OPINION OF MR ADVOCATE GENERAL LAGRANGE (1)

Summary

General considerations

‘Improponibilità’ and admissibility

Misuse of powers in general

French law

Belgian law.

Luxembourg law

Italian law

Netherlands law

German law

Conclusion

Misuse of powers under the Treaty

Application to present case

Mr President,

Members of the Court,

It remains for me to express my views on the last two applications and, I think with the agreement of the parties, I should like to be allowed to consider them together. As the Court will be aware, I am referring to Application No 3/54 from the Associazione Industrie Siderurgiche Italiane (ASSIDER) and to Application No 4/54 from the Associazione Industrie Siderurgiche Associate (I.S.A.). (2)

I regard it as essential to deal jointly with these two applications which, like the two earlier ones, not only impugn the same decisions but are based on precisely the same grounds, rely with slight variations on almost the same arguments, and call for a decision on the same issues as to both admissibility and substance.

General considerations

I must begin by quoting the words of the second paragraph of Article 33 of the Treaty:

‘Undertakings or the associations referred to in Article 48 may, under the same conditions, institute proceedings against decisions or recommendations concerning them which are individual in character or against general decisions or recommendations which they consider to involve a misuse of powers affecting them.’

The words ‘under the same conditions’ refer to the first paragraph, which is concerned with actions brought by Member States or the Council: this means that applications by undertakings or associations are also actions for annulment on grounds of lack of competence, infringement of an essential procedural requirement, infringement of the Treaty or of any rule of law relating to its application, or misuse of powers, and that the restrictions imposed on the jurisdiction of the Court relating to the evaluation of the situation resulting from economic facts or circumstances are equally applicable to actions by undertakings or associations.

But in the case of the latter there is a further restriction based on the nature of the decisions or recommendations which may be impugned: they may institute proceedings only ‘against decisions or recommendations concerning them which are individual in character’or ‘against general decisions or recommendations which they consider to involve a misuse of powers affecting them’.

It is not disputed that the two associations before the Court are associations of undertakings within the meaning of Article 48 of the Treaty; nor, for their part, do they dispute that the three decisions which they are contesting are ‘general decisions’ but they contend that those decisions ‘involve a misuse of powers affecting them’ — affecting each of them. These applications would, therefore, appear to be admissible.

‘Improponibilita’ and admissibility

Nevertheless there is some dispute on this point. The High Authority considers that both applications are not only inadmissible but ‘improponibile’. I use the Italian word which, despite all their expertise, the Court's interpreters have stated that they are unable to translate.

‘Improponibilita’ appears to be a legal concept peculiar to Italian law, specifically administrative law. As I understand it, it is a kind of absolute inadmissibility which is an automatic, independent and absolute bar to proceedings. In French administrative law, with which I am more familiar, there can be traced suggestions of a similar concept which is, however, far less clearly defined. What are more easily recognized are cases of an absolute bar to proceeding with a case (‘fins de non-recevoir d'ordre public’) — a matter which the Court must raise even of its own motion — and those in which the bar may be defeated. Some of the former no doubt resemble the concept of ‘improponibilita’; I refer for example to an application which is not submitted on stamped paper or which has not been submitted for the fiscal formality of registration, and which must be automatically set aside without even being read. But this is of course only a legal fiction because, to take the example I gave, the possibility may arise in a particular case that the application may specifically fall into a category which is exempt from the formality of stamping or of registration and this can only be established by reading it.

I have no wish to go further into this subject especially because, as the High Authority itself recognized without difficulty in its rejoinder, there is no question here of applying either Italian or French law or that of any other country of the Community but of applying the law of the Treaty and it is solely for the purposes of construing the law of the Treaty that, whenever it appears necessary to that end, reference must be made to the position in national law.

In the present case this does not appear necessary. In my view, a study of the reference in Article 33 to actions for annulment makes it abundantly clear that there are, on the one hand, conditions for admissibility and, on the other hand, what are in French administrative law called ‘cas d'ouverture’ but which may be given any other name and which are the four grounds for annulment set out in the article.

As regards the question with which we are concerned, namely the admissibility of the proceedings instituted by an undertaking or an association of undertakings against a general decision, the wording of Article 33 appears to me to be perfectly clear: undertakings and associations ‘may… institute’ such proceedings ‘against general decisions or recommendations which they consider to involve a misuse of powers affecting them’.

This does not of course mean that they are necessarily right: does the general decision involve or not involve a misuse of powers and a misuse of powers affecting them? It is for them to prove it. Nor, on the other hand is it enough to plead a misuse of powers and to add that it was committed in relation to the applicant, in order to invoke the other grounds of action: lack of competence, infringement of an essential procedural requirement, infringement of the Treaty or of any rule of law relating to its application. Those grounds may be relied upon if, in addition, the decision involves one or more of these defects (the Treaty in no way prevents it and such a case might easily arise) but it must first be established that a misuse of powers affecting the applicant has been committed. This is one of those cases, recognized by national law, in which admissibility is linked to the substance.

I can find no place in the system for an additional concept of absolute inadmissibility or of ‘improponibilita’. On the contrary, since admissibility in all cases depends upon consideration of the substance, it follows that the normal rules of procedure must be observed and that, for example, there can be no question of setting aside the application on sight without notifying the defendant, which would, however, be the only practical justification for reference to a concept such as that of ‘improponibilita’.

Misuse of powers in general

At the same time the dual question of what is to be understood by ‘misuse of powers’ within the meaning of the Treaty and by the words ‘affecting them’ as a special requirement imposed on undertakings and associations remains unanswered and, in my view, deserves detailed examination.

On the first of these two aspects I think reference must be made to national law. The concept of misuse of powers was obviously not invented by the authors of the Treaty and, in making an attempt to reach a conclusion on what ought to constitute misuse of powers in terms of the Treaty (a conclusion which in any case must, of necessity, be open to revision and to adjustments commensurate with the evolution of case-law), the first task is to establish what it consists of in the law of each of our six countries. I must immediately add, however, that I do not intend at this juncture to embark upon a proper, scholarly study of comparative law because this is not part of my duties and would certainly take me too far afield. All I wish to do is to try to cover the essentials as concisely and objectively as possible.

