JUDGMENT OF THE COURT OF FIRST INSTANCE (First Chamber)

30 November 1994

Case T-498/93

Yvonne Dornonville de la Cour

v

Commission of the European Communities

‛Officials — Dependent child allowance for a child of full age suffering from a serious illness or disability — Withdrawal of a decision’

Full text in Danish II-813

Application for:

— annulment of the decision of the Commission terminating the payment to the applicant of dependent child allowance in respect of a child of full age suffering from a serious illness;

— an order requiring the Commission to pay the said allowance and damages.

Decision:

Annulment of the contested decision in so far as it withheld payment of the allowance for August 1992 and an order against the Commission to pay DKR 5610.55 together with default interest at the rate of 8% per annum from 1 September 1992; for the remainder, application dismissed.

Abstract of the Judgment

The applicant, a former Commission official, has been in receipt of an invalidity pension since 1983. On taking up her post, she was entitled to dependent child allowance for her daughter until 1978, when the latter reached the age of 26.

By letter of 24 September 1988, the applicant applied for the grant of dependent child allowance on the ground that her daughter, having contracted a mental illness and made a suicide attempt in 1986, was incapable of working and earning a livelihood.

By decision of 9 February 1989, the Commission granted the allowance for the period from 1 December 1988 until 30 November 1991. The effect of the decision was to bring the applicant's daughter within the cover of the Joint Sickness Insurance Scheme.

By decision of 26 October 1989, the Commission, at the applicant's request, doubled the dependent child allowance for the period from 1 September 1989 until 31 August 1992, pursuant to Article 67(3) of the Staff Regulations.

By letter of 10 August 1992, the Commission informed the applicant that, with effect from 1 August 1992, the allowance granted in respect of her daughter could no longer be paid.

By a letter of 24 August 1992, which remained unanswered, the applicant requested the Commission to continue the double dependent child allowance beyond the date envisaged by the decision of 26 October 1989.

The applicant lodged a complaint against the Commission decision of 10 August 1992, which was rejected by an express decision.

The claim for annulment of the decision of 10 August 1992, in so far as it terminated the dependent child allowance from 1 September 1992

The plea alleging misapplication by the Commission of the relevant provisions of the Staff Regulations

The Court observes, as a preliminary point, that Article 2(3) and (5) of Annex VII to the Staff Regulations, unlike Article 2(4), confer upon the competent authority only a circumscribed power (paragraph 31).

See: C-70/91 P Council v Brems [1992] ECR I-2973, para. 5; T-75/89 Brems v Council [1990] ECR II-899, para. 23

The Court finds, first, that Article 2(5) of Annex VII to the Staff Regulations does not, either on a literal interpretation or in the light of its context, exclude the possibility that payment of the allowance in question might be temporarily interrupted. The dependent child allowance is granted for social purposes, justified by expenses arising from a present and definite need connected with the existence of, and the cost of actually maintaining, the child. The objective of Article 2(5) undoubtedly extends to cases in which payment of the allowance has been temporarily interrupted (paragraphs 33 to 35).

See: Council v Brems, cited above, para. 9; T-41/89 Schwettlerv Parliament [1990] ECR II-79, para. 18

Nor, secondly, is there any express restriction in the wording of Article 2(5) to the effect that serious illness or disability of the child cannot give rise to a right to an allowance under that provision unless it was contracted before the age of 18 or 26 respectively. As for the purpose of the provision, there can be no doubt that the same considerations connected with the existence of the child and the cost of actually maintaining him or her may also apply in cases where a serious illness or disability first manifests itself at a more advanced age (paragraph 37).

Finally, as regards the coverage by the Danish social security system, of which the applicant's daughter has had the benefit since 1989, it should be noted that Article 2(5) does not confer entitlement to the allowance unless the serious illness or disability prevents the child concerned from earning a livelihood. Since the Community law provisions conferring entitlement to financial benefits must be strictly interpreted, it has to be verified in each individual case, where payment has been extended solely on the strength of Article 2(5), whether the social purpose of paying the dependent child allowance has been achieved. That is no longer the case if it is shown that the serious illness or disability confers an independent right to national benefits of such an amount that the person concerned can no longer be regarded as being in need for the purposes of Article 2(5). The fixing of that amount by the College of Heads of Administration at 40% of the remuneration of an official of Grade D 4, Step 1, is a correct interpretation of that provision (paragraphs 38 and 39).

