JUDGMENT OF 11. 7. 1974 — CASE 10/74 BECKER v COMMISSION

In Case 10/74

THE COURT (Second Chamber) composed of: M. Sørensen, President of Chamber, H. Kutscher and A. J. Mackenzie Stuart (Rapporteur), Judges, Advocate-General: H. Mayras Registrar: A. Van Houtte

gives the following

JUDGMENT

Facts

The facts and arguments of the parties during the written procedure may be summarized as follows:

I — Facts and procedure

The applicant took up his duties with the European Coal and Steel Community in 1953.

Article 47 (4) of the Staff Regulations of the Community (ECSC) provides that the General Regulations of the Community shall determine the amount of the installation and resettlement allowance. Under Article 12 of the General Regulations, certain officials are entitled on termination of service to a resettlement allowance equal to four months' salary, calculated by reference to their marital status and salary at the date of termination of service, provided that they move to a district more than 25 km from the place where they were employed.

On the coming into force of the 1962 ECSC Staff Regulations, the new Regulations became applicable to the applicant. On 20 June 1968 he took up duties with the single Commission in Brussels.

Under Article 93 of these 1962 ECSC Staff Regulations, the applicant is entitled to claim that their ‘Transitional and Final Provisions’ shall be applied to him.

Article 99 (3) of these provisions provides that ‘the amount of the resettlement allowance payable to an official … who terminates his service after these Regulations enter into force shall not be less than the amount which the official would have received under Article 12 of the former General Regulations of the ECSC’.

Under Article 6 (1) of Annex VII to the Staff Regulations at present in force, the official is entitled to only two months' salary as resettlement allowance in the case of an official who is head of household.

The applicant left the service on 30 April 1973 and effected on 15 May 1973 the removal of the family's furniture from Brussels to Stuttgart. At the same time he submitted an application for payment of the resettlement allowance.

During June 1973 he received payment, of an allowance equal to two months of his final basic salary.

Since he considered that he had not fully received his entitlement, the applicant lodged a complaint on 20 August 1973 claiming that the resettlement allowance should be paid on the basis not of two months but of four months of his final salary under Article 99 (3) of the 1962 ECSC Staff Regulations referring to Article 12 of the former ECSC General Regulations.

Not having received any reply, the plaintiff lodged an appeal which was filed at the Registry on 11 February 1974.

After hearing the report of the Judge-Rapporteur and the opinion of the Advocate-General, the Second Chamber decided to proceed without any preparatory inquiry.

II — Conclusions of the parties

The applicant claimed that the Court should:

1) Declare that the implied decision rejecting the applicant's complaint is void and of no effect;

2) Order the Commission to pay the applicant resettlement allowance equal to four months of his final salary;

3) Order the defendant to pay the costs.

The defendant claimed that the Court should:

1) Reject the appeal as unfounded;

2) Order the applicant to pay the costs.

III — Summary of the submissions and arguments of the parties

The applicant states that Article 92 of the Staff Regulations which came into force on 1 January 1962 formally safeguarded the benefits acquired by persons concerned before the coming into force of the 1962 Regulations and thus the right to the full application of the former Article 12 of the ECSC General Regulations, that is, resettlement allowance of four months for heads of household.

This safeguard clause is the simple application of the principle of vested rights.

In the 1962 Regulations the resettlement allowance was reduced by half in respect of all those who could not claim the advantage of officials and their dependents ‘to whom the provisions of the former ECSC Staff Regulations applied before 1 January 1962’. (Article 92 Staff Regulations.)

The former Article 12 (d) of the ECSC General Regulations provided that the resettlement allowance should be calculated on the basis of the marital status and the salary of the official at the date of termination of service or decease. The right acquired by the former employee does not therefore comprise only a number of months but also the salary at the end of his service. Article 99 (3) refers to Article 12 of the former Regulations as a whole and therefore also to subparagraph (d) which governed the question of the salary to be taken into account in the calculation of the allowance, that is the salary on the termination of service.

Under Article 12 of the former General Regulations there was only concerned with the end of service salary, which perforce increases with the salary scale.