French law

I take the liberty of beginning with French law because French administrative law and, in particular, proceedings for excès de pouvoir played a predominant part in the drafting of the Treaty. The ‘Report of the French Delegation’ on the Treaty has this to say on this subject:

‘The Treaty reflects the classic distinction in French administrative law between proceedings for annulment (actions for excès de pouvoir) and proceedings in which the Court has so-called 'unlimited jurisdiction’;

and a little further on:

‘Three of the four traditional grounds for proceedings for excès de pouvoir (lack of competence, infringement of an essential procedural requirement, and misuse of powers) were accepted without difficulty: the concept of misuse of powers was, in particular, very well understood and readily accepted by our foreign partners’

And this is what was said in the preamble to the German law authorizing ratification of the Treaty:

‘Any undertaking or association coming within the jurisdiction of the Community has the right to bring an action in the same way as a Member State or the Council of Ministers. The grounds on which an action may be based are set out in the first paragraph the terms of which have been borrowed from French theory of excès de pouvoir, the basic features of which are the same as those of German theory on wrongful acts or omissions by an administrative authority’.

In French law misuse of powers is very generally defined as the action of an administrative authority in ‘using its powers for a purpose other than that for which those powers were conferred upon it’. This is the form of words used in a large number of judgments of the Conseil d'Etat. It is reproduced verbatim by Alibert in Le contrôle juridictionnel de l'Administration au moyen du recours pour excès de pouvoir 1926, p. 236. In Droit Administratif (p. 389) de Laubadère states: ‘There is a misuse of powers whenever an administrative authority properly carries out an act within its powers but for a purpose other than that for which the act may lawfully be performed’. In his Cours de Contentieux Administratif (latest edition) Volume III, p. 615, Odent writes as follows: ‘The defect of misuse of powers arises when a power has been deflected from the objective for which it was instituted and has been used for purposes other than those for which it was intended’. And a little further on he adds: ‘Misuse of powers arises when the spirit of the legal rule is ignored. In order to detect a misuse of powers the Court … cannot restrict itself to appraising the external or even merely the objective legality of the decision referred to it; it must establish the reasons which motivated the author of the decision and determine whether those reasons were sound in law’.

This is what distinguishes misuse of powers from the other grounds, excès de pouvoir (ultra vires acts), and in particular infringement of the law: it means establishing the real aim pursued by the author of the decision, in other words, it involves an essentially subjective enquiry into intent.

Historically, misuse of powers arises directly from lack of competence. As the Court will be aware, until 1872 the only legal basis for an action for excès de pouvoir (which in its entirety, is in fact purely a judge-made doctrine evolved by the Conseil d'Etat), was a revolutionary law dictated by expediency, the law of 7 to 14 October 1790; moreover the Conseil d'Etat discovered it only in 1832. Prior to that date it refrained from referring to any legislative provision whatsoever. The 1790 law was the consequence of a disagreement which arose between the ‘directoire’, that, is to say, the executive authority for the Department of the Haute Saône, and the municipality of Gray but which, in keeping with the methodical disposition peculiar to people of that period, had been solved on a basis of principle. The law read as follows: ‘Claims of want of competence on the part of administrative bodies shall in no circumstances be entertained by the courts; they shall be brought before the King as the head of the general administration’. Accordingly, excès de pouvoir was the act of a public authority in going beyond the limits of its powers. But Alibert continues (op. cit. same page): ‘On close examination misuse of powers is a kind of want of competence. A decision which involves misuse of powers is to a certain extent vitiated by want of competence if not on account of the provisions which it lays down at least on account of the aim which it seeks to achieve. It can be understood therefore that the concept of misuse of powers was at an early date developed by case-law, which very logically deduced this ground for the annulment of administrative acts from the earlier ground, namely, want of competence properly so-called or usurpation of powers: to use a power for other than its lawful purpose is in fact to act without competence.

In fact this is where we find the rule which governs the whole of administrative law, the principle of the purpose pursued. In contrast to the rights of private individuals the exercise of which, at least in a free system, is (apart from restrictions laid down by the law) limited only by the need to respect the rights of other private individuals, the rights of public authorities which are in fact powers, may be exercised only for the purposes for which they have been vested with those powers. Obviously these purposes are, in the first place, the public interest, what is called the ‘good of the service’ for which the Administration was created and which is nothing other than the embodiment of the common good which is the foundation of social order. But to this must be added a concept of specialization which is quite simply dictated by the need for order and organization. The Administration has many, varied duties and each of the public services has a specific task to fulfil, a specific aim to pursue.

There are in fact administrations within the Administration with a capital A. The powers vested in each one of them are therefore themselves limited (even if no legislative provision so specifies) by a purpose which is peculiar to it. And, to return to misuse of powers, this can accordingly be present also in cases where the objective pursued is not in itself unlawful or in conflict with the public interest but where the authority has not acted for the purposes which within its special province it was obliged to pursue. We are here still nearer to want of competence properly so-called. To conclude this brief analysis of French law in the matter of misuse of powers it must be borne in mind that case-law accepts this plea on fairly strict conditions. The concept of proof is, generally speaking handled with considerable flexibility and, if I may say so, tact, by an administrative court, which follows the principle of judicial investigation. When, on the other hand, it is dealing with misuse of powers it requires proof to be supplied by the plaintiff or to be clearly forthcoming from the file. The reason for this is the need for inquiry into subjective intention, which must not be the subject of a priori suspicion; until the contrary is proved the Administration must be presumed to have acted in the interests of the service for which it is responsible.

Finally I ought to add that we have in France for a number of years and, in particular, since the last war witnessed a marked decline in misuse of powers which, so to speak, reached its peak roughly in the period from 1890 to 1920. I cannot develop this point because it would require a detailed study of judicial precedents. In any case this study has in my view been adequately made by Mr Letourneur, Maître des Requêtes in the Conseil d'Etat in L'Appréciation du fait par le Conseil d'Etat de France (Recueil de Jurisprudence du Droit Administratif et du Conseil d'Etat, Brussels, 1952, p. 81 et seq.).

I confine myself to saying that this ‘decline’ is explained at least in part by the parallel development of the concept of infringement of the law, that is to say, in short, by recourse to an objective review, which the Conseil d'Etat seems increasingly to prefer to the subjective examination which the misuse of powers involves. This is brought out very clearly in the study to which I have just referred.

