JUDGMENT OF 10. 12. 1969 — CASE 34/69 ASSURANCE VIEILLESSE v DUFFY
In Case 34/69 Reference to the Court under Article 177 of the EEC Treaty by the Cour d'Appel, Paris, (Social Chamber), for a preliminary ruling in the action pending before that court between
THE COURT composed of: R. Lecourt, President, R. Monaco (Rapporteur) and P. Pescatore, Presidents of Chambers, A. M. Dormer, W. Strauß, A. Trabucchi and J. Mertens de Wilmars, Judges, Advocate-General: K. Roemer Registrar: A. Van Houtte
gives the following
JUDGMENT
Issues of fact and of law
I — Facts and procedures
Mrs Jeanne Duffy, née Dustin, originally a Belgian national, married Mr Duffy, a French national, and went to live with him in France where she acquired French nationality by virtue of a Decree of 1945.
In her own right she has been receiving since 1 September 1958 an old-age pension paid by the Caisse nationale des pensions pour employees of Brussels.
Following the death of her husband on 9 March 1965, she made an application dated 16 April 1965 to the Caisse nationale d'assurance vieillesse des travailleurs salaries de Paris (hereinafter referred to as ‘the Caisse’) for the survivors' pension for widows laid down in Article L 351 of the Social Security Code.
According to that provision,
‘If the insured person shall die after attaining the age of 60 years, his dependent spouse shall be entitled… to a survivor's pension if she is not in receipt of or has not a contingent right to benefit under social security legislation.’
Nevertheless under Article 148(3) of the Decree of 29 December 1945 when the amount of the personal benefit is less than the survivor's pension — which is the case here — a differential supplement is paid.
The Caisse considered that those provisions were applicable to the present case under Article 11(2) of Regulation No 3 of the Council concerning social security for migrant workers which provides:
‘Provisions in the legislation of one Member State for the reduction or suspension of benefit where there is plurality with other social insurance benefits, shall apply to a beneficiary even in respect of “benefits acquired under a scheme in another Member State, or in respect of income derived from, or employment in, the territory of another Member State: provided that this rule shall not apply where benefits of the same kind are acquired in accordance with the provisions of Articles 26 and 28 of this regulation.”
On the basis of the aforementioned provisions the Caisse refused Mrs Duffy the pension which she claimed, but granted her a differential pension corresponding to the amount of the survivor's pension reduced by the amount of the old-age pension which she received from the Belgian Pension Fund.
Mrs Duffy made an application against this decision to the Commission de premiere instance du contentieux de la sécurité sociale de Paris, 9th Section, claiming the entire survivor's pension.
By a decision of 11 July 1967 the Commission de premiere instance allowed her application.
The Caisse appealed against this decision to the Cour d'Appel, Paris, Social Chamber, and the latter, by a judgment of 27 June 1969, referred the following question to the Court of Justice under Article 177 of the EEC Treaty:
“Can Regulation No 3, concerning social security for migrant workers, especially Article 11(2) dealing with provisions for the reduction or suspension of benefit, apply as against a widow who is in receipt of an old-age pension obtained by virtue of her having worked as a wage-earner in one Member State and who claims in a second Member State where she has her permanent residence, the survivor's pension acquired by her husband in the second Member State.”
The decision containing the reference was despatched on 28 July 1969 and entered at the Court Registry on 30 July 1969.
In accordance with the second paragraph of Article 20 of the Protocol on the Statute of the Court of Justice annexed to the Treaty establishing the EEC, Mrs Duffy, the Caisse and the Commission of the European Communities submitted written observations.
Upon hearing the report of the Judge-Rapporteur and the views of the Advocate-General, the Court decided to dispense with measures of preparatory inquiry.
The oral observations of Mrs Duffy and of the Commission of the European Communities were presented at the hearing of 19 November 1969.
The Advocate-General delivered his opinion at the hearing on 3 December 1969.
