CELEX: 61996CC0397
Language: en
Date: 1999-05-04 00:00:00
Title: Opinion of Mr Advocate General Saggio delivered on 4 May 1999. # Caisse de pension des employés privés v Dieter Kordel, Rainer Kordel and Frankfurter Allianz Versicherungs AG. # Reference for a preliminary ruling: Landgericht Trier - Germany. # Social security - Institution responsible for benefits - Right of action against liable third party - Subrogation. # Case C-397/96.

Important legal notice

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61996C0397

Opinion of Mr Advocate General Saggio delivered on 4 May 1999.  -  Caisse de pension des employés privés v Dieter Kordel, Rainer Kordel and Frankfurter Allianz Versicherungs AG.  -  Reference for a preliminary ruling: Landgericht Trier - Germany.  -  Social security - Institution responsible for benefits - Right of action against liable third party - Subrogation.  -  Case C-397/96.  

European Court reports 1999 Page I-05959

Opinion of the Advocate-General

1 By order of 29 November 1996, the Ladgericht Trier (Germany) referred to the Court of Justice for a preliminary ruling a question on the interpretation of Council Regulation (EEC) No 1408/71 on the application of social security schemes to employed persons and their families moving within the Community, (1) as amended by Council Regulation (EEC) No 2001/83 (2) (hereinafter `the Regulation'). That question, supplemented by further order of 24 October 1997, concerns the extent of the rights of action accorded to institutions responsible for social security benefits under Article 93(1)(a) of the Regulation. The relevant Community and national legislation 2 The Regulation co-ordinates the social security schemes which apply in the Member States to employed persons and to members of their families moving within the Community, in order to promote freedom of movement for workers and to contribute towards the improvement of their standard of living and conditions of employment. As stated in the fifth recital in the preamble to the Regulation, to that end, the Regulation guarantees `within the Community firstly equality of treatment for all nationals of Member States under the various national legislations and secondly social security benefits for workers and their dependents regardless of their place of employment or of residence'. 3 Within Title II of the Regulation, which lays down rules for determining which legislation is applicable, Article 13 provides that `persons to whom this Regulation applies shall be subject to the legislation of a single Member State only', which is to be determined in accordance with the provisions of that Title. 4 Article 93, entitled `Rights of institutions responsible for benefits against liable third parties', is the provision which is the subject of the question referred by the German court. Article 93(1)(a), the relevant part of that provision, provides that `[i]f a person receives benefits under the legislation of one Member State in respect of an injury resulting from an occurrence in the territory of another State, any rights of the institution responsible for benefits against a third party bound to compensate for the injury shall be governed by the following rules: (a) where the institution responsible for benefits is, by virtue of the legislation which it administers, subrogated to the rights which the recipient has against the third party, such subrogation shall be recognised by each Member State'. 5 Article 232 of the Luxembourg Social Insurance Code provides that if a person entitled to a pension has a legal right, exercisable against a third party, to compensation for loss or damage caused to him by reason of a death or invalidity, the rights of the victim or his heirs pass to the institution paying the pension up to the amount of the benefits payable. If the pension is a permanent pension, the institution's right of recourse applies to the amount of the cover capital less accrued rights. According to Article 4 of the Grand-Ducal regulation giving effect to the Code, however, where a person already entitled to a pension dies, the institution has no right of recourse against a liable third party. The facts and the question referred 6 The proceedings before the national court concern the establishment of responsibility for the death of a German national as a result of a road accident that happened on 27 December 1991 near Trier. Alfons Ginsbach died after being run over by a motor vehicle driven by Dieter Kordel and owned by Rainer Kordel, both of whom are also German nationals. Mr Ginsbach was insured with the Caisse de Pension des Employés Privés (the Luxembourg institution responsible for pension schemes for employees in the private sector, hereinafter `the Pension Fund'). Consequent upon Mr Ginsbach's death, the Pension Fund paid to his widow and daughter a reversionary pension with cover capital of LUF 4 003 236. In the main proceedings, the Pension Fund claims damages in the sum of half of the cover capital against the driver of the vehicle, its owner and the insurance company on the basis that they are jointly and several liable. The Pension Fund maintains that, in accordance with Article 232 of the Luxembourg Social Insurance Code, it is subrogated to the rights of Mr Ginsbach's survivors in this regard and that, pursuant to Article 93(1)(a) of the Regulation, its right of subrogation must also be recognised in Member States other than that in which the Pension Fund operates. 