J 0011/85 (Small amount lacking) 23-10-1985
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1. Where an amount paid jointly in respect of several fees is insufficient, the question of whether the amount lacking is small within the meaning of Article 9(1), fourth sentence, of the Rules relating to Fees, must be resolved by reference to the total fee amount.
2. Application of Article 9(1), fourth sentence, of the Rules relating to Fees is not precluded by dint of the fact that the danger of a legal disadvantage resulting from insufficient payment of fees could be obviated by grant of re-establishment of rights or payment in due time of a surcharge.
3. An underpayment of about 10% may as a rule be considered as a small amount.
Small amount lacking in fee payment
Fee payment/small amount lacking
Summary of Facts and Submissions
I. The applicants filed international application PCT/FI 82/00050 on 27 October 1982 claiming the priority of a national patent application filed in Finland on 28 October 1981. This application was given the European patent application number 82 903 242.4. The international search report for it was published on 11 May 1983.
II. The applicants filed a request for examination on 18 November 1983 and paid DM 4 080 on 25 November 1983. The following details were given on the transfer slip No. 067297: Filing fee DM 520 8 designation fees DM 2 080 Examination fee DM 1 980 Total DM 4 080 The fee amounts given are correct but the total is wrong. Added together the fees amount to DM 4 580, so that DM 500 too little was transferred.
III. In a letter dated 22 December 1983 the Receiving Section notified the applicants that a valid request for examination had not been filed within the period for filing such a request which had expired on 28 November 1983, since the examination fee had been underpaid by DM 500. This deficiency could be rectified by payment of a surcharge of DM 990 within a period of two months from 28 November 1983.
IV. In a letter dated 9 January 1984 the applicants asked that their rights be re-established in respect of the period for filing the request for examination which they had failed to observe and paid the DM 500 outstanding as well as the fee for re-establishment of rights of DM 115. In support of their application the applicants stated that the patent agent's normally reliable assistant who had been processing European patent applications since 1977 had unfortunately made a mistake when adding up the fees given on the transfer slip. Should the application for re-establishment not be granted by 28 January 1984, DM 990 was to be debited from the representatives' account as a precautionary measure.
V. In a communication dated 2 April 1984 the Examining Division notified the applicant that no application for re-establishment of rights could be filed since there had been no loss of rights. As a result of payment of the surcharge of DM 990 the request for examination was deemed to be filed on 9 January 1984. Reimbursement was not possible. The applicants maintained that, pursuant to Decision J06/79 of the Legal Board of Appeal dated 13 June 1980 (OJ 7/1980, p. 225), the precondition for re-establishment under Article 122 EPC was met since the period prescribed under Articles 150(2) and 94(2) was susceptible of re-establishment.
VI. In a communication dated 27 August 1984 the Examining Division stated that the application for re-establishment was to be rejected, because the applicants had not been prevented from completing an act. The examination fee had been paid, albeit not in full. This deficiency could be rectified by the legal remedy enshrined in Rule 85b EPC. The applicants argued that the legal remedy in question did not preclude re-establishment and drew attention to Decision T 152/82 of the Technical Board of Appeal dated 5 September 1983 (OJ 7/1984, p. 301).
VII. By decision dated 30 November 1984 the Examining Division rejected the request for reimbursement of the DM 990 surcharge on the examination fee on the grounds that the applicants had suffered no loss of rights within the meaning of Article 122 EPC but merely a financial penalty. The imposition of a penalty was not synonymous with a loss of rights. Article 122 EPC was the last means of redress for avoiding a loss. Other remedies had to be exhausted first, including payment of the surcharge under Rule 85b EPC. Not even a Euro-PCT applicant, who could in principle have his rights re-established in respect of the time limit for filing a request for examination which he had failed to observe, could choose the legal remedy most favourable for him.
VIII. The appellants filed an appeal against that decision in due time. At the same time the applicants issued a debit order in respect of the fee for appeal. In support of their appeal the applicants argued that the Convention did not indicate that re-establishment should be excluded where a period of grace in respect of the omitted act was available in which to pay a surcharge. Payment of a surcharge, however, was not, as the Examining Division maintained, a penalty, but a means of saving an application. Moreover, they did not share the view expressed in the contested decision that loss of the right to have an official action carried out against payment of a particular fee was not a loss of rights within the meaning of Article 122 EPC. In the alternative the applicants requested oral proceedings.
