Judgment of the Court (Second Chamber) of 31 May 1979. - Frederick H. Newth v Commission of the European Communities. - Case 156/78.



European Court reports 1979 Page 01941

Greek special edition Page 00989



Summary

Parties

Subject of the case

Grounds

Decision on costs

Operative part



Keywords

1 . OFFICIALS - RETIREMENT IN THE INTERESTS OF THE SERVICE - ALLOWANCE - DETERMINATION OF CURRENCY OF PAYMENT - APPLICATION BY ANALOGY OF THE SYSTEM OF PAYMENT OF SALARIES , PENSIONS AND ALLOWANCES FOR PREMATURE TERMINATION OF SERVICE - NOT PERMISSIBLE

( STAFF REGULATIONS OF OFFICIALS , FIFTH PARAGRAPH OF ART . 50 )

2 . OFFICIALS - RETIREMENT IN THE INTERESTS OF THE SERVICE - ALLOWANCE - APPLICATION OF WEIGHTING FOR LAST PLACE OF EMPLOYMENT - BREACH OF EQUALITY OF TREATMENT - DUTY OF ADMINISTRATION

( STAFF REGULATIONS OF OFFICIALS , FIFTH PARAGRAPH OF ART . 50 )

Summary

1 . IT IS NOT POSSIBLE , FOR THE PURPOSE OF DETERMINING THE CURRENCY IN WHICH THE ALLOWANCE PAYABLE ON RETIREMENT IN THE INTERESTS OF THE SERVICE UNDER THE FIFTH PARAGRAPH OF ARTICLE 50 OF THE STAFF REGULATIONS OF OFFICIALS IS TO BE REMITTED , TO APPLY BY ANALOGY THE RULES GOVERNING PAYMENT OF OFFICIALS ' SALARIES ( ARTICLE 63 OF THE STAFF REGULATIONS ), PAYMENT OF PENSIONS ( ARTICLE 82 OF THE STAFF REGULATIONS ) AND PAYMENT OF THE ALLOWANCES PROVIDED FOR IN THE EVENT OF PREMATURE TERMINATION OF SERVICE FOLLOWING THE MERGER OF THE EXECUTIVE BODIES OF THE COMMUNITIES AND THE ACCESSION OF THE NEW MEMBER STATES ( REGULATIONS NOS 259/68 , 2530/72 AND 1543/73 ). IN FACT , IN CONTRAST TO THE TEXTS EMBODYING THOSE GENERAL RULES , WHICH ESTABLISH A DIRECT LINK BETWEEN THE PLACE WHERE THE PERSONS ENTITLED TO THE PENSION OR ALLOWANCE DECLARE THEIR HOME TO BE AND THE WEIGHTING APPLICABLE , THUS BY IMPLICATION INDICATING THE CORRESPONDING CURRENCY OF PAYMENT , THE FIFTH PARAGRAPH OF ARTICLE 50 OF THE STAFF REGULATIONS ESTABLISHES A CLOSE LINK BETWEEN THE WEIGHTING AND THE PLACE WHERE THE OFFICIAL WAS LAST EMPLOYED , AN EXPRES- SION WHICH CANNOT BE INTERPRETED AS MEANING PLACE OF ' ' RESIDENCE ' ' .

2 . THE FIFTH PARAGRAPH OF ARTICLE 50 OF THE STAFF REGULATIONS MUST BE INTERPRETED TO MEAN THAT WHERE ITS APPLICATION IS LIKELY TO RESULT IN A BREACH OF A SUPERIOR RULE OF LAW SUCH AS THE PRINCIPLE OF EQUALITY AMONG OFFICIALS WHOSE CIRCUMSTANCES ARE SIMILAR , THE ADMINISTRATION IS OBLIGED , IN ORDER TO AVOID SUCH A RESULT , NOT TO APPLY THE WEIGHTING FIXED FOR THE PLACE WHERE THE OFFICIAL WAS LAST EMPLOYED .

