it should first be noted that on account of the large number of SLOM producers concerned, many similar cases were brought before the Court of First Instance which then grouped them, for reasons of procedural economy, into model cases according to their characteristics and common features.
47. It is in fact possible to draw a distinction between various categories of SLOM producers affected to different degrees on the basis of the interrelationship of the various rules and ‘reparative rules’ relating to the allocation of a reference quality and in accordance with the possibilities for compensation created by case-law and the Community legislature. Some of these distinctions obviously already form part of the fixed terminology of the parties and authorities dealing with the SLOM problem and therefore it is necessary at this juncture to refer to some of these categorisations in order to appreciate the following comments and the submissions of the parties. (38)
48. Firstly, it is possible to identify a group of SLOM producers whose non-marketing undertakings expired after 31 December 1983 and to whom a specific reference quantity could therefore already be allocated by virtue of Regulation No 764/89 of 20 March 1989 which altered for the first time the calculation of the reference quantity at issue made pursuant to Regulation No 857/84. These so-called ‘SLOM I producers’ include in particular the 84 SLOM producers, that is to say SLOM producers whose non-marketing undertakings expired in the course of 1984.
49. Those SLOM prod ucers who did not become eligible for the allocation of a specific reference quantity until after the renewed amendment of Regulation No 857/84 by Regulation No 1639/91 are distinguished from the SLOM I producers. A sub-group of this category generally referred to as ‘SLOM II producers’ is formed by the 83 SLOM producers, that is to say the SLOM producers whose non-marketing undertakings had expired during the reference year 1983 and who were therefore not eligible for an allocation by virtue of Regulation No 764/89.
50. Finally, the parties refer in their submissions also to SLOM III producers who are essentially producers who were first able to obtain a reference quantity by virtue of Regulation No 2055/93 by reason of the fact that they were covered by the anti-accumulation rule. (39)
51. Furthermore, it must be borne in mind that the offer of compensation pursuant to Regulation No 2187/93 is directed at all producers to whom a specific reference quantity had definitively been allocated by virtue of one of the abovementioned regulations. (40)
2. Subject-matter of the present proceedings
52. The parties to the present proceedings commented, as a preliminary point, on the subject-matter of these proceedings and on which categories of SLOM producer are being ruled on therein. These general comments will have to be considered in connection with the grounds of appeal in which these comments are given concrete expression. However, in order better to appreciate the parties’ lines of argument their preliminary remarks are outlined in brief.
53. The appellants state that the present proceedings were designed as a test case for a group of 83 SLOM producers who have in common the fact that they were initially allocated a specific reference quantity by virtue of Regulation No 1639/91 which, however, was subsequently withdrawn from them. The objective is to clarify whether the latter fact in any way alters the 83 SLOM producers’ entitlement to compensation from the Community. They basically emphasise that SLOM II producers are also entitled to compensation and on the same terms as the SLOM I producers.
54. As they state, the appellants have brought the present appeals essentially to challenge the fact that in the judgments under appeal the Court of First Instance took into consideration, in respect of the rights to compensation, not the withdrawal of the specific reference quantity but whether the producers had clearly manifested their intention to resume milk production upon expiry of their non-marketing undertakings. They complain that this could also undermine the rights to compensation of those 83 SLOM producers who had definitively obtained a specific reference quantity and whose rights to compensation had already been acknowledged by the Commission.
55. By contrast, the Commission and the Council stress that the present proceedings relate to 83 SLOM producers who had obtained no definitive reference quantity and consider that the position taken by the Court of First Instance in the judgments under appeal, namely that these producers’ right to compensation is subject to the resumption of milk production or a manifestation of intent to do so, is correct.
56. In so far as the appellants object in these considerations to the fact that the judgments under appeal failed to rule on the legal position of the ‘target group’ of producers to be covered by the model cases, it should be noted from the outset it was not for the Court of First Instance to rule in the present actions for compensation brought under Article 235 EC, read in conjunction with the second paragraph of Article 288, a priori in respect of a group of persons, formed in accordance with whatever criteria, who had been affected by the Community act at issue, but instead to rule on whether or not the conditions for the Community’s non-contractual liability had been satisfied in relation to each applicant. For this reason it cannot be excluded that the judgments are ultimately not precisely relevant to the group for which they are intended to serve as a model but the Court of First Instance cannot basically be held responsible for this.
57. Furthermore, it should be observed that even in appeal proceedings the subject-matter or scope of the present cases cannot be ‘recast’ to establish the rights to compensation of a particular group of SLOM producers. In that respect it should be borne in mind at this juncture that the Court of Justice does not have to consider the whole case and rule again on the action brought before the Court of First Instance but that its jurisdiction in appeals is confined to examining the judgment of the Court of First Instance for errors in law relating to the grounds of appeal raised. (41)
B – The grounds of appeal in detail
58. In both cases the appellants base their appeals on five grounds. (42) In view of the sections in the judgments in Bouma
and Beusmans, to which these grounds relate, it would be advisable first to examine the first ground, then the third ground, then the second and fourth grounds together, and finally the fifth ground.
1. First ground of appeal
(a) Main submissions of the parties
59. By their first ground of appeal, which consists of seven parts, the appellants
essentially submit that at paragraphs 43 to 45 of the judgment in Bouma
and paragraphs 42 to 44 of the judgment in Beusmans
the Court of First Instance misinterpreted the judgment in Spagl
and consequently drew incorrect conclusions as regards the 83 SLOM producers’ rights to compensation. In particular they object to an interpretation of Spagl
according to which not all 83 SLOM producers but only those who show that they could not resume their production immediately for particular reasons are entitled to compensation.