II — Written observations submitted under Article 20 of the Protocol on the Statute of the Court of Justice
The observations submitted under Article 20 of the Statute of the Court may be summarized as follows:
A — Observations submitted by Mrs Jeanne Duffy
Mrs Duffy recalls that, according to its very title, Regulation No 3 concerns “social security for migrant workers” and that its object is to prevent those workers from being adversely affected in social security matters by reason of their movement within the Common Market. It is precisely to this end that, especially with regard to old-age pensions, the legislature conceived Articles 27 and 28 to which provisions the Court has given a particularly wide interpretation.
The area of application of Regulation No 3 is in principle defined by Article 4(1) but this provision is not to be understood in an absolute sense. The very general wording employed therein, even referring to workers who were only subject to the legislation of one Member State, was adopted to cover all the particular cases referred to by this regulation which in fact lays down certain provisions (for example Article 19(1) and (7)) with regard to those workers. Nevertheless, it must certainly not be deduced from those particular cases that Article 4 establishes a general and absolute rule as this would lead to absurd results. It is clear that a worker who has worked and resided only in France in principle comes under French legislation alone and that this legislation would be simply set aside if this article were interpreted in an absolute sense. Thus, apart from certain particular cases and the clear and express provisions which refer to them, all the other provisions of the regulation apply only to migrant workers who are subject to the legislation of two or more Member States.
Mrs Duffy states, however, that neither Mr Duffy who was employed only in France nor she herself who was employed only in Belgium, was subject to the legislation of two or more Member States. Consequently her case cannot fall within Regulation No 3, especially Article 11(2) thereof.
Although certain provisions referred to by Regulation No 3 (such as that of plurality of benefits) normally apply to workers who, as regards the conditions for the acquisition of their rights, benefited from the provisions of this regulation, it cannot be held that those game prohibitions are also applicable to workers who — like Mr and Mrs Duffy — did not benefit from those provisions.
Finally, it is paradoxical that this regulation, which is intended to secure freedom of movement for migrant workers within the Community and to prevent their being adversely affected by reason of such movement, should result in reducing the rights which the person concerned previously enjoyed under internal French legislation alone which does not consider foreign benefits as a ground for reducing the French survivors’ pension.
B — Observations submitted by the Caisse nationale d'assurance vieillesse des travailleurs salaries de Paris
The Caisse notes that ‘the provisions of Article 4(1) of Regulation No 3 do indeed concern all nationals of one or more Member States, as was admitted, moreover, by the Cour d'Appel, Paris’, and that Article 4(2) is also applicable ‘to the survivors of wage-earners or assimilated workers who were subject to the legislation of one or more Member States, irrespective of the nationality of these latter’.
It maintains that there is no difficulty on this point, especially as the Court itself has clarified it in several judgments.
With regard to the wording of Article 11(2) of Regulation No 3, it conforms entirely to the spirit of national law on this topic, especially that of French law; the content of this paragraph, moreover, seems perfectly clear and unequivocal.
Furthermore, Decision No 31 of 27 October 1960 of the Administrative Committee of the EEC concerning social security for migrant workers which considered an identical point with regard to Article 9(1) of Regulation No 4 of the Council confirms that the argument put forward by the Caisse is well founded since it provides the same solution to the problem of plurality of benefits. Although it appears that the provisions contained in this decision with regard to interpretation relate only to benefits of the same kind (own rights and derived rights), it seems that it must be possible to adapt them to benefits which may not be accumulated, such as old-age and survivors' pensions. The Caisse concludes that the survivors' pension requested by Mrs Duffy must be subject to the provisions on plurality laid down by Article L 351 of the Social Security Code which are merely emphasized in clear and precise terms by Article 11(2) of Regulation No 3.