Belgian law

From France I turn to Belgium. In this case my comments will be shorter not because the creation of the Belgian Conseil d'Etat is still too recent to have enabled case-law to be established (on the contrary a substantial number of judgments makes it possible to obtain a fairly clear idea of the trend of that case-law) but because, on the point with which we are concerned, namely the concept of misuse of powers, its formulation in French law has been precisely and deliberately reproduced in the Belgian Law.

The Law expressly refers to it. This is done in Article 9 of the Law of 23 December 1946‘under which “the section d'administration” (of the Conseil d'Etat) shall deliver judgment in proceedings for annulment for infringement either of an essential procedural requirement or of procedural requirements prescribed on pain of nullity, for ultra vires acts or for misuse of powers (excès ou détournement de pouvoir) which may be brought against the acts and regulations of the various administrative authorities or against contested administrative decisions’.

Reference to the preparatory documents reveals the following in the statement of grounds:

‘It is quite understandable that any public authority is liable to misdirect itself either in assessing its own powers or in applying the provisions of law which it is under a duty to enforce. The law vests it with these powers for specific purposes. If it uses its powers for purposes other than those laid down, expressly or by implication, by the legislature, it disregards the will of the latter and this disregard amounts to acting ultra vires (excès de pouvoir) or even, “to use a term which is common in France, “détournement de pouvoir” (misuse of powers)”.

As far as the parliamentary debates are concerned, I take the following passage from the discussion which took place in the Senate:

‘As regards excès de pouvoir (ultra vires acts)’, said Mr Devèze, Minister of the Interior, ‘one understands immediately what is meant: “I, as Minister, go beyond the scope of the powers which I possess under the law. I exceed my powers”. That is the excès. But what, then, is misuse of powers? The Rapporteur states that it is the performance of an act required by one's office and in the prescribed form but producing a result other than that envisaged by the Law. In contravening the spirit of the law one has diverted from its true object the power with which one has been vested: in the guise of police regulations, a municipal authority in fact restricts freedom of trade, the freedom of the press, the freedom of opinion and of religion, or the right of association. Those are the words of the Rapporteur. In my view misuse of powers is, in short, the act of an administrative authority which, while performing an act within its powers, fulfilling the procedural requirements prescribed by the law and acting in conformity with the letter of the law nevertheless uses its powers for a purpose other than that for which those powers were conferred upon it.’

The Court will recognize the classic definition repeated word for word from French case-law and theory.

To turn now to legal writers I should like first to quote Henri Velge, one of the founders of the Belgian Conseil d'Etat and its first President. In 1930 he defined excès de pouvoir in these terms:

‘The act issues from an authority lacking competence or else the essential procedural requirements for the act have not been fulfilled or the act infringes or wrongly interprets the law’. And on misuse of powers he wrote: ‘The act is in due form; its extrinsic legality is respected; it issues from a competent authority but that authority has diverted the powers vested in it from their true purpose’. In such a case ‘the validity of an act is to be judged not on the basis of its subject-matter but on the basis of the underlying objective which motivated it. The objective thus becomes an element of competence’.

Finally I must quote from Pierre Wigny's excellent work, Le Droit Administratif (which is a summary of Belgian administrative law). In Droit Administratif, Principes Généraux, Brussels, 1953, p. 375, Pierre Wigny writes as follows:

‘The activities of the Administration are governed by the principle of purpose; this principle means that authority may be exercised only for the purpose for which it was conferred. An act carried out by an official in exercising his powers but for a purpose other than that for which he received those powers is vitiated for misuse of powers’.

‘The powers (of the Administration) are no longer unlimited and even when they are discretionary, the justification for their exercise may nevertheless be examined by the courts (No 69-91-506)’.

I need go no further. It is clear that the French system has been incorporated into the Belgian Law. Of course this does not mean that case-law will not develop independently and perhaps in different ways from that of the French Conseil d'Etat but that the basic legal concept is a common one.

I draw attention to a procedural peculiarity which seems of interest. Because of the seriousness of the case, a submission of misuse of powers may be entertained only before the contentious proceedings division of the Conseil d'Etat in plenary session. The case is automatically referred to it if the chamber before which the proceedings are brought finds that there may have been a misuse of powers (see the Law of 23 December 1946, Article 46).

This clearly demonstrates that misuse of powers is regarded as an instrument to be handled with care since its use has been conditioned by special safeguards for the benefit of the Administration. However, the Conseil d'Etat has not hesitated to use it and there have already been several annulments under the heading of misuse of powers.

Luxembourg law

From Brussels we go to Luxembourg. As the Court will be aware, the Grand Duchy has its own Conseil d'Etat, which has been established for a much longer time than its Belgian neighbour and is still today governed by a basic Law of 1866. In the context of adversary proceedings it recognizes an action for annulment but for various reasons this action did not develop to such an extent as in France. For this reason legislative amendment appeared to be necessary. This was the Law of 20 July 1939.

I cannot resist the temptation to quote the following passage from the statement of the grounds for the draft prepared in 1936 which became the Law of 20 July 1939:

‘Our administrative jurisdiction has remained unchanged and out of date; the admirable development as a result of which the French Conseil d'Etat became the highest court for the review of administrative morality has not been emulated here. Many of our legislative provisions are the same as in France. While we note that there has been a bold and forward-looking interpretation by our neighbours which has opened wide the doors of the administrative courts to those within the jurisdiction, there has been no change at all in Luxembourg, where we remain bogged down in out-of-date concepts and petitioners are received in a forbidding manner and, moreover, their course is fraught with snares and difficulties’.

After this soul-searching, which is no doubt unduly pessimistic and, in my view, rather unfair concerning the work of the Luxembourg Conseil d'Etat in the past, those who drew up the draft law accept that the administrative courts of the Grand Duchy ‘scarcely have the same importance as the administrative courts of France’ mainly on account of the fact that in Luxembourg, as in Belgium, public authorities are commonly called to account before the ordinary courts. They add:

‘It was the concept of excès de pouvoir which gave rise to the happy evolution of French administrative law. By adopting some French legislation and enshrining the decisions of the French courts in our own, we can, without difficulty, make our law similar and draw without hindrance on that inexhaustible source of the purest judge-made law which is daily developed by the French Conseil d'Etat’.

‘The first task of all is to define the concept of excès de pouvoir by stating in the law that it includes the misuse of powers which, timid to a fault, our supreme administrative court has refused to include in it. The concept of misuse is above all that of the defence of administrative morality and, in view of the often very serious nature of the circumstances which abuses of power can conceal, it is really difficult to understand how the Conseil d'Etat could imagine that it had no authority to intervene and prevent them.’

