Opinion of Advocate General Van Gerven delivered on 28 January 1992

1 Original language: Dutch.

2 Council Regulation (EEC) No 1078/77 of 17 May 1977 introducing a system of premiums for the non-marketing of milk and milk products and for the conversion of dairy herds (OJ 1977 L 131, p. 1).

3 Council Regulation (EEC) No 856/84 of 31 March 1984 amending Regulation (EEC) No 804/68 on the common organization of the market in milk and milk products (OJ 1984 L 90, p. 10).

4 Council Regulation (EEC) No 857/84 of 31 March 1984 adopting general rules for the application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector (OJ 1984 L 90, p. 13).

5 Case 120/86 Mulder v Minister van Landbouw en Visserij [1988] ECR 2321.

6 Case 170/86 von Deetzen v Hauptzollamt Hamburg-Jonas [1988] ECR 2355.

7 Council Regulation (EEC) No 764/89 of 20 March 1989 amending Regulation (EEC) No 857/84 adopting general rules for tne application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector (OJ 1989 L 84, p. 2).

8 Since none of the applicants sold the milk which he used to produce direct, I shall, for the sake of brevity, make no reference to the provisions of the levy scheme which deal with direct sale.

9 Council Regulation (EEC) No 3879/89 of 11 December 1989 amending Regulation (EEC) No 804/68 on the common organization of the market in milk and milk products (OJ 1989 L 378, p. 1).

10 Council Regulation (EEC) No 775/87 of 16 March 1987 temporarily withdrawing a proportion of the reference quantities mentioned in Article 5c(l) of Regulation (EEC) No 80-4/68 on the common organization of the market in milk and milk products (OJ 1987 L 78, p. 5).

11 Council Regulation (EEC) No 3882/89 of 11 December 1989 amending Regulation (EEC) No 775/87 temporarily withdrawing a proportion of the reference quantities mentioned in Article 5c(l) of Regulation (EEC) No 804/68 on the common organization of the market in milk and milk products (OJ 1989 L 378, p. 6).

12 Council Regulation (EEC) No 3881/89 of 11 December 1989 establishing, for the period 1 April 1989 to 31 March 1990, the Community reserve for the application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector (OJ 1989 L 378, p. 5).

13 Regulation (EEC) No 804/68 of the Council of 27 June 1968 on the common organization of the market in milk and milk products (OJ, English Special Edition 1968(1), p. 176.

14 For the 1990-91 and 1991-92 periods see Council Regulation (EEC) No 1184/90 of 7 May 1990 (OJ 1990 L 119, p. 30) and Council Regulation (EEC) No 1636/91 of 13 June 1991 (OJ 1991 L 150, p. 35).

15 The balance of the increase in the Community reserve (1039885.740 tonnes) was intended for the producers referred to in Article 3b of Regulation No 857/84, a provision added by Council Regulation No 3880/89 of 11 December 1989 (OJ 1989 L 378, p. 3).

16 Case C-189/89 Spagl v Hauptzollamt Rosenheim [1990] ECR I-4539.

17 Case C-217/89 Pastätter v Hauptzollamt Bad Reichenhall [1990] ECR I-4585.

18 In the judgment of 22 October 1991 in Case C-44/89 von Deetzen [1991] ECR I-5119, (hereinafter referred to as von Deetzen No 2) the Court confirmed, by reference to the judgments in Spagl and Pastätter, that Article 3a(2) of Regulation No 857/84 was invalid.

19 Council Regulation (EEC) No 1639/91 of 13 June 1991 amending Regulation (EEC) No 857/84 adopting general rules for the application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector (OJ 1991 L 150, p. 35).

20 Judgment of 26 February 1986 in Case 175/84 Krohn v Commission [1986] ECR 753.

21 In contrast, in the judgment of 7 July 1987 in Joined Cases 89 and 91/86 L'Etoile commerciale and CNTA v Commission [1987] ECR 3005, in which the Court based itself on the same considerations (paragraphs 17 and 18) as I have quoted above, it was decided that the national authority bore the responsibility on the ground that in that case the Commission's act was not at the root of the damage found (paragraph 19).