C — Observations submitted by the Commission
1. The jurisdiction of the Court
The Commission states that the Court, according to its own case-law, is entitled under Article 177 of the EEC Treaty to give a ruling on the interpretation of Community law, but it may not apply this law to a particular case or give a ruling on the regularity of national measures. It goes on to observe that the Court may always extract from inadequately worded requests the questions which fall under Community law and within its jurisdiction to give a preliminary ruling. It moreover notes that according to the case-law of the Court, Regulations Nos 3 and 4 must be interpreted in terms of Article 51 of the EEC Treaty so that in the present case an endeavour must be made to arrive at an interpretation of Article 11 of Regulation No 3 which is compatible with the said article.
2. The answer to the question
(a) The application of Regulation No 3 to the present case
According to the Commission, the fact that Mrs Duffy was employed only in one Member State (Belgium) and that her husband was employed only in another Member State (France), so that neither of them was strictly speaking a migrant worker, is not of such a nature as to exclude the application of Regulation No 3. Militating against this exclusion are Article 4 of the regulation which defines its area of application so far as persons are concerned and which in paragraphs (1) and (2) refers expressly to the case of a worker who was subject to the legislation of a single Member State, and the case-law of the Court which has expressly decided this point.
(b) The scope of Article 11 of Regulation No 3
The Commission emphasizes that Article 11(2) of Regulation No 3 expressly provides that restrictive provisions laid down by national legislation in respect of plurality of benefits apply to the beneficiary ‘even in respect of benefits acquired under a scheme in another Member State’.
By virtue or the last part or this paragraph, this rule is not to apply where benefits of the same kind are acquired in accordance with the provisions of Articles 26 and 28 of the regulation. On the other hand it remains applicable to all benefits of differing kinds (like invalidity benefits and old-age pensions, survivors' pensions and invalidity and accident benefits), such as those in the present case which are constituted partly by an old-age pension and partly by a survivor's pension.
The adoption of the said paragraph is justified by the fact that the application of the legislative systems of the Member States without territorial restrictions may be regarded as a logical complement or a kind of counterpart to the other provisions of the regulation which abolish in favour of the persons concerned the territorial restrictions with regard to the acquisition, maintenance, calculation and payment of benefits.
(c) The correctness of this interpretation in relation to Article 51 of the EEC Treaty
The Commission observes finally that although the Court has in fact in a number of its judgments given an interpretation of Regulation No 3 which is favourable to the persons concerned it does not necessarily follow that it has recognized the principle that the rules of Community law are applicable only if it is established that they are more beneficial to the persons concerned than the national law in itself. Various passages from the case-law of the Court, especially the judgments in Cases 4/66 and 12/67, afford grounds for doubting whether this conclusion is correct.
According to the Commission, a solution of the problem of the relationship between Article 11 of Regulation No 3 and Article 51 of the Treaty must be founded on the concept of ‘coordination of national legislative systems’, which forms the basis of the two rules. This coordination gives rise to problems the solution of which is made the more difficult since Article 51 of the Treaty, which forms the basis of the regulations concerning social security, is restricted to setting out as guidelines two factors, which are indeed important, in this coordination: the aggregation of all periods taken into account under the laws of the several countries and the payment of benefits to persons resident in the territories of Member States. However, these two factors merely constitute particular applications of a general principle which forms the basis of any international coordination and the concept thereof: the abolition of territorial restrictions by taking into account factors originating in another Member State as if they had originated on the territory of the State in question.
This principle is frequently applied in regulations concerning social security where it has given rise to numerous provisions whose aim is to settle positive and negative conflicts of national laws. All these provisions are derived from the same principle and complement one another to such an extent that it is difficult to conceive that it might be possible to deny that certain provisions are applicable on the ground that their object is to settle positive conflicts, since on such a view coordination on the Community level would be incomplete and lack coherence. The Court of Justice has moreover recognized the complementary nature of this relationship as regards Article 52(1) of Regulation No 3 (judgment in Case 33/64).