On the point with which we are concerned in this case there can be no doubt: the concept of excès de pouvoir in general and of the misuse of powers in particular in the Grand Duchy is the French one. If we needed to be convinced of this it would be sufficient to read this passage from the report of the Section Centrale of the Conseil d'Etat on the draft law: ‘Finally an extension of the jurisdiction of the Conseil d'Etat in certain cases was considered necessary in order to complete assimilation with the French institution.’

Italian law

We now go to Italy. As the Court will be aware, Italian law on the supervision of the administration by the courts is essentially based on the distinction between the protection of diritti soggettivi (subjective rights) and that of interessi legittimi (legitimate interests). This distinction is also known in French administrative law where it takes the form of a distinction between cases in which the court has unlimited jurisdiction and those in which the action involves annulment or excès de pouvoir. But the essential difference is that, whereas in France, both these types of proceedings come within the jurisdiction of the administrative courts, in Italy, on the other hand, the latter are responsible only for the protection of interessi legittimi.

Interessi legittimi are protected by the jurisdiction ‘on legality’ (di legittimità) and by the jurisdiction on the substance (di merito). The first arises under ordinary law, the second arises only under a jurisdiction which is specially conferred (for example cases relating to the civil service staff regulations). When the Consiglio is adjudicating in merito it deals with issues of fact and of law and even adjudicates on policy; it can revise the measure contested and not merely declare it void. When it is exercising jurisdiction di legittimità it cannot go into policy but can only annul; it is therefore in this action di legittimità that we get closest to the action for annulment under Article 33 of the Treaty.

Article 24 of the Law of 31 March 1889, which is the relevant enactment, designates ‘want of competence, infringement of the law and eccesso di potere (ultra vires acts) as the three defects which can lead to annulment. This demonstrates the point of main difference from the French system: in France, whatever the importance attached to the ground of infringement of the law, which has gradually converted the action for excès de pouvoir into proceedings relating to the validity of administrative acts, it is nevertheless the concept of excès de pouvoir which, in terms of legislation, covers everything, as is clear from the words of the enactment (Order of 31 July 1945, Article 32): ‘The Conseil d'Etat is the court of last instance in contentious “actions for the annulment for excès de pouvoir” of acts of the various administrative authorities; the expression “actions for excès de pouvoir” is synonymous with “actions for annulment”. In Italy, eccesso di potere is regarded only as one ground for bringing proceedings on the same basis as want of competence and infringement of the law. The outcome of this has been a rather independent development of the concept of eccesso di potere as such, within the context of the action di legittimità and independently of the two other concepts of want of competence and infringement of the law which are different from that of eccesso di potere; this is so although the concept of eccesso di potere was borrowed direct from French administrative law. The result is that the field of infringement of the law seems more restricted than in France, where infringement of the law has really become synonymous with ‘infringement of a legal rule’. In this way for example review of the legality of the reasons on which an enactment is based, that is, a review relating to any error of law or of fact which such a statement may contain is in France regarded as illegality whereas in Italy this type of defect belongs to the concept of eccesso di potere.

As for misuse of powers, to which I must now turn, this is only one example of eccesso di potere

in general and has not the status of a ground of action. In other words, it is difficult to find in the decisions of the Italian Consiglio di Stato clearly defined boundaries between misuse of powers and the other possible causes of annulment on the ground of eccesso di potere.

Nevertheless, the concept of misuse of power is fully developed and used in case-law although the expression itself is only rarely used. Examples of expressions used are ‘misconception and distortion of the final purpose of the law’, ‘conflict with the intention of the law’, ‘act undertaken for a purpose other than the public interest’ and ‘use of a power for a purpose other than that provided for by the law’. As the Court will observe, these last two expressions accord with the classic definition in French law of misuse of powers. It clearly involves a defect affecting the objective which, contrary to appearances, is in reality being pursued and the discovery of which demands subjective investigation into intent. I dare not embark on a review of legal theory because it would take me too far afield. All I need say is that several authors regard the concept of misuse of powers as being at the heart of that of eccesso di potere.

For example, in his Corso di Diritto Amministrativo, Milan, 1952, Zanobini writes, on page 252, that ‘eccesso di potere is generally an indication of absolute want of competence as well as the want of competence which emerges when an administrative body has encroached on the competence of a non-administrative authority and which may be described as eccesso di potere but above all misuse of powers occurs when, in taking a decision, an authority is motivated by a consideration other than that by which it should have been motivated in the performance of the act’.

In his Trattato di Diritto Amministrativo, Volume III, 1901 Edition, pages 800 to 815, Orlando maintains that ‘in Italian legislation referring expressly to eccesso di potere, want of competence and infringement of the law, the essential meaning of eccesso di potere is that of misuse of powers, which is an infringement of the law which may lead to an inquiry into the motives which inspired the discretionary act of the public administration’.

Finally, Salemi states that ‘misuse of powers goes to the intent of the author of the act, that is to say, that if, “through the exercise of a discretionary power, objectives which are unlawful or wrongly described are pursued, the acts in question although issuing from competent bodies and although in conformity with the letter of the law, are illegal in that they have been carried out for a purpose, private or public, other than that for which discretionary power was granted and thus compromise the objective sought by the law. To compromise it in this way is a misuse of powers”.

This rather short excursion into the Peninsula shows that in Italy the concept of misuse of powers appears to be very much the same as it is in France, Belgium and Luxembourg but that it is incorporated in the wider concept of eccesso di potere, itself clearly distinguishable from infringement of the law.

Netherlands law

Continuing our journey, we now go to the Netherlands.

This is the first country which we have visited where there is no general enactment on actions for annulment. The action nevertheless exists since it is provided for under a number of special laws. On the other hand, although there is a Council of State (Raad van State) before which proceedings may be brought, justice is not delegated; the Council does no more than deliver an opinion which is forwarded to the Government, which may, though it is not bound to, submit it for the approval of the Sovereign. There are in any case administrative courts separate from the Raad van State, which are not subject to it such as, for example, the public service courts, from which there is an appeal to a central appeal court (Centraal Ambtenarengerecht). Finally, some administrative cases come under the ordinary law courts even in the case of disputes relating to the validity, in a wide sense of this term, of administrative acts: as such they are subject to review by the Supreme Court (Hoge Raad).