60. They challenge such an interpretation by contending that Spagl
relates to all 83 SLOM producers (43) and, contrary to the view of the Court of First Instance, gives no basis to suggest that the Court of Justice intended to restrict the repeal of Regulation No 857/84 to those cases in which the SLOM producers concerned were able, upon expiry of their non-marketing undertakings, to resume milk production during the reference year 1983. Furthermore, the Court of Justice has already rejected in the judgment in Spagl, as is evident when read in conjunction with the opinion in that case, (44) the contention that Mr Spagl could have resumed production in the period between the expiry of his non-marketing undertaking and the introduction of the rules on levies. Moreover, it does not follow from the judgment in Spagl
and the relevant Advocate General’s Opinion that the Court of Justice took into account, in giving this ruling, the particular facts of the case as set out by the Court of First Instance and taken as the basis for its interpretation.
61. The applicants further state that neither Regulation No 1639/91 nor Regulation No 2187/93 contain additional conditions relating to entitlement to compensation, as the Court of First Instance ruled in the contested decisions, and that the Council and the Commission have also always acknowledged that the 83 and the 84 SLOM producers have equal rights to compensation in the light of Spagl . Therefore, the judgments under appeal ultimately amount to a breach of several general legal principles, such as that of equal treatment, legal certainty and protection of legitimate expectations vis-à-vis the 83 SLOM producers. In addition, the Court of First Instance failed to appreciate the Spagl
case as a test case relating to the rights and obligations of all 83 SLOM producers. By attempting to limit the significance of this judgment more than 10 years after it was given in the light of the facts at that time, the Court of First Instance also fails to appreciate the judicial function of the Court of Justice.
62. Furthermore, by requiring the 83 SLOM producers to demonstrate specific steps to resume milk production upon expiry of their non-marketing undertakings the Court of First Instance imposed a further condition which is not consistent with the principles laid down in Mulder II . In respect of the 84 SLOM producers, to which that judgment related, the Court of Justice attached no such condition to the right to compensation.
63. Finally, the appellants contend that in the judgments under appeal the Court of First Instance also contradicts its own judgment in the Joined Cases of Quiller and Heusmann, (45) which are of direct interest because Mr   Quiller was not only a SLOM III producer but also a 83 SLOM producer. Unlike in the judgments under appeal, in that judgment the Court of First Instance rejected the institutions’ contention that the appellant could have obtained a reference quantity if he had resumed milk production in 1983.
64. The Council
disputes in detail the various arguments put forward by the appellants. In this regard it stresses in particular that Spagl
concerns the validity of Regulation No 857/84, whilst the present cases relate to the non-contractual liability of the Community which, as the Court of First Instance rightly held, is generally subject to number of conditions. No liability on the part of the Community can be inferred directly from Spagl
alone. In any event, there are no inconsistencies between the judgment in Spagl
and the judgments under appeal. Nor are they inconsistent with the judgment in Mulder II . The Court of First Instance applied the Court of Justice’s criterion that the appellant must have clearly manifested his intention to resume production to the cases at issue without making any additions.
Contrary to the view of the appellants, the 83 SLOM producers were not treated less favourably than the 84 SLOM producers to which Mulder II
related. At issue here is not different treatment of 83 and 84 SLOM producers but different treatment of those producers who had the intention to resume production upon expiry of their non-marketing undertakings and those who did not.
65. Unlike the Council, the Commission
did not deal with the first three grounds of appeal separately. The Commission’s position concurs with that of the Council in so far as they both dismiss as unfounded or irrelevant the complaints raised by the appellants and essentially argue that the Court of First Instance correctly interpreted the judgments on which it based the judgments under appeal and correctly laid down the conditions for a right to compensation. As regards the judgments cited by the appellants, they both repeatedly stress that a distinction must be drawn between the judgments concerning the validity of provisions relating to levies and the judgments concerning the rights to compensation of the producers concerned.
66. In addition, the Commission considers that Spagl, which relates to the validity of Regulation No 857/84 – that is to say in particular to the allocation of a reference quantity – is not relevant to the question of compensation to which these cases relate. Nor is the judgment in Quiller
relevant to the present cases. Furthermore, the Commission rejects the criticism that the Court of First Instance applied a stricter standard as regards liability to 83 SLOM producers in the contested decisions than it did as regards liability to the 84 SLOM producers in Mulder II . Like the Council, the Commission takes the view that the situation of the 83 SLOM producers differs from that of the 84 SLOM producers in that they could actually have resumed milk production upon expiry of their non-marketing undertakings, a fortiori
since the rules on levies had not yet entered into force.
(b) Appraisal
67. It should firstly be pointed out – and the Court of First Instance correctly referred thereto at paragraph 39 of the judgment in Bouma
and at paragraph 38 of the judgment in Beusmans
– that, according to settled case-law, the Community’s non-contractual liability on account of its legislative powers depends on the coincidence of a set of conditions as regards the unlawfulness of the act of the institution, the fact of damage and the existence of a direct link in the chain of causality between the act and the damage complained of. (46)
68. Naturally, the same applies again as regards the Community’s liability for damage that the SLOM producers have suffered, as the case may be, as a result of Regulation No 857/84 in its various versions.
69. It therefore follows, contrary to the premiss on which the appellants obviously proceed, that no rights to compensation in respect of the 83 SLOM producers or other SLOM producers can be automatically inferred from the judgment in Spagl, by which the Court of Justice merely ruled in preliminary ruling proceedings on the validity of Article 3a of Regulation No 857/84, as amended by Regulation No 764/89. Nor does the invalidity established in Mulder I, Von Deetzen or Pastätter
directly give rise to liability on the part of the Community.
