Summary:

I.

The constitutional complaint concerns the question whether it is compatible with the Basic Law for asylum seekers to be obliged to use damages awarded for personal suffering as income or capital to provide for their subsistence prior to receiving benefits under the Asylum Seekers Benefits Act.

The Asylum Seekers Benefits Act (hereinafter referred to as “the Act”) of 1993 created a separate benefits system outside that of social assistance in order to provide subsistence for asylum seekers. The benefits, in principle, are intended to take the form of benefits in kind, but may also be paid in cash under certain circumstances. In addition, the Act contains special rules on deducting income and capital from the benefits. The persons entitled to benefits as well as their family members must first use up their income and capital, to the extent that they have access thereto, before state benefits become payable. Capital also includes, in principle, other social security benefits as well as awards for damages.

The complainant and his family, who are from Bosnia and Herzegovina and had sought asylum in Germany, received benefits under the Asylum Seekers Benefits Act. In August 1997, the complainant’s wife and child were victims of a traffic accident. For quite some time they required in-patient treatment at an emergency hospital and a dental clinic. In settlement of all claims arising from the accident, the victims received damages for personal suffering totalling DM 25,000. By decision of August 1998, the agency administering benefits refused, with effect from September 1998, to grant any further benefits under the Asylum Seekers Benefits Act. According to the agency, the damages constituted chargeable capital for the purposes of § 7.1.1 of the Act. The complainant and his family were thus required to use these up first. The action brought against that decision, following an unsuccessful administrative appeal, was unsuccessful at all levels of jurisdiction.

II.

In response to the constitutional complaint, the First Senate of the Federal Constitutional Court held it to be incompatible with the principle of equality in the Basic Law for asylum seekers to be obliged to use awards for damages for their subsistence before being eligible to receive state benefits. The contested judgments were set aside and the case was remanded to the Administrative Court.

The decision was based essentially on the following considerations:

The deduction rule in § 7.1.1 of the Act is incompatible with Article 3.1 of the Basic Law to the extent that, under the rule, persons entitled to the benefit must use up any award of damages for their subsistence prior to receiving benefits under the Act.

Article 3.1 of the Basic Law requires all persons to be treated equally before the law. It is true that this does not bar the legislature from making any distinctions. However, it does constitute an infringement of constitutional law where one group is treated differently in comparison with another group even though there are no differences between these groups of such nature or significance as to be capable of justifying the difference in treatment.

The rule challenged in the constitutional complaint has the effect of treating asylum seekers differently than persons who receive social assistance. They are obliged to use damages awarded for personal suffering for their subsistence before they may receive benefits on the basis of asylum law. This does not apply to recipients of social assistance or welfare benefits.

This difference in treatment is not sufficiently justified. It is true that the legislature has discretion in the field of social policy to set up a separate legislative scheme for asylum seekers, which ensures that they have the necessities of life. In so doing, the legislature may also adopt rules relating to benefits which differ from the law on social assistance. In particular, the legislature is not barred from making the nature and extent of social security benefits paid to foreign nationals dependent on the likely duration of their stay in Germany. However, the specific function of damages for personal suffering confers on such payments a special position among other types of income and capital. This special position is also reflected without exception in the rest of the legal system: nowhere else are such deductions from state welfare benefits required. Against this background, the grounds for the special scheme ensuring that asylum seekers have the material necessities for subsistence do not support the difference in treatment in respect of damages for personal suffering constituting income and capital.

The statutory function of damages for personal suffering is not to cover those material necessities which the Asylum Seekers Benefits Act aims to provide. § 253.2 of the Civil Code provides for monetary payment to compensate for damage of a non-pecuniary nature. Such awards of damages are primarily intended – like in the case of the complainant’s dependants – to compensate for past or ongoing impairments of physical and mental integrity, and in particular for the added difficulties, disadvantages and suffering that continue after the damaging event itself and that are not covered by awards of pecuniary damages. They also take into account the idea that the damaging party owes satisfaction to the damaged party for what they have done. Consequently, a deduction – insofar as it would mean considering damages for personal suffering to be income or capital – cannot be justified on the grounds that the benefits under the Act only pursue the objective of ensuring that asylum seekers have the minimum necessities for subsistence during the transitional period while their request is being considered. That objective may, admittedly, justify rules which require the person entitled to use all available financial means to defray the cost of their subsistence. However, damages for personal suffering are specifically not assigned the function of ensuring a means of subsistence in the material sense. Rather, they are intended to meet a need that is not covered by the benefit scheme under the Asylum Seekers Benefits Act.

Nor do other considerations underlying the special scheme under the Asylum Seekers Benefits Act justify a deduction to the extent that the rule in question also covers damages for personal suffering. Deducting damages for personal suffering when granting and assessing benefits under the Act does not undermine the legislature’s objective of reducing the economic incentive for foreign nationals to enter Germany. Damages for personal suffering are not a calculable source of income, nor would any asylum seeker rationally seek to exploit them. Thus, the legislature need not pursue the deduction of such income or capital from benefits in order to prevent recipients of benefits from having funds at their disposal with which they could, for example, pay the costs of being smuggled into Germany.