Case C‑173/22
MG
v
European Investment Bank
Judgment of the Court (First Chamber) of 30 November 2023
(Appeal – Civil service – Staff of the European Investment Bank (EIB) – EIB Staff Rules – Remuneration – Family allowances – Payment to the sole parent with full custody of the child – Charter of Fundamental Rights of the European Union – Article 41(2) – Right to be heard – Plea of illegality in respect of the Staff Rules – Principle of equal treatment – Principle of proportionality – Action for annulment and for damages)
1. Officials – Principles – Rights of the defence – Obligation to hear the person concerned before adopting a measure adversely affecting him or her – Scope
(Charter of Fundamental Rights of the European Union, Art. 41(2)(a))
(see paragraphs 21-24, 32)
2. Officials – Staff of the European Investment Bank – Remuneration – Family allowances – Decision of the administration transferring the entitlement to allowances from one parent to another – Adoption of the decision without giving the parent whose entitlement to allowances is withdrawn the prior opportunity to submit his or her observations – Infringement of the right to be heard – Consequences
(Charter of Fundamental Rights of the European Union, Art. 41(2)(a); Staff Regulations of the European Investment Bank, Art. 41)
(see paragraphs 28, 31, 33-41)
3. Officials – Staff of the European Investment Bank – Remuneration – Family allowances – Dependent child allowance – Conditions for granting – Actual maintenance – The Bank’s internal rules providing for dependent child allowances to be paid only to the parent with custody of the child – Infringement of the principles of equal treatment and proportionality
(Charter of Fundamental Rights of the European Union, Art. 20; Staff Regulations of the European Investment Bank, Annex I)
(see paragraphs 45-56)
4. Actions brought by officials – Actions for damages – Annulment of the illegal act in dispute – Non-material harm capable of being separated from the illegality and incapable of being fully compensated for by the annulment – Burden of proof
(Staff Regulations of Officials, Art. 91)
(see paragraph 64)
Résumé
The appellant, MG, has been a member of the European Investment Bank (EIB) staff since 1998. In 2003, he married A, who was also a member of the EIB staff. They have five children.
In 2017, A brought divorce proceedings against the appellant before the tribunal d’arrondissement de Luxembourg (District Court, Luxembourg, Luxembourg). That court fixed the residence of the children at A’s address. The appellant was granted visitation and accommodation rights every second weekend and during half of the school holidays. By order of 20 July 2018, the Luxembourg judge hearing applications for interim measures ordered that the appellant pay A maintenance in an amount corresponding to EUR 300 for each of their children, and certain other costs.
By letter of 11 October 2018 (‘the letter of 11 October 2018’), the EIB informed the appellant that he would no longer be entitled to the family allowance, the dependent child allowance and the education allowance (together, ‘the family allowances’), or to the derived financial rights, since those entitlements had been granted to A. That letter followed a conciliation procedure opened at A’s request under Article 41 of the EIB Staff Regulations, (1) without the appellant having been informed of this.
The appellant lodged an action seeking, in essence, annulment of the letter of 11 October 2018. That action was dismissed by the General Court in its judgment of 21 December 2021, MG v EIB. (2)
Hearing an appeal, the Court of Justice sets aside the judgment of the General Court on the ground that the General Court erred in law in finding that the appellant’s right to be heard had not been infringed and in holding that the EIB Staff Rules which provide that, in order to be regarded as a dependent child of a member of staff, the child must effectively be maintained by that member of staff – such effective maintenance requiring that it be demonstrated, inter alia, that the child lives in his or her household – do not infringe the principles of equal treatment and proportionality.
Findings of the Court
First, the Court of Justice observes that, under Article 41(2) of the Charter of Fundamental Rights of the European Union (‘the Charter’), the right to good administration includes, inter alia, the right of every person to be heard before any individual measure which would affect him or her adversely is taken.
As follows from its very wording, that provision is of general application. Accordingly, the right to be heard must be observed in all proceedings which are liable to culminate in a measure adversely affecting a person, even where the applicable legislation does not expressly provide for such a procedural requirement.
In an administrative procedure, the right to be heard implies that the person concerned must have been put in a position effectively to make known his or her views on the draft decision, in the context of an oral and/or written exchange initiated by that authority, evidence of which it must provide. In particular, the person concerned must have been expressly informed of a draft decision and been invited to submit his or her comments. Only then, mindful of the consequences of the proposed decision, will he or she have been put in a position to influence the decision-making process at issue.
In the present case, the EIB did not put the appellant in the position to submit his observations in good time and, therefore, to influence the decision-making process at issue.
The Court adds that, in order for an infringement of the right to be heard of the person concerned to lead to the annulment of an individual decision of the administrative authority which may be unfavourable to him or her, that authority must have had discretion in taking the decision in question.
That is the position in the present case. The Court rejects the EIB’s assertion that a different apportionment of the family allowances between the appellant and his ex-wife would not have been possible in the light of the EIB Staff Rules. The Court points out that it is apparent from the findings made by the General Court that the EIB could have adopted a different interpretation of its own Staff Rules and that the EIB therefore had discretion, so that the outcome of the procedure at issue might have led to a different decision if the appellant had been given the opportunity to submit his observations before the letter of 11 October 2018 was adopted.
The Court of Justice also holds that the EIB Staff Rules, in so far as their interpretation does not permit under any circumstance the inference that a parent who has not been granted sole custody of a child effectively contributes to the maintenance of that child, breach the principles of equal treatment and proportionality.
The dependent child allowance reflects a social objective justified by the expenses arising from a present and definite need, linked to the existence of the child and to his or her effective maintenance. In the light of that objective, the relevant criterion for deciding whether, as regards the payment of dependent child allowances, the parent who has sole custody of the child is in a situation comparable to that of the parent who does not have custody is that of their respective financial contribution to the maintenance of that child.
It follows that parents who both effectively contribute to the maintenance of their child are in a comparable situation as regards payment of the dependent child allowances, and that payment, as a matter of principle, of those allowances to only one of them constitutes a difference in treatment which must be objectively justified.
In that regard, the fact that one of the parents does have sole custody of the child, and accordingly that child lives in that parent’s household, means, in principle, that that parent will effectively contribute to the maintenance of that child. However, that circumstance does not in any way preclude the other parent, even if he or she does not have sole custody of the child, from also contributing effectively to the child’s maintenance, in particular, having regard to that child’s right, enshrined in Article 24(3) of the Charter, to maintain on a regular basis a personal relationship and direct contact with both his or her parents, unless that is contrary to his or her interests.
In this context, it is important also that the principle of proportionality be observed; that principal requires that measures adopted by the EU institutions should not exceed the limits of what is appropriate and necessary in order to attain the objectives legitimately pursued by the legislation in question and, where there is a choice between several appropriate measures, recourse must be had to the least onerous, and the disadvantages caused must not be disproportionate to the aims pursued.
In that regard, while the existence of a judicial decision handed down by a national court or tribunal which fixes the amount of the contributions a divorced official is obliged to pay towards the maintenance of a child constitutes a factor which must be taken into consideration by the institution, that factor cannot relieve that institution from exercising itself its discretion in order to determine whether that official effectively contributes to the maintenance of the child.