Reasons for the Decision
1. The appeal complies with Articles 106 to 108 and Rule 64 EPC and is therefore admissible.
2. In its decision of 30 November 1984 the Examining Division presupposes that the applicants' request for examination was not filed within the period prescribed in Article 94(2) EPC in conjunction with Articles 157(1) and 150(2) EPC which ended on 28 November 1983. Although a request for examination had been filed in due time on 18 November 1983, the examination fee had not been paid in full within the time limit. This deficiency could be rectified only by payment of a surcharge of DM 990; the request for reimbursement could not therefore be allowed.
3. The Board is unable to agree with the Examining Division's opinion. If it were correct that the applicants had paid only DM 1 480 instead of the prescribed examination fee of DM 1 980, the Board would have no objection to sharing the Examining Division's view; anybody who pays approximately 25% too little in respect of a fee is on a par, in terms of the legal consequence to which the payment is intended to give rise, with an applicant who has not paid the fee at all. This follows from the fact that only payment of the full amount of a fee can bring about the associated legal consequence whereas part payments cannot.
4. The premise behind the contested decision that the applicants paid only DM 1 480 instead of DM 1 980 in respect of the examination fee is incorrect. It can be seen from the transfer slip No. 067297 received by the EPO that the applicants had completed it as follows: Filing fee DM 520 8 designation fees DM 2 080 Examination fee DM 1 980 Total DM 4 080 The applicants had stated the correct amounts of the fees to be paid, but had made an error when adding them up. The total was calculated to be DM 4 080 whereas the correct amount was DM 4 580. As a result of this error of addition the applicant transferred DM 4 080 only, i.e. DM 500 too little.
5. The Examining Division charged the DM 500 underpayment to the examination fee, presumably because that fee figured last among the fees to be paid on the applicants' transfer slip. However, this would appear to be just as arbitrary as if it had been charged solely to one of the other fees indicated on the transfer slip, in this case the filing fee or the designation fees. The only correct finding would be that the total fee amount of DM 4 580 was underpaid by DM 500.
6. Article 9(1), fourth sentence, of the Rules relating to Fees, is applicable even where several fees are paid jointly. The wording of the German version ("geringfügige Fehlbeträge der zu entrichtenden Gebühr") and of the French version "des parties minimes non encore payées de la taxe") give the impression, if the wording were to be followed literally, that small amounts may be overlooked only where a single fee is paid. This interpretation, however, would be contrary to the meaning of that provision which is intended to provide an equitable arrangement in the event that small amounts of a fee are not paid. It would be arbitrary to apply Article 9(1), fourth sentence, of the Rules relating to Fees, for small amounts lacking only where a fee is paid separately, but not where several fees are paid jointly. The obvious meaning of Article 9(1), fourth sentence, of the Rules relating to Fees, is also fully reflected in the English version ("it may also overlook any small amounts lacking") which covers both cases. Where therefore several fees are paid together, the question of what constitutes a small amount lacking should be resolved on the basis of the ratio between that amount and the total amount paid.
7. Seen against the fee total of DM 4 580, the DM 500 underpayment may fairly be considered small within the meaning of Article 9(1), fourth sentence, of the Rules relating to Fees. Consequently it may be overlooked without prejudice to the rights of the person making the payment. The DM 500 underpayment may be considered small because it represents only slightly more than 10% of the total amount. The Technical Board of Appeal (Decision T 130/82 dated 26 August 1983 "Vehicle Guidance System/Bell & Howell", OJ 4/1984, p. 172) has already addressed the question of when an underpayment may be deemed to constitute a small amount. It took the view that an underpayment of just over 10% may be considered to be a small amount. In the said case the underpayment amounted to DM 16 compared with a total of DM 157. The Legal Board of Appeal shares the view that underpayments of that order may be considered to be small within the meaning of Article 9(1), fourth sentence, of the Rules relating to Fees. It is also justified to overlook the underpayment without prejudice to the rights of the person making the payment. The transfer of an insufficient amount is due solely to the excusable error of addition on the part of an otherwise reliable secretary and the applicants transferred the DM 500 lacking immediately after the error became known.
