1 THE INTERLOCUTORY JUDGMENT OF THE COURT OF 4 OCTOBER 1979 IN JOINED CASES 261 AND 262/78 ( INTERQUELL STARKE-CHEMIE AND DIAMALT V COUNCIL AND COMMISSION ( 1979 ) ECR 3045 ) ORDERED THE EUROPEAN ECONOMIC COMMUNITY TO PAY THE TWO APPLICANTS , AS DAMAGES FOR WHICH IT WAS NON-CONTRACTUALLY LIABLE , THE AMOUNTS EQUIVALENT TO THE PRODUCTION REFUNDS ON QUELLMEHL INTENDED FOR USE IN THE BAKERY INDUSTRY WHICH EACH OF THOSE UNDERTAKINGS WOULD HAVE BEEN ENTITLED TO RECEIVE IF , DURING THE PERIOD FROM 1 AUGUST 1974 TO 19 OCTOBER 1977 , THE USE OF MAIZE FOR THE PRODUCTION OF QUELLMEHL HAD CONFERRED AN ENTITLEMENT TO THE SAME REFUNDS AS THE USE OF MAIZE FOR THE MANUFACTURE OF STARCH . THE COURT FURTHER ORDERED THAT INTEREST AT 6% SHOULD BE PAID ON THE SAID AMOUNTS AS FROM THE DATE OF JUDGMENT AND THAT THE PARTIES SHOULD INFORM THE COURT WITHIN 12 MONTHS OF THE AMOUNTS OF COMPENSATION ARRIVED AT BY AGREEMENT . IN THE ABSENCE OF AGREEMENT THE PARTIES WERE TO TRANSMIT TO THE COURT WITHIN THE SAME PERIOD A STATEMENT OF THEIR VIEWS , WITH SUPPORTING FIGURES . THE COSTS WERE RESERVED .
2 IN CASE 261/78 ( INTERQUELL ) THE PARTIES HAVE NOT BEEN ABLE TO REACH AGREEMENT ON THE AMOUNT OF DAMAGES . THE APPLICANT CLAIMS DM 641 234.27 . THE DEFENDANTS , ON THE OTHER HAND , CONSIDER THAT THE APPLICANT HAS NOT ADDUCED SUFFICIENT EVIDENCE OF ITS PRODUCTION OF QUELLMEHL . THEY THEREFORE ASK THE COURT TO DISMISS THE APPLICATION IN ITS ENTIRETY .
3 IN CASE 262/78 ( DIAMALT ) THE PARTIES HAVE REACHED AGREEMENT ON THE AMOUNTS OF COMPENSATION FOR THE PRODUCTION OF QUELLMEHL INTENDED FOR THE BAKERY INDUSTRY . ON THE OTHER HAND , THE DEFENDANTS CONSIDER THE APPLICANT ' S CLAIM UNFOUNDED IN SO FAR AS IT RELATES TO THE PRODUCTION OF QUELLMEHL INTENDED FOR HUMAN CONSUMPTION OTHERWISE THAN VIA THE BAKERY INDUSTRY .
4 IN VIEW OF THE COMPLETELY DIFFERENT NATURE OF THE ISSUES STILL OUTSTANDING IN THE TWO CASES IT IS APPROPRIATE TO DISJOIN THE CASES FOR THE PURPOSES OF THE JUDGMENT .
5 IN ITS ORIGINAL APPLICATION INTERQUELL CLAIMED COMPENSATION BOTH FOR QUELLMEHL MADE FROM MAIZE FLOUR AND FOR QUELLMEHL MADE FROM COMMON-WHEAT FLOUR . FOLLOWING THE INTERLOCUTORY JUDGMENT OF 4 OCTOBER 1979 THE APPLICANT ABANDONED ITS CLAIM FOR COMPENSATION IN RELATION TO THE PRODUCTION OF QUELLMEHL FROM MAIZE FLOUR SINCE SUCH FLOUR IS A BY-PRODUCT IN THE MANUFACTURE OF MAIZE GRITZ AND , ACCORDING TO JUDGMENTS GIVEN ON THE SAME DATE , THE PRODUCERS OF MAIZE GRITZ ARE THEMSELVES ENTITLED TO COMPENSATION IN CONNECTION WITH THE MANUFACTURE OF MAIZE GRITZ . THE APPLICANT HENCEFORTH SEEKS COMPENSATION ONLY FOR THE MANUFACTURE OF QUELLMEHL FROM COMMON-WHEAT FLOUR .