70. However, as regards the finding that a Community act is unlawful these judgments coincide with one of the requirements of liability law and can therefore serve as a basis for claims for compensation against the Community.
71. Thus, in Mulder II the Court of Justice concluded on the basis of its findings in Mulder I
and Von Deetzen
that Regulation No 857/84, as supplemented by Regulation No 1371/84, was adopted in breach of the principle of protection of legitimate expectations and that the Community must compensate for damage which the producers have suffered as a result of the application of these regulations. In that respect the Court of Justice pointed out inter alia that the principle of protection of legitimate expectations is a superior rule of law for the protection of individuals and that – as required by settled case-law in respect of Community liability for legal provisions whose adoption involves choices of economic policy – there is a sufficiently serious breach of this rule of law. (47)
72. Consequently, as the Court of First Instance correctly held at paragraph 40 of the judgment in Bouma
and paragraph 39 of the judgment in Beusmans, the Community’s liability to SLOM producers who have suffered a reparable loss owing to the fact that they were prevented from delivering milk by Regulation No 857/84 is therefore based on an infringement of the principle of protection of legitimate expectations.
73. The comments made by the Court of First Instance in respect of Spagl
which were complained of must be viewed in this context. They concern the scope of the principle of protection of legitimate interests in respect of the 83 SLOM producers and thus the requirement that the Community act be unlawful.
(i) The principle of protection of legitimate expectations and the importance of the resumption of milk production
74. As regards the principle of protection of legitimate interests, it should first be pointed out that the Court of Justice has already commented on several occasions on the scope thereof in judgments concerning SLOM producers. Furthermore, the Court of First Instance also referred to this case-law at paragraphs 41 and 42 of the judgment in Bouma
and paragraphs 40 and 41 of the judgment in Beusmans .
75. Accordingly, it is generally the case that the principle of the protection of legitimate expectations may be invoked as against Community rules, only to the extent that the Community itself has previously created a situation which can give rise to a legitimate expectation. (48)
76. Therefore, when applied to the situation of a SLOM producer the principle of protection of legitimate expectation means that such a producer can legitimately expect not to be subject, on the expiry of his undertaking, to restrictions which specifically affected him for the very reason that he had availed himself of the possibilities offered by the Community provisions. (49) In other words, he can legitimately expect that his non-marketing undertaking is limited.
77. On the other hand, the principle of the protection of legitimate expectations does not preclude the imposition of restrictions on a producer under a system like the additional levy system by reason of the fact that he did not market milk during a given period prior to the entry into force of that system for reasons unconnected with his non-marketing or conversion undertaking. (50)
78. Thus, it follows that the reasons why the SLOM producer concerned has marketed no milk – or has marketed only a reduced quantity – and therefore was not allocated a reference quantity are indeed relevant as regards the principle of protection of legitimate interests. Consequently, the producer can rely on an infringement of his legitimate expectation that his non-marketing undertakings is limited only where the reason for the absence of a reference quantity is connected precisely with the fact that he had entered into such an undertaking.
79. If production was not resumed upon expiry of the undertaking for other reasons, the producer concerned cannot rely on the principle of protection of legitimate interests.
80. That is the case in particular where a SLOM producer has voluntarily not resumed milk production upon expiry of a non-marketing undertaking. On this point, the Court of Justice stated in Kühn
that ‘the principle of the protection of legitimate expectations does not preclude, in the case of a scheme such as that concerning the additional levy, the imposition of restrictions on a producer by reason of the fact that he has not marketed milk or has marketed only a reduced quantity of milk during a period prior to the entry into force of that scheme, in consequence of a decision which he freely took without being encouraged to do so by a Community measure.’ (51)
81. An occupational incapacity, for example, could be cited as another possible reason for non-resumption which is unconnected with any conversion or non-marketing undertaking. (52)
82. In all these cases the SLOM producers are in the same position as any other economic operator who did not deliver milk during the reference period and who, according to settled case-law in the sphere of the common organisation of the markets, whose purpose involves constant adjustments to meet changes in the economic situation, cannot legitimately expect that he will not be subject to restrictions arising from future market policy rules or structural policy. (53)
83. Such SLOM producers must therefore accept that they will not obtain a reference quantity if they nevertheless resume milk production at a later date.
84. The comments made by the Court of First Instance on the basis of Spagl
must now be viewed in the light of this case-law.
(ii) The findings relating to protection of legitimate expectations made by the Court of First Instance on the basis of Spagl
85. Firstly, the Court of First Instance correctly stated at paragraph 43 of the judgment in Bouma
and at paragraph 42 of the judgment in Beusmans
that it follows from Spagl
that the Community could not without infringing the principle of protection of legitimate expectations automatically preclude from the grant of quotas all 83 SLOM producers, in particular those who, like Mr   Spagl, had been unable to resume production for reasons connected with their undertaking.
86. This follows from the answer given by the Court of Justice to the first question submitted for a preliminary ruling (54) in Spagl, in particular in connection with paragraph 13 thereof which the Court of First Instance reproduced verbatim.
87. Furthermore, as the Court of First Instance correctly stated at paragraph 44 of the judgment in Bouma
and paragraph 43 of the judgment in Beusmans, Spagl
must be read only in the light of the facts of the case before the national court and to the effect that the rules at issue in this case infringe the principle of protection of legitimate expectations only in that respect or only in respect of those 83 SLOM producers whose failure to deliver milk for the whole or part of the reference year derives from the fulfilment of an undertaking given under Regulation No 1078/77, and not from other reasons. By its comments on the specific situation of Mr  Spagl the Court of First Instance indicates that Mr Spagl is precisely an 83 SLOM producer who produced no milk during the reference year for reasons connected with his undertaking.
