Marion Klein v European Commission (307/87)

Contents

Judgment of the Court (Third Chamber)31 January 1989^noteIn Case 307/87Marion Klein, a former official of the Commission of the European Communities, residing at 7 Timianvej, 8600 Silkeborg, Denmark, represented by Georges Vandersanden of the Brussels Bar, with an address for service in Luxembourg at the Chambers of Alex Schmitt, 13 boulevard Royal,vCommission of the European Communities, represented by its Legal Adviser, Joseph Griesmar, acting as Agent, with an address for service in Luxembourg at the office of Georgios Kremlis, a member of its Legal Department, Jean Monnet Building, Kirchberg,THE COURT (Third Chamber)composed of G. Grévisse, President of the Chamber, J. C. Moitinho de Almeida and M. Zuleeg, Judges,Advocate General: F. JacobsRegistrar: B. Pastor, Administratorhaving regard to the Report for the Hearing and following the hearing on 1 December 1988,after hearing the Opinion of the Advocate General delivered at the sitting on 7 December 1988,gives the following

Judgment

1By an application lodged at the Court Registry on 8 October 1987 Marion Klein, a former official of the Commission of the European Communities, brought an action for the annulment of the decision of 17 December 1986, confirmed on 10 July 1987, by which the Commission refused her application for the household allowance.

2The applicant was retired on grounds of invalidity as from 1 May 1986. Pursuant to the third paragraph of Article 78 of the Staff Regulations she receives an invalidity pension, the rate of which was fixed at 69.166% of her former basic salary, corresponding to Grade LA 4, Step 6.

3Mrs Klein's husband, an official of the Council of the European Communities, retired on 1 October 1986 pursuant to the provisions of Council Regulation No 3518/85 of 12 December 1985 introducing special measures to terminate the service of officials of the European Communities as a result of the accession of Spain and Portugal (Official Journal 1985, L 335, p. 56).

4Pursuant to Article 4(1) of the regulation Mrs Klein's husband receives a so-called termination of service allowance equal to 70% of the basic salary corresponding to Grade LA 5, Step 5, which he was receiving when he retired. Pursuant to Article 4(5) of the regulation Mrs Klein's husband receives in addition the household allowance which, in accordance with Article 1 of Annex VII to the Staff Regulations to which Article 4(5) of Regulation No 3518/85 refers, is fixed at 5% of the basic salary.

5The applicant considers herself to be entitled, in place of her husband, to payment of the household allowance pursuant to Article 1(4) of Annex VII to the Staff Regulations, which provides that ‘In cases where ... a husband and wife employed in the service of the Communities are both entitled to the household allowance, this shall be payable only to the person whose basic salary is the higher’.

6Reference is made to the Report for the Hearing for the facts of the case and the arguments of the parties, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court.

7In refusing the applicant's request for the household allowance the Commission relied on Article 1(3) of Annex VII to the Staff Regulations, which provides that:(3) If the spouse of an official is gainfully employed, with an annual income before deduction of tax, of more than the basic annual salary of an official in the third step of Grade C 3, weighted at the rate for the country where the spouse carries out his or her occupation, the official entitled to the household allowance shall not receive this allowance save by special decision of the appointing authority. The official shall, however, be entitled to the allowance where the married couple have one or more dependent children.’

8In the Commission's view, the termination of service allowance received by an official who has terminated his employment pursuant to Council Regulation No 3518/85 must be treated as income arising from ‘gainful employment’ within the meaning of Article 1(3) of Annex VII to the Staff Regulations.

9In its view, the termination of service allowance constitutes replacement income intended to ensure the means of existence for an employee who no longer has the possibility of pursuing an occupation, just like sickness benefits paid by social security institutions to an employee who has had to interrupt his work, unemployment benefits, allowances payable on dismissal, or the salary received by an official subject to a disciplinary suspension measure. Such income should be taken into account for the purposes of Article 1(3).

10The Commission argues that if voluntary termination were not covered by that provision, there would be an infringement of the principle of equal treatment. The applicant's interpretation of the provision would mean that the household allowance would be granted to a couple of officials both of whom are in Category A simply because one of them was subject to a measure of voluntary termination whereas another couple, one being an official in a grade lower than Grade A and the other not being an official, could not receive such an allowance if, in view of the income received by the spouse who was not an official, Article 1(3) were applicable.

11The Commission's arguments cannot be accepted.

12First of all, the income to be taken into account pursuant to Article 1(3) of Annex VII to the Staff Regulations is that arising from gainful employment. However, a person covered by the special scheme for the termination of service is not in employment of that kind. As the Commission itself recognizes, the wording of the aforesaid provision does not cover the allowance received by the applicant's husband.

13The arguments put forward by the Commission do not allow the provision in question to be given an interpretation which would override its actual wording.

14In the first place, the special measure which is provided for by Regulation No 3518/85 and which covers Mrs Klein's husband involves the definitive termination of service. Contrary to what the Commission contends, the position of Mrs Klein's husband cannot therefore be equated with that of an employee on sick leave or unemployed or of an official subject to a disciplinary suspension measure. It is more akin to that of the recipient of an invalidity pension or a retirement pension, which the Commission agrees is not income from gainful employment within the meaning of Article 1(3) of Annex VII to the Staff Regulations.

15In the second place, the principle of equal treatment cannot be invoked, as is done by the Commission, to prevent the application of the provisions of Article 1(3) of Annex VII to the Staff Regulations. The position of a spouse who, as the recipient of an allowance for termination of service, has definitively terminated his service is not comparable to that of a spouse who continues in gainful employment. If that argument were accepted, it would also have to be accepted that not to apply the aforementioned provision to invalidity pensions and retirement pensions would entail an infringement of the principle of equal treatment, which the defendant rules out.

16It follows from the foregoing considerations that the Commission's decision refusing to grant the household allowance to the applicant must be annulled.

Costs

17Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been asked for in the successful party's pleading. Since the Commission has failed in its submissions, it must be ordered to pay the costs.

Operative part

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

(1).Annuls the decision of 17 December 1986 refusing to grant the household allowance to the applicant;

(2).Orders the Commission to pay the costs.

Delivered in open court in Luxembourg on 31 January 1989.