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Judgment of the Court of 16 December 1963. - Société des Aciéries du Temple v High Authority of the European Coal and Steel Community. - Case 36-62. European Court reports French edition Page 00585 Dutch edition Page 00611 German edition Page 00621 Italian edition Page 00575 English special edition Page 00289 Danish special edition Page 00447 Greek special edition Page 01009 Portuguese special edition Page 00353

Summary Parties Subject of the case Grounds Decision on costs Operative part

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WRONGFUL ACT OR OMISSION INDUCING ERROR ON THE PART OF A PARTY CONCERNED - RESULTING INJURY - DIRECT CAUSALITY - CRITERIA

( ECSC TREATY, ARTICLE 40 )

THE EXISTENCE OF A DIRECT RELATIONSHIP OF CAUSE AND EFFECT BETWEEN CONDUCT OF THE ADMINISTRATION CONSTITUTING A WRONGFUL ACT OR OMISSION AND INJURY RESULTING FROM THE FACT THAT SUCH CONDUCT INDUCED AN ERROR ON THE PART OF A PERSON CONCERNED PRESUPPOSES THAT SUCH CONDUCT COULD AND SHOULD CAUSE SUCH AN ERROR IN THE MIND OF A PRUDENT PERSON .

IN CASE 36/62

SOCIETE DES ACIERIES DU TEMPLE, A LIMITED COMPANY HAVING ITS REGISTERED OFFICE AT BILLANCOURT ( SEINE ), REPRESENTED BY ITS GENERAL MANAGING DIRECTOR IN OFFICE, EUGENE DE SEZE, ASSISTED BY JEAN DE RICHEMONT, ADVOCATE OF THE COUR D'APPEL, PARIS, WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE CHAMBERS OF GEORGES MARGUE, 20 RUE PHILIPPE-II, APPLICANT,

V

HIGH AUTHORITY OF THE EUROPEAN COAL AND STEEL COMMUNITY, REPRESENTED BY ITS LEGAL ADVISER, ITALO TELCHINI, ACTING AS AGENT, ASSISTED BY JEAN COUTARD, ADVOCATE AT THE CONSEIL D'ETAT, PARIS, WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT ITS OFFICES, 2 PLACE DE METZ,

DEFENDANT,

APPLICATION FOR REPARATION FOR INJURY CAUSED BY AN ALLEGED WRONGFUL ACT OR OMISSION ON THE PART OF THE DEFENDANT;

ON THE SUBSTANCE OF THE CASE

THE APPLICANT CONTENDS THAT THE CONDUCT OF THE HIGH AUTHORITY IN DRAFTING AND APPLYING THE BASIC DECISIONS GOVERNING THE EQUALIZATION SCHEME IN QUESTION AMOUNTED TO A WRONGFUL ACT OR OMISSION .

THIS WRONGFUL ACT OR OMISSION LED THE APPLICANT'S PREDECESSOR, SNUPAT, TO THE MISTAKEN BELIEF THAT THE FERROUS SCRAP WHICH IT RECEIVED FROM REGIE RENAULT WAS EXEMPT FROM EQUALIZATION . SNUPAT THEREFORE CARRIED ON ITS BUSINESS IN A MANNER WHICH SUBSEQUENTLY PROVED DETRIMENTAL .

THE APPLICANT SUBMITS THAT THE WRONGFUL ACT OR OMISSION WHICH IT IMPUTES TO THE HIGH AUTHORITY CAUSED THE INJURY OF WHICH IT COMPLAINS; IT IS, THEREFORE, APPROPRIATE TO EXAMINE THIS QUESTION FIRST OF ALL AND TO ESTABLISH WHETHER A CAUSAL LINK ACTUALLY EXISTS BETWEEN THE ALLEGED WRONGFUL ACT OR OMISSION AND THE ALLEGED INJURY . FOR THE PURPOSES OF THIS EXAMINATION, ONE MUST ASK NOT WHETHER THE CONDUCT OF THE DEFENDANT IN FACT CAUSED THE ERROR, BUT WHETHER IT COULD AND SHOULD HAVE CAUSED SUCH AN ERROR IN THE MIND OF A PRUDENT PERSON .