The applicant bases himself therefore on the immutable principle of the vested right, a principle which was recognized by Article 92 of the 1962 Regulations. Since it was felt necessary to grant additional protection to former ECSC employees, Article 99 (3) of the 1962 Regulations was intended to grant them the additional protection which that Article contains, which in the applicant's opinion is superfluous, since in no case could their resettlement allowance be lower than the sum which they would have received under Article 12 of the ECSC General Regulations. It was intended to avoid anyone seeking to apply the restrictions in Annex VII of the new Regulations, that is a reduction by half. The wording is perhaps not very felicitously chosen, but it is consistent with the general tendency to safeguard every kind of vested rights.

Former ECSC employees who were entitled under the former Regulations to the separation allowance retained their privileges. Others retained the benefit of the compensatory allowance and even former ECSC employees who had received the residential allowance under individual contracts were allowed to retain it. For this reason it is not possible to adduce .arguments based on equality between former and new officials.

Article 95 of the 1962 Regulations, which relates to the possibility of a reduction in salary for some officials as a result of the coming into force of the new Regulations provides for the grant of a compensatory allowance for these officials. The reason for Article 99 (3) was the desire to ensure that those who were faced with a reduction in their salary at least had their resettlement allowance maintained at the level of their salary under the former Regulations and therefore under its salary scale. Article 99 (3) is therefore not tautologous if it is understood in this connexion, but an actual case of the application of Article 95 which precedes it.

Even accepting that Article 99 (3) is tautologous in so far as it relates to Article 12 (d) of the General Regulations, a provision otherwise clear and precise must however not be deprived of its meaning.

Quod abundat non vitiat

Even if Article 93 is perhaps a repetition, this does not change in any way the clear meaning that four months' end of service salary is obviously to be calculated on the salary scale in force when the official left the service. Any other interpretation would take away from former employees a large part of what had been granted to them before 1962. The High Authority had not thought in the past that the advantage of four or two months' end of service salary was an exorbitant advantage having regard to the conditions from 1952 to 1961, which were fundamentally different from the present conditions, and it was necessary at that time to overcome the resistance to expatriation by granting certain advantages with regard to resettlement.

The official who entered the service before 31 December 1961 acquired a right to a benefit. This was a future benefit and in some respects conditional, but the right to the benefit existed as from the employee's entry into the service. Resettlement on termination of service brought the right to fruition, for, contingent as it may have been in the past, it was nevertheless an actual right to a benefit. The fact that the official cannot request payment of the resettlement allowance in advance does not prevent the extent of the right being known to the official well beforehand, this amount being twice or four times his final salary.

Article 99 (3) refers to the former Article 12 as a whole. Such a reference as a whole does not leave open any discussion as to the continuance in force of the Article to which the new Regulations refer, and the fact that the provisions which remain in force have not been repeated in their entirety makes no difference. The former Article 12 itself is therefore still valid as regards the application of the new Article 99 (3) which refers to it expressly. The former Article 12 did not refer to salary scales, but only to a salary in force at the time of termination of service.

The applicant submits that the formal provision of Article 99 (3) provides that the amount of the allowance paid at the termination of service cannot in any event be less than it would have been under the former Article 12. This amount was not related to a salary scale; it was four times the final salary, whether reference is made to the former Article 12 (d) of the ECSC General Regulations or the new Article 6 (3) of Annex VII.

According to the defendant, the applicant can claim that the resettlement allowance should in no way be less than the amount which he would have received under Article 12 of the General Regulations of the Community (ECSC).

Article 12 fixes this allowance on the basis of four months' salary. The amount which would have been payable under Article 12 of the former General Regulations could not in any event have exceeded four months' salary calculated on the basis of the salary scale in force only until 31 December 1961.

The defendant interprets the scheme laid down by Article 99 (3) as follows:

Although as a general rule the resettlement allowance is equal to only two months' salary calculated according to the salary scale in force at the date of termination of service, nevertheless in a case where four months' salary calculated according to the former salary scale could, in respect of an employee employed by an institution of the ECSC before 1 January 1962 who left it after that date, amount to a higher allowance, this latter amount would be for this employee the minimum amount (and at the same time the maximum, in this case) of his entitlement, and this in derogation from the provisions of the new Staff Regulations, a derogation which is itself dictated by a desire to safeguard relatively established rights.

In the opposite case, where two months' salary calculated on the basis of the present salary scale would amount to more than four months' salary calculated on the basis of the salary scale in force on 31 December 1961, the general rule would apply and it would be the higher amount (2 months according to the present salary scale) which would have to be paid to the official.