Parties

IN CASE 156/78

FREDERICK H . NEWTH , A FORMER OFFICIAL OF THE COMMISSION OF THE EUROPEAN COMMUNITIES , RESIDING AT 88 AVENUE LEOPOLD WIENER , 1170 BRUSSELS , REPRESENTED BY MARCEL SLUSNY , OF THE BRUSSELS BAR , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG C/O ARIE GULDEN , 9 RUE DE LA MONTAGNE , TRINTANGE ,

APPLICANT ,

COMMISSION OF THE EUROPEAN COMMUNITIES , REPRESENTED BY ITS LEGAL ADVISER , ALAIN VAN SOLINGE , ACTING AS AGENT , ASSISTED BY DANIEL JACOB , OF THE BRUSSELS BAR , 36 RUE DE PRAETERE , 1050 BRUSSELS , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE OFFICE OF MARIO CERVINO , LEGAL ADVISER AT THE COMMISSION , JEAN MONNET BUILDING , KIRCHBERG ,

DEFENDANT ,

Subject of the case

APPLICATION FOR THE ANNULMENT OF THE COMMISSION ' S DECISION OF 20 APRIL 1978 REJECTING THE COMPLAINT SUBMITTED BY MR NEWTH AND FOR THE PAYMENT IN BELGIAN FRANCS OF THE ALLOWANCES DUE TO HIM ,

Grounds

1THE APPLICATION LODGED ON 18 JULY 1978 SEEKS TO OBTAIN THE PAYMENT IN BELGIAN FRANCS OF THE ALLOWANCE TO WHICH THE APPLICANT IS ENTITLED BY VIRTUE OF ARTICLE 50 OF THE STAFF REGULATIONS .

THE FACTS WHICH LED UP TO THE LODGING OF THE APPLICATION ARE AS FOLLOWS :

2ON 1 MAY 1975 THE APPLICANT WAS RECRUITED IN GRADE A 2 UNDER ARTICLE 29 ( 2 ) OF THE STAFF REGULATIONS AS A DIRECTOR AT THE ISPRA JOINT RESEARCH CENTRE .

3BY DECISION OF 28 SEPTEMBER 1977 , ADOPTED ON THE BASIS OF THE FIRST PARAGRAPH OF ARTICLE 50 OF THE STAFF REGULATIONS , THE APPLICANT WAS RETIRED IN THE INTERESTS OF THE SERVICE WITH EFFECT FROM 1 NOVEMBER 1977 AND AWARDED A DECREASING ALLOWANCE CALCULATED IN ACCORDANCE WITH THE TERMS OF ANNEX IV AND WEIGHTED IN ACCORDANCE WITH THE FIFTH PARAGRAPH OF ARTICLE 50 AT THE RATE FIXED FOR THE PLACE WHERE HE WAS LAST EMPLOYED .

4AS THE COMMISSION CONSIDERS A CLOSE LINK TO EXIST BETWEEN THE WEIGHTING AND THE CURRENCY OF THE COUNTRY WHERE THE OFFICIAL WAS LAST EMPLOYED , IT PAYS THAT ALLOWANCE IN ITALIAN CURRENCY .

5IT IS ESTABLISHED THAT ON HIS RECRUITMENT THE APPLICANT WAS WORKING AND RESIDING IN BELGIUM AND THAT FOLLOWING HIS DISMISSAL HE RETURNED TO BELGIUM AND THE APPLICANT THEREFORE REQUESTS THAT HIS ALLOWANCE BE PAID TO HIM IN BELGIAN FRANCS WITHOUT CONVERSION INTO ITALIAN LIRE , THAT THE COMMISSION ADJUST HIS ACCOUNT AND THAT IT BE ORDERED TO PAY THE ARREARS DUE .

6IN SUPPORT OF HIS CONCLUSIONS THE APPLICANT RELIES ON THREE SUBMISSIONS , WHICH WILL BE CONSIDERED IN TURN .