See: 146,192 and 193/81 Bay Wa v Balm [1982] ECR 1503, para. 10; Schwedlerv Parliament, cited above, para. 23

The definition by the same body of ‘heavy expenditure’, within the meaning of Article 67(3) of the Staff Regulations, as only those expenses which exceed 20% of an official's remuneration or pension is also a correct interpretation (paragraph 41).

Since the resources of the applicant's daughter herself are well in excess of the 40% referred to above, and the monthly sums paid by the applicant to her daughter do not exceed the 20% threshold, the submission that the Commission misapplied the relevant provisions of the Staff Regulations is rejected.

The plea alleging breach by the Commission of the general principles of legal certainty, the protection of acquired rights, and the protection of legitimate expectations

It is settled law that the right to rely on the principle of the protection of legitimate expectations extends to any individual whom the administration has led to entertain reasonable expectations, but breach of that principle may not be pleaded unless the administration has given him precise assurances. Since, in this case, the right to the grant of the disputed allowance was limited to a period expiring on 31 August 1992, the applicant cannot deduce from it any assurance by the Commission that the allowance would continue to be paid after that date (paragraph 46).

See: T-123/89 Chomel v Commission [1990] ECR II-131, paras 25 and 26

Moreover, since the invalidity pension granted to the applicant's daughter under the Danish social security system exceeded the own resources ceiling applicable to the dependent child allowance, the decision of 26 October 1989 must be regarded as erroneous and its revocation for the future as a possibility (paragraph 47).

See: 54/77 Herpels v Commission [1978] ECR 585, para. 38

The claim for annulment of the decision of 10 August 1992, in so far as it withdrew the allowance for August 1992

Since the decision of 26 October 1989 granted the allowance from 1 September 1989 until 31 August 1992, and the withdrawal of the allowance with effect from 1 August 1992 was not communicated to the applicant until after that month had already begun, the effect of the decision of 10 August 1992 was to withdraw retroactively an administrative measure which, as the Court has just held, is unlawful. However, the administration's right to withdraw such a measure is restricted by the need to fulfil the legitimate expectations of a beneficiary of the measure, who has been led to rely on the lawfulness thereof (paragraph 53).

See: C-248/89 Cargill v Commission [1991] ECR I-2987, para. 20

By expressly limiting the validity of its decision to a period expiring on 31 August 1992, the Commission led the applicant to expect that the allowance would be paid until that date. In this case, the withdrawal of the allowance was too abrupt, and must thus be regarded as an excessive measure which must therefore be annulled (paragraphs 54 and 56).

The claim for default interest

As this claim falls within its unlimited jurisdiction, the Court considers that it should be allowed, and the rate of default interest fixed at 8% per annum. Since each monthly payment of the allowance was made in arrears for the preceding month, the interest should be paid as from 1 September 1992 (paragraph 60).

See: T-4/92 Vardakas v Commission [1993] ECR II-357, para. 49

The claim for damages

To establish her claim for damages, the applicant must show that the Commission committed a service-related fault causing her nonmaterial damage. Since the decision to terminate payment of the dependent child allowance was lawful, it cannot constitute a service-related fault. Since the decision revoking the allowance came only a few days before the end of the validity of the decision of 26 October 1989 which granted it, that also excludes any finding of a service-related fault. As for the withholding of the allowance for August 1992, which has been annulled, the Court, in the exercise of its unlimited jurisdiction in the matter, takes the view that that is an element which is not severable from the shock caused by the withdrawal of the allowance as a whole and is not therefore capable of causing the applicant separate nonmaterial damage (paragraphs 63 to 65).

Operative part:

1. The Commission's decision withholding the payment to the applicant of dependent child allowance for August 1992 is annulled.

2. The Commission is ordered to pay the applicant the sum of DKR 5610.55 together with default interest at the rate of 8% per annum from 1 September 1992.