In support of this interpretation the defendant refers to the fact that the actual wording of Article 99 (3) of the 1962 ECSC Regulations is limited to stating that the amount of the allowance due to an official to whom the provision relates cannot be less than the amount which would have been payable under the former Article 12. Article 99 (3) thus sought to avoid a situation whereby, as a result of the application of the new system, the persons concerned should be financially penalized by reason of the reduction of the amount of the allowance which could be paid under the new general rule in the event of their leaving after 1 January 1962, in relation to the amount which would have been paid immediately before that date, that is four times the end of service salary as at 31 December 1961.

If the intention of the draftsmen of the 1962 ECSC Staff Regulations had been that the allowance of four months' salary due to employees referred to in Article 99 (3) should be calculated on the basis of the new salary scale, there would have been no reason for them to have employed the phrase ‘may not be less’ which conjures up an idea of comparison and checking which necessarily has to be carried out.

This interpretation of Article 99 (3) has regard to:

The desire shown by the draftsmen of the 1962 Regulations not to prejudice old employees through the amendment of the Regulations reducing by half the number of months taken into account in determining the resettlement allowance.

The balance of the alteration of the salary scale and the stricter definition which they have given to the rules governing resettlement allowance.

The reasonable concern not to grant old employees an additional advantage which would have arisen from the calculation of the allowance on the basis not only of the number of months formerly and still granted but in addition on the basis of the new salary scale.

The principle illustrated by Article 102 (5) of the Regulations at present in force which entails that rights acquired under the system of the former Regulations may not lead, by a combination of the old and new provisions, to the grant of excessive advantages, which could not arise either under the old system or under the current one.

Article 99 (3) of the ECSC Regulations, which is the only context in which the old Article 12 survives, is a provision concerning, not the conditions for entitlement to resettlement allowance, but the payment of the amount of this allowance. As regards the minimum distance from the place of his former; employment at which the official must resettle to be able to claim the resettlement allowance, it is clear that this distance must be 70 km under Article 6 (4), Annex VII of the new Regulations and not 25 km under Article 12 (e) of the former General Regulations.

Under Article 6, Annex VII which does not readopt the provisions of the former Article 12 (f) under which ‘the declaration of resettlement must be notified in writing within one year of termination of service’, this formality is no longer required of former ECSC officials, even those recruited before 1 January 1962.

In the case where the official dies the allowance may be paid to his widow or ‘to the dependants within the meaning of Article 2’ of Annex VII whereas under the former Article 12 (c) the resettlement allowance was provided for the widow, or if there was none, ‘to dependent children’ only.

For these reasons the defendant considers that Article 6 of Annex VII of the present Regulations has complete authority as regards the conditions of entitlement to resettlement allowance. There is no provision in Article 99 (3) referring to the former Article 12 (f) and (c) and keeping it in force.

Since it is a question only of the payment of the allowance the defendant considers that Article 99 (3) of the 1962 ECSC Regulations has introduced simply a relative and not an absolute derogation from the provisions of Article 6 of Annex VII to the present Regulations. If today there is still cause to refer to the former Article 12, having regard to Article 99 (3) of the 1962 ECSC Regulations, still in force, it is only in so far as Article 12 establishes the rules for paying the allowance. It is thus basically a question of Article 12 (a), which provides that the allowance is four months for an official who is head of household and two months for an official who is not so. The former rule applies only in so far as it derogates, from the present general rule.

Not having survived as such in the present rule, the former Article 12 (d) does not, properly speaking, establish vested rights in favour of former ECSC officials who took up duties before 1 January 1962 and who are currently leaving the service. At present they have the same right to have their allowance paid on the basis of the last salary which was paid to them: they have this right however not as a vested right but solely under the wording of Article 6 (3) of Annex VII to the present Regulations which is included in a system under the Regulations which lays down differently the conditions of payment of the allowance.

The derogation in Article 6 (1) of Annex VII to the Regulations provided for in Article 99 (3) must in any case be interpreted strictly: it can only be limited to referring to the conditions of payment of the allowance such as they were in force before 1 January 1962. These were necessarily determined in relation to a particular salary scale.

The restrictive interpretation has the merit of doing the less violence to the principle of equality of treatment within the same body, which is a firm principle and applies strictly to an administration save express and unequivocal derogation.

