Next is the no. 7294/2020 Decision of the Administrative Court of First Instance of Thessaloniki, on a case successfully handled by our office, which vindicated a pensioner applicant, ruling that the return to EFKA of unduly received pension amounts is not legal, according to the interpretation of the relevant general principle of social security law, as it may result in unforeseen and adverse consequences for her livelihood.
The text of the Decision of the Administrative Court of First Instance of Thessaloniki:
Decision Number: 7294/2020
THE ADMINISTRATIVE COURT OF FIRST INSTANCE OF THESSALONIKI
SECTION E
S O N O M E L E S
It sat in public in its audience on February 11, 2020, with judge Stella Pantzali, First Instance Court of the Hellenic Republic, and secretary Anatoli Hazaridou, judicial officer. To judge the appeal filed on April 24, 2019 (registration no. PR2470/2019).
Of ….., resident of Thessaloniki (street …..), who was represented by the statement dated 10.2.2020 (pursuant to article 133 par. 2 of the Code of Civil Procedure, as amended by article 29 par. 1 of law 2915/2001) of her attorney-in-fact Thomas Kalokiris.
Against the Public Legal Entity with the name "Single Social Security Institution (EFKA)" represented by its Governor and represented by its attorney-at-law....
During the discussion, the party present at the hearing developed his claims and requested what is stated in the minutes. The Court's judgment is as follows:
1. Because, with the appeal under consideration, for which the legal fee was paid (see the proof of payment, dated 24.4.2019, to Piraeus Bank, of the amount of the issued electronic fee with payment code 269724594959 0610 0067), the applicant requests, in accordance with her pleadings, the annulment of decision no. 59/syn. 6/28.1.2019 of the 1st T.D.E. of the Thessaloniki Regional Branch of Employees of the E.F.K.A., in the part by which the objection no. 57672/22.5.2017 of the applicant pensioner against the no. 4756/26.4.2017 decision of the Director of the same Branch and it was determined that the applicant was obliged to return to the E.F.K.A. the pension amounts that had been paid to her unduly during the period from 26.4.2012 and onwards. Moreover, the decision no. 4036/26.3.2019 of the Director of Pensions of the same Branch, against which the appeal under consideration is also directed, has been issued, as is apparent from its content, in execution of the said decision of the T.D.E. and repeats its operative part, is therefore devoid of enforceability and cannot be admissibly challenged by appeal. The appeal under consideration, which is competently filed with this Court and is admissibly brought against the above decision of the T.D.E., must be further examined on its merits.
2. Whereas, article 40 par. 4 of the Civil Code 1846/1951 “On Social Insurance” (A' 179) stipulates that: “All benefits in money unduly paid by the Social Insurance Institution, as well as the value of such benefits in kind, ... are returned with interest to 5% and are sought in accordance with the provisions on the forced collection of the Foundation's arrears of contributions. …” According to the meaning of this provision, any benefit unduly paid by the Social Insurance Institution is returned to it with interest. However, as has been held, it is contrary to the principle of good administration, a general principle that also applies to social security law, for the insurance organization to seek periodic insurance benefits after a reasonable period of time has passed since their collection, if the benefits have been paid unduly by the insurance organization, but the insured has received them in good faith. The search for these benefits is permitted, provided that it is determined that the person who has received the amounts sought acted fraudulently towards the organization when collecting them. The judgment on the contribution of fraud must be specifically justified (S.C. 2354/2015, 478/2011, S.C. 154/2008, 819/2007, 2010/2006). Fraudulent action by the insured also includes the concealment of a material fact, which justifies the interruption of further payment of the benefits granted (Council of State 3146/2017, 1318/2014, 3587/2011, 1835/2007). Furthermore, the recovery of unduly paid amounts is required if the period of time between collection and recovery is short, unless the person who has illegally, but not in good faith, received the financial insurance benefits, claims and proves that their return will result in unforeseen consequences to him and adverse to his livelihood (Council of State 928/2009, 153/2008, 525/2006).
3. Whereas, subsequently, with article 103 of law 4387/2016 (A' 85) the issue of the refund of benefits unduly paid by IKA-ETAM was re-regulated, as follows: "1. Any benefit that has been paid by IKA-ETAM unduly is refunded regardless of the recipient's fault and is recovered, in accordance with the provisions of the KEDE. In case of his fault, it is recovered with interest, at an interest rate of 3%. In parallel with the application of the above provisions, it is permitted to set off any debt to IKA-ETAM with the total of the benefits granted, to which the debtor may be entitled. The offsetting is carried out in monthly installments, the amount of each of which cannot exceed 1/3 of the gross amount corresponding to the benefits granted, or in a lump sum, provided that the total amount of the debt does not exceed 1/3 of the amount corresponding to the benefits granted. The imputation and any offsetting carried out is carried out by decision of the Director of the competent Branch. 2…". These new provisions, which differ little from the previous ones, are valid and applied when the EFKA recovers benefits unduly paid, either by the said Body or by the IKA-ETAM, subject to the above rules arising from the principle of good administration, as has been consistently interpreted in case law (see previous paragraph).
4. Whereas, in the present case, the following emerges from the information in the case file: The applicant, who was born in 1949, was awarded a reduced old-age pension as of 16.8.2005, by decision no. 26098/8.11.2005 of the Director of the Thessaloniki Regional Branch of I.K.A.-ETAM, in accordance with the provisions of Council Regulation (EEC) 1408/71 of 14 June 1971 "on the application of social security schemes to employed persons and their families moving within the Community" (OJ L 149 of 5.7.1971), based on her total period of insurance with I.K.A. and by taking into account the period of insurance she had completed with a Cypriot insurance institution. Subsequently, the above decision was partially amended by decision no. 4756/26.4.2017 decision of the Director of the Thessaloniki Regional Branch of Employees of the E.F.K.A., by which the amount of the pension payable to the applicant was re-determined - at 231.54 euros from 16.8.2005 and at 263.22 euros from 21.6.2011 and onwards - after its recalculation, based on the provisions of the 41/2011 circular of the I.K.A.-ETAM, which imposed in this case the determination of the "theoretical" amount of the pension (in accordance with the above Regulation) after comparing what resulted based on the total insurance period and the increased minimum pension amount that resulted based only on the insurance days that had been paid to the national institution, as the applicant did not establish an independent right to a pension from the I.K.A.-ETAM. By the same decision, after it was recognized that the additional amounts paid to the applicant were undue, but had been collected in good faith by her, the set-off of each pension amount that had been paid from 16.8.2005 and onwards was ordered, as well as the calculation of the undue pension amounts paid from 21.6.2011 (date of issuance of the circular) and onwards, the interest-free imputation of these amounts to the applicant, pursuant to article 103 of the law. 4387/2016, and their return either in a lump sum or by withholding from the amount of her monthly pension, in a percentage of up to 1/4 thereof, according to the provisions of the KEDE. Against this decision, the applicant filed her objection no. 57672/22.5.2017 before the TDE of the same Branch, during the hearing of which she appeared in person, with her daughter …. claiming that she did not know the reason for the reduction of her pension and the withholding of part of this amount, as well as that she was collecting the pension granted to her in good faith. Her objection was partially accepted by the contested decision no. 59/syn. 6/28.1.2019 of the 1st TDE. of the aforementioned Branch and the Director's judicial decision was annulled, insofar as it concerned the imputation against the applicant of the pension amounts unduly paid to her for the period from 21.6.2011 to 25.4.2012, since it was considered that the applicant did not have malice in collecting the additional amounts of her pension, so the recovery of these amounts for a period of time that exceeded the reasonable period of five years (which is, as a rule, the reasonable period within which the revocation of illegal administrative acts is permissible) before the issuance of the imputation decision, was not permissible, in accordance with the principle of good administration. On the contrary, the T.D.E. ruled that the applicant was obliged to return the amounts unduly paid to her for the period from 26.4.2012 onwards, as their recovery was made within a reasonable time and it did not appear that their return would have unforeseen adverse consequences for her livelihood.
5. Since the applicant disputes, in her appeal under consideration, as developed in her duly filed memorandum, the legality of the above decision of the TDE, under her contested chapter, and requests its annulment under this chapter, arguing that the recovery of the pension amounts that were considered, based on the aforementioned IKA-ETAM circular, to have been paid to her unduly, is contrary to the principles of good administration, the protection of the legitimate expectations of the administered person and proportionality, as she herself was in good faith when receiving these amounts and had been reasonably convinced that the amount of the pension that had been calculated from the outset was the correct and legal one, she was therefore unable to foresee that she would receive amounts in addition to those to which she was entitled, which she should, after a long time has passed since they were collected and spent on her daily living needs, return to the insurance organization. In particular, the applicant claims that she makes a living exclusively from the pensions she receives, the reduced old-age pension, which now amounts, due to the withholding by the E.F.K.A. of the amount of 61.83 euros per month against her debt from the assessed amount, to the monthly amount of 179.52 euros, and the pension due to the death of her husband, which amounts to approximately 365 euros per month, from which she concludes that the obligation to return the assessed amount seriously undermines her financial situation, which was already difficult, as she was unable to meet her living expenses, increased due to her age (70 years) and her health problems, and to repay, as an heir, the debts that her husband had incurred in banks before his death, making her financial ruin certain and putting her survival at immediate risk, thus offending her dignity. In this regard, she claims that, as a consequence of the search for the disputed amount, with the withholding of part of her low pension, she is deprived of the basic means of subsistence, given that she is completely unable, due to her age, to find new resources in order to supplement her income, while she points out that the pension, which is provided for the purpose of earning a living, is protected against seizure in the hands of a third party, in accordance with article 31 of the Pension and Disability Insurance Act, not only in the amount of 3/4 of it, but also up to the amount of 1,000 euros. In confirmation of her above allegations, the applicant invokes and presents (in copies): a) the submitted declaration and the administrative tax assessment for the tax year 2018, according to which her annual income amounted to 7,244.40 euros in that year, derived exclusively from pensions, b) the settlement note of her pension (old age) dated 25.1.2019, from which the amount payable to her (179.52 euros), the amount withheld from her monthly (61.83 euros) and the balance of her debt from the amount attributed to her, amounting to 1,435.11 euros, c) an extract from the death certificate of her husband, ...who died on 21.3.2018, and a certificate his closest relatives, d) the 6.7.2018 record of publication of a private will of the Thessaloniki Court of Justice, by which the applicant is established as the sole heir of her deceased husband, and e) informational forms of the National Bank and Alpha Bank, which list her husband's overdue debts to these banks (already unpaid before the time of his death).
6. Because, as follows from the above facts, the applicant's good faith in collecting her pension amounts, which exceeded the monthly old-age pension amount payable to her, as recalculated in accordance with the provisions of the aforementioned IKA-ETAM circular, was recognized both by the Director of the competent Branch, who issued the judicial assessment act, and by the TDE, given that the partial acceptance of her objection with the contested decision was based on this judgment (regarding the applicant's good faith). In view of this and in accordance with what was interpretatively accepted in the second and third paragraphs of this decision, the good faith receipt of the disputed pension amounts precluded their recovery as having been unduly paid for a period exceeding a reasonable period of time (as a rule, five years from collection); however, their recovery was not precluded for this reason insofar as five years had not elapsed between the collection of these amounts and the issuance of the judicial imputation decision, as the T.D.E. lawfully ruled in principle. However, the Court, taking into account the evidence presented, from which it emerges that the applicant, aged 71 in the current year and already a widow, makes a living exclusively from the reduced old-age pension and the pension due to the death of her husband that she receives from the defendant in the appeal (as successor to I.K.A.-ETAM), amounting to approximately 600 euros per month in the year 2018 (in accordance with the relevant administrative tax assessment act), from which she covers the necessary expenses for her living, which are increased due to her age, while she is burdened, as the sole heir of her husband, with his overdue debts, finds that the applicant proves the occurrence of unforeseen and adverse consequences for her living due to the return to E.F.K.A. (even partially) of the part of the imputed amount that corresponded to the additional pension amounts received during the period from 26.4.2012 to 26.4.2017.
Therefore, in the present case, there is a legitimate reason that excludes, according to the case law, by interpretation of the relevant general principle of social security law, the recovery of the unduly received pension amounts from the applicant, which, consequently, were unlawfully attributed to her by the judicial decision of the Director of the aforementioned Branch. Therefore, for the above reasons, the T.D.E. which, with its contested decision, upheld the said decision of the Director in the relevant part, regarding the refund of the amount attributed for the period from 26.4.2012 onwards, rejecting the applicant's objection in the part that concerned the specific period of time and, for this reason, its contested decision must be annulled, in its relevant chapter, upon acceptance as valid the relevant ground of the appeal under consideration.
7. Because, following the above, the appeal under consideration must be accepted and the contested decision no. 59/syn. 6/28.1.2019 of the First Administrative Court of the above Branch must be annulled, insofar as it rejected the applicant's objection no. 57672/22.5.2017. Furthermore, the fee paid must be returned to the applicant (article 277 par. 9 sub-paragraph a of the Code of Civil Procedure), however, in light of the circumstances, the defendant Body must be exempted from its legal costs (article 275 par. 1 sub-paragraph e of the Code of Civil Procedure).
BECAUSE OF THIS
He accepts the appeal.
Annuls decision no. 59/syn. 6/28.1.2019 of the 1st T.D.E. of the Thessaloniki Regional Branch of Employees of the E.F.K.A., in the part by which the applicant's objection no. 57672/22.5.2017 was rejected.
Orders the payment of the fee to the applicant.
The defendant in the appeal is exempted from the applicant's legal costs.
The decision was published in Thessaloniki on 29-9-2020, in an extraordinary public session in the courtroom of this Court.
Thomas Kalokiris
MDE lawyer
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