THE BASIC DECISIONS WHICH ARE THUS AT ISSUE AND WHICH CONCERN THE SUCCESSIVE RULES OF THE EQUALIZATION SCHEME ( 22/54, 14/55 AND 2/57 ) MUST BE CONSIDERED NOT IN THE LIGHT OF LATER - CASE-LAW, BUT ACCORDING TO THE SITUATION PREVAILING AT THE TIME OF THEIR PUBLICATION .

ALTHOUGH THESE DECISIONS DID NOT EXPRESSLY REFER TO GROUP FERROUS SCRAP, CERTAIN FACTORS MUST NEVERTHELESS HAVE LED THE UNDERTAKINGS TO CONSIDER THAT IT WAS NOT EXCLUDED .

THESE DECISIONS, WITH A VIEW TO DEFINING THE NUMBER OF CONTRIBUTORS, USED THE CONCEPT OF 'UNDERTAKING' WITHIN THE MEANING OF ARTICLE 80 OF THE ECSC TREATY, A CONCEPT WHICH DISTINGUISHES PERSONS HAVING RIGHTS AND DUTIES AND WHICH, UNLESS THE CONTEXT OTHERWISE PROVIDES, REFERS TO AN ECONOMIC ENTITY DISTINGUISHED BY A DISTINCT LEGAL PERSONALITY .

FURTHER, THE TERM 'BOUGHT' USED BY DECISIONS 22/54 AND 14/55 TO IDENTIFY THE FERROUS SCRAP LIABLE TO ASSESSMENT COULD AT LEAST RENDER POSSIBLE AND EVEN LIKELY THE APPLICATION OF THESE ARRANGEMENTS TO EVERY SALE OR SIMILAR TRANSACTION BETWEEN LEGALLY DISTINCT UNDERTAKINGS .

THIS POSSIBILITY BECAME ALL THE MORE LIKELY SINCE DECISION 2/57, IN ORDER TO DEFINE EXEMPTED FERROUS SCRAP, ALSO USED THE CONCEPT OF 'OWN RESOURCES', THUS EVOKING THE LEGAL CONCEPT OF 'OWNERSHIP '.

EVEN THOUGH THEY WERE CAPABLE OF RAISING DOUBTS IN THE MINDS OF THE UNDERTAKINGS CONCERNED, THE BASIC DECISIONS WERE ILL-SUITED TO PROVIDE ASSURANCE THAT THE FERROUS SCRAP IN QUESTION WAS EXEMPT FROM EQUALIZATION . THE APPLICANT ITSELF ALLEGES THAT, BY LETTER OF 19 OCTOBER 1956, SNUPAT HAD PUT THIS QUESTION TO THE DEFENDANT WITHOUT RECEIVING A REPLY . THESE CIRCUMSTANCES CONFIRM IN FACT THAT SNUPAT WAS AWARE OF THE POSSIBILITY OF ASSESSMENT .

IN THIS SITUATION, IF SNUPAT SAW NO POINT IN TAKING THE MEASURES NECESSARY IN ORDER TO MEET THIS POSSIBILITY, AND IF ITS CALCULATION OF THE COST PRICE THUS TURNED OUT TO BE WRONG, IT IS THE COMPANY'S OWN LACK OF FORESIGHT WHICH DIRECTLY CAUSED THE DIFFICULTIES WHICH IT NOW DESCRIBES AS INJURY .

SECONDLY, IT SHOULD ALSO BE CONSIDERED WHETHER THE ATTITUDE ADOPTED BY THE DEFENDANT IN APPLYING THE BASIC DECISIONS WAS LIKELY TO LEAD THE APPLICANT INTO ERROR .