7IN A FIRST SUBMISSION THE APPLICANT MAINTAINS THAT AS ARTICLE 50 DOES NOT MAKE ANY EXPRESS PROVISION FOR THE CURRENCY IN WHICH THE ALLOWANCE PAYABLE ON RETIREMENT IN THE INTERESTS OF THE SERVICE IS TO BE REMITTED THAT LACUNA MUST BE FILLED BY ANALOGY WITH THE RULES GOVERNING PAYMENT OF SALARIES LAID DOWN IN ARTICLE 63 OF THE STAFF REGULATIONS , PAYMENT OF PENSIONS LAID DOWN IN ARTICLE 82 OF THE STAFF REGULATIONS AND PAYMENT OF THE ALLOWANCES PROVIDED FOR BY THE REGULATIONS CONCERNING PREMATURE TERMINATION OF SERVICE FOLLOWING THE MERGER OF THE EXECUTIVE BODIES OF THE COMMUNITIES AND THE ACCESSION OF THE NEW MEMBER STATES ( REGULATION NO 259/68 OF THE COUNCIL OF 29 FEBRUARY 1968 , OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1968 ( I ), P . 30 , REGULATION NO 2530/72 OF THE COUNCIL OF 4 DECEMBER 1972 , OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1972 ( 1-8 DECEMBER ), P . 11 , AND REGULATION NO 1543/73 OF THE COUNCIL OF 4 JUNE 1973 , OFFICIAL JOURNAL L 155 OF 11 JUNE 1973 , P . 1 ), SINCE THE TEXTS WHICH EMBODY THOSE RULES ESTABLISH A DIRECT LINK BETWEEN THE PLACE WHERE THE PERSONS ENTITLED TO THE PENSION OR ALLOWANCE DECLARE THEIR HOME TO BE AND THE WEIGHTING APPLICABLE ( WHOSE AIM IS TO COMPENSATE FOR THE NATIONAL VARIATIONS IN THE COST OF LIVING ) AND THUS BY IMPLICATION INDICATE THE CORRESPONDING CURRENCY OF PAYMENT .

8HOWEVER , IT DOES NOT APPEAR THAT IT IS POSSIBLE FOR REASONING BY ANALOGY TO EXTEND THE APPLICATION OF THOSE GENERAL RULES TO ARTICLE 50 , WHICH DEALS WITH A VERY SPECIAL SITUATION AND WHOSE FIFTH PARAGRAPH ESTABLISHED A CLOSE LINK BETWEEN THE WEIGHTING AND THE PLACE WHERE THE OFFICIAL WAS LAST EMPLOYED , AN EXPRESSION WHICH CANNOT BE INTERPRETED AS MEANING PLACE OF ' ' RESIDENCE ' ' .

9IN A SECOND SUBMISSION THE APPLICANT MAINTAINS THAT THE IMPERMANENCE OF THE DUTIES PERFORMED AT THAT LEVEL JUSTIFIES THE EXISTENCE OF SPECIAL RULES FOR THE ALLOWANCES PAID IN THE CASE OF TERMINATION OF SERVICE .

10IT IS , HOWEVER , OF NO IMPORTANCE IN THIS INSTANCE WHETHER THE DUTIES PERFORMED WERE UNDERTAKEN ONLY PROVISIONALLY OR ON A PERMANENT BASIS , SINCE THE ESSENTIAL FACTOR IS THE APPOINTMENT OF THE APPLICANT AS AN OFFICIAL , EVEN IF THAT APPOINTMENT TAKES PLACE IN A GRADE IN WHICH THE PERSON APPOINTED MAY BE RETIRED IN THE INTERESTS OF THE SERVICE AT THE DISCRETION OF THE APPOINTING AUTHORITY AND BY ITS DECISION .

11IT IS THEREFORE NECESSARY TO CONSIDER ONLY THE CONSEQUENCES OF THE PREMATURE TERMINATION OF SERVICE UNDER ARTICLE 50 AND NOT THE CAUSES OF THAT TERMINATION .

12IN A THIRD SUBMISSION THE APPLICANT MAINTAINS THAT THE APPLICATION OF ARTICLE 50 AS INTERPRETED BY THE COMMISSION RESULTS IN DISCRIMINATION , SINCE HE RECEIVES AN ALLOWANCE WHICH IS CONSIDERABLY LESS THAN THAT WHICH WOULD BE RECEIVED BY AN OFFICIAL OF THE SAME GRADE WHO HAD WORKED IN BRUSSELS . IT MUST BE NOTED THAT THE COMMISSION ' S CALCULATIONS SHOW THAT THE APPLICANT IN FACT RECEIVES 30% TO 35% LESS THAN AN OFFICIAL WHOSE LAST PLACE OF EMPLOYMENT WAS IN BRUSSELS .