88. Moreover, these comments by the Court of First Instance concerning Spagl
should therefore probably be construed as a response to the applicants’ submission, summarised at paragraph 34 of the judgment in Bouma
and paragraph 33 of the judgment in Beusmans, that the reasons why the plaintiff in Spagl
had not resumed milk production are irrelevant.
89. Consequently, no error in law can be detected in paragraph 44 of the judgment in Bouma
and paragraph 43 of the judgment in Beusmans .
90. Finally, at paragraph 45 of the judgment in Bouma
and at paragraph 44 of the judgment in Beusmans
the Court of First Instance comes to the central finding regarding the applicability of the principle of the protection of legitimate interests to the situation of the 83 SLOM producers against which the first ground of appeal is principally directed. In the view of the Court of First Instance, the 83 SLOM producers can validly base their actions for compensation on infringement of the principle of the protection of legitimate expectations only where they show that their reasons for not resuming milk production during the reference year are connected with the fact that they stopped production for a certain time and that they were unable, for reasons to do with the organisation of that production, to resume production immediately.
91. As is clear from my comments above, this finding is consistent with the importance that the Court of First Instance has attached to the principle of protection of legitimate interests in established case-law and in Spagl, and according to which SLOM producers cannot rely on this principle if they delivered no milk during the reference period as a consequence of an – albeit only temporary – voluntary decision to give up milk production.
92. Therefore, by virtue of the principle of protection of legitimate interests it is right to require that the 83 SLOM producers who did not resume milk production upon expiry of their non-marketing undertakings show that the failure to resume milk production is connected with their undertaking or, in other words, that although they did not actually resume milk production they at least had the intention to do so.
93. Furthermore, contrary to the appellants’ view, this is not, as the Council and the Commission have correctly stated, inconsistent with the judgment in Mulder II
and the standard which the Court of First Instance applied therein to the 84 SLOM producers. On the one hand, it should be borne in mind that the non-marketing undertakings given by the 84 SLOM producers applied, unlike those given by the 83 SLOM producers, throughout the reference period and the 84 SLOM producers were therefore unable to produce milk during this period directly because of these undertakings. On the other hand, in Mulder II the Court of First Instance also considered whether the producers had the intention to resume milk production or gave it up voluntarily. (55)
94. I will examine the interpretation of the judgment in Mulder II in detail when I consider the third ground of appeal.
95. In the light of all the foregoing considerations, it must be held that in the judgments under appeal the Court of First Instance correctly interpreted the judgment in Spagl
and on the basis thereof made the correct findings regarding the principle of protection of legitimate expectations. That being so, the first ground of appeal must be dismissed as unfounded.
2. Second ground of appeal
(a) Main arguments of the parties
96. By the third ground of appeal, the appellants
essentially submit that at paragraph 46 of the judgment in Bouma
and at paragraph 45 of the judgment in Beusmans
the Court of First Instance erroneously inferred from Mulder II
that the producers whose undertaking expired before the entry into force of Regulation No 857/84 must have resumed production or at least have taken steps to do so.
97. They argue that at paragraph 23 of the above judgment cited by the Court of First Instance the Court of Justice merely found that the SLOM producers concerned had manifested their intention to resume milk production with sufficient clarity. no exhaustive list of the possible ways of manifesting intention was set out therein. Moreover, in Mulder II
the Court of Justice did not examine the particular situation of the 83 SLOM producers in any way.
98. Furthermore, only the opposite of the view taken by the Court of First Instance can be substantiated by the passages of the judgment cited by the Court of First Instance and the associated Opinion. In any event, it cannot consequently be inferred that where milk production was not resumed before 1 April 1984 there is – unless proven otherwise – a presumption that the producer concerned definitively gave up milk production.
99. By contrast, the Council
submits that in the judgments under appeal the Court of First Instance laid down no relevant legal presumption in this respect but merely applied the general rule of civil law whereby it is for the person raising a claim for damages to show that the grounds for such a claim exist. As the Court of First Instance correctly found at paragraph 46 of the judgment in Bouma
and at paragraph 45 of the judgment in Beusmans, according to Mulder II
the Community’s non-contractual liability is subject to the condition that the producers have manifested their intention to resume production.
100. The Council further points out that the appellants’ situation is not comparable with that of the applicants in Mulder II
in so far as the former were not prevented by law from resuming milk production upon expiry of their non-marketing undertakings. Overall, the Court of First Instance correctly referred to the judgment in Mulder II
and the associated Opinion.
101. The Commission
essentially concurs with the Court of First Instance that according to Mulder II
– which thus far is the Court of Justice’s only judgment concerning the Community liability to SLOM producers – the producers must have clearly manifested their intention to resume milk production upon expiry of their non-marketing undertaking. Where a producer whose non-marketing undertaking expired in 1983 did not resume production or take steps to do so, he has in principle no right to compensation.
(b) Appraisal
102. As I stated in connection with the first ground of appeal, as regards the condition relating to illegality imposed in respect of liability it is important, in so far as it constitutes a breach of the principle of the protection of legitimate interests, as to why there was no production during the reference period and why no reference quantity was therefore allocated. However, a similar question arises also as regards the requirement relating to a causal link.
103. Accordingly, there must be a – sufficiently direct – causal link between the failure to allocate a reference quantity under Regulation No 857/84 and the alleged damage in the form of loss of income from milk deliveries. (56)
104.
Where a SLOM producer produces no milk upon expiry of his non-marketing undertaking as a consequence of his freely deciding to give up milk production, the alleged damage must be attributed to that decision and not to the fact that the Community legislature failed to take account of the situation of the SLOM producers in Regulation No 857/84 and to provide for the allocation of a reference quantity to them.