IN THIS RESPECT, THE APPLICANT'S FIRST CONTENTION IS THAT THE DEFENDANT'S LETTER OF 18 DECEMBER 1957 ONLY DEFINED 'OWN RESOURCES' AND THUS LEFT DOUBT AS TO THE REAL MEANING OF THE EXPRESSION 'BOUGHT FERROUS SCRAP '. THE AIM OF THIS DEFINITION WAS CLEARLY TO DETERMINE WHICH FERROUS SCRAP WAS EXEMPT . IT COULD HAVE BEEN DEDUCED A CONTRARIO THAT THE DEFENDANT CONSIDERED AS ASSESSABLE ALL FERROUS SCRAP WHICH DID NOT COMPLY WITH THAT DEFINITION . THIS COMPLAINT IS THUS UNFOUNDED .

THE APPLICANT NEXT CONTENDS THAT THERE WERE 'DELAYS AND UNCERTAINTIES' IN DEFINING THE CONCEPT OF 'OWN RESOURCES '.

IT HAS ALREADY BEEN DECLARED THAT THE BASIC DECISIONS, EVEN BEFORE BEING INTERPRETED BY THE DEFENDANT, COULD NOT LEAD TO ANY CERTAINTY IN THE MINDS OF THOSE CONCERNED . THIS COMPLAINT CANNOT BE ACCEPTED .

FINALLY, THE APPLICANT MAINTAINS THAT THE GRANT OF CERTAIN EXEMPTIONS AND THE REFUSAL TO WITHDRAW THEM HAD LET SNUPAT TO CONSIDER THAT THE FERROUS SCRAP IN QUESTION WAS NOT LIABLE TO ASSESSMENT .

THE LETTER OF 17 APRIL 1958 CLEARLY SHOWED THAT THE DEFENDANT ONLY INTENDED TO INCLUDE IN 'OWN RESOURCES' FERROUS SCRAP TRANSFERRED BETWEEN 'LOCALLY INTEGRATED' UNDERTAKINGS .

THEREFORE SNUPAT, WHOSE WORKS WERE NOT LOCALLY INTEGRATED WITH THOSE OF REGIE RENAULT, COULD NOT REASONABLY HAVE ANTICIPATED BEING GRANTED AN EXEMPTION .

THE MOST IT COULD ENVISAGE WAS THE MERE POSSIBILITY OF ANNULMENT OF THE REFUSAL TO EXTEND THE EXEMPTIONS TO 'GROUP FERROUS SCRAP' OTHER THAN THAT DISCUSSED IN THIS LETTER . HERE TOO THEREFORE THERE WAS NEITHER CERTITUDE NOR PROBABILITY .

MOREOVER, ANY SUCH HOPES WERE CRUSHED BY THE FIRST SNUPAT JUDGMENT ON WHICH THE COURT RULED THAT THE FERROUS SCRAP RECEIVED BY SNUPAT FROM REGIE RENAULT SHOULD BE SUBJECT TO EQUALIZATION .

THE SUBSEQUENT REFUSAL OF THE DEFENDANT TO WITHDRAW THE EXEMPTIONS GRANTED WAS THUS INCAPABLE OF LEADING SNUPAT INTO ERROR IN ITS OWN CASE . THIS LAST COMPLAINT IS ALSO UNFOUNDED .

IT FOLLOWS FROM ALL THESE CONSIDERATIONS THAT THERE IS NO DIRECT RELATIONSHIP OF CAUSE AND EFFECT BETWEEN THE BEHAVIOUR IMPUTED TO THE DEFENDANT AND THE ALLEGED INJURY .

THE APPLICATION MUST THEREFORE BE DISMISSED AS UNFOUNDED .

UNDER THE TERMS OF ARTICLE 69 ( 2 ) OF THE RULES OF PROCEDURE THE UNSUCCESSFUL PARTY SHALL BE ORDERED TO PAY THE COSTS .

IN THIS CASE, THE APPLICANT HAS FAILED IN ALL ITS SUBMISSIONS .

IT MUST THEREFORE BE ORDERED TO BEAR THE COSTS .

THE COURT

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