Chapter 16

DIRECT ACTIONS AGAINST EU INSTITUTIONS, BODIES, OFFICES OR

AGENCIES - PART II
Action for damages: non-contractual liability of the European Union under Article
340(2) TFEU

1. In which of the situations set out below can an applicant, who has suffered damages
resulting from the unlawful conduct of the relevant EU institution, bring proceedings before
the General Court against that institution?

a. Only when the applicant has successfully concluded proceedings under Article 263 TFEU
b. Only when the applicant has suffered damages exceeding €1.000
c. Only when the conditions for liability as set out in Case C-352/98 Bergaderm are satisfied.

a. This is an incorrect answer. In Case 5/71 Schöppenstedt, the ECJ held that an action in
damages under Articles 340(2) TFEU is autonomous as it has a special role to play within the
system of remedies. The difference between an action for annulment and an action for
damages is that the latter is intended not to nullify a particular measure, but to make good
damage caused by an EU institution in the exercise of its functions.
The autonomous nature of an action under Article 340(2) TFEU is subject to one exception.
If an action for damages would have the same effects as an action for annulment, but the
applicant did not institute the latter within the prescribed time-limit, the former will be
inadmissible. Therefore, if an application under Article 340(2) TFEU is intended in fact to
nullify an individual decision, which has become definitive (i.e. immune from annulment due
to the expiry of the time-limit provided for in Article 263(5) TFEU), or otherwise designed to
provide a means of escaping the restrictions imposed by Article 263 TFEU, it will be
rejected.
b. This is an incorrect answer. Article 340(2) TFEU as interpreted by the Union courts
imposes neither a minimum nor a maximum on the amount of damages that can be claimed
and awarded.
c. This is the correct answer. In Case C-352/98 Bergaderm, the ECJ held that the EU incurs
non-contractual liability under the same conditions as a Member State. These are:
 the rule of law which has been breached must be one which is intended to
confer rights on individuals;
 the breach must be sufficiently serious to merit an award of damages; and,
 there must be a direct causal link between the infringement of the rule and the
damage suffered by the claimant.
All three conditions governing the EU’s liability must be satisfied. If one of them is not
fulfilled the application is dismissed in its entirety without the necessity for the Union courts
to examine the remaining conditions for such liability.

2. Against which of the EU institutions CANNOT an action for damages under Article 340(2)
TFEU be brought?

a. The European Council

 b. The ECJ
c. The General Court

a. This is an incorrect answer. Under the ToL, the European Council, being an EU institution,
is within the scope of Article 340(2) TFEU.
b. This is the correct answer. The ECJ cannot be a judge and a party in the same proceedings.
c. This is an incorrect answer. The General Court may be held liable under Article 340(2)
TFEU for failure to adjudicate within a reasonable time.

3.In which of the cases set out below did the ECJ hold that if applicants have contributed
through their own negligence to damage, the amount of damages will be reduced
proportionally?

a. In Joined Cases C-104/89 and 37/90 Mulder

b. In Case 145/83 Adams
c. In Case C-352/98 Bergaderm

a. This is an incorrect answer. In Joined Cases C-104/89 and 37/90 Mulder the ECJ held that
applicants have a duty to mitigate loss.
b. This is the correct answer. In this case the ECJ held that the applicant contributed through
his negligence to the resulting damage and accordingly awarded only half of the amount
claimed by the applicant.
c. This is an incorrect answer. In Case C-352/98 Bergaderm the ECJ merged the two regimes
relating to non-contractual liability of the EU, i.e. that concerning general liability relating to
a failure of administration; and that specifically regarding the liability of the EU for
legislative acts. The Court also synchronised the rules of liability of the EU and of liability of
Member States.

4. Which of the following claims will be inadmissible under Article 340(2) TFEU?

a. a claim for damages caused by a lawful administrative act of the EU

b a claim for damages caused by an act of EU servants acting outside the course of their duty
c. a claim based on unjust enrichment of the EU

a. This is an incorrect answer. In Joined Cases C-120/06 P and C-121/06 P FIAMM, the ECJ
rejected the possibility that the EU may be held liable for lawful acts, whether administrative
or legislative, that have caused damage to the applicant.
b. This is an incorrect answer. In Case 9/69 Sayag the ECJ held that the EU is liable only for
those acts of its servants, which by virtue of the internal and direct relationship, constitute the
necessary extension of tasks conferred on EU institutions.
c. This is the correct answer. In Case C-47/07 Masdar, the ECJ held that a claim based on
unjust enrichment may be brought under Article 340(2) TFEU.

5. What conditions must be satisfied by an applicant claiming unjust enrichment in order to

succeed under Article 340(2) TFEU?

a. An applicant must satisfy the three conditions set out in Case C-352/98 Bergaderm;
b. The only condition that an applicant must satisfy is to prove enrichment of the defendant
for which there is no valid legal basis and the impoverishment of the applicant which is
linked to that enrichment;
c. an applicant must satisfy not only the three conditions set out in Case C-352/98 Bergaderm
but also prove enrichment of the defendant for which there is no valid legal basis and the
impoverishment of the applicant which is linked to that enrichment

a. This is an incorrect answer.

b. This is the correct answer. In Case C-47/07 P Masdar the ECJ stated that although a claim
based on unjust enrichment does not fall under the rules governing non-contractual liability in
the strict sense, it nevertheless cannot deny legal redress to persons who have suffered a loss
which has increased the wealth of another person, solely on the ground that there is no
express provision under the Treaties for pursuing that type of action. The conditions for
liability set out under Article 340(2) TFEU do not apply to an action for unjust enrichment.
The only requirement that a claimant must satisfy is the proof of enrichment of the defendant
for which there is no valid legal basis and the impoverishment of the applicant which is
linked to that enrichment.
c. This is an incorrect answer.