This in no way impedes the exercise in the Netherlands of supervision of the administration by the courts. Indeed, this supervision is carried out de jure as well as de facto under conditions which are very similar to those we have discussed so far. Both the law and the decisions of the courts have closely followed the principles of administrative law in the countries of Western Europe — the Continental ones of course — which has enabled legal commentators to evolve some interesting formulas.

In the absence of a general law, as always happens in such cases, it is special laws which have constituted the corner-stone both of case-law and of learned opinion. As for misuse of powers this is a very familiar concept.

The provision most commonly referred to on this subject is Article 58 of the 1929 civil service law (Ambtenarenwet), the first article of which reads as follows:

‘An action may be brought in the case of a decision, act or refusal (to take a decision or perform an act) in respect of an official, his survivors or successors in title which has been adopted, performed or announced by an administrative body and which de facto or de jure conflicts with the relevant generally mandatory requirements in force or when, in adopting, performing or announcing it, the administrative body has manifestly exercised its powers for a purpose other than that of achieving the objectives for which those powers were vested in it’.

That is the perfectly orthodox definition of misuse of powers. The definition is generally regarded as the expression in a specific field of an unwritten general rule, a true rule of law on which the exercise of administrative power is based. However, reference to the preparatory work on the Law reveals that it followed the adoption by the Second Chamber of the States General of an amendment the author of which writes as follows:

‘The amendment is intended to give an official a right of action against decisions which appear to be lawful in terms of the letter but not in terms of the spirit of the law. The amendment is intended to give an official a right of action in cases where the administration has been guilty of misuse of powers or an abuse of power, that is to say, in cases in which it has exercised its power for purposes other than those for which that power was vested in it’.

During subsequent discussions on the amendment the Minister for Justice quoted as a typical example of misuse of powers the transfer of an official effected not in the interests of the service but in order to discipline him without specific reference to any penalty.

Case-law appears to have applied the Law with absolute fidelity to its spirit though with a degree of caution which no doubt explains the use of the word ‘manifestly’ appearing in the text.

The question of requisitioning of property, which is dealt with by the ordinary courts, has also given rise to judgments based on the misuse of powers, taken in the same sense. As examples I refer to two judgments of the Supreme Court, on 14 January and on 24 June 1949.

In the first case the mayor of a town had requisitioned a dwelling for a police inspector who had urgent need of it. As the ground for the requisition the mayor referred to the fact that the requisitioned accommodation was let at a much higher rent than that permitted.

In its judgment the Hoge Raad stated: ‘The object of the order on the requisitioning of accommodation was to ensure a fair allocation of living accommodation and it follows from the tenor of the order that if the mayor wishes to exercise his power to requisition a dwelling for civilians who have urgent need of it he must, in designating a particular house, have regard to what is necessary to ensure an appropriate allocation of dwellings’.

‘As the Court has already declared, if he allows himself to be influenced by motives — even though in the public interest — other than those which, according to the object of the law, ought to be taken into account when he selects the property to be requisitioned he is exercising his power of requisition to achieve objectives other than those for the purpose of which that power was vested in him’.

In its judgment of 24 June 1949 (N.J. 1949, No 559) on the subject of a requisition of alluvial land at Groningen under the general order of 1940 on requisitions, the Hoge Raad held: ‘The question whether in a specific case the requisition accords with the public interest is usually a matter for decision by the requisitioning authority and it is in consequence not within the purview of the court but the court may nevertheless intervene if it finds that the said authority manifestly requisitioned in order to achieve an objective other than that for the purposes of which that power was vested in it’.

Among legal writers Van der Pot, for example, writes: (3)

‘The content and the purpose of the decision must correspond to the general rules on which that decision is based.

If, as far as the purpose is concerned, those conditions are not fulfilled, in other words, if the power to take a decision has not been exercised in order to achieve the purpose for which the power was conferred, this is a misuse of powers.’

Another writer deserves special mention. This is de Brom, who devoted a whole book to misuse of powers. In his view, it is possible to read into Article 58 of the civil service law, treated as an expression of a general rule, both an objective concept of misuse of powers and a subjective concept or, again, a concept which he calls ‘semi-subjective’.

If I have correctly understood this idea it means that in the so-called ‘objective’ concept, the only thing taken into account is the act as it appears in comparison with the object sought by the law, regardless of the true intention, actual or presumed, of the person performing the act. The subjective concept is concerned only with the motive, the aim actually pursued, regardless of appearances. The semi-subjective concept is also concerned with motive but, in addition, with the question whether, on the assumption that the contested act was based on motives other than those envisaged by the law, it is nevertheless justified for other reasons which are themselves perfectly legal and consistent with the lawful objective, in which case the submission of misuse of powers will be set aside. I ought to interpolate here that this latter concept certainly seems to be the one which at the present time forms the basis of French case-law, one of the most typical examples of which is the judgment of the Conseil d'Etat in Sociéte des Automobiles Berliet of 22 July 1949, Rec. p. 367, quoted by Letourneur (op. cit. p. 2) and with which all practitioners in administrative law are very familiar. It is, in short, the introduction of the change of purpose in the doctrine of misuse of powers. Obviously, it appreciably reduces the field to which the purely subjective concept applies.

As for the so-called ‘objective’ concept, I take the view that it is incompatible with the actual concept of misuse of powers as we have hitherto witnessed it evolving. If the act can only be considered objectively on the basis of what it appears to be, without any inquiry into intent, all that remains to enquire into is whether the act is or is not in accordance with the law: there can no longer be any question of a power which is misused (or diverted from its purpose). At least this is what applies in legal systems which accept a broad concept of infringement of the law. In those where such a concept is not accepted, reference is made not to the concept of misuse of powers but to that of excès de pouvoir, as we have seen it in Italy and as it was once known in France.

The Netherlands appear to be moving more and more towards a wide and even the widest concept of infringement of the law, which is currently defined as being infringement of the rule of law. This is clearly only a tendency but it seems very pronounced, to the extent that certain writers not only assimilate to formal law what are called ‘the general principles of law’, such as for example the principle of the equality of citizens in matters of taxation, but would readily go so far as to regard them as including misuse of powers itself. This is what Donner, for example, does in ‘Bestuursrecht’ (1953) General Section, p. 249:

‘The concept of infringement of the law (strijd met de wet) must be given a wide interpretation so that it covers not only written but also unwritten rules. In a way it is possible to speak of a conflict between the content of an administrative act and the rules of law. In this way this concept can be made to cover the infringement of the general principles of sound administration. Interpretation in this wide sense has the advantage of making it no longer necessary to be involved in a sterile debate as to whether “détournement de pouvoir” ought or ought not to be treated as an infringement of the law.’