8. Application of Article 9(1), fourth sentence, of the Rules relating to Fees, is also not precluded in this case because the European Patent Convention provides for other legal remedies in the event that fees are paid incorrectly, and the applicant must avail himself of those remedies before Article 9(1), fourth sentence, of the Rules relating to Fees, can be applied. In this case the legal remedies in question are use of the period of grace under Rule 85b EPC and the filing of an application for re-establishment of rights. It is clear from the contested decision that the Examining Division considers it possible for a Euro-PCT applicant to file an application for re-establishment of rights only after other remedies, such as payment of the surcharge under Rule 85b EPC, have been utilised. However, the Board is unable to share this legal view of the relationship between Article 9(1), fourth sentence, of the Rules relating to Fees, and the said alternative legal remedies. The EPC does not stipulate that the three legal provisions, i.e. application of Article 9(1), fourth sentence, of the Rules relating to Fees, payment of a surcharge under Rule 85b EPC and filing of an application for re-establishment of rights, rank in a specific order which has to be observed. Nowhere does the EPC indicate that application of Article 9(1) fourth sentence, of the Rules relating to Fees, is out of the question so long as the possibilities under Rule 85b or Article 122 EPC are available. Rather the EPC provides the applicant with the said three possibilities as alternatives. This is moreover appropriate since each of the said possibilities is intended to prevent the same detrimental legal consequence, but each has different pre-conditions. Thus, Article 9(1), fourth sentence, of the Rules relating to Fees, may be applied by the Office of its own motion where the amount lacking is small, making it unnecessary for the person concerned to file a request, whereas the other two possibilities presuppose an action on the applicant's part which is also governed by a time limit. Furthermore, under Article 9(1), fourth sentence, of the Rules relating to Fees, the amount lacking must be paid immediately after it becomes known, although no time limit for so doing is prescribed, whereas payment of a surcharge is governed by a time limit regardless of when it becomes known.
9. Referral to a re-establishment procedure prior to application of Article 9(1), fourth sentence, of the Rules relating to Fees, is ruled out in most cases of re-establishment, since Article 122(5) EPC excludes the possibility of re-establishment in the event of failure to observe the period for filing a request for examination. Even where exceptionally re-establishment in that period is possible, i.e. in the case of Euro-PCT applications (Legal Board of Appeal Decision J 06/79 of 13 June 1980, OJ 7/1980, p. 225), the applicant may not be referred to the possibility of re-establishment since it is granted only under strict pre-conditions which often do not apply where an applicant has inadvertently omitted to pay a small amount of a fee. Moreover, the procedure under Article 9(1), fourth sentence, of the Rules relating to Fees, provides the EPO and the applicant for re-establishment with the more straightforward procedure when a small amount lacking is involved.
10. Nor does Rule 85b EPC take precedence over application of Article 9(1), fourth sentence, of the Rules relating to Fees. Until Rule 85b EPC came into being by Decision of the Administrative Council of 4 June 1981 (OJ 7/1981, p. 199) Article 9(1), fourth sentence, of the Rules relating to Fees, was applicable in all cases where only a small amount was lacking at the time of payment of the examination fee. Such underpayment could therefore be overlooked without prejudice to the rights of the person making the payment. The Administrative Council's Decision of 4 June 1981 was clearly not intended to change the legal position obtaining prior to that date, since as a result of that Decision an additional possibility was to be created in the event of failure to file a request for examination within the period laid down in Article 94(2) EPC. There is nothing in the said Decision to support exclusion of application of Article 9(1), fourth sentence, of the Rules relating to Fees where Rule 85b EPC is concerned. Moreover, the Board would consider such a provision as somewhat opaque, since it would mean that small amounts lacking at the time of payment of an examination fee could no longer be overlooked for purposes of an equitable decision. The Board is unable to see any compelling reason for this.
11. For these reasons small amounts lacking when payment of several fees is made may - insofar as the pre-conditions of Article 9(1), fourth sentence, of the Rules relating to Fees, are met - be overlooked even where the danger of a legal disadvantage resulting from insufficient payment of fees could be removed by granting re-establishment or payment in due time of a surcharge. The question of whether a particular precedence exists between the status of an application for re-establishment and payment of a surcharge in accordance with Rules 85a and 85b EPC where the stipulations of Article 9(1), fourth sentence, of the Rules relating to Fees, are not met is not addressed by the Board, since a decision on that question is not relevant to the case in hand.
12. Since by application of Article 9(1), fourth sentence, of the Rules relating to Fees, the filing, examination and designation fees may be considered as paid in due time, there is no need for payment of a surcharge under Rule 85b EPC; that fee is therefore to be reimbursed.
13. As a result of this legal situation there is no requirement for the re-establishment requested by the applicants, since no time limit was missed. Since the application for re-establishment is therefore superfluous, payment of the fee for re-establishment of rights received by the EPO was without foundation and is therefore to be reimbursed to the appellants.
14. Reimbursement of the fee for appeal is equitable under Rule 67 EPC by reason of a substantial procedural violation residing in the failure to apply Article 9(1), fourth sentence, of the Rules relating to Fees. Had the Examining Division applied that provision in accordance with the case law referred to under point 7 above, there would have been no need to file the appeal or pay the corresponding fee.
ORDER
For these reasons, It is decided that:
1. The decision of the Examining Division dated 30 November 1984 is set aside.
2. Reimbursement of the surcharge on the examination fee and of the fees for re-establishment of rights and for appeal is ordered.