7 Taking the view that interpretation of Article 93(1)(a) of the Regulation is necessary in order for it to give judgment, the German court referred the following question to the Court of Justice for a preliminary ruling: `How is Article 93(1)(a) of Regulation (EEC) No 1408/71 to be interpreted? Does recognition by the Member States extend to the content of the subrogated right, as defined in another Member State (in this case, by the second sentence of Article 232 of the Luxembourg Social Insurance Code which, in conjunction with the relevant Grand-Ducal regulation, provides that the claim to which the Pension Fund is subrogated is to amount to the cover capital less accrued statutory rights), or merely to the subrogation as such?' 8 By letter of 24 July 1997, the Court sent the Landgericht Trier a copy of its judgment in DAK v Lærerstanders Brandforsikring, (3) at the same time asking whether or not, in the light of that judgment, the Landgericht wished to reformulate its question. By further order of 24 October 1997 the Landgericht Trier supplemented its question as follows: `Do provisions which prevent an institution of a Member State responsible for benefits, within the meaning of Article 93(1)(a) of Regulation (EEC) No 1408/71, from being subrogated to the right of a person in receipt of benefits to claim damages against a person liable for causing injury in another Member State, or prevent such an institution from asserting such a right, not also exclude the institution's right of recourse against the third party where the provisions in question are those of the Member State to which the institution belongs (the provision in this case being Article 4 of the regulation implementing Article 232 of the Social Insurance Code, under which, on the death of a person entitled to a pension, no right of recourse is to be exercised against liable third parties)?' Substance 9 The question originally referred by the national court essentially concerns the extent of the rights of action accorded to social security institutions by Article 93(1) of the Regulation which, I would repeat, provides that where an institution responsible for benefits is, by virtue of the legislation which it administers, subrogated to the rights which a recipient has against a third party, such subrogation is to be recognised by every Member State. The German court, faced with two conflicting sets of rules under German and Luxembourg law respectively, only the latter of which allows the social security institution rights of action, asks the Court whether the reference in Article 93 of the Regulation to the legislation administered by the social security institution (in this case, Luxembourg law) is to be understood as applying exclusively to the subrogation as such, or to the content of the subrogated right also. 10 It must be observed at the outset that the answer to that question is quite evident from the settled case-law of the Court and that there seems to me to be no reason to depart from that case-law in the instant case. It is sufficient to refer to the judgment in DAK, cited above, in which the Court had occasion to clarify the scope of Article 93(1) of the Regulation. That case involved a dispute between a German social security institution and a Danish insurance company concerning the reimbursement of expenses incurred by the former in connection with the transport and hospital treatment of one of its insured who was involved in a road accident in Denmark. Asked by a Danish court for a preliminary ruling, the Court of Justice ruled that `Article 93(1) of the regulation is to be interpreted as meaning that the conditions and extent of the right of recoupment which a social security institution within the meaning of the regulation has against the party who has caused an injury in the territory of another Member State, which has entailed the payment of social security benefits, are determined in accordance with the law of the Member State to which that institution is subject' (paragraph 23). Thus, legal provisions of the Member State where the harmful event giving rise to the right of recoupment occurred cannot impose conditions upon or limit any right of action belonging to a social security institution in another Member State. 11 In its reasoning leading to that conclusion, the Court referred to the underlying purpose of the provision of the Regulation which is the subject of the present request for a preliminary ruling: Article 93, like Article 52 of the earlier Regulation No 3 of 25 September 1958, whose wording it largely reproduces, `has the object of allowing a social security institution, which has paid social security benefits following an injury sustained in the territory of another Member State, to exercise against the third party liable for the injury the rights of action provided for by the legislation which it administers, either by means of subrogation or by any other legal method' (paragraph 16). (4) The rights thus conferred on national social security institutions constitute, according to the Court, `a logical and fair counterpart to the extension of the obligations of those institutions throughout the entire Community as a result of the provisions of the regulation'. (5)  To that end, Article 93(1) of the Regulation provides that every Member State is to recognise the subrogation of the institution responsible for benefits to the rights which the recipient of the benefits has against the third party bound to compensate for the injury, where that institution has such rights under the legislation of the Member State in which it operates (paragraph 17). 12 In the Court's view, Article 93(1) `must thus be seen as conflict-of-laws rule, which requires the national court hearing an action for compensation brought against the party liable for the injury to apply the law of the Member State to which the institution responsible is subject, not only to determine whether that institution is subrogated by law to the rights of the injured party or has direct rights against the third party liable, but also to determine the nature and extent of the claims to which the institution responsible for benefits is subrogated or which it can bring directly against the third parties' (paragraph 18). The conflict-of-laws rule in Article 93 thus precludes national courts from applying the law of the place where the harmful event occurred in order to establish the extent of the right of action of which the institution responsible for benefits may avail itself. That right must be recognised in the other Member States on the same conditions and to the same extent as is laid down by the legislation to which the social security institution is subject in the Member State in which it operates. That rule accords with the general principle, mentioned earlier, that the social security treatment of workers within the Community must be governed by the legislation of a single Member State only (Article 13 of the Regulation), and also takes account of the fact that the institution in question is also responsible for providing benefits in cases of loss or injury sustained in another Member State. (6) As the Commission has observed, the aim is to ensure that the institution's rights of action against a third party liable for a harmful event which led to its intervention match the benefits which it is required to provide. 