German law

I now reach the last stage. Let us go back up the Rhine into Germany.

As the Court will be aware, administrative law has deep roots in that country and the administrative courts play a very important role. The action for annulment has been established for a long time. Nevertheless it has in recent years received a new lease of life as a result of the reorganization of administrative tribunals both in the Bund and in the Lander. There are therefore a number of laws or regulations to help us. I refer in particular to:

Article 15 of the Law on the Bundesverwaltungsgericht (Federal Administrative Court):

Paragraph 23 of Ordinance No 165 of the British Military Government; and

Article 36 of the Law on the administrative courts of the South German Länder; and

The Law of 14 April 1950 on the organization of administrative jurisdiction in Rheinland-Pfalz (Articles 15 and 23).

In addition there are studies and commentaries of writers whom, in Germany more than anywhere else, it is essential to consult in order to have an accurate idea of the legal concepts employed by the legislature and the courts. This is all the more necessary in the present case since there is a wealth of terms which are not always uniform either in legislation or in case-law.

Among the ‘defects’ which may invalidate an administrative act within the meaning of German law are those relating to the exercise of discretionary power (Ermessensfehler).

In his Lehrbuch des Verwaltungsrechts (Treatise on Administrative Law) 1953, page 68, Forsthoff defines discretionary power as ‘the field in which there is freedom of action and of decision, a choice between several equally valid courses of action’. If such a field is not open to the administration and if, in consequence, it has merely to interpret and apply the law there can, of course, be no question of Ermessensfehler but only of a ‘violation de la loi’, an infringement of the law, what in France is called ‘competence liée’ (circumscribed powers), a concept with which the Germans are also familiar. If, on the other hand, subject to prescribed limits, the administration were ‘free to adopt a measure which it considers to be expedient’ the administrative measure which it adopts comes within the purview of the courts only from a double standpoint:

If it was adopted outside the field in which the authority has freedom of decision this generally involves Ermessensüberschreitung (exceeding discretionary powers);

or If it was taken within the limits of that field but was motivated by considerations of which the legal system disapproves or if regard has not been paid to the considerations prescribed by the legal order, this is referred to as Ermessensfehlgebrauch (erroneous use of discretion);

Ermessensüberschreitung and Ermessensfehlgebrauch together constitute the concept of Ermessensfehler (defective use of discretion).

I must now attempt to give some indication of the general tenor of the concept of Ermessensfehlgebrauch and I should like to refer to a classification which seemed to me to be clear and in accordance with general opinion and is given by Schunck and de Clerck in their Kommentar zum Landesgesetz über die Verwaltungsgerichtsbarkeit für Rheinland-Pfalz (Commentary on the law on administrative jurisdiction in the Rhineland-Palatinate), 1952.

Dealing with the whole of the doctrine of defects relating to the exercise of discretionary power by the administration, that is to say, Ermessensfehler, these writers, like Forsthoff, begin with the difference between Ermessensüberschreitung and Ermessensfehlgebrauch.

Ermessensüberschreitung ‘in the strict sense of the term’ is the action of the Administration in going beyond the limitations imposed by law on its discretion: for example, the refusal to issue a pedlar's licence on grounds not provided for by the law.

The Ermessensfehlgebrauch includes defects intrinsic to the appraisal made by the Administration, which are essentially acts which conflict with the objective laid down by the law. According to Schunck and de Clerck, the Ermessensfehlgebrauch consists of the following:

Ermessensfehler aus Rechtsirrtum This means ‘Defective use of discretion arising from a mistake of law’. That is: the Administration has allowed itself to be influenced by considerations which were wrong in law.

Ermessenswillkür This means ‘arbitrary exercise of discretionary power’. This refers to infringements of the principle of equality, the principle of continuity (the tradition on the basis of which the Administration customarily resolves similar questions in the same way) as well as decisions taken as the Administration ‘sees fit’.

Ermessensmissbrauch This means ‘abuse of discretion’. This defect consists in the Administration's basing its action on considerations which are, in fact, unconnected with the purpose which in law it should be furthering. On this subject Schunk and Clerck state that ‘French administrative law refers in this connexion to “détournement de pouvoir” (they use the French expression) and covers the situation in which an administrative authority completes an act within its powers, complies with the procedural requirements, commits no formal infringement of the law but exercises its powers for reasons other than those for the purpose of which powers were conferred upon it’.

Moreover, the authors state that ‘practice tends to go beyond this narrow definition’ and extends it to include cases coming under the category of decisions based on Ermessenswillkür (acting as one pleases), listed above.

As examples of Ermessensmissbrauch they quote:

A refusal to act as a result of personal animosity;

Prohibition of an agency in order to avoid the competition which it would provide for a combine;

Pressure by a housing authority with the intention of forcing a householder to sell his house to the Administration.

From this survey which again, it seems to me, reflects generally accepted views, it appears clear that it is the word Ermessensmissbrauch which comes nearest to the French concept of misuse of powers based on subjective inquiry into the aim which the person performing the act is really pursuing compared with the aim which in law he should be pursuing. Moreover it is this word Ermessensmissbrauch which is used in the German text of the Treaty in order to translate the words ‘misuse of powers’ which appear in Article 33; although, as the Court will be aware, the French version is the only authentic text, I am sure the German word was chosen with care. One might, perhaps, merely add that certain of the cases covered by the concept of Ermessenswillkür, the concept of arbitrary decision, might be punished in France by an annulment under the heading of misuse of powers. But a majority of the other cases of Ermessensfehlgebrauch and certainly all cases of Ermessensüberschreitung would, in France, be subject to objective review under the heading of infringement of the law, whether it was a matter of a mistake of law in the statement of reasons on which the act was based, of a material mistake of fact or of a violation of the general principles of law.

Furthermore it should be noted that even in Germany the concept of infringement of the law is often extended to mean something wider than formal infringement and thus tends to encroach to a certain extent on the field to which the Ermessensfehler applies, which does nothing to simplify the position.

