Case T-171/99

Corus UK Ltd

v

Commission of the European Communities

‛Action for damages — Recovery of undue payments — Harm suffered by reason of a partially annulled decision’

Judgment of the Court of First Instance (First Chamber), 10 October 2001   II-2972

Summary of the Judgment

1. Actions for damages — ECSC — Application initiating proceedings — Pleas in law relied on — Error in designating the applicable text — Irrelevant

   (Arts 34 CS and 40 CS, first para.)

2. Actions for damages — ECSC — Harm suffered by reason of decisions — Basis of the application — Specific legal remedy laid down by Article 34 CS

   (Arts 34 CS and 40 CS, first para.)

3. Actions for damages — ECSC — Harm suffered by reason of decisions — Application based on the third sentence of Article 34 CS, first para. — Conditions — Prior finding of fault on the part of the Community resulting in direct and special harm — Compliance with a reasonable time-limit within which the Commission is to take compensatory steps — Nature of the fault

   (Art. 34 CS, first para., second and third sentences, and second para.)

4. Community law — Principles — Principle prohibiting unjust enrichment of the Community — Principle constituting one of the general principles of Community law

5. Actions for damages — ECSC — Harm suffered by reason of decisions — Application based on the second sentence of Article 34 CS, first para. — judgment annulling or reducing the fine imposed on an undertaking for breach of the competition rules — Obligation to adopt the measures necessary to eliminate the effects of the illegality found — Scope

   (Art. 34 CS, first para., second sentence)

1.  There is no need to take account of possible errors made by the applicant in designating the text applicable to its claims since the purpose of the proceedings and summary of the pleas in law appear sufficiently clearly from the application.

   (see para. 36)

2.  According to the express wording of Article 34 CS and Article 40 CS, first paragraph, Article 34 CS provides for a specific legal remedy, distinct from that provided by the general rule of Community liability under Article 40 CS, in cases where the injury relied upon results from a decision of the Commission that has subsequently been annulled by the Community courts. It follows that, if no fault other than that constituted by the annulled decision has contributed to the damage relied on, the applicant can seek to have the Community declared liable only on the basis of Article 34 CS.

   (see paras 39-40)

3.  The second and third sentences of the first paragraph of Article 34 CS draw a distinction with regard to the steps that the Commission is required to take when a matter is referred back to it after an annulment, between those steps that are necessary in order to give effect to the annulment decision, and which must be taken by the Commission as a matter of course and in all cases, even in the absence of any fault, and those steps that are compensatory in nature, and which need only be taken to the extent that there has been a prior finding by the Community courts that the void act was vitiated by a fault of such a nature as to render the Community liable, and to the extent that the undertaking has suffered direct and special harm. In either case, proceedings for damages under the second paragraph of Article 34 CS are admissible only in so far as the Commission has had a reasonable time to take the steps in question.

   As for the nature of the fault required to render the Community liable under the third sentence of the first paragraph of Article 34 CS, it appears both from the terms of that provision and the case-law of the Court of Justice that the mere illegality of a decision is not enough. When called upon to determine the question of the Community's liability under Article 40 CS, the Court of Justice has used descriptions such as ‘inexcusable mistakes’, ‘gravely neglected the duties of supervision’ or ‘lack of care’ which was ‘Obvious’. In order to determine the nature of the fault necessary to render the Community liable, whether under Article 34 CS or Article 40 CS, it is necessary to take into account the fields and circumstances in which the Community institution acts. In that respect particular account must be taken of the complexity of the situations which the institution must regulate, the difficulties of applying the legislation and the discretion available to the institution under that legislation.

   (see paras 44-45)

4.  The unjust enrichment of the Community is contrary to the general principles of Community law.

   (see para. 55)

5.  As a consequence of a judgment of annulment, which takes effect ex tunc and thus has the effect of retroactively eliminating the annulled measure from the legal system, the defendant institution is required, by virtue of Article 34 CS, to take the necessary measures to reverse the effects of the illegalities as found in the judgment of annulment, which, in the case of an act already enforced, may take the form of restoring the applicant to the position he was in prior to that act.

   Foremost amongst the steps referred to in the second sentence of the first paragraph of Article 34 CS, in the case of a judgment annulling or reducing the fine imposed on an undertaking for infringement of the Treaty competition rules, is the Commission's obligation to repay all or part of the fine paid by the undertaking in question, in so far as that payment must be described as a sum unduly paid following the annulment decision. That obligation refers not only to the principal amount of the fine unduly paid, but also to the interest on that amount.

   First, the payment of default interest on the amount overpaid would seem to be an essential component of the Commission's obligation to restore the applicant to his original position following a judgment of annulment, or a judgment exercising the Court's unlimited jurisdiction, since complete reimbursement of a fine unduly paid cannot leave out of account factors, such as the effluxion of time, which may in fact reduce its value. Proper compliance with such a judgment therefore requires, in order fully to restore the applicant to the position in which it legally should have been, that account be taken that such restoration only occurred after an appreciable lapse of time, during which the applicant did not have the use of the sums it had unduly paid. Second, a failure to reimburse interest could result in the unjust enrichment of the Community, which would be contrary to the general principles of Community law. It follows that the Commission is required to reimburse not only the principal amount of the fine unduly paid, but also the amount of any enrichment or benefit it has obtained as a result of such payment.

   According to a generally accepted principle in the domestic laws of the Member States concerning actions for the recovery of sums unduly paid founded on the principle prohibiting unjust enrichment, the question of payment of interest on a capital sum unduly paid is strictly dependent upon the right to recover the principal itself.

   The determination of the amount due as arrears of interest depends, directly and necessarily, on the amount of the sum unduly paid and on the time which elapsed between the undue payment, or at least the final demand served by the body collecting the payment, and its repayment. Finally, the right to receive such interest is not subject to proof of damage.

   Regarding the rate of interest, according to a principle generally accepted in the domestic law of the Member States, in an action for the recovery of a sum unduly paid based on the principle prohibiting unjust enrichment, the claimant is normally entitled to the lower of the two amounts corresponding to the enrichment and the loss. Furthermore, where the loss consists of the loss of use of a sum of money over a period of time, the amount recoverable is generally calculated by reference to the statutory or judicial rate of interest, without compounding. The same principles must be applied mutatis mutandis, to an action based on the second sentence of the first paragraph of Article 34 CS, given the similarities of the present action with such an action.

   (see paras 50-56, 60-61)