The concept of a relationship between the employee and the Community administration existing not under a contract but under the Regulations prevents the admission, subject to the safeguard clauses inserted in the new Regulations, of the existence of vested rights: the principle generally accepted is that there are no vested rights in the maintenance of Regulations.

In order that there should be a vested right on the basis of the former Regulations to pecuniary benefits arising from the termination of service, it is necessary for all the facts giving rise to the right to have occurred while the former rules were in force. The official cannot on principle be entitled at the time of his resettlement to have the amount of his benefit calculated solely on the basis of rules which were previously in force but which have ceased to be so.

According to the Commission, writers and national case law agree on this point and as Mr Advocate-General Roemer has stressed in his Opinion in Boursin v High Authority (Case 102/63, Rec. 1964, p. 1394) it is right to refer to the national laws relating to public office and their principles for the solution of actual legal problems relating to the Staff Regulations of the Communities.

There is no entitlement to the benefits recognized by the Regulations except in so far as all the facts giving rise to the right occurred while the Regulations were in force. ‘This argument … is the logical consequence of the notion that the official is not in a contractual position but one governed by Regulations, for the Staff Regulations are true Regulations which can always be amended by the competent authority.’ Mr Advocate-General Gand in Pasetti v Commission (Case 20/68, Rec. 1969, p. 251).

Since the applicant did not have prior to 1 January 1962 a vested right to the benefit of the resettlement allowance, Article 92 of the Regulations cannot apply to him.

In the present case the resettlement of the applicant, which fact gave rise to the entitlement to the allowance the method of calculation of which is disputed, occurred only under the new Regulations.

A transitional provision issued on transition to a less generous system does not normally aim to give employees more extensive rights than those they had under the system which is revoked: Mr Advocate-General Gand in Chuffart and others v Commission (Cases 60, 61 and 62/69, Rec. 1970, p. 641).

The general rule is a single entity, and one of its features is the taking into account of a number of monthly salaries limited to two. If it were accepted that Article 99 (3) allowed the grant of an allowance equal to four months' salary on the basis of the current salary scale the result would be to ‘give employees more extensive rights than those they had under the system which is revoked’, which limited the allowance to four months' salary on the basis of the old salary scale.

IV — Oral procedure

The parties were heard at the hearing on 20 June 1974.

The applicant was represented by Victor Biel, avocat of the Cour Supérieure de Justice, Luxembourg and the Commission of the European Communities by its Legal Adviser, Joseph Griesmar, acting as agent.

The Advocate-General delivered his opinion on 4 July 1974.

Law

1. The appeal filed at the Registry on 11 February 1974 seeks the annulment of the implied decision rejecting the complaint made by the applicant on 20 August 1973 that his resettlement allowance should be paid on the basis of four months of his final basic salary.

2. Article 99 (3) of the ECSC Staff Regulations, which comes under Title VIII concerned with transitional and final provisions, provides that the amount of the resettlement allowance due to established officials under the old ECSC Staff Regulations who terminate their service after the new Regulations come into force shall not be less than the amount which the persons concerned would have received under the provisions of Article 12 of the former ECSC General Regulations.

3. A transitional provision issued on the transition to a less generous system does not normally seek to give employees greater rights than they would have had under the system which is revoked.

4. Such a provision cannot therefore be interpreted as allowing a combination of the more favourable method of calculation of one system with the more favourable salary scale of another.

5. Article 99 (3), in providing expressly that the amount of the allowance paid to an official shall not be less than that which he would have received under Article 12 of the former Regulations, was intended to prevent an official who terminates his service after the new system has come into force finding himself financially in a less favourable position than he would have had if he had left the service before the new system came into force.

6. Having regard to the new salary scales in force since 1 January 1962, when the amount of the allowance equal to two months' basic salary is less than the amount equal to four months' basic salary at the same grade calculated on the basis of the old salary scales, this provision enables the official concerned to enjoy the more favourable terms.

7. As soon as the new salary scales double the salaries prior to 1962, this safeguard clause is no longer applicable.

8. The appeal must therefore be rejected as unfounded.

Costs

9. The applicant has failed in his appeal.

10. Under Article 69 (2) of the Rules of Procedure, the unsuccessful party must bear the costs.

11. Nevertheless, under Article 70 of the Rules of Procedure, in actions by staff of the Communities the institutions shall bear their own costs.

On those grounds, THE COURT (Second Chamber) hereby:

1 Dismisses the appeal;

2 Orders each party to bear its own costs.