Property

Bank Leumi le-Israel v. Tal Trading Corp.

Case/docket number: 
CFH 8447/15
Date Decided: 
Monday, September 11, 2017
Decision Type: 
Appellate
Topics: 
Abstract: 

 

[This abstract is not part of the Court's opinion and is provided for the reader's convenience. It has been translated from a Hebrew version prepared by Nevo Press Ltd. and is used with its kind permission.]

 

Background: This case is a further hearing of the Court's judgment in LCA 8301/13 Tal Trading Corp v. Bank Leumi Le-Israel Ltd. (November 24, 2015) (hereinafter: the Appeal Judgment), which overruled a longstanding precedent in the law of bills of exchange established in CA 333/61 Guisky v. Meir, IsrSC 16 595 (1962) (hereinafter: the Guisky Precedent).

 

The Guisky Precedent determined that not only a holder in due course, but also a holder for value could defeat a claim of total failure of consideration raised by the drawer of a check, provided that the bill had been negotiated to that holder prior to the failure of consideration.

 

The Court's main reason for reaching that conclusion was grounded in property law. The Court's ruling emphasized that there was no stipulation that prohibited negotiating the check, and since the delivery date had not yet arrived when the check was negotiated and endorsed, no defect occurred at that point in time in the title held by the check's endorser, and the endorsee consequently received flawless title, entitling him to be paid for the check once he had provided value for it. In this context, the Court added and underscored the importance of the bill as a money equivalent, as well as the law merchant, noting that taking a bill in the knowledge that it was given to the transferor on the basis of a yet-to-be-fulfilled contract does not lack good faith.

 

Since it was rendered in 1962, the Guisky Precedent has been the object of substantial criticism, both in the rulings of the Court and in the legal literature. However, because the issue decided by the Guisky Precedent has never since come up directly before the Court, the Court sufficed with attaching a "cautionary note" to the precedent without expressly overruling it (CA 1560/90 Zitiat v. First International Bank of Israel Ltd., IsrSC 48(4) 498, 527 (1994) (hereinafter: the Zitiat case).

 

In the Appeal Judgment, Justice Hendel pointed out that reservations about the Guisky Precedent brought about “a state of confusion in the rulings of the trial courts. Some of them interpreted the reservations about the Precedent to mean that it had lost some of its validity, while others continued to apply it to the letter”. For the first time in over fifty years since the Guisky Precedent was decided, the present case presented an opportunity for the Court to revisit the issue of total failure of consideration and the right to payment of the holder for value.

 

Facts: The dispute in the Appeal Judgment revolved around the Respondent, Tal Trading Corp. (hereinafter: the Respondent), which had concluded an agreement with the Zvi Or Diamonds Company (1981) Ltd. (hereinafter: Zvi Or) for the purchase of diamonds. The Respondent paid Zvi Or for the diamonds by postdated checks, one of which, for $205,000, was at issue. The check was drawn by the Respondent to the order of "Zvi Or Diamonds Company Ltd." and dated December 27, 2008. On September 1, 2008, that is, prior to the check's due date, the payee, Zvi Or, passed the check on to the petitioning bank (hereinafter: the Petitioning Bank)—in which it held a current loan account—as security for repayment of its debts. At the time when the check was transferred to the Petitioning Bank, Zvi Or's account was overdrawn. In the meantime, Zvi Or experienced financial difficulties and failed to deliver the diamonds to the Respondent. Following this total failure of consideration, the Respondent issued the drawee bank a stop payment order. The Petitioning Bank submitted the check for execution, while the Respondent filed an objection to the execution of the check. On June 18, 2012, the Magistrates Court in Tel Aviv rejected the objection, but found that the check was irregular on its face since the endorsement did not match the name of the payee, and the Petitioning Bank did not, therefore, acquire holder-in-due-course status with regard to the check. Nonetheless, as a "holder for value", the Petitioning Bank did have the right to be paid for the check by the Respondent under the Guisky Precedent, because the check had been negotiated to the Petitioning Bank before Zvi Or breached its underlying transaction with the Respondent, causing total failure of consideration. The Respondent’s appeal to the District Court was denied. In its ruling, the District Court noted that the Guisky Precedent stands, and that the Supreme Court is the competent authority to overrule it.

 

The Respondent was granted leave to appeal to the Supreme Court. The appeal was heard by a three-judge panel (Justices Hendel, Sohlberg and Shoham). The Court overruled the Guisky Precedent and granted the appeal.

 

In the Appeal Judgment (per Justice Hendel, Justice Shoham concurring, Justice Sohlberg dissenting), the Court noted that when holdership in due course is denied, the bill holder—even if he is a holder for value—is subject to defenses under the law of obligations and property law. As long as the bill holder does not meet the conditions for holdership in due course as per sec. 28 of the Ordinance, the linkage between the bill and the underlying transaction is maintained, alongside the independent bill-based ground for claim created when the bill is drawn. This means that even in a bill-based claim, the bill-based grounds for claim continue to be attended by the general principles taken from property law and obligation law, according to which, in transferring property or assigning a right, the transferor or assignor cannot convey more than it has to the transferee or assignee. In this context, the Court embraced the principal critique levelled at the Guisky Precedent, as articulated by (then) Deputy President A. Barak in the Zitiat case.

 

The President granted a request for a further hearing, and referred the petition to a seven-judge panel.

 

Held: The Court affirmed the judgment in LCA 8301/13 Tal Trading Corp v. Bank Leumi Le-Israel Ltd., expressing its concurrence with the majority opinion of Justice N. Hendel in the Appeal Judgment.

Voting Justices: 
Primary Author
majority opinion
Non-writer
majority opinion
Author
dissent
Author
concurrence
Author
concurrence
Author
concurrence
Author
concurrence
Full text of the opinion: 

 

CFH 8447/15

 

 

Applicant:                               Bank Leumi le-Israel

 

                                                v.

 

Respondent:                            Tal Trading Corp.

 

                                                In the Supreme Court

[Sept. 11, 2017]

Before: President M. Naor, Deputy President (emeritus) E. Rubinstein, Deputy President (emeritus) S. Joubran, Justices E. Hayut, N. Hendel, N. Sohlberg, U. Shoham

Further Hearing of the Supreme Court’s judgment in LCA8301/13 of November  24, 2015, by Justices N. Hendel, N. Sohlberg, and U. Shoham

 

On behalf of Applicant:          Adv. Einav Nahari-Sandler; Adv. Bruria Sharir-Harel; Adv. Gal Klausner

 

On behalf of Respondent:       Adv. Gilad Narkis; Adv. Yossi Pepper

 

 

 

JUDGMENT

 

Justice E. Hayut:

 

A Further Hearing of this Court's judgment in LCA 8301/13 Tal Trading Corp v. Bank Leumi Le-Israel Ltd. (November 24, 2015) (hereinafter: the Appeal Judgment), which overruled the longstanding precedent in the law of bills of exchange established in CA 333/61 Guisky v. Meir, IsrSC 16 595 (1962) (hereinafter: the Guisky Precedent).

 

Background

 

1.         In December 1958, Mr. Joseph Meir purchased phonographs, for which he paid by postdated check made in the amount of IL 2,000. The machines purchased by Meir were not delivered, whereupon he issued a stop payment order to the drawee bank. However, the check had been negotiated prior to the issuing of the stop payment order, and came into the hands of Mr. Eliezer Guisky. Because the check was negotiated to Guisky after its due date, Guisky did not qualify as "holder in due course" of the check under the meaning of this term in the Bills of Exchange Ordinance [New Version] (hereinafter: the Bills of Exchange Ordinance or the Ordinance). However Guisky, who had given value for the check, demanded its payment both from its drawer, Meir, and from the phonograph merchant as endorser. Meir refused to pay the check, invoking total failure of consideration. The District Court accepted his claim, rejecting Guisky's lawsuit. The matter was appealed to the Supreme Court, which reversed the result and ruled, per (then) Justice Sussman, President Olshan and Justice Cohn concurring, that:

 

… If, subsequently—i.e. after having negotiated the bill—the seller breached his contract with the buyer and failed to deliver that which had been sold, or if consideration failed for some other reason, the buyer must pay off the bill to the holder-transferee, provided that he is a holder for value, and if the transferee had given value to the seller-endorser, he qualifies as holder for value against the buyer as well, in accordance with sec. 26(b) of the Bills of Exchange Ordinance; the defense claim arising to the buyer, following failure of consideration, only after negotiation, cannot serve him in this case to counter the transferee's claim. When he, the suing transferee, had taken the bill from the seller, and a defect came about thereafter, the defect is not attributed retroactively, since it is the time when the suing holder took the bill that is decisive, and at that time—when the contract was still "open" to fulfilment and its fulfilment date still lay ahead—there was nothing to prevent negotiating the bill and taking possession thereof [emphasis added].

 

            The Guisky Precedent thus determined that not only a holder in due course, but a holder for value, too, could defeat a total failure of consideration claim raised by the drawer of the check, provided that the bill had been negotiated to that holder prior to the failure of consideration (Shalom Lerner, The Law of Bills and Notes, 317-321 (2nd ed., 2007) (hereinafter: Lerner) (Hebrew); Yoel Sussman, The Law of Bills of Exchange, 275-277 (6th ed., 1983) (hereinafter: Sussman) (Hebrew)). The Court's main reason for reaching this conclusion was grounded in property law. The Court's ruling emphasized that there was no stipulation that prohibited negotiating the check, and since the delivery date had not yet arrived when the check – given as a down payment for the undertaking to supply the phonographs in the future – was negotiated and endorsed to Guisky, no defect occurred at that point in time in the title held by the check's endorser, and the endorsee consequently received flawless title, entitling him to be paid for the check once he had provided value for it. In this context, the Court added and underscored the importance of the bill as a money equivalent, as well as the law merchant, noting that taking a bill in the knowledge that it was given to the transferor on the basis of a yet-to-be-fulfilled contract does not lack good faith:  

 

The law merchant does not rule out negotiating a bill in view of the possibility that the value given for it might fail in the future if it did not actually fail in the present at the time of negotiation (the Guisky Precedent, p. 599).

 

2.         Since it was rendered in 1962, the Guisky Precedent has been the object of substantial criticism, both in the rulings of this Court and in the legal literature (CA 444/82 Israel Continental Bank Ltd. v. Shaikevitz, IsrSC 39(3) 113, 120-121 (1985) (hereinafter: the Shaikevitz case); CA 1560/90 Zitiat v. First International Bank of Israel Ltd., IsrSC 48(4) 498, 527 (1994) (hereinafter: the Zitiat case); CA 775/85 Bank Leumi Le-Israel Ltd. v. Brosh Metal Trading (Ashdod) Ltd., IsrSC 42(1) 294, 296 (1988); LCA 6553/97 Hagai v. Abudi Haim Company Ltd., IsrSC 52(2) 345, 353 (1998); CA 6909/00 Israel Discount Bank Ltd. v. Aryeh Yitzhaki Group Ltd., IsrSC 55(4) 83, 85 (2001); Lerner, p. 321; Shalom Lerner, Security Bill and Bank Account Crediting as a Form of Providing Value in Bills and Notes, 17 Mishpatim 71, 88-91 (1987) (Hebrew); Menachem Mautner, Bill of Exchange Delivered as Security: A Contract Subject to Condition Precedent, a Mortgaged Asset and the Problem of Consideration and Value, 12 Tel Aviv University Law Review 205, 224-226 (1987) (hereinafter: Mautner) (Hebrew); Ruth Plato-Shinar, Towards a Rational Model of Defenses in the Law of Negotiable Instruments, 12 Hamishpat  – A Book in Honour of the Late Judge Adi Azar, 251, 275 (2007) (hereinafter: Plato-Shinar) (Hebrew)).

 

            That being said, because the issue decided by the Guisky Precedent has never since come up directly before this Court, the Court sufficed with attaching a "cautionary note" to this precedent without expressly overruling it (the Zitiat case, p. 527). In the Appeal Judgment, my colleague Justice Hendel pointed out that reservations about the Guisky Precedent brought about "a state of confusion in the rulings of the trial courts. Some of them interpreted the reservations about the Precedent to mean that it had lost some of its validity, while others continued to apply it to the letter" (see para. 3 of Justice Hendel's opinion in the Appeal Judgment). Now, for the first time in over fifty years since the Guisky Precedent was decided, an opportunity has presented itself for this Court to revisit the issue of total failure of consideration and the right to payment of the holder for value. Even though this issue has come up in a "third round", the panel hearing it rightly thought that "the time has come for this Court to address this issue and settle the matter, or more precisely clarify where the Guisky Precedent stands" (ibid.), which it did. 

 

 

The Appeal Judgment and the proceedings that preceded it 

 

3.         The dispute at the center of the Appeal Judgment revolved around the Respondent, Tal Trading Corp. (hereinafter: the Respondent), which had concluded an agreement with Zvi Or Diamonds Company (1981) Ltd. (hereinafter: Zvi Or) for the purchase of diamonds. The Respondent paid Zvi Or for the diamonds by postdated checks, one of which, for $205,000, is at issue. The check was drawn by the Respondent to the order of "Zvi Or Diamonds Company Ltd." and dated December 27, 2008. On September 1, 2008, that is, prior to the check's due date, the payee, Zvi Or, passed the check on to the petitioning bank (hereinafter: the Petitioning Bank)—in which it held a current loan account—as security for repayment of its debts. At the time when the check was transferred to the Petitioning Bank, Zvi Or's account was overdrawn. In the meantime, Zvi Or experienced financial difficulties and failed to deliver the diamonds to the Respondent. Following this total failure of consideration, the Respondent issued the drawee bank a stop payment order. The Petitioning Bank submitted the check to the Execution Office for execution, while the Respondent filed an objection to the execution of the check. On June 18, 2012, the Magistrates Court in Tel Aviv (Judge R. Ilan) rejected the objection, but found that the check was irregular on its face since the endorsement ("Zvi Or Diamonds (1981) Ltd.") did not match the name of the payee ("Zvi Or Diamonds Company Ltd."), and the Petitioning Bank did not, therefore, acquire holder-in-due-course status with regard to the check. Nonetheless, as a "holder for value", the Petitioning Bank did have the right to be paid for the check by the Respondent under the Guisky Precedent, because the check had been negotiated to the Petitioning Bank before Zvi Or breached its underlying transaction with the Respondent, causing total failure of consideration. The Respondent’s appeal to the District Court (Judges Y. Inbar, J. Shevach, and S. Shochat) was denied for the reasons given by the Magistrates Court under Regulation 460(b) of the Civil Procedure Regulations, 5744-1984. In its ruling, the District Court saw fit to note that the Guisky Precedent stands, and that the Supreme Court is the competent authority to overrule it.

 

            In submitting its request for leave to appeal, the Respondent raised various arguments but ultimately focused its request on a single issue, namely whether the Guisky Precedent should be overruled. The request was referred for hearing by a panel of three judges (see Justice Hendel's decision of Nov. 27, 2014) and as stated at the outset, the Respondent was granted leave to appeal, the request was heard as an appeal, the appeal was granted, and it was decided by majority opinion (my colleagues Justices Hendel and Shoham against the dissenting opinion of my colleague Justice Sohlberg) to overrule the Guisky Precedent.

           

4.         In a comprehensive, clear opinion, my colleague Justice Hendel reviewed the purposes underlying the law of negotiable instruments and those features of bills designed to fulfil those purposes. In a beautiful, instructive metaphor, my colleague referred to the theoretical analysis of Prof. A. Barak regarding the nature of a bill, stating as follows:

 

In general, this product can be viewed through three-dimensional glasses: “The bill is a complex phenomenon… It is an object, subject to property law; a bill is a contract, subject to contract law; a bill is a negotiable paper, subject to the law merchant laid down in the Bills of Exchange Ordinance"… Its nature derives from these three dimensions, but the type of holdership might affect the balance of power among these three dimensions. The type of holdership derives not only from the way in which it was acquired, but also from the nature of “object” being held.

 

Justice Hendel noted that when holdership in due course is denied (in the Guisky case because the payment date on the bill had expired and in our case, owing to the mismatch between the names of the payee and the endorser that affected the bill's regularity on its face), the bill holder—even if he is a holder for value—is subject to defenses under the law of obligations and property law. My colleague emphasized that as long as the bill holder does not meet the conditions for holdership in due course as per sec. 28 of the Ordinance, the linkage between the bill and the underlying transaction is maintained, alongside the independent bill-based ground for claim created when the bill is drawn. This means that even in a bill-based claim, the bill-based grounds for claim continue to be attended by the general principles taken from property law and obligation law, according to which, in transferring property or assigning a right, the transferor or assignor cannot convey more than it has to the transferee or assignee. In this context, my colleague Justice Hendel embraced the principal critique levelled at the Guisky Precedent, as aptly articulated by (then) Deputy President A. Barak in the Zitiat case. In that case, let us recall, a "cautionary notice" was attached to the Guisky Precedent as one that diverges from the aforementioned general principle in property law and obligation law. The words of (then) Deputy President A. Barak in the Zitiat case were quoted in the opinion of my colleague Justice Hendel (ibid, para. 8), and are worth repeating verbatim, in view of their importance:

 

Reuven made a bill to the order of Shimon, with Shimon undertaking to perform some future action (future consideration). Shimon endorsed the bill to Levi prior to maturity. When the due date arrives, Shimon breaches his undertaking. Consideration fails. If sued by Shimon, Reuven would have a good defense against Shimon. Levi is not a holder in due course, and his right is thus no better than Shimon's. How might Reuven be obligated toward Shimon? True, when the bill was negotiated from Shimon to Levi, failure of consideration had not yet occurred, and its occurrence does not apply retroactively. But the right negotiated from Shimon to Levi was one embodying some future consideration and carrying within it the potential for failure of consideration. This right passed on to Levi unaltered. When failure of consideration occurred, it "prejudiced" the right that was to be (e.g., held by Levi), as long as it was not in the hands of a holder in due course" [emphasis added] (the Zitiat case, p. 527).

 

            In adopting this position, my colleague Justice Hendel states that the nature of the right received by the holder of the bill, if he is not a holder in due course, should not be examined at the time when the bill was negotiated to him, but at the time when he demanded its payment. Thus, the fact that the consideration had not yet failed at the time of negotiation cannot serve to invalidate the defendant's defense claim of total failure of consideration. Justice Hendel made it clear that such a case was not about defective ownership of the bill itself, but a defect in the obligation embodied in it, and in our case, he stated as follows: "Since the bank is not a holder in due course, it does not defeat the Applicant's [the Respondent's – E.H.] claim that the undertaking to supply diamonds to it was violated. Holdership for value in itself does not fulfil a special purpose that justifies prevailing over the rights of the debtor under the usual legal rules" (ibid., para. 9). Justice Hendel further addressed additional aspects expressed in criticism of the Guisky Precedent and having to do, inter alia, with "the usual property law applicable to movable property", and particularly that this precedent also enables a holder for value who did not pay actual, fulfilled consideration to demand payment for the check. Justice Hendel further addressed the distinction between forcing the party injured by total failure of consideration to honor obligations under an underlying transaction that had been cancelled, as opposed to denying the remedy of restituting an "object" that had already been transferred or money that had already been paid. Justice Hendel stated that studies in behavioral economics suggested that forcing payment in these circumstances, which is in fact the outcome reached by the Court in the Guisky case, was perceived as a harder outcome than failure to restitute payment that had already been made. He refers in this context to the view of Prof. Eyal Zamir, according to which a different legal approach to these two categories might be justified from a normative perspective in view of the severity of the loss as opposed to the denial of profit.

 

5.         My colleague Justice Hendel then went on to discuss the Petitioning Bank's claim that the Guisky Precedent accords with the parties' expectations and that by not restricting the negotiability of the check, the Respondent assumed the risk that it might lose its money and priced this risk when drawing the check. This argument was dismissed by my colleagues for three reasons: The first is that even if the Respondent had assumed a risk by handing the payee a postdated check before receiving the diamonds, this does not mean that it should be made to bear all the risks involved therein, and matters should be examined "from the bill perspective, in all its aspects and shades", especially given the fact that the bank in this case did not have holder-in-due-course status that would defeat total failure of consideration; the second is that the argument regarding the pricing of the risk also applies to the bank for having taken as collateral an incomplete, irregular bill on its face, knowing that holding such a bill did not grant it the advantages reserved to a holder in due course; and the third lies in the Petitioning Bank's questionable assumption that anyone drawing a postdated check with no limitation of negotiability is aware of the possibility that it might have to pay for merchandise that it wanted to buy even without receiving it.

 

            The Petitioning Bank further claimed that overruling the Guisky Precedent would leave banks unable to rely on postdated checks as collateral, with possible repercussions for the credit market. The bank also raised concerns that drawers and payees might conspire against the banks by deliberately tampering with checks to make them irregular on their face in order to deprive the bank of holder-in-due-course status. In rejecting these arguments, Justice Hendel noted that the Petitioning Bank failed to present data on the number of checks endorsed to it as collateral and for how many among them it is only a holder for value and regarding which claims of failure of consideration were raised. Justice Hendel went on to dismiss the conspiracy concern, saying that if the drawer and the payee wanted to prevent the bank from collecting on the check in the event of a breach of contract, all they would have to do is add the word "payee only", and that in any case it was the bank's duty to verify that the check was complete and regular on its face.

 

For the above reasons, my colleague Justice Hendel proposed that the Guisky Precedent be overruled, and Justice Shoham concurred.

 

6.         As opposed to them, my colleague Justice Sohlberg was of the opinion that while the Guisky Precedent should be narrowed and limited, it should not be overruled. While Justice Sohlberg emphasized that he agreed with Justice Hendel's arguments concerning the laws of obligation and property law, he was nevertheless of the opinion that this was not the crux of the debate, and that the key question to consider was "what is the proper balance between the risks of the obligor on the bill and the endorsee in said circumstances, considering the purpose of the law of negotiable instruments in the strict sense". In answer to this question, my colleague thought that "the proper balance dictates that we place the risk on the obligor rather than the endorsee, provided that the endorsee gave the real, fulfilled value of the bill and did not anticipate the possible failure of consideration when taking it". My colleague Justice Sohlberg mainly rests his position on the logic behind the application of market overt to a holder in due course. As he sees it, the same logic also applies to a holder for value who gave real, fulfilled consideration and did not anticipate, nor could have anticipated, the failure of consideration that was to occur in the future after his holdership of the bill. Justice Sohlberg also noted the need to focus on the inner purposes of the law of negotiable instruments, including bills of exchange, which are meant to serve as an efficient commercial substitute for the use of cash money, rather than focus on the proprietary and contractual aspects of the bill. All these things lead, to his mind, to the need to also recognize the "immunity" of a holder for value, like the Petitioning Bank before us, against a claim of total failure of consideration formed after its holdership, provided that the additional conditions that restrict and limit the Guisky Precedent have been met, namely: the good faith of the holder for value who did not anticipate and could not have anticipated the future failure of consideration, and the provision of real, fulfilled value for the check.

 

            As mentioned above, the majority decision was to grant the Respondent leave to appeal, to grant the appeal and overrule the Guisky Precedent. The judgments of the Magistrates and the District Courts were reversed, the Petitioning Bank's claim was denied, and it was ordered to pay a total of NIS 60,000 in costs and legal fees of the Respondent.

 

7.         On July 17, 2016, my colleague the President granted the request of the Petitioning Bank and ordered a further hearing of the Appeal Judgment before a seven-judge panel. The parties submitted supplementary pleadings, and the petition was heard on January 31, 2017.

 

The parties' arguments in the further hearing

 

8.         The Petitioning Bank reiterated its claim that overruling the Guisky Precedent would work to the detriment of the credit market by downgrading the status of postdated checks as collateral, and that endorsees—and mostly banks—would be afraid to take postdated checks as collateral since any defect, down to the slightest, would negate holdership in due course and void the liability on the bill, even if value was given for it. It was further claimed that in order to check for any such defect, banks would have to invest considerable and disproportionate efforts in screening the checks. Alternatively, the Bank is in favor of leaving the Guisky Precedent in place subject to the conditions proposed by Justice Sohlberg. Making reference to market overt in movable property and in conflicting transactions in chattels, the Bank argues that the law of bills of exchange should also grant preference to the right of a holder who is temporally second, when said holder had given bona fide consideration for the bill, and all the more so in light of the principles of negotiability, certainty and stability of commerce particular to the law of bills of exchange. According to the Bank, the fact that the payee's name is not identical to the endorsement signature constitutes a technical defect in form rather than a material proprietary or contractual one. The Bank likewise subscribes to Justice Sohlberg's position regarding the appropriate division of risks and the desirable judicial policy in this context, claiming that the lowest cost and most effective damage avoider is the drawer of the check, whereas imposing upon the endorsee the duty to vet every underlying transaction for which a bill was initially given would completely void its essence and nature as a bill. The Bank further emphasizes that the present case does not involve a defective check under the Bills of Exchange Ordinance, and certainly not one defective to the point of voiding its negotiability, since the drawer of the check had issued a regular check on its face, while the payee was the one who introduced the defect with the endorsement signature. This is why, it is argued, the claim that the Guisky Precedent encourages the negotiability of defective checks is not justified. Another argument is that, under the Ordinance, the time of negotiation is the relevant point in time to examine the rights of the check's holder, and in this respect the Guisky Precedent does not deviate from the Ordinance, but is rather perfectly aligned with its principles. From this, the Bank infers that the law of negotiable instruments supports leaving the Guisky Precedent in place. The Bank further claims that the Assignment of Obligations Law, 5729-1969 (hereinafter: the Assignment of Obligations Law) is irrelevant and no analogy can be drawn from it to our case, as the law excludes bills of exchange, and the purposes underlying each of the laws—the law of obligations, on the one hand, and the law of negotiable instruments, on the other hand—are different. The Bank's view is that making the bill-based obligation analogous to a normal obligation would erode the law of negotiable instruments and do away with the unique character of a bill of exchange.

 

9.         The Respondent, for its part, agrees with the Appeal Judgment and emphasizes that the fundamental principle in property law that a person cannot transfer to another more rights than he himself has, save for the exception established in "market overt", likewise applies to the law of negotiable instruments. Therefore, it goes on to claim, only a holder in due course acquires full, valid title to a bill free of all defects or defense claims that parties precedent thereto may have, by virtue of the market overt established in the Ordinance with respect to bills. In the Respondent's view, this position accords with the proper judicial policy that the risk should not be imposed on the drawer of a postdated check in cases where total failure of consideration occurred, unless the holder thereof is a holder in due course, and this even if the drawer had not limited the negotiability of the check. This conclusion is all the more true, according to the Respondent, when the holder is a bank taking the bill as security for credit extended, since the bank is the best avoider of damage, capable of verifying that the conditions for holdership in due course are met before extending the credit, and of withholding credit if those do not obtain. It is further argued that this is not a case of overruling a longstanding, deep-rooted precedent, as the Bank claims, but of a precedent whose very validity remained unclear for many years. Finally, the Respondent argues that banks and check-discounting firms are the main players in the Israeli marketplace that receive postdated checks, and they price the risk of such checks being dishonored by means of interest and commissions, as well as by granting credit for less than the bill's stated value in view of the said risk. Therefore, and because these players are the most efficient risk preventers, nothing justifies relaxing the requirements for holdership in due course for their sake and allowing them to continue benefitting from the Guisky Precedent.

 

Discussion

 

Let me first say that if the hearing on overruling the Guisky Precedent had taken place before an expanded panel to begin with, my job would have been easier, for then I would have contented myself with saying that I concurred in the clear, compelling and comprehensive judgment of my colleague Justice N. Hendel and that his words should be deemed as if I myself had written them. With the proceeding first going before a panel of three (my colleagues Justices Hendel, Sohlberg and Shoham) and then ending up before an expanded panel in a further hearing, I saw fit to elaborate a little more, but as I have already noted, I see eye to eye with my colleague Justice Hendel on the issue of overruling the Guisky Precedent, and I agree with all of his reasons—including those written in response to the dissenting opinion of my colleague Justice Sohlberg.

 

10.       Notwithstanding the development of electronic means of payment, first and foremost credit cards, checks remain a major, widespread means of payment in present-day Israel (Michal Ofer Tsfoni and Ruth Plato-Shinar, Comment on Ruling —On Total Failure of Consideration, Holdership in Due Course and Everything in Between: An Opportunity to Fix a Legal Anachronism in the Law of Bills and Notes (Following LCA 8301/13 Tal Trading Corp v. Bank Leumi le-Israel Ltd.), 1 Moznei Mishpat (due to be published in 2018) (hereinafter: Tsfoni & Shinar) (Hebrew)). In his studies on the law of negotiable instruments, Prof. A. Barak discusses three systems of law—proprietary, contractual and bill-based—applicable to bills and influencing the legal outcomes to be adopted in their regard. These three areas of law apply according to the balance of powers among them, which varies with the circumstances of each individual case. In this context, Prof. Barak coined the term "the law of negotiable instruments in the strict sense", which is concerned with the bill as a negotiable instrument and is mainly grounded in legislative acts relating to bills, and "the law of negotiable instruments in the broad sense", concerned with the laws applicable to bills as an obligation and as an object as opposed to the laws that directly relate to the bill as a negotiable instrument, as long as the Bills of Exchange Ordinance makes no contrary arrangement (Aharon Barak, The Nature of the Negotiable Instrument, Selected Essays, vol. 2 1284 (2000) (hereinafter: Barak) (Hebrew); Shalom Lerner, Notes and Bills in the 21st Century, Shlomo Levin Book 433, 434 (eds. Asher Grunis, Eliezer Rivlin and Michael Karayanni, 2013) (hereinafter: Lerner 2013) (Hebrew)).