The Commission finally adds that Mrs Duffy's view that, since she did not benefit from the more favourable provisions of Regulation No 3 with regard to the conditions relating to the acquisition of her pension rights, it would be illogical to apply to her the provisions of this regulation with regard to the ascertainment of those rights in such a manner as to restrict them, is mistaken. Although it is true that her rights were acquired in Belgium under Belgian legislation alone, it is also true that it is precisely owing to Regulation No 3 that the Belgian pension is paid to her in France, as in the absence of this regulation the old-age pension is not payable outside that country under the said legislation.
The Commission ends by expressing the view that an affirmative answer should be given to the question put by the Cour d'appel, Paris.
Grounds of judgment
1. By a judgment of 27 June 1969 which was received at the Court Registry on 30 July 1969, the Cour d'appel, Paris, has referred to the Court of Justice under Article 177 of the Treaty establishing the EEC, the question: ‘Can Regulation No 3, concerning social security for migrant workers, especially Article 11(2) dealing with provisions for the reduction or suspension of benefit, apply as against a widow who is in receipt of an old-age pension obtained by virtue of her having worked as a wage-earner in one Member State and who claims in a second Member State where she has her permanent residence the survivor's pension acquired by her husband in the second Member State’.
The request for interpretation may be reduced to the question in what circumstances the provisions for reduction or suspension laid down by the legislation of one Member State are applicable, by virtue of Article 11(2) of Regulation No 3, as against an insured person when there is plurality of one benefit with other social security benefits acquired under a scheme in another Member State.
3. Under Article 4(1) of the said regulation it is applicable ‘to wage-earners or assimilated workers who are or have been subject to the legislation of one or more Member States … , as also to the members of their families and their survivors’.
4. From a comparison of that article with Article 11(2) it appears that the latter may apply to workers who have been subject to the legislation of a single Member State.
5. Under Article 11(2) provisions in the legislation of one Member State for the reduction or suspension of benefit where there is plurality with other social insurance benefits shall apply to a beneficiary even in respect of benefits acquired under a scheme in another Member State.
6. In order to define the meaning and scope of this provision it must be interpreted in the light of Articles 48 to 51 of the Treaty which constitute the basis, the framework and the bounds of the social security regulations.
7. Since those articles are intended to ensure the free movement of workers by conferring on them certain rights, to reduce the rights of workers without conferring upon them the compensating benefits prescribed in the regulations would be to depart from the purpose and framework of the said provisions.
8. In cases in which the regulations confer on workers social security benefits which they would otherwise be unable to obtain, limitations may be imposed on them corresponding to the advantages which they derive therefrom.
9. In the absence of such a counterbalance, such limitations cannot be justified since they would result in placing the worker in a situation less favourable than that which, were it not for the regulations, would follow from the application of national law or of the special conventions between Member States.
10. Consequently restrictions, such as those provided for or permitted by Article 11(2) of Regulation No 3 with regard to certain social security benefits, are only applicable to insured persons if they are in receipt of benefits acquired through the application of that regulation.
Costs
11. The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable.
12. Since these proceedings are, in so far as the parties to the main action are concerned, in the nature of a step in the action pending before the Cour d'appel, Paris, the decision on costs is a matter for that court.
On those grounds, Upon reading the pleadings: Upon hearing the report of the Judge-Rapporteur; Upon hearing the observation of the defendant in the mam action and the Commission of the European Communities; Upon hearing the opinion of the Advocate-General; Having regard to the Treaty establishing the European Economic Community, especially Articles 48 to 51 and 177; Having regard to Regulation No 3 of the Council of the European Economic Community of 25 September 1958, especially Articles 4, 11 and 19; Having regard to the Protocol on the Statute of the Court of Justice of the European Economic Community, especially Article 20; Having regard to the Rules of Procedure of the Court of Justice of the European Communities, THE COURT in answer to the question referred to it by the Cour d'appel, Paris, (Social Chamber) by judgment of 27 June 1969, hereby rules: