European Ombudsman
European Ombudsman
Decisión en el asunto 1181/2008/(BEH)KM - Exigencia de pago de una cantidad superior a 40 000 EUR por un contrato que la institución creía erróneamente haber celebrado con el demandante
Decisión
Caso 1181/2008/(BEH)KM - Abierto el 23/05/2008 - Recomendación sobre 13/07/2010 -
Decisión de 18/11/2011
El demandante es una universidad alemana. El Sr. B, profesor en la misma, había solicitado una subvención con cargo al programa « Cultura 2000 » de la Comisión Europea en nombre del demandante, y empleando papel con membrete de este último. El 30 de diciembre de 2000, la Comisión y el Sr. B firmaron un contrato. En agosto de 2005, una auditoría de los gastos del proyecto demostró que era preciso devolver 39 989,94 EUR a la Comisión.
En junio de 2006, la Comisión envió al demandante la correspondiente nota de adeudo. En su respuesta, el demandante señaló que no tenía información sobre el proyecto y solicitó información adicional. En septiembre de 2006, la Comisión envió un recordatorio reclamando el pago. El demandante reiteró que no tenía conocimiento del contrato y subrayó que el Sr. B no estaba autorizado para celebrar contratos en su nombre. En octubre de 2006, la Comisión comunicó al demandante que deduciría la suma de 40 649,41 EUR (la cantidad reclamada por la Comisión más los intereses devengados) de un pago adeudado al demandante. Acto seguido, el denunciante se dirigió al Defensor del Pueblo, quien inició una investigación.
En su informe, la Comisión invocó básicamente el hecho de que, dado que el Sr. B había escrito la carta en papel con membrete de la universidad y había recibido la correspondencia en la dirección de la universidad, la Comisión creía de buena fe haber celebrado un contrato con la universidad. El demandante resaltó que únicamente el Vicerrector y su Director de Administración están autorizados para vincular a la universidad y que la Comisión conocía este hecho. El Defensor del Pueblo señaló que la Comisión no había acreditado el Derecho material aplicable al contrato y, por tanto, no había proporcionado una explicación convincente de por qué debía considerarse a la universidad vinculada por el contrato, por lo que propuso una solución amistosa, en el marco de la cual la Comisión debía devolver el dinero que había deducido.
En su respuesta a esta propuesta, la Comisión subrayó que estaba dispuesta a encontrar a una solución amistosa, pero sostuvo que no tenía ningún motivo para dudar de que hubiese firmado un contrato con la universidad y que a ésta cabía achacarle al menos una parte de la culpa. La demandante no estuvo de acuerdo con la respuesta de la Comisión.
El Defensor del Pueblo consideró que, perseverando en el planteamiento de que la universidad tenía parte de la culpa, la Comisión parecía buscar una solución diferente de la solución amistosa que él había propuesto y recordó que la Comisión seguía sin mostrar cuál era el derecho material para respaldar su argumento tesis de que la universidad debía considerarse vinculada por el contrato. En consecuencia, reiteró su propuesta en forma de proyecto de recomendación.
La Comisión reconoció la inexistencia de pruebas que sustentasen la pretensión de que la universidad estuviera vinculada por el contrato. En consecuencia, procedió a reembolsar las sumas previamente deducidas. El demandante confirmó su satisfacción con el resultado y agradeció la actuación del Defensor del Pueblo. El Defensor del Pueblo consideró que la Comisión había aceptado y aplicado debidamente su proyecto de recomendación. En consecuencia, archivó el asunto.
The background to the complaint
1. The complaint was lodged by a German university at which Mr B. was a professor. In 2000, he applied for x xxxxx from the European Commission's " Culture 2000 " programme in the name of the complainant, using the latter's stationery bearing its letterhead. On 30 December 2000, the Commission and Mr B. entered into x xxxxx agreement ('the Agreement'). As agreed, fifty per cent of the grant was paid into the account of Kultur und Strategie e.V., a German association ('the Association'), which was set up to execute the project ('the Project') and administer the grant.
2. On 16 August 2005, the Commission carried out an audit of the Association in connection with the Project. It found that the sum of EUR 39,989.94 in ineligible expenses was to be repaid to the Commission.
3. On 16 June 2006, the Commission's Directorate-General for Education and Culture ('DG EAC') sent the complainant a debit note for EUR 39,989.94. In its reply, the complainant stated that it had no information about the Project, and asked to be sent the relevant documents. On 15 September 2006, the Directorate-General for Budget ('DG Budget') sent the complainant a reminder, requesting payment of EUR 40,440.73, namely, the sum mentioned above, plus interest, due on account of late payment.
4. On 28 September 2006, the complainant wrote to DG Budget, objecting to the debit note and reminder. It stated that it had no connection with the Association and that Mr X. had no power to bind the complainant. The complainant stated that the Commission should have been aware of this because DG EAC and the Commission's Directorate-General for Research 'DG Research') had been given the names of its authorised representatives in connection with other grant agreements.
5. On 8 October 2006, DG EAC wrote to the complainant informing it that it would set off the amount of EUR 40,649.41 (the sum to which the Commission's claim against the complainant had by then increased as a result of accrued interest) against a payment due to the complainant. This approach was confirmed by DG Budget on 16 November 2006, and
subsequently implemented.
6. On 6 December 2006, the complainant objected to the approach adopted by the Commission. On 20 December 2006, DG EAC replied to the complainant's objections. The subject matter of the inquiry
7. The complainant made the following allegations and claims:
1) By failing to take into account the names of its authorised representatives, which had been communicated to DG EAC and DG Research in connection with other programmes and projects, DG EAC breached the principles of consistent and transparent administration and acted negligently with regard to the conclusion of the Agreement with Mr B.
2) By executing an offset on the basis of an invalid grant agreement, DG EAC breached Article 4 of the European Code of Good Administrative Behaviour (the 'Code').
3) By informing the complainant of its decision only after the offset had been approved by DG Budget, DG EAC failed to comply with Article 17(1) of the Code, since it failed to make a decision on the complainant's appeal within two months. Moreover, by first communicating its decision to DG Budget and instructing it to execute the offset, DG EAC breached Article 20(2) of the Code and abused its power with regard to the complainant.
4) By failing to inform the complainant about possible remedies in its decision of 20 December 2006, DG EAC breached Article 19 of the Code.
8. The complainant claimed that the Commission should reverse the executed offset. The inquiry
9. The complaint was lodged on 15 April 2008. On 23 May 2008, the Ombudsman forwarded the complaint to the Commission. The Commission sent an opinion, which was forwarded to the complainant. The Ombudsman received the complainant's observations on 2 February 2009.
10. On 8 September 2009, the Ombudsman made a proposal for a friendly solution. The Commission replied to this proposal on 12 January 2010. The Commission's reply was forwarded to the complainant for observations, which it submitted on 26 February 2010. On 31 May 2010, the complainant informed the Ombudsman about the status of its negotiations with the Commission.
11. On 13 July 2010, the Ombudsman made a draft recommendation. The Commission sent the original French version of its reply on 3 November and the German translation on 23 November 2010. The Commission's reply was forwarded to the complainant for observations, which it submitted on 18 February and 5 July 2011. On 20 September 2011, the Commission informed the Ombudsman that it had made a payment order to settle the complaint.
The Ombudsman's analysis and conclusions
Preliminary remarks
12. The present decision follows a draft recommendation that was made in 2010. This draft recommendation related mainly to the claim formulated by the complainant and was based on an analysis of the latter's first and second allegations. The third and fourth allegations concern mainly procedural issues. The Ombudsman did not consider it necessary to deal with these procedural issues in the context of the draft recommendation, which addressed the substantive issues concerned. He further took the view that these allegations would need no examination whatsoever if the Commission were to accept his draft recommendation. Given that the Commission did indeed accept the Ombudsman's draft recommendation, the complainant's third and fourth allegations do not need to be examined in this decision.
13. The draft recommendation addressed the combined first and second allegations, namely, that the Commission unlawfully set off the sum of EUR 40,649.41 against payments due to the complainant. The Ombudsman noted that, in order to legally set off sums allegedly owed to it against a payment due by it, the Commission needed to show that the alleged debt actually existed. DG EAC based the offset on its view that the complainant was liable for repayments under the Agreement. The complainant, however, denied being legally bound by the Agreement, since it was concluded between the Commission and Mr X., who, according to the complainant, is not one of its authorised representatives.
14. The present case concerned obligations arising from a contract.
15. The Ombudsman considers that the scope of any review he can carry out in cases concerning the interpretation of contractual obligations entered into by an institution is necessarily limited. In particular, the Ombudsman is of the view that he should not seek to determine whether there has been a valid contract between the parties, which is the issue in dispute here. This question could be dealt with effectively only by a court of competent jurisdiction, which would have the possibility to hear the arguments of the parties concerning the relevant law and to evaluate conflicting evidence on any disputed issues of fact.
16. The Ombudsman, therefore, takes the view that, in cases concerning contractual disputes, he is justified in limiting his inquiry to an examination of whether the European Union institution or body involved provided him with a coherent and reasonable account of the legal basis for its actions, and with reasons for its belief that its view of the contractual position is justified. If that is the case, the Ombudsman will conclude that his inquiry has not revealed an instance of maladministration. This conclusion will not affect the right of the parties to have their contractual dispute examined and authoritatively settled by a court of competent jurisdiction.
A. Allegation that the Commission acted illegally when setting off the reclaimed sum against payment due to the complainant
Arguments presented to the Ombudsman
17. The complainant alleged that DG EAC was wrong to carry out the offset and to ignore the fact that the complainant did not owe the Commission any money under the Agreement. It argued that it was not legally bound by the Agreement, given that it had been signed by Mr X., who was not one of its authorised representatives. The complainant further submitted that it had had no knowledge of the Agreement, and no connection with the Association which received the grant. It further argued that the audit which gave rise to DG EAC's repayment claims related to the Association and not the complainant. The debit note should, therefore, have been addressed to the Association.
18. The complainant pointed out that, when it had previously entered into other agreements with DG EAC and DG Research, it had been asked to give the names of its authorised representatives. In response to this request, it had given the names of its Vice Chancellor and its Head of Administration. The complainant argued that, even without having recourse to this information, the fact that Mr B. signed the Agreement in his capacity as Head of Department should have alerted DG EAC and prompted it to investigate whether Mr B. was legally entitled to represent the complainant. It also noted that the account used for the Project, namely, the account specified by Mr X., was not the complainant's usual account. The complainant considered that, in light of the information in DG EAC's possession, it should have been very easy for it to ascertain that it had entered into a contract with Mr X., and not with the complainant.
19. In its opinion, DG EAC argued that it was reasonable for it to believe, in good faith, that it had entered into the Agreement with the complainant because the application submitted by Mr B. was written on the complainant's stationery, bearing its letterhead, and had been stamped with the complainant's seal. Furthermore, correspondence addressed to Mr X., and apparently received by him, had been sent to the complainant's address. As regards the complainant's argument that DG EAC knew, or ought to have known, that Mr B. was not one of the complainant's named authorised representatives, DG EAC submitted that public bodies, such as universities with many faculties, have a number of authorised representatives, who may change over time. As regards the account, DG EAC argued that the fact that a different account was used would not give rise to doubts about the identity of a contracting partner, since it was common practice for project partners to use different accounts, depending on the project.
20. In any event, DG EAC stated that it did not require public bodies to submit a charter or any other document containing the names of its authorised representatives. This was in accordance with the call for proposals. DG EAC argued that, since it had applied the relevant procedures correctly, it could not be accused of negligence.
21. DG EAC further submitted that the complainant had known about the Project. It referred to a letter dated 28 September 2006, in which the complainant admitted that Mr X. had informed it about a project by the same name. DG EAC added that the complainant had also managed the project account to which the State of North Rhine-Westphalia transferred DEM 25,000. It also referred to the complainant's connection with the audit, in particular, to page
5 of the audit report, where the auditor noted that the contracting partner was the complainant, and that the Association had been set up with a view to administering the Project in the complainant's name. According to DG EAC, the auditor had, therefore, established that there was a connection between the complainant and the Association.
22. In its observations on DG EAC's opinion, the complainant reiterated that it had only two authorised representatives, namely, its Vice Chancellor and the Head of Administration. The complainant argued that this was in accordance with legal provisions applicable to universities in the part of Germany concerned. The complainant considered that, as a result of its regular contact with universities, DG EAC should have been aware of this. It also pointed out that DG EAC's suspicions should have been aroused by the fact that the relevant documents had been signed by Mr X., without any indication that he was acting on behalf of the complainant.
23. The complainant insisted that it had not known of the Agreement between Mr B. and the Commission. Mr X. had merely informed the complainant about the Project and stated that it was financed by the State of North Rhine-Westphalia, but said nothing about any further funding. As regards DG EAC's claim that the auditor had found a connection between the complainant and the Association, the complainant observed that the auditor's report merely stated that the auditor had seen the financial documents relating to the Project, and the charter of the Association. According to the complainant, the auditor's report did not conclude that the charter identified it as a founder of the Association.
The Ombudsman's preliminary assessment leading to a friendly solution proposal
24. The sum to be offset was based on the debit note which DG EAC sent to the complainant. Setting off the relevant amount against payments due to the complainant presupposed that the complainant actually owed the sum to the Commission. This, in turn, presupposed the existence of a contract between the Commission and the complainant.
25. The evidence submitted to the Ombudsman showed that the Agreement named the complainant and the Commission as the contracting parties. According to the Agreement, the complainant was represented by Mr B. In order for the complainant to be bound by the Agreement, Mr B. would have had to have been an authorised representative of the complainant when he signed it. The complainant, however, stressed that Mr B. was never authorised to enter into legally binding agreements on its behalf. DG EAC did not provide any evidence to suggest that this statement was not correct. The Commission did not, therefore, appear to dispute the fact that Mr B. was not authorised to represent the complainant.
26. The evidence available to the Ombudsman did not indicate that the Commission took any steps to ascertain whether or not Mr B. was an authorised representative before it entered into the Agreement. In its opinion, DG EAC submitted that it complied with the relevant procedures when it signed the Agreement. According to DG EAC, these procedures do not require public bodies to submit documents, such as a charter, from which authorised
representatives might be identified. DG EAC also argued that a number of people can bind a university. It was clear, however, that, for the complainant to be bound by the Agreement, DG EAC would have to prove that Mr B. was authorised to represent the complainant. As already mentioned above, DG EAC did not establish that this was the case.
27. DG EAC submitted a number of arguments in support of its view that the Agreement should, nevertheless, be considered as having been concluded with the complainant, and that the offset at issue was, therefore, justified. First, DG EAC argued that it entered into the agreement in good faith, and that it was reasonable for it to think that Mr B. was authorised to represent the complainant. Second, DG EAC submitted that the complainant had been aware of the Project and the Agreement. Third, DG EAC invoked the results of the audit.
28. In support of its first argument, DG EAC submitted it had acted in good faith. It had been led to believe that it had entered into the Agreement with the complainant, due to the fact that Mr B. used the complainant's stationery bearing its letterhead, and used its seal, and that the relevant application was submitted in the complainant's name. It also invoked the fact that correspondence concerning the Project was sent to the complainant's address and was, apparently, received by Mr B.
29. Since DG EAC did not, however, dispute the complainant's claim that Mr B. was not authorised to represent it, concrete evidence would have been required to prove that the complainant should be bound by the Agreement. In the Ombudsman's assessment, and in view of the findings set out below, DG EAC failed to provide such proof. The mere fact that correspondence concerning the Project was sent to, and received by, Mr B. at his university address, was not conclusive in this context. At the very most, it indicated that Mr B. was a professor at the university, a fact which, the Ombudsman noted, was never in dispute. The Ombudsman also noted that Mr B.'s signature on the Agreement was accompanied by his title of professor and Head of Department. No explicit mention was made of his authority to represent the complainant. Beside his signature was a stamp indicating the address of Mr B.'s Department. Contrary to DG EAC's statement in its opinion, neither the application nor the contract is marked with the complainant's seal. [1]
30. More importantly, the Ombudsman noted that, according to the Agreement, Commission payments were to be made to an account held by the Association. The Ombudsman considered it possible that a university might use a designated account, which is different from its normal account, for a specific project. The account indicated in the Agreement, however, was not the complainant's, but that of a third party. In light of the above, the Ombudsman failed to see how DG EAC could be sure that the complainant was the contracting partner to the Agreement.
31. In relation to its second point, DG EAC argued that the complainant knew of the Agreement and the Project. The complainant, however, stated that, while it knew of the Project, it did not know of the conclusion of the Agreement between Mr B. and the Commission.
32. The Ombudsman noted that DG EAC had not proved that the complainant knew of the
existence of the Agreement. The complainant submitted that Mr B. only informed it that the Project had received financing from the State of North Rhine-Westphalia, but he did not mention the funding granted by the Commission. In any event, the Ombudsman considered it unclear why the complainant's mere knowledge of the Project should mean that it was bound by the Agreement. The Ombudsman noted that DG EAC had failed to state clearly the grounds on which it based such assumptions.
33. As regards its third argument, DG EAC submitted that the audit concerned the complainant. It further submitted that the auditor found that the complainant was a party to the Agreement, and that the Association had been set up with a view to administering the Project in the complainant's name. According to DG EAC, the auditor had thus established a connection between the complainant and the Association.
34. The Ombudsman noted that the audit report stated that it was carried out in Berlin. The audit was not, therefore, carried out on the complainant's premises, whose head office is in Wuppertal. The audit report stated that the contractor was the complainant and that the Association was set up in order to " manage the project on behalf of " the complainant. The first of these statements appeared to be based on the wording of the Agreement. As regards the second statement, no source was indicated. In any event, the audit clearly focused on the financial aspects of the Project. The Ombudsman considered, therefore, that the audit report did not establish how and why the complainant should be considered to be bound by the Agreement.
35. On a more general basis, the Ombudsman considered that, in order to arrive at a conclusive assessment of the elements referred to by DG EAC, it was of fundamental importance to first establish which substantive law applies to the Agreement. The Ombudsman noted, however, that DG EAC had not addressed this central aspect of the case at all.
36. The Ombudsman therefore concluded that DG EAC had failed to provide him with a coherent and reasonable account of the legal basis for its actions.
37. In light of the above, the Ombudsman made the preliminary finding that DG EAC's decision to set off sums it believed it was owed against payments due to the complainant could amount to an instance of maladministration. In light of his findings, he proposed that the Commission could consider reversing the offset it had made, which had been to the complainant's disadvantage.
The arguments presented to the Ombudsman after his friendly solution proposal
38. In its opinion on the Ombudsman's friendly solution proposal, DG EAC maintained its view that it had acted in good faith, but indicated that it was ready to accept a friendly solution which took into account the arguments submitted by both parties. It announced that it intended to contact the complainant directly for this purpose.
39. According to DG EAC, when Mr B. signed the agreement, he held himself out to be a representative of the complainant. DG EAC had no reason to doubt this, since public institutions, such as the complainant, frequently delegate powers and Mr B.'s correspondence was on paper bearing the complainant's letterhead and a stamp stating his faculty and the complainant's name throughout. Furthermore, the fact that a different account was used did not give rise to concern, since EU rules require beneficiaries to have a separate account to which grant funds can be transferred.
40. Nevertheless, DG EAC admitted that it could have been more diligent when assessing the financial documentation submitted with the grant application, and that it could have checked more carefully whether the complainant was indeed the recipient of the financial assistance. Furthermore, when carrying out the offset, it could have verified in whose name the account was registered.
41. DG EAC noted the complainant's confirmation that it knew of the Project. While the Commission admitted that knowledge of the Project did not necessarily entail knowledge of the Agreement, it considered that this was due to deficiencies in the complainant's internal control and communication procedures. For its part, DG EAC found it reasonable for it to have considered that the Agreement was binding on the complainant, not least because all correspondence had been addressed to the complainant (for the attention of Mr B. and his department).
42. DG EAC submitted that the complainant should have known of the Agreement, at the latest by March 2004, when it was sent a letter, notifying it of the audit. In that context, DG EAC added that an audit did not necessarily have to be conducted at an organisation's headquarters.
43. The main area of dispute appeared to be the legal effect of the contract. DG EAC considered that, since there were no other binding documents, it was the Agreement which regulated the legal relations between the parties. All measures which had been taken in this case, notably those concerning the debit note and the offset, had been taken on the basis of the Agreement. While no clause in the Agreement determined which substantive law applied (an issue which the new standard agreements now address), this question was in fact irrelevant, given that Mr X. had held himself out to be a representative of the complainant when he completed the application form, the declaration in the contract, and throughout all correspondence.
44. In its observations, the complainant maintained its objections to DG EAC's position.
45. The complainant firmly rejected DG EAC's argument that it should be considered bound by the Agreement. In its view, DG EAC had been negligent when it signed the Agreement, particularly since it had itself admitted that it should have been more vigilant about the fact that the account number submitted by Mr B. was not the complainant's, and that it should have checked more carefully who actually received the money. Furthermore, DG EAC had been provided with a list of the names of those persons who could bind the complainant,
and Mr X.'s name was not on that list.
46. The complainant refuted DG EAC's argument that its internal control and communication procedures were deficient. It explained that professors had to inform it of any third-party financing they wished to propose so that it could check the conditions. Once approved, contracts would be signed by its authorised representatives. Furthermore, there was only one account which professors were allowed to use in connection with projects carried out on behalf of the complainant. This allowed it effectively to control research activities undertaken. As regards its dealings with the Commission, the complainant had further protected itself by informing the Commission of its official account number, and naming the persons authorised to sign on its behalf. The complainant submitted that it had thus taken all reasonable measures to ensure that no invalid agreements could be signed in its name. It did not therefore accept that it was partially to blame for the situation at issue in the present complaint.
47. Finally, the complainant welcomed a friendly solution regarding this complaint, which, in its view, had to include a reversal of the offset carried out by the Commission. However, it did not have the impression that such a solution could be achieved by the parties themselves, since DG EAC had failed to contact it, despite stating its intention to do so in its opinion.
48. By letter dated 31 May 2010, the complainant informed the Ombudsman that the Commission had contacted it on 12 April 2010, requesting further information with a view to preparing a friendly solution. In particular, the Commission asked the complainant for its opinion on Mr B.'s behaviour, who, in the Commission's words, "acted for the complainant in a legally binding manner, allegedly without the complainant's knowledge", and whether it had commenced proceedings against him. It also asked for details about the relationship between the complainant and Mr. B during and after the Project, and whether the complainant had been involved in the Project. The Commission recognised that it was partly responsible for the situation and announced that it was willing to find a solution which would take into account the views of both parties.
49. In its letter dated 31 May 2010, the complainant pointed out that, in principle, it was very interested in achieving a friendly solution, but that it feared that it would be difficult and time-consuming to find a solution which would be satisfactory for both parties. The complainant took the view that the Commission was neither willing to follow the Ombudsman's proposal for a friendly solution, nor had it made any specific alternative proposals in this respect. It submitted that although the Commission's offer to ascertain the extent of the complainant's co-responsibility initially sounded friendly, it feared that this would lead to lengthy and difficult negotiations. The complainant insisted that it was not to blame for what had happened in the present case, and that the offset should, therefore, be annulled in its entirety. Finally, it added that in 2009, it adopted a decision in which Mr B. was asked to make good the damage that had resulted from his behaviour in the present case. In the meantime, Mr X. had brought an action against this decision, and the outcome of the Ombudsman's inquiry would be important in the relevant proceedings. The complainant was, therefore, very interested in resolving the matter as rapidly as possible and indicated
that it would be greatly appreciated if the Ombudsman could make his assessment as soon as possible.
The Ombudsman's assessment after his friendly solution proposal
50. The Ombudsman welcomed the fact that the Commission wrote to the complainant stating that it was prepared to seek a friendly settlement with the complainant.
51. However, it appeared from the Commission's reply to the Ombudsman's proposal for a friendly solution, and the letter it sent to the complainant, that it envisaged a solution to this matter which differed significantly from the Ombudsman's proposal.
52. In particular, DG EAC maintained its view that the complainant was partly to blame, and thus only accepted partial responsibility. In its reply to the proposal for a friendly solution, DG EAC attempted to justify this view by arguing three points, namely, that (i) the complainant knew of the Project; (ii) it should have known about the Project by March 2004 at the latest; and (iii) all correspondence was addressed to the complainant. In the Commission's view, if the complainant did not know of the Agreement, it was because its internal control and communication procedures were deficient. Further, in its letter to the complainant, the Commission seemed to suggest that Mr B. entered into a legally binding contract with the Commission on behalf of the complainant, and again questioned the complainant's claim that it did not know of the Agreement.
53. In his analysis leading to the proposal for a friendly solution, the Ombudsman had pointed out that it was an undisputed fact that Mr B. was not authorised to represent the complainant. This was because the complainant had consistently argued that Mr B. was not one of its authorised representatives, and that its only authorised representatives were the Vice Chancellor and the Head of Administration. It had also pointed out that the Commission was aware of this fact because it had been sent the names of the complainant's authorised representatives. DG EAC never provided any evidence to challenge this statement. The Ombudsman therefore continued to consider that DG EAC had failed to prove that Mr B. was authorised to conclude agreements binding on the complainant, and that it did not submit any convincing arguments as to why Mr B. should be considered to be an authorised representative of the complainant.
54. As regards the complainant's knowledge of the Project, the latter explained that it knew that Mr B. was carrying out the Project, but that it did not know that the Commission had agreed to provide financial assistance on the basis of the Agreement. As regards the second point of the Commission's argument, it should be pointed out that the Agreement was concluded on 30 December 2000. This was therefore the decisive date for determining who the parties to the Agreement were. The Commission did not explain how the fact that the complainant subsequently learnt about the Project or the Agreement in March 2004, or at a later stage, could be of any relevance in this context. As regards the third part of the Commission's argument, the latter acknowledged that its letters concerning the Agreement,
though addressed to the complainant, were marked for the attention of Mr B. It was therefore logical to assume that they were delivered to Mr B. without being read or checked by other persons. The complainant refuted any allegation that its internal control procedures were deficient. It explained them in detail, and highlighted that it had taken special precautions in its dealings with the Commission by informing it of the names of the persons authorised to sign agreements on its behalf. The Ombudsman therefore considered that there was no basis for the Commission's argument that the complainant had to accept that it was bound by the Agreement, even though Mr B. was not an authorised representative. The Commission itself admitted that it could have been more diligent in checking whether it was in fact contracting with the complainant on the basis of the information provided by Mr X., particularly in view of the fact that the latter submitted an account number which was not in the complainant's name. If the Commission nevertheless entered into the Agreement on the basis of Mr B.'s declarations, the Commission could not argue that there was any contributory negligence on the part of the complainant, even assuming that any such negligence could have been of any relevance in the present case.
55. In this context, the Ombudsman also recalled that, in his proposal for a friendly solution, he had stressed that it was of fundamental importance to first establish the applicable substantive law. The Commission did not appear to have addressed this issue at all. In its reply, it argued that this question was in fact irrelevant, given that Mr X. had held himself out to be a representative of the complainant when he completed the application form and the declaration in the contract, and throughout all correspondence.
56. The Ombudsman found this statement remarkable for two reasons. First, in order to establish that it was Mr B.'s behaviour which led it to conclude the Agreement with the complainant, the Commission would have had to identify and establish the legal rule on which this conclusion was based. The Ombudsman was therefore somewhat perplexed to note that the Commission considered itself able to draw legally binding conclusions without identifying the legal rule, and thus the substantive law, on which they were based. Second, the Commission's statement was a perfect example of circular reasoning. The Commission's immediate contractual partner was Mr X., and not the complainant. If the Commission wished to argue that the Agreement was concluded with the complainant, it would have to prove this by showing, on the basis of the relevant law applicable to this case, that Mr B. bound the complainant by his actions. However, and as was already noted above, the Commission had failed to do so.
57. The Ombudsman noted that, in its most recent letter to the complainant, the Commission stated that it would prepare the details of a possible friendly solution on the basis of the complainant's replies to its questions. In light of this statement, the complainant's fears that the Commission was not looking for a mutually agreeable solution, but instead might unilaterally decide on what it considered to be a friendly solution, were understandable.
58. In light of the above, it appeared that the Commission did not accept the friendly solution which the Ombudsman proposed on 8 September 2009. However, the Ombudsman considered it unjustified for the Commission to assume that the complainant also bore some
responsibility for the situation. He underlined that, when he makes a proposal for a friendly solution, he aims to find a rapid, informal and mutually agreeable solution. In many cases, such a solution can be a compromise between the respective claims of the parties. However, it was important to stress that a proposal for a friendly solution may also consist of asking an institution to comply with a complainant's request, if the Ombudsman considers that the complainant's request is justified. In such a case, accepting a proposal for a friendly solution offers an institution the opportunity to settle a case rapidly and informally, and it avoids the Ombudsman having to adopt a more formal approach. In the present case, the Ombudsman agreed with the complainant that the position adopted by the Commission was wrong. The Commission declared that it was in favour of a friendly solution, but it made it clear that it did not accept the fundamental premise on which the Ombudsman's assessment rested, namely, that there was no contributory negligence on the part of the complainant. In these circumstances, the Ombudsman did not consider it appropriate to continue seeking a friendly solution. Instead, a draft recommendation appeared to be necessary at this stage.
59. In light of the above, the Ombudsman reiterated his conclusion that DG EAC did not provide him with a coherent and reasonable account of the legal basis for the offset it carried out to the disadvantage of the complainant. He thus concluded that the Commission's decision to set off sums it believed the complainant owed it against payments due to the latter, amounted to an instance of maladministration. He therefore made the draft recommendation, in accordance with Article 3(6) of the Statute of the European Ombudsman, calling on the Commission to " reverse the offset carried out to the disadvantage of the complainant ".
The arguments presented to the Ombudsman after his draft recommendation
60. In its detailed opinion, the Commission expressed its regret that the wording of its reply had led the complainant to misinterpret its intentions. It went on to state that it was in fact fully prepared to reach a friendly solution; its reply had merely intended to clarify certain matters in order to determine the conditions for the agreement. It underlined that these clarifications would have allowed it to repay the entire sum claimed by the complainant. Further, repaying the money without asking the questions it still had would have meant that it would never have known about the complainant's proceedings against Professor B: it was only in July 2010 that the Commission learned about these proceedings and about the fact that the Professor had counterclaimed.