6 WHILE STATING THAT IT IS NOT RAISING AN OBJECTION OF INADMISSIBILITY IN THAT RESPECT , THE COMMISSION POINTS OUT THAT THE COURT DID NOT IN ITS INTERLOCUTORY JUDGMENT ORDER THE COMMUNITY TO PAY COMPENSATION FOR QUELLMEHL MADE FROM COMMON-WHEAT FLOUR BUT ONLY FOR QUELLMEHL MADE FROM MAIZE .
7 IN THAT RESPECT IT MUST BE REMEMBERED THAT THE PRODUCTION REFUNDS ON QUELLMEHL WHICH THE APPLICANT RECEIVED UNTIL THEIR ABOLITION ON 1 AUGUST 1974 RELATED TO QUELLMEHL MADE FROM COMMON WHEAT AS WELL AS FROM MAIZE . THAT IS ALSO TRUE OF THE REFUNDS REINTRODUCED BY COUNCIL REGULATION NO 1125/78 OF 22 MAY 1978 AMENDING REGULATION NO 2727/75 ON THE COMMON ORGANIZATION OF THE MARKET IN CEREALS ( OFFICIAL JOURNAL 1978 , L 142 , P . 21 ). THE THIRD RECITAL TO THAT REGULATION STATES THAT ' ' THE INTRODUCTION OF PRODUCTION REFUNDS FOR THE PRODUCTS IN QUESTION CONSTITUTES A MEANS OF CONFORMING WITH THE COURT ' S CONCLUSIONS ' ' AS CONTAINED INTER ALIA IN THE JUDGMENT OF 19 OCTOBER 1977 IN JOINED CASES 117/76 AND 16/66 ( RUCKDESCHEL AND OTHERS ( 1977 ) ECR 1753 ), WHERE THE COURT FOUND THAT THE DIFFERENCE IN TREATMENT BETWEEN QUELLMEHL AND PREGELATINIZED STARCH WAS INCOMPATIBLE WITH THE PRINCIPLE OF EQUALITY . FURTHERMORE , IT APPEARS FROM INFORMATION SUPPLIED DURING THE PROCEEDINGS THAT WHEN THE COMMISSION FIXED THE AMOUNTS OF COMPENSATION DUE TO OTHER PRODUCERS OF QUELLMEHL ON THE BASIS OF THE INTERLOCUTORY JUDGMENTS OF 4 OCTOBER 1979 IT MADE NO DISTINCTION BETWEEN QUELLMEHL MADE FROM MAIZE AND QUELLMEHL MADE FROM COMMON-WHEAT .
8 IT IS THEREFORE NOT DISPUTED THAT THE PRODUCTION OF QUELLMEHL FROM COMMON WHEAT IS IN THE SAME POSITION , WITH REGARD TO THE RIGHT TO COMPENSATION RECOGNIZED BY THE INTERLOCUTORY JUDGMENT , AS THE PRODUCTION OF QUELLMEHL FROM MAIZE . SINCE MOREOVER THERE IS NOTHING IN THAT JUDGMENT TO WARRANT AN INTERPRETATION TO THE EFFECT THAT THE COURT DISMISSED THAT PART OF THE CLAIM , IT IS NECESSARY TO CONSIDER IN THE CONTEXT OF THE PRESENT CASE THE ISSUES ON WHICH THE PARTIES HAVE ADDUCED EVIDENCE .
9 AS REGARDS PROOF OF THE DAMAGE , THE COMMISSION TAKES THE VIEW THAT THE APPLICANT OUGHT IN PRINCIPLE TO SATISFY THE SAME CONDITIONS AS THOSE TO WHICH THE COMMUNITY AND NATIONAL RULES SUBJECT CURRENT ENTITLEMENT TO PRODUCTION REFUNDS . IT IS COMMON GROUND THAT SINCE THE ABOLITION OF THE REFUNDS IN 1974 THE APPLICANT ' S BOOKS NO LONGER SATISFY THOSE CONDITIONS .
10 IT MUST BE REMEMBERED THAT THE PRESENT CASE , IN RESPECT OF WHICH THE INTERLOCUTORY JUDGMENT OF 4 OCTOBER 1979 HAS ALREADY BEEN GIVEN , IS NOT CON- CERNED WITH THE PAYMENT OF REFUNDS . THE INTERLOCUTORY JUDGMENT WAS GIVEN FOLLOWING CLAIMS FOR COMPENSATION UNDER ARTICLE 178 AND THE SECOND PARAGRAPH OF ARTICLE 215 OF THE EEC TREATY AND THE COURT CONSIDERED THAT THE COMMUNITY INCURRED LIABILITY BY REASON OF THE ABOLITION OF THE REFUNDS FOR QUELLMEHL .
11 CONSEQUENTLY THE AMOUNT OF DAMAGES DOES NOT DEPEND ON THE COMMUNITY OR NATIONAL PROVISIONS GOVERNING THE CURRENT PAYMENT OF PRODUCTION REFUNDS . INSTEAD , PURSUANT TO THE SECOND PARAGRAPH OF ARTICLE 215 OF THE TREATY THE AMOUNT MUST BE DETERMINED IN ACCORDANCE WITH THE GENERAL PRINCIPLES COMMON TO THE LAWS OF THE MEMBER STATES IN RELATION TO NON-CONTRACTUAL LIABILITY . AS REGARDS THE QUESTION OF PROOF OF DAMAGE , A GENERAL FEATURE OF THOSE LAWS IS THAT THE COURT HAS AN UNFETTERED DISCRETION IN ASSESSING ALL THE EVIDENCE SUBMITTED TO IT .
12 ACCORDING TO THE INTERLOCUTORY JUDGMENT , THE BASIS OF THE CALCULATION IS THE PRODUCTION REFUNDS ON QUELLMEHL INTENDED FOR THE BAKERY INDUSTRY WHICH THE APPLICANT WOULD HAVE BEEN ENTITLED TO RECEIVE IF DURING THE PERIOD IN QUESTION THE PRODUCTION OF QUELLMEHL HAD CONFERRED AN ENTITLEMENT TO THE SAME REFUNDS AS THE MANUFACTURE OF STARCH . IN ORDER TO PROVE THE DAMAGE WHICH THE APPLICANT CLAIMS TO HAVE SUFFERED THE ONUS IS THEREFORE UPON IT TO SHOW THAT IT PRODUCED QUELLMEHL FROM COMMON-WHEAT FLOUR WHICH WOULD HAVE GIVEN ENTITLEMENT TO REFUNDS EQUIVALENT TO THE DAMAGES CLAIMED , NAMELY DM 641 234.27 , AND THAT THAT QUELLMEHL WAS USED IN THE BAKERY INDUSTRY .
13 THE MAIN EVIDENCE SUBMITTED TO THE COURT IN THAT RESPECT IS THE REPORT OF 16 MAY 1980 ( HEREINAFTER REFERRED TO AS ' ' THE REPORT ' ' WHICH TWO INSPECTORS ( HEREINAFTER REFERRED TO AS ' ' THE EXPERTS ' ' ) FROM THE BETRIEBSPRUFUNGSSTELLE ZOLL FUR DEN OBERFINANZBEZIRK MUNCHEN ( CUSTOMS INSPECTORATE FOR THE PRINCIPAL REVENUE DISTRICT OF MUNICH ) DREW UP AFTER INSPECTING THE APPLICANT ' S FACTORY . THE REPORT , WHICH WAS DRAWN UP UPON THE BASIS OF THE APPLICANT ' S ACCOUNTS , SHOWS THE QUANTITIES OF QUELLMEHL WHICH THE APPLICANT SOLD TO BAKERIES AND TO PRODUCERS OF BAKING IMPROVERS . AFTER DEDUCTING THE AMOUNT OF UNPROCESSED FLOUR ADDED TO THE QUELLMEHL SOLD , THE EXPERTS CALCULATED ON THAT BASIS THE QUANTITIES OF COMMON-WHEAT FLOUR GIVING ENTITLEMENT TO REFUNDS . IN THAT RESPECT THEY WORKED ON THE BASIS OF A CONVERSION RATE OF 100% , THAT IS TO SAY THE RATE LEAST FAVOURABLE TO THE APPLICANT . THE REPORT ALSO STATES THE QUANTITIES OF COMMON-WHEAT FLOUR PURCHASED BY THE APPLICANT .
14 ACCORDING TO THE EXPERTS , THAT METHOD OF CALCULATION WAS MADE NECESSARY BY THE FACT THAT THE APPLICANT ' S BOOKS DID NOT MAKE IT POSSIBLE TO ESTABLISH THAT A SPECIFIC CONSIGNMENT OF COMMON-WHEAT FLOUR PURCHASED HAD ACTUALLY BEEN PROCESSED INTO QUELLMEHL . HOWEVER , THE EXPERTS EXPLAINED THAT , SINCE THE APPLICANT HAD SCARCELY ANY STORAGE CAPACITY FOR FLOUR , IT HAD BOUGHT FLOUR AS AND WHEN IT RECEIVED ORDERS FOR QUELLMEHL AND THE FLOUR HAD BEEN IMMEDIATELY PROCESSED AND THE QUELLMEHL DELIVERED FORTHWITH .
15 THE APPLICANT ALSO LODGED STATEMENTS FROM PRODUCERS OF BAKING IMPROVERS , FROM WHICH IT APPEARS THAT THE PRODUCTS MANUFACTURED FROM QUELLMEHL WHICH THEY PURCHASED WERE USED IN BREAD-MAKING .
16 IN THE ABSENCE OF EVIDENCE TO THE CONTRARY , THE DOCUMENTS SO PRODUCED AND SUBSEQUENTLY CLARIFIED BY THE EXPERTS AT THE HEARING SHOW THAT THE QUANTITIES OF COMMON-WHEAT FLOUR ON WHICH THE APPLICANT RELIES TO ESTABLISH THE AMOUNT OF COMPENSATION WERE IN FACT PROCESSED BY IT INTO QUELLMEHL AND THE QUELLMEHL USED IN BREAD-MAKING .
17 IN THAT RESPECT , THE COMMISSION CONSIDERS THAT THE EVIDENCE ADDUCED BY THE APPLICANT CONTAINS TOO MANY UNCERTAINTIES TO SERVE AS A BASIS FOR THE CALCULATION OF THE COMPENSATION .
18 THE FIRST UNCERTAINTY IS THAT THE APPLICANT ' S BOOKS DO NOT EXCLUDE THE POSSIBILITY OF THE APPLICANT ' S RE-SELLING PART OF THE FLOUR PURCHASED WITHOUT MAKING A PROFIT AND BUYING QUELLMEHL ON WHICH REFUNDS HAD ALREADY BEEN PAID IN ORDER TO OBTAIN A FURTHER REFUND BEFORE SELLING THE PRODUCT .
19 THE COMMISSION HAS NOT HOWEVER SHOWN THAT SUCH TRANSACTIONS TOOK PLACE AND MOREOVER THE UNDERTAKING COULD NOT HAVE PROFITED THEREFROM AT A TIME WHEN PRODUCTION REFUNDS ON QUELLMEHL HAD BEEN ABOLISHED .
20 FURTHER UNCERTAINTY IS SAID TO HAVE BEEN CREATED BY THE FACT THAT THE APPLICANT PROCESSED THE COMMON-WHEAT FLOUR WHICH IT BOUGHT NOT ONLY INTO QUELLMEHL BUT ALSO INTO FLAKES ( QUELLFLOCKEN ), ON WHICH REFUNDS WERE NEVER PAYABLE .
21 IN THAT RESPECT , IT APPEARS FROM THE INFORMATION PROVIDED BY THE EXPERTS AT THE HEARING THAT THE MANUFACTURE OF FLAKES REPRESENTED ONLY A VERY SMALL PERCENTAGE OF THE APPLICANT ' S PRODUCTION AND THAT , MOREOVER , SOME OF THE FLAKES WERE MADE INTO QUELLMEHL , WHILE THE REMAINING QUANTITY , WHICH WAS USED IN THE PREPARATION OF ANIMAL FEED , WAS SET OUT IN THE REPORT AND DEDUCTED FOR THE PURPOSE OF CALCULATING THE REFUNDS .