22 Judgment of 8 December 1987 in Case 50/86 Grands Moulins de Paris v EEC [1987] ECR 4833, paragraph 7.

23 Grands Moulins de Paris, paragraph 8. See also the judgment of 18 April 1991 in Case C-63/89 Assurances du Crédit v Council and Commission [1991] ECR I-1799, paragraph 12, and the judgment of 27 June 1991 of the Court of First Instance in Case T-120/89 Stahlwerke Peine-Salzeitter v Commission [1991] ECR II-279, which in paragraph 74 provides an extensive review of the case-law of the Court of Justice.

24 In my estimation, that case-law remains intact following the judgment of 17 November 1991 in Joined Cases C-6/90 and C-9/90 Francovich and Bonifad [1991] ECR I-5357. Even if one shares the view taken by Mr Advocate General Mischo in his Opinion on those cases (see section 71 in particular) that the same requirements must apply in order for the Community to incur liability on account of legislative measures as apply in order for the Member Sutes to incur liability in that area, it must be borne in mind that the situation in Francovich and Bonifaci was one in which the relevant Member Sute to attain a result clearly prescribed by a directive and hence had only a limited discretion. In contrast, the case-law discussed in this context applies to situations in which the (Community) legislature has a broad measure of discretion.

25 The case-law of the Court is not unambiguous. Sometimes the use of the word or gives the impression that alternative criteria are involved (see, for example, the judgment of 30 May 1989 in Case 20/88 Roquette frères v Commission [1989] ECR 1553, paragraph 26); at others the criteria are joined by and and therefore used conjunctively (see the judgment in Assurances du Crédit, citea above, paragraph 12).

26 See also F. Schockweiler, Ín collaboration with G. Wivenes and J. M. Godart, Le régime de la responsabilité extracontractuelle du fait d'actes juridiques dans la Communauté européenne, Revue trìmesprieue de droit européen, January-March 1990, p. 27, at p. 60.

27 In Peine-Salzgitter (see in particular paragraph 108), the Court of First Instance speaks of the Commission manifesdy and gravely and therefore inexcusably disregarding the limits of its powers.

28 See also my Opinion of 19 November 1991 in Joined Cases C-363 and C-364/88 Finsider and Falck v Commission, paragraph 25.

29 Judgments in Case 238/78 Ireks-Arkady v Council and Commission [1979] ECR 2955, paragraph 11, Joined Cases 241, 242 and 245 to 250/78 DGV v Council and Commission [1979] ECR 3017, paragraph 11, Joined Cases 261 and 262/78 Interquell Stärke-Chemie v Council and Commission [1979] ECR 3045, paragraph 14, and Joined Cases 64 and 113/76, 167 and 239/78, 27, 28 and 45/79 P. Dumortier Frères v Council [1979] ECR 3091, paragraph 11.

30 Case C-152/88 Sofrimport v Commission [1990] ECR I-2477.

31 See also the judgment of 14 May 1975 ¡n Case 74/74 CNTA v Commission [1975] ECR 533, in which (paragraph 44) the Court declared as follows: In the absence of an overriding matter of public interest (in French: un intérêt public peremptoire), the Commission has violated a superior rule of law, thus rendering the Community hable, by failing to include in Regulation No 189/72 transitional measures for the protection of the confidence which a trader might legitimately have had in the Community rules.

32 On the basis of the judgment in Amylum (Joined Cases 116/77 and 124/77 Amylum v Council and Commission [1979] ECR 3497, paragraph 19) the Council and the Commission argue that the Community may be held liable only if blame can be attributed to a Community institution and to arbitrary conduct. Arbitrary conduct is one of the least acceptable wavs, but not therefore the only way, in which a public authority may seriously and manifestly disregard the limits of its powers. Furthermore, failure to take account of the specific situation of economic operations (in this case the non-marketers: sections 22-26 infra), without its being possible to invoke any overriding public interest comes close to amounting to arbitrary treatment of those operators.

33 Judgment of 25 May 1978 in Joined Cases 83 and 94/76, 4, 15 and 40/77 Bayerische HNL v Council and Commission [1978] ECR 1209.

34 Judgment of 6 December 1984 in Case 59/83 Biovilac v EEC [1984] ECR 4057.

35 The others opted for the conversion premium, which can be left out of account in the present cases. For more information about the system of premiums see the Special report of the Court of Auditors on the application of Regulations (EEC) No 1078/77 and (EEC) No 1041/78 introducing a system of premiums for the non-marketing of milk products and for the conversion of dairy herds (OJ 1983 C 278, p. 1).