 

Market Overt in bills and the holder for value

 

11.       With a view to promoting the purpose of bills as a quick and efficient mode of payment in the commercial realm, the Bills of Exchange Ordinance established, alongside the transferability feature characterizing the bill, a "market overt" in bills that grants the "holder in due course", as per the meaning of this term in sec. 28(a)(2) of the Ordinance, rights in the bill that are free of defects and any other right of parties precedent thereto (sec. 37(2) of the Ordinance; Barak, p. 1266; the Zitiat case, p. 505; Plato-Shinar, p. 254). In other words, holdership in due course "purifies" the bill, granting the holder in due course "immunity" from any claim drawn from the law of negotiable instruments in the broad sense (CR 258/98 Zemach v. Shelshevski, IsrSC 55(4) 193, 196 (1998)). This turns the bill into a "courier without luggage", to quote Justice Gibson in Overton v. Tyler (1846) 3 Pa 346, 45 Am. Dec. 645 (referred to in CA 9/79 Carpol v. Horowicz, IsrSC 34(1) 260, 262 (1980)). It releases it from the burden of the "law of negotiable instruments in the broad sense" and subordinates it to the law of negotiable instruments in the strict sense only, i.e. to the Bills of Exchange Ordinance.

 

12.       Some consider the "market overt" in bills to be the very essence of the law of negotiable instruments, without which the law of negotiable instruments cannot justifiably exist as a separate branch of law (Lerner 2013, p. 436). Like its counterparts in property law and obligations law, the "market overt" in bills is an exception to the fundamental principle we have addressed above, by which a person cannot transfer to another more rights than he himself possesses (for the "market overt" in movables, see sec. 34 of the Sale Law, 5728-1968; for the "market overt" in real property, see sec. 10 of the Land Law, 5729-1969; and for the "market overt" in pledges, see sec. 5 of the Pledge Law, 5727-1967). The holdership in due course on which the "market overt" in bills is based depends on the fulfilment of the following main conditions: The holder has taken the bill complete and regular on the face of it; he became its holder before it was overdue; and he took the bill in good faith and for value (sec. 28(a) of the Ordinance; Lerner, pp. 240-243). When these conditions are met, the holder in due course acquires, as noted, the right to receive payment of the bill "free from any defect of title of prior parties, as well as from mere personal defenses available to prior parties among themselves, and may enforce payment against all parties liable on the bill" (sec. 37(2) of the Ordinance). The holder in due course will also be able to transfer his purchase to another party substituting it (Lerner, 248). The market overt in bills is more lenient than its Sale Law and Land Law counterparts. Thus, holdership in due course makes no requirement as to the identity of the bill's assignor, contrary to market overt in the Sale Law, which applies only when the seller of the asset carries on the sale of property of the kind of the object sold (sec. 34 of the Sale Law, 5728-1968; Lerner 2013, p. 438; Barak, p. 1384; CA 230/73 Israel Discount Bank Ltd. v. Bank Halva'ah Vekhisachon le-Israel Ltd., IsrSC 28(1) 113, 119 (1973)). Moreover, in order to benefit from market overt in real estate, the buyer of a right must run a check at the Land Registry (sec. 10 of the Land Law, 5729-1969), whereas the holder of a bill will be considered a "holder in due course" even without having performed any check regarding the bill. One of the important rationales on which "market overt" in bills rests is that holdership in due course encourages the use of bills as a means of payment, and thus contributes to the increase of transactions and to developing commerce. This was explained by Lerner, who added that this explanation is all the more true in the Israeli realty where a large proportion of checks carry a future date and are used by the payee as security by endorsing them to a bank in order to obtain credit (Lerner 2013, p. 439). The rationale underlying "market overt" in bills based on holdership in due course was also addressed by Plato-Shinar, who noted that it constitutes "a key instrument in the service of the 'certainty of payment principle', which is one of the fundamentals of the law of negotiable instruments. The certainty of payment principle is meant to ensure, to the extent possible, that the bill will indeed be paid to the bill creditor, thus encouraging the taking of the bill and contributing to its negotiability (Plato-Shinar, p. 254, 255).

 

13.       Like my colleague Justice N. Hendel, I too see this market overt arrangement in bills per sec. 37(2) of the Bills Ordinance as expressing a negative implication. It makes the "purity" of the bill conditional on its holder being a holder in due course, stating: "Where he is a holder in due course, he holds the bill free…" etc. As a result, when the conditions for holding in due course do not obtain, the bill is not "purified" and we do not have before us a "courier without luggage", but a bill that continues to carry, alongside "the law of negotiable instruments in the strict sense", a dimension of "the law of negotiable instruments in the broad sense" as well, and as such it is subject to the well-known fundamental principle of obligations and property laws whereby a person cannot assign to another more rights than he himself has.

 

            One of the most prevalent defense claims raised by defendants sued on bill-related grounds, as in our case, is total failure of consideration. In one of the cases, (then) Justice A. Barak addressed this claim and drew, with respect thereto, the line separating a holder in due course—who overcomes this defect in the title of the person assigning the right—and other holders, among them holder for value, who do not meet the conditions for holdership in due course and cannot overcome it (the Shaikevitz case, p. 116). In his academic writing, President Barak criticized the arrangement established in the Bills of Exchange Ordinance with regard to holdership in due course, noting that it "is far from satisfactory", inter alia because "the conditions required for a holdership in due course are unjustifiably numerous and complicated" (Barak, p. 1339). According to President Barak's approach in that article, it is fitting to predicate holdership in due course on purchase for consideration and in good faith, whereas the other conditions established by the Ordinance for a holding in due course—including: the bill being complete and regular on its face, and the requirement that its negotiation to the holder in due course be done prior to its stated due date—are unjustified if the idea is to promote dynamic commercial activity (ibid.). This critique is shared by Lerner, who also thinks that the time has come to update the law of negotiable instruments, saying, inter alia, that the law of holdership in due course is often in conflict with the interest of consumer protection (Lerner 2013, pp. 441-450). Yet, despite this critique by Prof. Barak in his academic writing of the "unjustifiably numerous and complicated" conditions established by the Ordinance for holdership in due course, President Barak, wearing his judicial "hat", adhered to these conditions and saw fit to set down a "cautionary notice" against the Guisky Precedent, even though it might be construed as a precedent that mitigates those "numerous and complicated" conditions, inconsistent as it is with the provisions of the Ordinance (the Zitiat Case, p. 527; the Shaikevitch Case, pp. 120-121). In other words, in his article, Prof. Barak criticized the conditions for holdership in due course as prescribed in the Ordinance as well as its delineation, and called to amend these conditions, noting that provision of consideration in good faith should suffice for the purpose of the "market overt" in bills. However, his rulings on the issue indicate President Barak's clear position that as long as no change has been made to the market overt conditions and the related requirements for holdership in due course by amending the Ordinance, they were impossible to bypass, and a holder who did not meet the conditions for holdership in due course, even if he was a holder for value, could not defeat defense claims presented by the defendant on bill-related grounds, including the claim of total failure of consideration.

 

14.       In this context, I wholly agree with Justice Hendel, who thought that Justice Sohlberg's approach created "a middle class of holder, entitled in some circumstances to defeat certain defense claims" (para. 22 of his opinion) and also created "a middle-class bill, located between a defect-free bill that can be held in due course and a bill whose restriction appears on its face. The exact status of the bill cannot be clearly ascertained by examining the bill itself without referring to external circumstances" (ibid., para. 24). Justice Hendel emphasizes that an arrangement of this kind has no foundation in the Ordinance, and he believes that "establishing a new arrangement in the law of negotiable instruments, one that overcomes the law of negotiable instruments in the broad sense and is not derived from the law of negotiable instruments in the strict sense, should properly be undertaken by the legislature" (ibid,, para. 25). In their article, Tsfoni & Shinar also address the difficulties inherent in Justice Sohlberg's position, noting that the critique levelled at the Guisky Precedent "likewise applies to Justice Sohlberg's dissenting opinion", as it "deviates from the basic paradigm of defense claims in the law of negotiable instruments, instead of converging on it and creating a clear, certain, uniform law in keeping with the narrow and broad principles of the law of negotiable instruments" (Tsfoni & Shinar, p. 27). They support the reservations made in this context by Justice Hendel, and are also of the opinion that there is no call for creating a new type of holder in the law of negotiable instruments—one who had provided real value against the bill without anticipating and having had to anticipate a possible failure of consideration. This kind of holder, they say, finds no mention in the Ordinance, and considering the substantial change in the law of negotiable instruments involved in creating such a holder, they believe that this requires "holistic thinking and a review of the law of negotiable instruments in both the strict and broad senses" and that, to the extent that change is warranted, it should be effected by legislative amendment of the Bills of Exchange Ordinance itself (ibid.).

 

            With this I cannot but agree. In my opinion, as well, there is no call to create a new kind of bill holder who has no trace in the Bills Ordinance, and actually contradicts the letter of the Ordinance, which establishes a "negative arrangement" in this regard. Moreover, the good-faith requirement under the restrictions proposed by my colleague Justice Sohlberg establishes objective and subjective criteria for testing good faith, thus deviating from the good-faith requirement established in sec. 91 of the Ordinance, which has heretofore been interpreted as subjective good faith (Lerner, p. 234; Tsfoni & Shinar, p. 20). It also deviates from the purpose of the law of negotiable instruments that we have shown above, because it requires that the holder carry out checks and inquiries before agreeing to accept a check.

 

15.       The Anglo-American law from which the Israeli Ordinance draws its provisions likewise takes the approach that the right of any holder not in due course is subject to the failure-of-consideration defense. The American legal system sets down this rule in the UCC (in effect in some 49 U.S. States) (UCC § 3-305(a)-(b)). In English law, opinions diverge. In making its arguments in this context, the Bank relies on the book by Prof. Guest, Chalmers and Guest on Bills of Exchange and Cheques (16th ed., 2005), claiming that, in English law, a holder for value is granted immunity against a failure-of-consideration defense. However, a close examination of the ruling by the House of Lords to which the learned Prof. Guest refers in this context (Misa v. Currie (1876) 1 App. Cas. 554) suggests that it does not address this question directly. Furthermore, this ruling was rendered before the status of holder in due course was established in the Bills of Exchange Act 1882, which is the forerunner of the Israeli Ordinance. Another ruling on which Guest relies in this context was rendered by one of the lower instances in England, and some scholars believe that this ruling involved a holder in due course rather than a holder for value (Elliott Odgers and Phillips Byles on Bills of Exchange and Cheques, pp. 270-271 (28th ed. 2007), whence they conclude that immunity from a failure-of-consideration claim in English law is exclusively granted to a holder in due course (ibid., p. 270) (for a review of other positions, see Tsfoni & Shinar, p. 28). It should be noted, in passing, that it is quite hard to find judgments pertaining to our subject in Anglo-American law, since the use of postdated checks in England and the United States is extremely rare, unlike the commercial practice in Israel, in which the use of postdated checks is quite widespread (Lerner 2013, p. 439).

 

Conclusion

 

16.       For all the reasons specified above, I propose that my colleagues deny the petition for a further hearing and charge the Petitioning Bank with the Respondent's costs and legal fees in the amount of NIS 75,000.

 

           

                                                                                                           

 

President M. Naor:

 

I concur in the opinion of my colleague Justice E. Hayut.

 

 

 

Justice N. Sohlberg:

 

1.         My colleague Justice E. Hayut notes in her opinion that had she sat on the original panel debating the overruling of the Guisky Precedent, she would have concurred in the judgment of my colleague Justice N. Hendel and left things at that. If so says my colleague, then surely I can say, for my part, that I agree with my own opinion in that judgment, and see no need to add to it. Indeed, the disagreement between my colleagues and me in the ruling, and the reasoning provided by the different sides, are sufficiently detailed in that judgment. The words of my colleague Justice N. Hendel there are clear and comprehensive, and I believe that I, too, expounded my opinion in sufficient elaboration. The further hearing held before us did not turn up a new perspective, and did not turn any previously unturned stone there. Therefore, essentially, I could content myself with saying that I have studied the ruling once again and do not deem it necessary to change my opinion as expressed there.

 

2.         With that said, I wish to touch on one point that preoccupied my colleague, namely the institutional question regarding the relationship between the provisions of the Bills of Exchange Ordinance [New Version] and the Guisky Precedent, and the division of labor between the legislature and the court in this context.

 

3.         As my colleague [Justice Hayut] has noted, the main novelty in the law of negotiable instruments regulated in the Ordinance is the market overt in bills, which is accorded to anyone defined as a holder in due course. This is the core of the law of negotiable instruments. Market overt entitles the holder of a bill who meets certain conditions under which he is considered a holder in due course to a bill purified of defects found therein. The border line, in this context, is binary: On one side of the line stands the holder in due course, whose bill is purified of defects, and on the other side are the other holders, whose bill is not purified. As such, it is subject to the usual law of obligations, by which a person cannot assign to another a right he does not have. This is the "basic paradigm" of the law of negotiable instruments, which I do not contest.

 

4.         The matter before us is much more modest: It concerns a certain defect in a bill (failure of consideration) occurring at a specific time (after endorsement of the bill), and according to my approach—under certain conditions (the endorsee paid actual consideration and did not anticipate the failure of consideration). As such, our case is not about the purity of the bill. The holder in due course of a bill holds a bill purified of defects that occurred even prior to being assigned to him. This is the metaphoric meaning of the bill's purification: When a person holds it in due course, he is like a person who immerses in a mikveh, going in impure and emerging pure. This is not the situation in question. This is not a "market overt" meant to protect innocent buyers who have bought an essentially defective right. Ours is a different situation in which an essentially regular bill was endorsed (but became subject to a technical defect as a result of which its holder is not a holder in due course), except that subsequently a failure-of-consideration event occurred. Failure of consideration, in simple terms, means that one of the parties to the transaction (in our case, the endorser) found itself unable to fulfil its obligation. In this state of affairs, as in many situations of insolvency, someone must absorb the loss, and the question becomes upon whom should it justly be imposed.

 

5.         The starting point for this question is indeed the "basic paradigm" of the law of negotiable instruments, whereby once a holder of a negotiable instrument is not a holder in due course, he no longer possesses more than he has been assigned. But to my mind, this is not the end point. True, the legislature is silent on this matter, but its silence is not the final word. I do not accept the argument that the very distinction between a holder in due course and one who is not creates a "negative arrangement" that prevents us from examining the specifics of the issue. I also disagree that my position implies "creating a new type of bill holder" (as my colleague says in para. 14 of her opinion). The question before us is much more focused than my colleagues make it out to be. It is about a well-defined, distinct dilemma: Upon whom are we to impose the loss in a situation where the endorser cannot fulfil his obligation in the specific circumstances before us?

 

6.         Add to this another point, which I also addressed in the judgment: We are not treading on virgin soil. This is not about some novel judicial legislation, but about reviewing a longstanding, established precedent. This point, too, is significant when we look at the balance of power between the branches of government. Indeed, this is about “judicial legislation”, but it was done more than fifty years ago, and we are now treading a furrow long ago plowed. If the outcome of this “judicial legislation” is justified on the merits—as I believe it is (within the limits I have defined)—then to my mind, this not a compelling consideration against preserving it.

 

7.         On the other hand, the legislation before us—the Bills of Exchange Ordinance—has its origin in the English version of 1882, which has undergone only minute changes since its translation into Hebrew (Shalom Lerner, Bills in the 21st Century, Shlomo Levin Book 433, 434 (2013) (Hebrew)). As my colleague Justice E. Hayut notes in para. 13 of her opinion, the arrangement in the Ordinance—as regards the requisite conditions for holding in due course—is not necessarily satisfactory, and my position in the judgment does some justice in that respect. True, the question of updating the Bills of Exchange Ordinance falls to the legislature, not the Court.  I would not lend a hand to creating a legal rule that runs counter to the language of the Ordinance, deviates from what it implies, and aims at circumventing its arrangements. But we are not there: We are not creating a legal rule, but debating the boundaries of an existing one. The Ordinance does not, in my opinion, create a negative arrangement with respect to the matter before us, and in any event, we are not looking to bypass its arrangements.

 

8.         As I see it, all of the above means that it is not these considerations that should make or break the Guisky Precedent, but rather the material considerations pertaining to the specifics of the case. I detailed and explained my position in the judgment, namely that when the endorsee has given actual consideration for the bill and could not have anticipated the failure of consideration, then justice and judicial policy dictate that the loss be imposed on the obligor, even if such a decision comes to some extent at the expense of certainty considerations. Indeed, my colleague Justice N. Hendel and myself agreed that as regards considerations on the merits of the case, in terms of who should be made to bear the loss incurred, the arguments cut both ways. In my opinion then, as now, when the considerations are weighed, given that real consideration was provided and the endorsee acted in good faith, the scales are tipped in favor of preferring the endorsee over the obligor. Had my opinion been heard, this is what we would now instruct.

                                                                                                           

 

Deputy President (emeritus) E. Rubinstein:

 

A.        It is not without hesitation that I have decided to join in the opinion of Justice Hayut—and Justice Hendel originally—which changes the Guisky Precedent (CA 33/61 Guisky v. N. Meir, IsrSC 16(1) 595 (1962)). I carefully perused the appeal judgment and the opinions in the further hearing, and although they are all are deserving, it seems to me that, in the interest of future legal and practical clarity, presenting a framework that offers "decisiveness" and specificity is warranted. Indeed, in principle, there is some appeal to the Guisky Precedent and the view held by my colleague Justice N. Sohlberg that it should not be overruled but rather modified. After all, if the bank is assumed to have acted in good faith, given no real indications of future complications attending the transaction, why should it be deprived and lose the money it had given? But we are concerned with cases that do not involve an immaculately good bill, or at least the bill in question had been "seriously demoted" such that its holder does not have the status of a "holder in due course". By analogy to the approach that has taken root in the law of tenders, it seems that when it comes to the law of negotiable instruments, it is proper to adopt an approach focused upon "the need for utmost strictness upon meeting the conditions" of the bill (and in that case—the tender;  AAA 6823/10 Matan Health Services Ltd. v. Ministry of Health (2011), para. 22 of Justice Vogelman's opinion; see also para. D of my opinion in the same case (2011)); and as I have noted in another case, "the lesson to be learned is the strictness and accuracy" (from my opinion in AAA 2628/11 Epcon Control and Automation Ltd. v. the State of Israel – the Government Authority for Water and Sewage (2012)). This is also true, both legally and morally, for the law of negotiable instruments, where "more often than not, the endorsee will be a bank and the drawer a consumer" (CA 1560/90 Moshe Zitiat v. the First International Bank of Israel Ltd., IsrSC 48(4), 498, 519 (1994), per President Shamgar), and the bank, the most effective damage avoider, has at its disposal the most effective tools to verify the regularity of the bill (CA 8068/01 Ayalon Insurance Com Ltd. v. Executor Opplager, IsrSC 59(2) 349, 369 (2004); CA 7370/06 Shani v. Berdichevsky, para. 9 (2009); I. Gilead, Tort Law – The Limits of Liability, 856-858 (2012) (Hebrew)). And at the end of the day, I doubt that changing the Precedent would make that much actual difference in the conduct of commerce in this day and age, or at any rate not to the extent claimed by the Petitioning Bank in our case, considering that bills are losing ground to credit cards as a form of consumer payment (See Plato-Shinar, Towards a Rational Model of Defenses in the Law of Negotiable Instruments, 12 Hamishpat (In memory of the late Adi Azar), 251, 257 (2007); S. Lerner, The Law of Bills and Notes 29 (2nd edition, 2007) (Hebrew)).

 

B.        I therefore concur in the opinion of Justice E. Hayut. In signing and taking my leave from this Court, I would like to wish my colleague Justice Hayut my heartfelt congratulations on her being chosen to serve as President of the Court. I have had the privilege of serving alongside her in good friendship throughout my term, and I wish her satisfaction and success, with God's help.

 

 

Justice U. Shoham:

 

            I concur in the judgment of my colleague Justice E. Hayut, and likewise believe that the petition for a further hearing should be denied, as proposed by my colleague. As may be recalled, I concurred in the opinion of my colleague Justice N. Hendel in the proceeding that is the subject of this further hearing (LCA 8301/13 Tal Trading Corp v. Bank Leumi le-Israel Ltd. (Nov. 24, 2015)), according to which the Guisky Precedent should be overruled, and I see no cause to depart from my view there.

 

                                                                                               

Deputy President (emeritus) S. Joubran:

 

1.         I concur fully with the lucid opinion of my colleague Justice E. Hayut. Like her, I believe that this extended panel should adopt the comprehensive, instructive opinion my colleague Justice N. Hendel in LCA 8301/13 Tal Trading Corp v. Bank Leumi le-Israel Ltd. (Nov. 24, 2015) ((hereinafter: the Judgment), which overruled the precedent laid down in CA 333/61 Guisky v. N. Meir, IsrSC 16(1) 595 (1962) (hereinafter: the Guisky Precedent)). Since the opinion of my colleague Justice N. Hendel in the Judgment left no stone unturned and aptly presented the reasons for overruling the Guisky Precedent, I shall content myself with a brief comment only.