22 THE COMMISSION ALSO STATES THAT THE FACT , SHOWN IN THE REPORT , THAT THE APPLICANT IN CERTAIN CASES SOLD QUELLMEHL MADE FROM COMMON-WHEAT FLOUR AS QUELLMEHL MADE FROM MAIZE FLOUR , TOGETHER WITH THE ABSENCE OF CONFIRMATION OF THE EXACT AMOUNTS OF RAW MATERIAL USED AND THE AMOUNTS OF QUELLMEHL OBTAINED , SUGGESTS THE POSSIBILITY THAT PART OF THE QUELLMEHL ACCEPTED BY THE EXPERTS FOR THE PURPOSE OF CALCULATING THE REFUNDS WAS IN FACT MADE FROM MAIZE .
23 HOWEVER , THE EXPERTS EXPLAINED AT THE HEARING THAT THE APPLICANT NEVER BOUGHT WHITE MAIZE FLOUR , WHICH ACCORDING TO THEM WAS THE ONLY PRODUCT CAPABLE OF BEING MADE INTO MAIZE QUELLMEHL AND SOLD AS QUELLMEHL FROM COMMON WHEAT .
24 A FINAL UNCERTAINTY IN THE COMMISSION ' S VIEW IS THAT IT CANNOT BE EXCLUDED THAT QUANTITIES OF UNPROCESSED COMMON-WHEAT FLOUR OTHER THAN THOSE MENTIONED BY THE APPLICANT WERE ADDED TO THE QUELLMEHL PRODUCED BY IT .
25 ON THAT ISSUE , IT APPEARS FROM INFORMATION SUPPLIED BY THE EXPERTS AT THE HEARING THAT THE FLOUR ADDED TO THE QUELLMEHL WAS OF THE 1600 VARIETY , WHEREAS THE FLOUR PROCESSED INTO QUELLMEHL WAS OF THE 550 VARIETY . THE REFUNDS WERE CALCULATED IN THE REPORT ONLY ON THE BASIS OF FLOUR OF THE 550 VARIETY . IT WAS POSSIBLE TO ESTABLISH THE RESPECTIVE QUANTITIES OF THE TWO VARIETIES OF FLOUR PURCHASED BY THE APPLICANT ON THE BASIS OF THE PURCHASE INVOICES . EVEN IF THE EXPERTS WERE NOT ABLE COMPLETELY TO EXCLUDE THE POSSIBILITY THAT THE APPLICANT HAD ADDED FLOUR OF THE 550 VARIETY TO THE QUELLMEHL PRODUCED , THEY STATED THAT THEY WERE CONVINCED IN PARTICULAR BY THE APPLICANT ' S EQUIPMENT AND ITS METHOD OF PRODUCTION , THAT THE QUANTITIES PURCHASED OF FLOUR OF THAT VARIETY WERE MADE INTO QUELLMEHL .
26 IT MUST THEREFORE BE CONCLUDED THAT THE COMMISSION HAS NOT BEEN ABLE TO CAST DOUBT ON THE CONCLUSIONS WHICH ARE TO BE DRAWN FROM THE DOCUMENTS PRODUCED BY THE APPLICANT . THOSE DOCUMENTS THUS ESTABLISH , WITH THE REQUIRED DEGREE OF CERTAINTY , THE PRODUCTION OF QUELLMEHL BY THE APPLICANT FROM COMMON-WHEAT FLOUR AS SET OUT IN THE REPORT AND THE USE OF THAT QUELLMEHL FOR BREAD-MAKING .
27 SINCE NEITHER THE COUNCIL NOR THE COMMISSION HAS CHALLENGED THE CORRECTNESS OF THE EXACT SUMS CLAIMED ON THE BASIS OF THE QUANTITIES OF FLOUR SET OUT , THERE MUST ACCORDINGLY BE JUDGMENT FOR THE APPLICANT IN ACCORDANCE WITH ITS CLAIM .