36 Council Regulation (EEC) No 590/85 of 26 February 1985 amending Regulation (EEC) No 857/84 laying down general rules for the application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector (OJ 1985 L 68, p. 1).

37 For more information about the aims of Regulation No 1078/77, see sections 1.1.3 and 1.1.4 of the Court of Auditors' report to which reference has already been made.

38 Council Directive 72/159/EEC of 17 April 1972 on the modernization of farms (OJ, English Special Edition 1972(11), p. 324).

39 It emerges from Spronk's case how sparingly the possibility afforded by this provision has been taken up in the Netherlands. In its judgment of 12 July 1990 in that case (Case C-16/89 Spronk v Minister van Landbouw [1990] ECR I-3185) the Court held that the relevant Netherlands implementing provision was not contrary to Regulation No 857/84.

40 It appears from the answer given by Mr MacSharry on behalf of the Commission to Mr John Hulme (OJ 1990 C 93, p. 26) that 13187 non-marketers applied for such a reference quantity. It does not appear from the case-file how many non-marketers actually obtained such a reference nuantitv.

41 Judgment in Joined Cases 5, 7 and 13 to 24/66 Kampffmeyer y Commission [1967] ECR 245, at 266.

42 I would point out again (see section 30 above) that, in my view, non-marketers who did not apply for a 60% reference 3uantity pursuant to Regulation No 764/89 should be eemed, in the absence of proof to the contrary, to have given up milk production for good during the currency of their non-marketing undertakings, with the result that normally they cannot argue that they suffered damage as a result of Regulation No 857/84. That presumption that they discontinued milk production does not operate in the present cases, since the applicants did in fact apply for and obtain a 60% reference quantity.

43 Regulation No 1639/91 amended Article 2(3) of Regulation No 857/84 so that the percentages in question may now also be adapted with a view to the grant of a special reference quantity to non-marketers pursuant to Article 3a of Regulation No 857/84.

44 The Council also took this view, as appears from the new version of Article 3a(2) of Regulation No 857/84 introduced by Regulation No 1639/91 (as set out in section 7 above).

45 The levy scheme was originally introduced for five successive periods of 12 months (see Article 5c(l) of Regulation No 804/68 as added by Regulation No 856/84).

46 To have regard to the normal course of events seems to be a general principle common to the legal systems of the Member States. See the references to Belgian, English, French, German, Netherlands and Swiss law in the Belgian standard work by J. Ronse, Schade en schadeloosstelling (onrechtmatige daad), Algemene Praktische Rechtsverzameling, 1957, Nos 73 and 74. See more specifically the wording of § 252 of the German Bürgerliches Gesetzbuch (Civil Code), which reads as follows: Der zu ersetzende Schaden umfasst auch den entgangenen Gewinn. Als entgangen gilt der Gewinn, welcher nach dem gewöhnlichen Laufe der Dinge oder nach den besonderen Umständen, insbesondere nach den getroffenen Anstalten und Vorkehrungen, mit Wahrscheinlichkeit erwartet werden konnte. [The compensation shall also include lost profits. Profit is deemed to have been lost which could probably have been expected in the ordinary course of events, or according to the special circumstances, especially in the light of the preparations and arrangements made. (The German Civil Code, trans, by Forrester, Goren and Ilgen, North-Holland Publishing Co., Amsterdam.)]

47 The Court has recognized this principle in staff cases. More specifically, in the judgment in Case 58/75 Sergy v Commission [1976] 1139 (paragraphs 46 and 47) the Court held that a lack of ordinary vigilance was partly responsible for the damage suffered by the applicant and that that had to be taken into account when assessing the extent to which the defendant had to make good the damage. For a recent study in comparative law, see R. Kruithof, L'obligation de la partie lésée de restreindre la dommage, Revue critique de jurisprudence belge, 1989, p. 12 et seq ļ., which includes numerous references to Belgian, English, French, German and Netherlands law.

48 If it should appear that the applicants obtained a higher profit than the normal profit from the replacement activities, that extra profit should not be deducted from the lost profits, since the Community should not derive an advantage from special efforts made by the applicants.

49 There may in fact be a causal connection between some losses and the regulation which was declared invalid, for example in the case of the loss alleged by some applicants in Case 104/89 on the sale of cows purchased in 1983 or 1984 with a view to the resumption of milk production, which was subsequendy made impossible by Regulation No 857/84.