13IT IS CLEAR THAT THE EXISTENCE OF SUCH A SITUATION IS ASTONISHING , PARTICULARLY AS IT MAY BE REGARDED AS NORMAL IN THE PRESENT CIRCUMSTANCES FOR THE APPLICANT , WHO LEFT HIS PLACE OF RESIDENCE IN BRUSSELS TO TAKE UP HIS DUTIES AT HIS PLACE OF EMPLOYMENT , TO HAVE RETURNED TO HIS FORMER PLACE OF RESIDENCE AS SOON AS HE TERMINATED HIS SERVICE . THE COMMISSION IS , MOREOVER , VERY CONSCIOUS OF THE INJUSTICE OF THAT SITUATION , SINCE IT IS STILL CONSIDERING HOW TO MAKE APPROPRIATE PROVISION FOR AN EQUITABLE SOLUTION TO SUCH CASES , WHICH , MOREOVER , ARE NOT VERY COMMON . ORIGINALLY , NO WEIGHTING WAS APPLIED TO THE ALLOWANCE PROVIDED FOR IN ARTICLE 50 . THE PRESENT PROVISION WAS DRAWN UP IN 1971 AND THE COMMISSION HAS JUST SUBMITTED FRESH WORDING TO THE COUNCIL WHICH WOULD INTRODUCE INTO ARTICLE 50 APPLICATION OF THE WEIGHTING FIXED FOR THE PLACE OF RESIDENCE . THE APPLICANT THEREFORE SUFFERS DISCRIMINATION AS COMPARED TO OTHER OFFICIALS IN A COMPARABLE SITUATION , FOR EXAMPLE , THOSE TO WHOM THE REGULATIONS RELATING TO PREMATURE TERMINATION OF SERVICE WERE APPLIED FOLLOWING THE MERGER OF THE EXECUTIVE BODIES AND THE ACCESSION OF THE NEW MEMBER STATES , OR THOSE WHOSE LAST PLACE OF EMPLOYMENT WAS BRUSSELS AND WHO TAKE UP RESIDENCE IN ITALY . THAT SITUATION IS CAUSED BY THE APPLICATION OF A GENERAL RULE , WHICH , IN THE APPLICANT ' S SPECIAL CASE , CONSTITUTES A BREACH OF THE PRINCIPLE OF EQUALITY AMONG OFFICIALS WHOSE CIRCUMSTANCES ARE SIMILAR . IN ORDER TO AVOID THAT DISCRIMINATION AND VERY CONSIDERABLE FINANCIAL LOSSES AN OFFICIAL IN THE POSITION OF THE APPLICANT WOULD THEREFORE BE OBLIGED TO TAKE UP RESIDENCE AT THE PLACE WHERE HE WAS LAST EMPLOYED . THE FIFTH PARAGRAPH OF ARTICLE 50 MUST THEREFORE BE INTERPRETED TO MEAN THAT WHERE , AS IN THE PRESENT CASE , ITS APPLICATION IS LIKELY TO RESULT IN A BREACH OF A SUPERIOR RULE OF LAW , THE COMMISSION IS OBLIGED , IN ORDER TO AVOID SUCH A RESULT , NOT TO APPLY THE WEIGHTING FIXED FOR THE PLACE WHERE THE OFFICIAL WAS LAST EMPLOYED .

14BY VIRTUE OF ARTICLE 91 OF THE STAFF REGULATIONS THE COURT HAS UNLIMITED JURISDICTION IN DISPUTES OF A FINANCIAL CHARACTER AND ACCORDINGLY REQUESTS THE COMMISSION TO DETERMINE THE RIGHTS OF THE APPLICANT WITH ALL DUE PRECISION .

Decision on costs

COSTS

15THE COMMISSION HAS FAILED IN ITS SUBMISSIONS .

16ARTICLE 69 ( 2 ) OF THE RULES OF PROCEDURE , UNDER WHICH THE UNSUCCESSFUL PARTY IS TO BE ORDERED TO PAY THE COSTS , IS APPLICABLE .

Operative part

ON THOSE GROUNDS ,

THE COURT ( SECOND CHAMBER )

HEREBY :

1 . DECLARES THAT THE APPLICANT IS ENTITLED TO PAYMENT OF THE ALLOWANCE REFERRED TO IN THE FIFTH PARAGRAPH OF ARTICLE 50 OF THE STAFF REGULATIONS , EXPRESSED IN BELGIAN FRANCS , WEIGHTED AT THE RATE FIXED FOR BELGIUM ;

2 . ORDERS THE COMMISSION TO ADJUST THE APPLICANT ' S ACCOUNT AND PAY HIM THE ARREARS DUE TO HIM ;

3 . ORDERS THE COMMISSION TO PAY THE COSTS .