From this review, which is far too superficial but which I nevertheless hope will not give rise to any accusation of Ermessensmissbrauch or of Ermessenswillkür, because my motives are pure, I conclude:

That, as we found in the other five countries of the Community, Germany also has a concept of misuse of powers the subject of which is virtually the same;

But that, as in Italy, it is only one aspect, a specific case, of a wider concept: exceeding the limits of discretionary power, in short, excès de pouvoir.

Conclusion

I have now come to the end of this journey through the countries of the Community, which was too rapid for my liking, although Members of the Court will no doubt have found it too long, but I am sure that the Court will agree that it was reassuring. In my view, it provides striking confirmation that, in our six countries, the legal principles which underlie control of the administration by the courts are in fact the same. These principles are based on the same conception of administrative acts, which are regarded as having to be performed within the limits of the law and on the basis of the same conception of the function of the court in considering those acts, which is to determine whether those limits have been observed. Their similarity extends even to the procedure chosen to make this review possible, namely, the action for annulment.

As for the differences, which certainly exist, they seem to me to amount in fact to a mere difference of presentation. Sometimes the main emphasis is placed on the idea of powers and the limits of those powers; this is the conception which France originally had of this action which was specifically called ‘action for excès de pouvoir’; it is the conception to which Germany and Italy adhered while developing considerable extensions to it. Sometimes there is special emphasis on the idea of ‘infringement of the law’ in the sense of neglect of the rule of law as the latter emerges, objectively, not only from the written law but also from the general principles underlying it. This is the present conception in France, Belgium and Luxembourg and, as I think I have shown, the Netherlands. But it is clear that the two ideas are basically the same since it is obvious that a misconception by a public authority concerning the extent of its powers necessarily constitutes an infringement of a rule of law, on the assumption that the rule has previously been defined. These are two aspects of the same concept.

Nevertheless there are clearly certain differences in the legal technique used in one system or the other although the same results can be obtained under each. That is why it is necessary to determine which solution is provided by the Treaty.

Misuse of powers under the Treaty

We have only to read Article 33 to realize that it enshrines a system which is half way between the two extreme conceptions and which is virtually the same as the present ‘Franco-Benelux’ system, if it can be so described, that is to say, one which provides for a broad conception of infringement of the law and treats it as the main but not the only ground for an action. This does not of course mean that, in its decisions, the Court must follow the precedents established in one or other country, in particular, French case-law, which is at present very restrictive (there may be alignment of prices but, fortunately, there is, under the Treaty, no alignment of case-law). There are, certainly, many reasons which tend to point in the opposite direction; this merely means that the Treaty appears to correspond more or less to the legal concepts at present applied in the four countries in question.

In my view, this is supported at three points in the actual wording of Article 33:

In the first place the text expressly refers to misuse of powers as a moyen (ground) or if a less procedural term is preferred, as a legal reason for annulment on the same footing as infringement of the Treaty (that is to say, of the law) without actually using the expression ‘excès de pouvoir’.

Secondly, Article 33 refers to ‘infringement of this Treaty or of any rule of law relating to its application’, which indicates that it is the concept of infringement of the law in the wide sense which is embodied here. Indeed, the expression ‘rule of law’ is expressly used; nothing would be clearer. If necessary, there is, thirdly, proof to be found in the sentence beginning ‘The Court’ which reads: ‘The Court may not, however, examine the evaluation of the situation, resulting from economic facts or circumstances, in the light of which the High Authority took its decisions or made its recommendations’ save where there is misuse of powers or manifest infringement of the rule of law. This is an exception which as such confirms the rule that in so far as this is necessary to review the legality of the reasons on which a decision is based, it is normally for the Court to evaluate the facts. The intention was that this review should be fully exercised only in cases where a decision does not depend upon an evaluation of a situation as a whole but only on specific facts: in cases where a situation is evaluated, the intention was that there should only be a review which took place in the specific context of a misuse of powers or of a manifest infringement, in short, subjective or objective check on abuse.

In his study Die Nichtigkeitsklage im Recht der Europäischen Gemeinschaft für Kohle und Stahl (Actions for annulment in the law of the European Coal and Steel Community), Frankfurt, 1952, Steindorff writes: ‘To attempt at this stage, in the law of the Community, to bring under the heading of misuse of powers cases which are covered in France by the ground of infringement of the law would mean deliberately ignoring the intention of the authors of the Treaty regarding the extent of the powers of review which they conferred on the Court’. In my view this statement has all the more weight since it comes from a writer who has been especially aware of the restrictions imposed by the Treaty on the subject of an individual's right to bring an action before the Court.

Those are the three reasons why, in my view, the wording makes it quite impossible in any way to extend the meaning of the words ‘misuse of powers’ used in the Treaty, apart from the fact that, as I hope I have demonstrated, those words express a concept which is common to the six countries of the Community.

In addition to these comments on the concept of misuse of powers, which I trust have not been too extensive, I must now go into the meaning of those words as they appear in the second paragraph of Article 33, where they are followed by the words ‘affecting them’.

First, as I have said, there can be no question of envisaging a wider concept of misuse of powers in the second paragraph than in the first. The only question is, what is meant by the words ‘affecting them’?

The parties entered into lengthy explanations of the words ‘affecting them’ both in their written and in their oral submissions. My own comments will be brief.

The rule laid down in the second paragraph of Article 33 is that undertakings or associations may institute proceedings only against ‘decisions or recommendations concerning them which are individual in character’. What is the reason for the addition of the words ‘or against general decisions or recommendations which they consider to involve a misuse of powers affecting them’? There seems to me to be only one acceptable explanation: this is that, having just included misuse of powers among the grounds for annulment, the authors of the Treaty thought of the situation where a decision which, while in fact individually affecting an undertaking, is ‘disguised’ (‘camouflaged’, to use the word employed without hesitation in the written submissions) as, to all appearances, a general decision and is, in consequence, clearly invalidated as a misuse of powers. It is true that at that time it was perhaps unnecessary to add these words because case-law would probably have managed, in such circumstances, to accept that, since the decision was in fact an individual one, the action was admissible. It was no doubt thought that if this did not need to be said, it was even clearer when put into words, although, as we realize today, that is not always true.

In any case as Counsel for the defence have very rightly pointed out, it is not clear why the ground of misuse of powers has been given a position of privilege compared with other grounds, in particular that of lack of competence which is undoubtedly the most ‘radical’ in the hierarchy of grounds for annulment if indeed such a hierarchy exists.