105. Accordingly, the Court of Justice, to which the Court of First Instance correctly referred, found at paragraph 23 of the judgment in Mulder II that the applicants concerned in that case ‘manifested, in an appropriate manner, their intention to resume milk production, with the result that the loss of income from milk deliveries cannot be regarded as being the consequence of the applicants’ freely deciding to give up milk production.’
106. Therefore, in Mulder II
the Court of Justice found that there was the requisite causal link between the illegality in question and the loss of income from milk deliveries since the 84 SLOM producers manifested their intention to resume milk production in an appropriate manner.
107. That being so, the Court of First Instance could, contrary to the appellants’ view, correctly find on the basis of the judgment in Mulder II
and the relevant Opinion that producers whose undertaking expired before the entry into force of Regulation No 857/84 must have resumed production or at least taken steps to do so, such as making investments or repairs, or maintaining the equipment necessary for such production.
108. Therefore, where the producer does not at least take steps to resume milk production upon the expiry of his non-marketing undertaking – the list of relevant steps provided by the Court of First Instance being, according to the wording thereof, merely exemplary – even though resumption was possible at least temporarily, it may be assumed that that producer produced no milk voluntarily and not because he was prevented from doing so by Community rules.
109. In that respect the Court of First Instance merely applied the requirement laid down by the Court of Justice in Mulder II
in respect of the 84 SLOM producers, according to which the producer’s intention to resume production upon the expiry of the non-marketing undertaking must be manifest, to the situation of 83 SLOM producers who, unlike the 84 SLOM producers, had an opportunity to produce milk directly upon expiry of their undertakings, without being prevented from doing so by the rules on levies.
110. It therefore follows that at paragraph 46 of the judgment in Bouma
and at paragraph 45 of the judgment in Beusmans
the Court of First Instance correctly interpreted the judgment in Mulder II and on the basis thereof drew no conclusions erroneous in law in respect of the conditions relating to the Community’s liability to 83 SLOM producers. Therefore, the third ground of appeal is unfounded.
3. Second and fourth grounds of appeal
(a) Main submissions of the parties
111. By the second and fourth grounds of appeal, the appellants
complain of the comments made by the Court of First Instance at paragraph 48 of the judgment in Bouma
and at paragraph 47 of the judgment in Beusmans .
112. In connection with the second ground of appeal they complain that the Court of First Instance held against them the fact they did not fully resume milk production after the expiry of the reference year, that is to say during the period from 31 December 1983 to 1 April 1984. They contend that it follows from Mulder I, Spagl
and Mulder II
that 83 SLOM producers must be able to claim compensation under the same conditions as 84 SLOM producers.
113. In this connection the appellants observe that producers who resumed milk production during this period could in any case no longer have built up a normal reference quantity and were still eligible at most for the allocation of a (limited) reference quantity under the optional provisions of Regulation No 857/84. However, in its judgment in Mulder I
the Court of Justice ruled that the existence of such a theoretical possibility in no way alters the unlawfulness of the Commu nity rules. (57)
The Community institutions’ submissions to this effect were subsequently also rejected in Spagl, (58) Mulder II (59) and Quiller and Heusmann . (60) In the light of this case-law the Court of First Instance’s criticism that they did not resume milk production is therefore untenable.
114. In the view of the Council, the second ground of appeal cannot be upheld because in that respect the judgments under appeal do not concern whether the applicants could have obtained a reference quantity under the optional provisions of Regulation No 857/84 had they resumed production, but whether they actually had the intention to resume milk production.
115. In connection with the fourth ground of appeal the appellants
essentially go on to submit that at paragraph 48 of the judgment in Bouma
and at paragraph 47 of the judgment in Beusmans
the Court of First Instance wrongly placed upon them the burden of proving that they had the intention of resuming milk production upon the expiry of their non-marketing undertakings and that they found it impossible to do so owing to the entry into force of Regulation No 857/84.
116. The appellants argue that such a reversal of the burden of proof cannot be linked to the mere fact that they did not resume milk production on 1 April 1984. As they repeatedly emphasise, this fact in no way alters the rights of the 83 SLOM producers to obtain a reference quantity or compensation in respect of the period up to the allocation of a reference quantity. The obligation to provide evidence in question subjects the appellants retroactively to the consequences of the entry into force of Regulation No 857/84 and also creates problems in view of the long period of time that has elapsed since the relevant events. Before Regulation No 857/84 entered into force the SLOM producers concerned could not foresee that they would definitively lose the right to a specific reference quantity or to compensation if they had not resumed milk production by that time.
117. The appellants further submit that the obligation to provide evidence objected to is inconsistent with the wording used by the Court of First Instance at paragraph 46 of the judgment in Bouma
and paragraph 45 of the judgment in Beusmans, according to which producers must show that they have taken steps to resume milk production ‘such as making investments or repairs, or maintaining the equipment necessary for such production.’
118. The Council
and the Commission
reject the appellants’ argument that the criticised finding of the Court of Justice must be regarded as a reversal of the burden of proof. Instead, it constitutes an application of general rules on evidence. A fortiori
since the appellants did not actually resume milk production, the Court of First Instance rightly concluded that they had to prove an intention to do so. This requirement is in keeping with the decision in Mulder II .
119. The Commission further submits that at paragraph 48 of the judgment in Bouma
and paragraph 47 of the judgment in Beusmans
the Court of First Instance essentially defined – albeit in somewhat broader terms – the obligation to provide evidence in a manner substantively consistent with its findings at paragraph 46 of the judgment in Bouma
and paragraph 45 of the judgment in Beusmans .
(b) Appraisal
120. As is already evident from my comments regarding the first and third grounds for appeal, the Court of First Instance was rightly able to conclude, both on the basis of the importance of the principle of protection of legitimate interests, on whose breach the Community liability for any damage suffered by the SLOM producers as a result of Regulation No 857/84 was based, and the considerations relating to a causal link, that only 83 SLOM producers who clearly had the intention
to resume production upon expiry of their non-marketing undertakings are eligible for compensation. The Court of First Instance made this finding at paragraph 48 of the judgment in Bouma
and at paragraph 47 of the judgment in Beusmans .
121. If an 83 SLOM producer had actually resumed milk production upon expiry of this non-marketing undertaking – which Regulation No 857/84 made it impossible for him to do only as from 1 April 1984 – it would therefore be evident that he did not have any reference production or any sufficient reference production as a consequence of his voluntary decision to give up milk production.
122. If, on the other hand – as the Court of First Instance concluded in the cases of Bouma
and Beusmans
– an 83 SLOM producer did not actually resume milk production upon expiry of his non-marketing undertaking, it must be possible to prove at least an intention to do so.
123. As the Council correctly stated, in this connection it is not important as to whether or not the 83 SLOM producers could have still built up a (normal) reference quantity by resuming production pursuant to Regulation No 857/84 but to establish whether they voluntarily gave up milk production.
124. The passages from the judgments in Mulder I, (61) Spagl (62) and Mulder II (63) cited by the appellants are not relevant in this case because they concern an entirely different question, namely whether or not the rules on levies or Regulation No 857/84 actually ensure that a reference quantity is allocated to SLOM producers (in all cases).
125. Furthermore, also as regards the allocation of the burden of proof I am unable to detect any error in law that the Court of First Instance has committed by demanding from Messrs Bouma and Beusmans proof of their intention to resume milk production. In my view, this obligation to provide evidence is consistent with established case-law, according to which it is for the applicant to prove that the various conditions relating to the Community’s non-contractual liability are satisfied. (64)
126. Finally, it is also necessary to reject the complaint that there are inconsistencies in relation to the wording of the obligation to provide evidence at paragraph 46 of the judgment in Bouma
and paragraph 45 of the judgment in Beusmans . The steps referred to therein constitute nothing other than specific evidence that the requisite intention to resume production exists.
127. That being so, the Court of First Instance has not committed any error in law as regards the finding that Messrs Bouma and Beusmans had to prove their intention to resume milk production in support of their claims for compensation. Therefore, the second and fourth grounds of appeal are unfounded.
4. Fifth ground of appeal
(a) Main submissions of the parties
128. By the fifth ground of appeal the appellants
essentially submit that the Court of First Instance evaluated inaccurately the relevant facts and evidence by which they had shown their intention to resume milk production and therefore failed to fulfil the [obligation] to state reasons. In their view, they provided conclusive evidence to establish that they had not definitively given up production in 1983 and were able to resume it.
129. The appellants raise two complaints in opposition to the grounds stated for the judgments under appeal, and in particular in opposition to paragraphs 14 and 49 of the judgment in Bouma
and paragraphs 14 and 48 of the judgment in Beusmans .
130. On the one hand, they essentially object that the Court of First Instance did not take due account of their respective declarations on oath and the other information provided by their lawyer during the hearing or made incorrect findings of fact on the basis thereof. The declaration on oath made by Mr   Bouma proves – in conjunction with the information provided by his lawyer – that he re-sowed grass in autumn 1983 in order to resume milk production. The declaration made by Mr   Beusmans shows that upon expiry of his non-marketing undertaking he converted to rearing dairy and beef cows – that is to say cows which were also suitable for milk production –, that he had a sufficient number of such cows, and that he was still milking his cows in spring 1983.
131. On the other hand, the appellants essentially submit that the Court of First Instance’s finding that they had adduced no evidence to show that they contacted the national authorities with a view to obtaining a reference quantity in 1984 when the milk quota system entered into force is inaccurate and factually incorrect. In that regard they refer to the declarations that they made on oath before the Court of First Instance and to the documents submitted to it by their lawyer.
132. The Council
considers that the fifth ground of appeal is inadmissible or, in the alternative, that it is also unfounded. In its view, the evidence that the applicants claimed to have provided – namely that they had not definitively given up production and were able to resume milk production – is in any case incapable of supporting a claim for compensation in the light of the conditions laid down in Mulder II . It goes on to state that the Court of First Instance took due account of the applicants’ submissions and documents, in particular the declarations on oath, and made correct findings of fact.
133. The Commission
shares this view and notes in particular that the applicants’ complaints were essentially to the effect that the Court of First Instance did not consider that their declarations on oath constituted conclusive evidence. However, this forms part of the assessment of the evidence which is not subject to review in appeal proceedings.
(b) Appraisal
134. By the arguments put forward in this ground of appeal, the appellants essentially submit that, contrary to the view of the Court of First Instance, they have indeed proven that they had the intention to resume milk production upon expiry of their non-marketing undertakings.
135. Therefore, in actual fact they contest the finding and the assessment of the facts which the Court of First Instance made at paragraphs 49 et seq. of the judgment in Bouma
and paragraphs 48 et seq. of the judgment in Beusmans
in answer to the question whether the appellants had the intention of resuming production upon the expiry of their non-marketing undertakings and found it impossible to do so owing to the entry into force of Regulation No 857/84. (65) Furthermore, they contest the findings of fact made by the Court of First Instance at paragraph 14 of the judgment in Bouma
and in Beusmans .