13 Lastly, the Court held in DAK that the fact that jurisdiction is determined by reference to Article 93 not does imply any alteration of the rules applicable for determining whether and to what extent there is non-contractual liability on the part of the third party who has caused the injury. That liability remains subject to the substantive rules which are normally to be applied by the national court before which proceedings are brought, in other words, in principle the legislation of the Member State in whose territory the injury has occurred (paragraph 21). (7) 14 The pointers that can be derived from that case-law are highly relevant to the solution of the present case. The victim of the accident in Germany was insured by a Luxembourg social security institution. Any right to compensation which those deriving title from the victim of the accident might have against the liable party arises under the law which, in accordance with German private international law, applies in matters of non-contractual liability. Subrogation of the social security institution, on the other hand, is governed by the law which that institution administers - in this case, Luxembourg law - and that is also the law which determines the extent of the subrogated rights of action in another Member State. That right of action, governed by Luxembourg law, must be recognised in the other Member States, and in the present case in Germany, pursuant to Article 93 of the Regulation. 15 The answer to the question originally referred by the German court must therefore be consistent with the settled case-law of the Court, and thus Article 93 of the Regulation must be interpreted as requiring national courts to apply the law of the Member State to which the institution responsible for benefits belongs also in establishing the nature and extent of the rights to which such an institution is subrogated. In the grounds of its second order for reference, by which it expanded on its initial question, the German court appears to accept that solution. However, it justifies retaining its question, mentioning a factor which might distinguish the case now before it from that in DAK: whilst in DAK the Court held that the rights of the subrogated institution could not be restricted by provisions in the legislation of the State of the court having jurisdiction, in which the harmful event occurred, the obstacles to bringing an action arise in the present case from the legislation in force in the State where the institution operates, namely Luxembourg. As stated earlier, under Article 4 of the Grand-Ducal regulation giving effect to Article 232 of the Luxembourg Social Insurance Code, a subrogated institution cannot bring an action against a third party responsible for a harmful event in place of the heirs of the victim where the person entitled to a pension dies. Clearly, it is a matter for the national court, called upon to apply Luxembourg law, to ascertain whether in the present case the necessary conditions prevail for applying the Luxembourg provision just mentioned, in accordance with Article 93 of the Regulation. Nevertheless, if it should transpire that the legislation to which the institution is subject does pose an obstacle to the institution's exercising its own right of action, even if properly subrogated to the rights of those entitled under the victim, that restriction must be recognised in all the Member States. 16 The solution here proposed is derived without difficulty from the letter and spirit of Article 93. That provision, containing a conflict-of-laws rule, requires the Member States to recognise subrogated rights of action irrespective of the content of applicable legislation. Recognition must be on the same conditions as those under which the provision in question is applied in the Member State in which the subrogated institution operates. Restrictions on rights of action must be recognised and applied in the other Member States, and thus, in the present case, by the German court. Conclusion 17 In light of the foregoing, I suggest that the Court answer the question referred by the Landgericht Trier as follows: Article 93(1) of Council Regulation (EEC) No 1408/71 of 14 July 1971 on the application of social security schemes to employed persons and to members of their families moving within the Community, as amended by Council Regulation (EEC) No 2001/83 of 2 June 1983, is to be interpreted as meaning that the conditions applicable to and extent of the right of action which a social security institution, within the meaning of the regulation, has against a party liable for loss or injury which was sustained in the territory of another Member State and which has led to the payment of social security benefits are determined in accordance with the law of the Member State of the institution. Provisions of the laws of the Member State in which the institution responsible for benefits operates which restrict or preclude the right of action of the social security institution must therefore be recognised in the other Member States. (1) - OJ, English Special Edition 1971 (II), p. 416. (2) - OJ 1983 L 230, p. 6. (3) - Case C-428/92 DAK v Lærerstanders Brandforsikring [1994] ECR I-2259. (4) - See also the judgment in Case 27/69 Entr'aide Médicale v Assurances Générales [1969] ECR 405, paragraph 15. (5) - See, to the same effect, the judgments in Case 33/64 Betriebskrankenkasse Heseper Torfwerk v Koster [1965] ECR 97 and Case 44/65 Hessische Knappschaft v Singer [1965] ECR 965, which, of course, refer to the earlier version of the text of the Regulation. (6) - See the Opinion of Advocate General Lenz in DAK (ECR 1994 I-2261, paragraph 22). (7) - See, to that effect, Hessische Knappschaft, cited above, which refers to the earlier version of the Regulation.