Finally, if need be, I can refer to a passage in the preamble to the Luxembourg ratification law which is couched in the following terms:

‘Actions for annulment will be brought by the Member States or the Council of Ministers. Only individual decisions of the High Authority or those which are general but which the concept of misuse of powers makes it possible to treat as individual decisions can be directly contested by the undertakings or associations against which they are directed’.

The intention of the authors of the Treaty seems therefore to be beyond doubt.

Nevertheless I do not think that there is any need to be as strict as the High Authority. Although it is true that the only reasonable explanation of the wording is that of the ‘camouflaged individual decision’, the wording still stands; its meaning must not be forced, nor must it be made to say less than it does. On the other hand, if the restrictive interpretation were taken to its limit this would result in making the field of application of the action practically non-existent as far as associations were concerned. The latter represent collective interests which are usually prejudiced by decisions which are not individual. This would have the consequence that associations could not bring an action against decisions affecting their own position in the Community in their capacity as associations, for example, a decision refusing to ‘normally call upon’ an association on the ground that it does not fulfil the conditions laid down for that purpose under Article 48 of the Treaty, which would be a curious restriction of their right to bring proceedings. All that in practice would remain to them would be the right to intervene. Not even the High Authority goes as far as that. In my opinion the words ‘affecting them’ must, in the case of an association, be interpreted as embracing the collective interests which that association exists to protect, or even wider interests which are directly related to those interests. This is exemplified by a decision which involved a misuse of powers because although, to all appearances, it was taken in the general interests of the Common Market and under the general powers of the High Authority, it was really intended to affect the Italian market, whereas direct intervention on that market would be contrary to the Treaty; such a decision could, in my opinion, be impugned by an association such as the I.S.A. which represents not only a category but an important category of the Italian steel undertakings. It is a question of degree.

On the other hand, there could be no question of the admissibility of an action by an association against a decision involving a misuse of powers the direct purpose of which was not to attack the interests protected by the association since this would not have amounted to the commission of a misuse of powers affecting that association. In other words, it seems to me impossible for an association to dissolve the connexion, as it were, by establishing:

1.That it has a mere interest in securing the annulment of the decision, on the same footing as any other undertaking in the Common Market;

2.That the decision involves a misuse of powers of one kind or another even though it has no specific connexion with the interests which the association in question is responsible for representing.

This is the most which, in my view, can be read into the wording of Article 33. To go any further would be tantamount to reversing the rules laid down in that article on the conditions of admissibility of an action for annulment.

As was to be expected, we are in fact witnessing efforts by the undertakings to widen the breach, narrow as it is, through which the Treaty allows them to seek a decision from the Court. This very close restriction of the action for annulment in the case of private parties is undoubtedly the one which, in the legal field, has given most cause for criticism since the Treaty came into force. There are, however, reasons for it: the main one is undoubtedly due to the great importance of the decisions involved, which has given rise to the belief that it is necessary for the legal interest to be commensurate with that importance and that the State, being by definition representative of the public interest, should alone be considered to fulfil that condition. This is what learned Counsel for the Italian Government explained so clearly to us in Case 2/54 when he pointed out that Article 33 generally vested in the governments of the Member States responsibility for safeguarding the interests of their nationals. We have also been able to note that, in certain cases, undertakings have the advantage of indirect but nevertheless valuable guarantees which enable them to have decisions of the High Authority declared illegal. I am thinking in this connexion of the third paragraph of Article 36 concerning penalties, which provides for a genuine objection of illegality when a fine is imposed, and which was referred to at the Bar. I am also referring to Article 41, under which the Court is granted jurisdiction to give preliminary rulings on the validity of acts of the High Authority and of the Council where their validity is impugned in proceedings brought before a national court or tribunal. This rule may be very useful to undertakings and even to third parties.

I believe that there is in fact an ambiguity concerning the role of the concept of interest in Article 33 and the other related provisions of the Treaty (Article 36 for example). This ambiguity is, however, very easily explained and, in my view, was certainly not created deliberately for the purposes of an argument as often happens during proceedings. It is true that the concept of legal interest is the foundation of an action for annulment under Article 33 because it is inherent in the special action known as the action for annulment. It could therefore be expected that the authors of the Treaty would confine themselves to introducing the concept of interest in explicit terms by making it a condition of admissibility of an action and by making the Court responsible for defining it by way of case-law. But the Treaty did not do so. The intention was that it should settle the question itself; in the case of each category of decision it was intended to indicate authoritatively who had access to the Court. In restricting, as it did, the conditions under which private parties have access by making other indirect channels open to them, it no doubt did so for the reasons which I have indicated: in any event, it did so.

Nevertheless it is as well to recognize that, useful as the protection thus granted may prove, whether it be that under Article 36 or that under Article 41, it is only indirect and incomplete and is not the same as the general and direct access which would have been created by the assignment to undertakings and to other private parties concerned of the same rights as to Member States in connexion with actions for annulment.

On the grounds of fairness, should an attempt be made to force the door open, if not wide at least wider? That is an issue which is truly a question of conscience for the Court. Nothing is more difficult for a court, especially a court of last instance, than to resist the temptation to square the law with equity. In the present case, however, I do not think that this is possible. The Treaty is perfectly clear on the point; although it may be criticized de lege ferenda, the system which it lays down is a coherent one and I do not believe that its meaning can be forced on any ground, however commendable.

Application to present case

In the circumstances, the application to the present case need not take up much time. It has in no way been established, in fact it has not even been alleged, that, under the guise of the general interest of the Common Market, the contested decisions were really adopted for the purpose of damaging the Italian steel industry or affecting it in particular. The Court is now aware of the real objective of the contested decisions: the considerations involved are all concerned with problems relating to the Common Market as a whole.

Even if, against my advice, the Court were to place a wider interpretation on Article 33 either as regards the meaning of the words ‘affecting them’ or as regards the content of the concept of misuse of powers, I should in those circumstances call attention to the observations which I made on the substance of the other actions. If the Court finds itself in agreement with those observations it will also have to set aside the actions of the two associations.

My opinion is that the applications should be rejected.

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(1) Translated from the French.

(2) See Opinion in Case 1/54, supra.

(3) C.W. van der Pot: Handboek van het Nederlandse Staatsrecht (1953) p. 354.