136. In that connection, it must be recalled, together with the Commission, that under Article 225 EC and Article 58 of the EC Statute of the Court of Justice, an appeal lies on points of law only and that therefore the Court of First Instance alone has jurisdiction to find and appraise the facts, save where the factual inaccuracy of its findings results from the documents in the case before it. The appraisal of the facts by the Court of First Instance does not constitute, save where the clear sense of the evidence produced before it is distorted, a question of law which is subject, as such, to review by the Court of Justice. (66)
137. Moreover, in their complaints the appellants do not allege that the Court of First Instance distorted the evidence before it, nor is this evident.
138. Therefore, the fifth ground of appeal must be dismissed as inadmissible.
VII – Costs
139. Under Article 69(2) of the Rules of Procedure, which, pursuant to Article 118, applies to the procedure on appeal, the unsuccessful party is to be ordered to pay the costs. If the appeal is dismissed in its entirety, as I propose, on the ground that all the parts thereof are unfounded or inadmissible, the appellant must be ordered to pay the costs.
VIII – Conclusion
140. For the reasons set out above, I propose that the Court should
(1) dismiss the appeal and
(2) order the appellants to pay the costs.
(1) .
(2)
–	Case T-533/93 Bouma
v Council and Commission
[2001] ECR II-203.
(3)
–	Case T-73/94 Beusmans v Council and Commission
[2001] ECR II-223.
(4)
–	From the Dutch ‘ sl achten en om schakelen’ (‘slaughter and convert’).
(5)
–	Council Regulation (EEC) No 1078/77 of 17 May 1977 introducing a system of premiums for the non-marketing of milk and milk products and for the conversion of dairy herds (OJ 1977 L 131, p. 1).
(6)
–	Council Regulation (EEC) No 857/84 of 31 March 1984 adopting general rules for the application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector (OJ 1984 L 90, p. 13).
(7)
–	Cited in footnote 5 above.
(8)
–	OJ 1984 L 90, p. 10.
(9)
–	Cited in footnote 6 above.
(10)
–	Case 120/86 Mulder
v Minister van Landbouw en Visserij
[1988] ECR 2321.
(11)
–	Case 170/86 Von Deetzen
v Hauptzollamt Hamburg-Jonas
[1988] ECR 2355.
(12)
–	Commission Regulation (EEC) No 1371/84 of 16 May 1984 laying down detailed rules for the application of the additional levy referred to in Article 5c of Regulation (EEC) No 804/68 (OJ 1984 L 132, p. 11).
(13)
–	OJ 1989 L 84, p. 2.
(14)
–	Commission Regulation (EEC) No 1546/88 of 3 June 1988 laying down detailed rules for the application of the additional levy referred to in Article 5c of Regulation (EEC) No 804/68 (OJ 1988 L 139, p. 12), as amended by Commission Regulation (EEC) No 1033/89 of 20 April 1989 (OJ 1989 L 110, p. 27), required in Article 3a(1) that requests for the grant of a special reference quantity be made by the producers concerned ‘to the competent authority designated by the Member State ... provided that the producers can prove that they still operate, in whole or in part, the same holdings as those they operated at the time ... of their premium applications.’
(15)
–	Case C-189/89 Spagl v Hauptzollamt Rosenheim
[1990] ECR I-4539.
(16)
–	Case C-217/89 Pastätter v Hauptzollamt Bad Reichenhall
[1990] ECR I-4585.
(17)
–	OJ 1991 L 150, p. 35.
(18)
–	Case C-264/90 Wehrs v Hauptzollamt Lüneburg
[1992] ECR I-6285.
(19)
–	OJ 1993 L 187, p. 8.
(20)
–	Joined Cases C-104/89 and C-37/90 Mulder and Others v Council and Commission
[1992] ECR I-3061.
(21)
–	OJ 1992 C 198, p. 4.
(22)
–	OJ 1993 L 196, p. 6.
(23)
–	Moreover, as is laid down in Article 2 of this regulation, under the conditions set out in Article 3a(3) of Regulation No 857/84, either on 29 March 1991 pursuant to Regulation No 764/89 or on 1 July 1993 pursuant to Regulation No 1639/91.
(24)
–	Joined Cases C-104/89 and C-37/90 Mulder and Others v Council and Commission
[2000] ECR I-203.
(25)
–	Loc. cit., paragraph 7.
(26)
–	See paragraphs 14 to 17 of the judgment in Bouma
(cited in footnote 2 above) and paragraphs 14 to 16 of the judgment in Beusmans
(cited in footnote 3 above).
(27)
–	See Case T-533/93, cited in footnote 2 above, paragraphs 24 and 29 et seq. and Case T-73/94, cited in note 3 above, paragraphs 23 and 28 et seq.
(28)
–	See paragraphs 31 et seq. of the judgment in Bouma, cited in footnote 2 above, and paragraphs 30 et seq. of the judgment in Beusmans, cited in footnote 3 above.
(29)
–	Paragraphs 39 and 40 of the judgment in Bouma, cited in footnote 2 above, and paragraphs 38 and 39 of the judgment in Beusmans, cited in footnote 3 above.
(30)
–	Paragraph 41 of the judgment in Bouma, cited in footnote 2 above, and paragraph 40 of the judgment in Beusmans, cited in footnote 3 above.
(31)
–	Paragraph 42 of the judgment in Bouma, cited in footnote 2 above, and paragraph 41 of the judgment in Beusmans, cited in footnote 3 above.
(32)
–	Paragraphs 43 and 44 of the judgment in Bouma, cited in footnote 2 above, and paragraphs 42 and 43 of the judgment in Beusmans, cited in footnote 3 above.
(33)
–	Paragraph 43 of the judgment in Bouma, cited in footnote 2 above, and paragraph 44 of the judgment in Beusmans, cited in footnote 3 above.