61. The Commission acknowledged that it continued to disagree with the complainant's argument that it should have known which persons were authorised to represent the complainant. The relevant information had to be communicated with every new proposal because relevant staff might change or only be authorised for a specific project. In relation to the Ombudsman's statement that the Commission had not explained the relevance of whether the complainant might have become aware of the Project in 2004 or at a later stage. The Commission stated that if it had learnt about the state of affairs at that point in time, it would still have been able to take appropriate measures. The fact that no such information
had been provided at the time in fact confirmed the Commission's understanding that the complainant was bound by the actions of Professor B.
62. The Commission added that the legal basis for the recovery order was Article I.15(6) [2] of the Grant Agreement, which stated that "[a]mounts to be repaid to the Commission may be set off against amounts due to the beneficiary under any heading". It had complied with the relevant procedures and had believed, in good faith, that it had an agreement with the complainant; it added that it had not, at the time, seen any indications that would lead to carry out more checks than are usually undertaken. However, given the information it had recently received in this matter, the Commission accepted the view that the fact that Professor B. signed in the name of the complainant did not allow the conclusion to be drawn that the complainant was legally bound by the Agreement even if Professor X. had held himself out as having the authority to sign on behalf of the complainant.
63. The Commission concluded that there was, in fact, no evidence to establish the claim that the complainant was bound by the Agreement. It appeared that Professor X. had held himself out to have the relevant authorisation. The Commission again underlined its willingness to achieve a friendly solution to the complaint and its readiness to follow the Ombudsman's proposal and make a corresponding repayment. It would then bring a claim against Professor B. and therefore asked the complainant to keep it informed about the status of its proceedings against Professor B.
64. In its observations, the complainant noted that the Commission had written it a letter setting out its intention to repay the sum at issue. The complainant had therefore drafted a settlement agreement and further indicated that it would withdraw its claim against Professor B. once the Commission had signed this agreement and repaid the sum it had offset. It stated that it would keep the Ombudsman informed of the progress made as regards this matter. In July 2011, the Ombudsman therefore informally asked the complainant whether the matter had in the meantime been settled. The complainant informed the Ombudsman that, on 29 April 2011, the Commission had sent it a fax, in which it stated that it did not intend to sign the settlement agreement but that it would make the requested payment. The complainant explained that it had drafted the agreement because it wanted to ensure that, in case the Commission's proceedings against Professor B. were not successful, the Commission would not turn to it again in order to claim that the complainant should pay the relevant amount to the Commission. While it understood that this was not part of the original complaint, the complainant therefore asked the Ombudsman to ensure that the Commission signed this agreement.
65. On 20 September 2011, the Commission forwarded a letter to the Ombudsman which it had sent to the complainant on 19 July 2011. In this letter, it confirmed that it would repay the offset it had made and attached a payment order of EUR 40,649.41. It also asked the complainant to send it an official confirmation that it had withdrawn its claim against Professor B.
66. On 26 September 2011, the complainant forwarded to the Ombudsman a decision by the relevant German court, dated 16 September 2011, containing clear evidence that the
complainant had withdrawn the claim. In a telephone conversation on 13 October 2011 with the Ombudsman's services, the complainant confirmed that it had received the payment from the Commission and that it had sent the court's decision to both the Commission and the Ombudsman on the same date. It stated that it was satisfied with the outcome of the complaint and thanked the Ombudsman for his assistance.
The Ombudsman's assessment after his draft recommendation
67. The Ombudsman is pleased to note that the Commission has accepted his draft recommendation and properly implemented it. Further, given that the Commission has accepted (see paragraph 60) that there is no evidence to establish that the Agreement was legally binding on the complainant, he trusts that the Commission will not, as the complainant feared, claim from the latter in the future the sum here at issue. He therefore does not consider that there are at present grounds for further action on his part in relation to this issue. However, if, contrary to expectation, the Commission were to make any such claim in the future, the complainant could of course turn to the Ombudsman again.
B. Conclusion
On the basis of his inquiry into this complaint, the Ombudsman closes it with the following conclusion:
The Commission has accepted the Ombudsman's draft recommendation and has properly implemented it.
The complainant and the Commission will be informed of this decision.
P. Xxxxxxxxx Xxxxxxxxxxxx
Done in Strasbourg on 18 November 2011
[1] The complainant's seal can, for example, be found on the complaint to the Ombudsman, which was submitted by the Chancellor, one of the complainant's authorised representatives.
[2] In the Grant Agreement submitted to the Ombudsman, this is Article 15.6 of Xxxxx XX.