(34)
–	Paragraph 46 of the judgment in Bouma, cited in footnote 2 above, and paragraph 45 of the judgment in Beusmans, cited in footnote 3 above.
(35)
–	Paragraph 48 of the judgment in Bouma, cited in footnote 2 above, and paragraph 47 of the judgment in Beusmans, cited in footnote 3 above.
(36)
–	Paragraphs 50 to 55 of the judgment in Bouma, cited in footnote 2 above, and paragraphs 49 to 52 of the judgment in Beusmans, cited in footnote 3 above.
(37)
–	Paragraph 54 of the judgment in Bouma, cited in footnote 2 above, and paragraphs 53 of the judgment in Beusmans, cited in footnote 3 above.
(38)
–	See, in that respect, the distinction which the Court draws between the SLOM I, SLOM II and SLOM III schemes in Case C-273/98 Schlebusch v Hauptzollamt Trier
[2000] ECR I-3889, paragraphs 5 to 11.
(39)
–	See, to that effect, my comments above at paragraph 17 et seq.
(40)
–	See paragraph 21 and footnote 29 above. Thus, both SLOM I and SLOM II producers were in principle eligible for such compensation, but SLOM III producers were not.
(41)
–	See, inter alia, Case C-217/01 P Hendrickx v Cedefop
[2003] ECR I-3701, paragraph 37, Case C-274/00 P Simon
v Commission
[2002] ECR I-5999, paragraph 39, and Case C-136/92 P Commission v Brazzelli Lualdi and Others [1994] ECR I-1981, paragraph 29.
(42)
–	The grounds of appeal raised and the submissions of the parties are – apart from certain exceptions primarily in connection with the fifth ground which result from differences in the
facts underlying the main proceedings – largely identical in both cases.
(43)
–	The applicants substantiate this contention also by referring to Case C-85/90 Dowling [1992] ECR I-5305, paragraph 25.
(44)
–	Opinion of Advocate General Jacobs in Case C-189/89, cited in footnote 15 above, paragraphs 25 and 31.
(45)
–	Joined Cases T-195/94 and T-202/94 Quiller and Heusmann v Council and Commission
[1997] ECR II-2247, paragraphs 94 and 97.
(46)
–	See in particular Case C-257/98 P Lucaccioni
v Commission
[1999] ECR I-5251, paragraph 11, Case C-136/92 P, cited in footnote 41 above, paragraph 42, and Case 50/86 Grands Moulins de Paris
v EEC
[1987] ECR 4833, paragraph 7.
(47)
–	See Mulder II, cited in footnote 20 above, paragraphs 12 to 17 and 22.
(48)
–	See, inter alia, Case C-14/01 Molkerei Wagenfeld
v Bezirksregierung Hannover
[2003] ECR I-2279, paragraph 56, Case C-63/93 Duff and Others
v Minister for Agriculture and Food and Attorney General
[1996] ECR I-569, paragraph 20, and Case C-177/90 Kühn
v Landwirtschaftskammer Weser-Ems
[1992] ECR I-35, paragraph 14.
(49)
–	See, inter alia, Mulder I, cited in footnote 10 above, paragraph 24, Von Deetzen, cited in footnote 11 above, paragraph 13, and Wehrs, cited in footnote 18 above, paragraph 8.
(50)
–	See, inter alia, Mulder I, cited in footnote 10 above, paragraph 23, and Von Deetzen, cited in footnote 11 above, paragraph 12.
(51)
–	Case C-177/90, cited in footnote 48 above, paragraph 15.
(52)
–	See, to that effect, Dowling, cited in footnote 43, paragraph 20.
(53)
–	See, inter alia, Case C-104/97 P Atlanta and Others v Commission and Council
[1999] ECR I-6983, paragraph 52, Mulder I, cited in footnote 10 above, paragraph 23, and Von Deetzen, cited in footnote 11 above, paragraph 12.
(54)
–	See, to that effect, paragraphs 15 and 17 of the judgment.
(55)
–	See Mulder II, cited in footnote 20 above, paragraph 23.
(56)
–	See, for example, Joined Cases 64/76 and 113/76, 167/78 and 239/78, 27/79, 28/79 and 45/79 Dumortier frères and Others v Council [1979] ECR 3091, paragraph 21.
(57)
–	At paragraphs 15 to 19 of Mulder I, cited in footnote 10 above.
(58)
–	At paragraph 14 of the judgment and at paragraphs 25 and 28 to 30 of the Opinion of Advocate General Jacobs (judgment cited in footnote 15 above).
(59)
–	At paragraphs 17, 24 and 25, cited in footnote 20 above.
(60)
–	At paragraphs 94 and 97, cited in footnote 45 above.
(61)
–	Paragraphs 15 to 19, cited in footnote 10 above.
(62)
–	Paragraph 14, cited in footnote 15 above.
(63)
–	Paragraphs 17, 24 and 25, cited in footnote 20 above.
(64)
–	See, inter alia, Case C-257/98 P, cited in footnote 46 above, paragraph 63.
(65)
–	The Court of First Instance laid down this criterion previously at paragraph 48 of the judgment in Bouma
and paragraph 47 of the judgment in Beusmans . See, on that subject, my comments regarding the fourth ground of appeal.
(66)
–	See, in particular, Case C-121/01 P O’Hannrachain v Parliament
[2003] ECR I-5539, paragraph 35, Case C-122/01 P T. Port v Commission
[2003] ECR I-4261, paragraph 27, Case C-449/99 P EIB v Hautem
[2001] ECR I-6733, paragraph 44, and Case C-184/01 P Hirschfeldt v EEA
[2002] ECR I-10173, paragraph 40.