 

2.         The legal question at hand requires deciding between conflicting interests. On one side stands the drawer of the bill, who has passed it on to the payee in expectation of some future consideration in return. Opposite him stands the endorsee, who received the bill from the payee and gave consideration in return, expecting to be able to receive payment for the bill when the time came. This state of affairs is disrupted when the payee fails to provide the drawer with consideration for the bill. Once this happens, it is no longer possible for both parties, the drawer and the endorsee, to have their expectations fulfilled. Which side will be forced to bear the cost of this failure is a complex question, in view of the bill's multi-layered character as an amalgam of property law, obligation law and the law of negotiable instruments (see: Aharon Barak, The Nature of a Negotiable Instrument, Selected Writings, vol. II 1253, 1282 (2000) (Hebrew)). The explicit wording of the Bills of Exchange Ordinance does provide an answer to this question, but one that is restricted to particular circumstances. As long as the endorsee acquired "holder-in-due-course" status (as defined in sec. 28 of the Bills of Exchange Ordinance [New Version] ((hereinafter: the Ordinance)), the legislature instructs that the endorsee be accorded precedence and that the burden of failure be placed on the drawer. As my colleague Justice N. Hendel explained, this precedence stems from the commercial purposes of the bill and the desire to facilitate and streamline its use (see para. 6 of his opinion in the Judgment). On the other hand, the strict wording of the Ordinance does not grant similar precedence to an endorsee of lesser standing relative to the bill, including a "holder for value" (as defined in sec. 26 of the Ordinance). Despite this lacuna in the scope of application, the Supreme Court saw fit to determine at the time, in the Guisky Precedent, that even he would be immune to a failure-of-consideration defense and be able to demand execution of the bill.

 

3.         For the reasons specified and elaborated by my colleague Justice N. Hendel in the Judgment, it is also my view that the said lacuna should be deemed a negative arrangement, which does not allow an endorsee with merely holder-for-value status—including the Applicant in this proceeding—to have the bill executed. Consequently, I did not see fit to subscribe to the intermediary approach suggested by my colleague Justice N. Sohlberg, which seeks to limit the Precedent and establish, de facto, a new status in the law of negotiable instruments (see para. 14 of the opinion of my colleague Justice E. Hayut).

 

4.         Hence, I believe, like my colleague Justice E. Hayut, that the petition for a further hearing should be denied.

 

                                                                                   

Justice N. Hendel:

 

1.         I concur in the clear opinion and edifying comments of my colleague Justice E. Hayut.

 

            I believe that in the previous hearing, my colleague Justice N. Sohlberg and I were given ample opportunity to set forth our disagreement. I thus considered leaving it at that and concurring in the majority opinion in the current proceeding. However, my colleague Justice Sohlberg—for understandable reasons—added specific reference to his way of perceiving our disagreement. To avoid any misunderstanding, I wish to clarify why I do not share that perception.

 

2.         My colleague believes that the crux of the disagreement is the following question: A "contest of rights" arises between Party A and Party C. Both have acted in good faith, and both have paid or will pay consideration that will be lost. Who should "take the hit"? In other words, the legislature did not settle this question, and my colleague believes that there is nothing to prevent the Court from developing criteria to decide the issue. I, on the other hand, believe that this is not at all the question at issue here. The question, to my mind, is whether it is fitting to subject the parties to that contest of rights to start with, in a situation where such contest is not inevitable and can be fully prevented. The legislature did not initiate that contest, and there is no place, in my view, for the Court to do so itself.

 

            As I have noted in my judgment, and as my colleague Justice Hayut noted, the law of negotiable instruments institutes a market overt of sorts, in the form of the holder in due course. This arrangement differs, however, in one respect from the rest of the "classic" market overts, such as in relation to the sale of land or movable property. These instances of market overt address what is commonly referred to as a "legal accident". Why accident? Because these situations come about as a result of an involuntary encounter between Party A and Party C who compete over the right a tort-like rather than contractual-like encounter, if you will. Typical situations in which the need to use the market overt rule arises are cases of fraud or forgery, or—quite differently—human error. This is not so when it comes to the negotiable-instrument context now before us. When a person holds a bill in due course, such holding arises from the voluntary choice of the person drawing the bill not to restrict it to begin with. What this choice means is a wish to create such holdership of the bill as would allow payment thereof even if its drawer has a good defense claim from the realm of contract law. Unlike other contests, the focus here is the bill's existence as a means of payment. This involves independent considerations pertaining to the flow of commerce. This distinction suggests that underlying the contest of rights is a voluntary arrangement—the relationships between the bank and other players. The contest of rights results from the choice made by the drawer of the bill not to restrict its negotiability in any way. It is this choice that leads, in cases of holdership in due course, to the contest of rights between Party A and Party C – a contractual-like rather than tort-like encounter, if you will.

 

            The contest of rights between Party C, who holds the bill in due course, and Party A, the person drawing the bill, is made possible as a result of the legislature's choice to allow this encounter. It is not a situation dictated by reality. Had it been prescribed that a bill holder cannot at all overcome good defense claims grounded in contract and property law, Party C would not have taken the bill to begin with. Alternatively, it would have taken it while knowing, however, that it is assuming the risk of a good defense claim being raised by the drawer of the bill, and pricing the consideration for the bill accordingly. As previously explained, however, holdership in due course is a mechanism offering significant economic advantages. It is conducive to developing commercial activity and making it more efficient. This is why the legislature has chosen to allow the parties to enter a contest of rights to begin with, while laying down appropriate decision rules.

 

3.         Similarly, in the proceeding before us as well, the question that arises is whether to allow the parties to enter a contest of rights to begin with. This is the general facet of the legal question discussed in the further hearing, from a forward-looking (ex ante) perspective—which is the primary perspective in such proceedings. To rule as per my colleague's view would allow various players, and banks in particular, to accept defective checks as collateral, knowing that in some circumstances the defect in the check would not prevent them from collecting on it, even from a person who has a good defense claim in terms of contract law. In other words, to rule like this would mean to allow a contest of rights between the bank and the person who drew the check but did not receive the contractual consideration they were looking to acquire using the check. On the other hand, the majority decision produces an outcome where the bank, which can easily spot the flaws in a check, would initially avoid taking a defective check as collateral, or else choose to take it by way of a known and calculated risk. In other words, this approach prevents the contest of rights from the outset. Thus, I believe that what we have here is not a contest of rights wherein my colleague prefers Party C and I prefer Party A. The question before us is whether to initiate the contest of rights to start with where the legislature did not do so. In this sense, my colleague does, indeed, seek to establish a "market overt", that is, a device meant to fix, streamline and develop the market mechanism. This is the sense in which the arrangement of holdership in due course is a market overt, and this is the sense in which the proposal to develop the law made by my colleague is market overt.

 

4.         To conclude, I still believe that the Guisky Precedent should be overruled, as it was in the judgment subject of this further hearing. My reasons have been presented and elaborated in the previous proceeding. I therefore concur in the decision of my colleague Justice Hayut, denying the petition for a further hearing.

 

                                                                                                           

 

Decided by majority opinion (against the dissenting opinion of Justice N. Sohlberg) to deny the petition for a further hearing as stated in the opinion of Justice E. Hayut.

 

Given this day, 20 Elul 5777 (Sept. 11, 2017).

 

 

 

Sacks v. Mussary et al.

Case/docket number: 
CA 108/60
Date Decided: 
Monday, November 7, 1960
Decision Type: 
Appellate
Abstract: 

The appellant and the respondents carried on business in partnership, and differences having arisen between them a submission to arbitration was signed in which the arbitrators were invited "to investigate, consider and decide the amount which Mr. Edgar Sacks (the appellant) is to pay to the partnership", this being an amount "which Mr. Edgar Sacks has to refund to the partnership on account of damages and losses caused by him." The District Court found that the subject matter of the arbitration was in fact joint property which the appellant was alleged to have stolen, and that the parties, in submitting the dispute to arbitration, intended and agreed to conceal a felony and refrain from disclosing the matter to the Police. Nevertheless an application by the appellant to set aside the submission on the ground of the above intention and agreement of the parties was refused, and an appeal was lodged.

 

Held, dismissing the appeal:

 

Per Sussman J.

 

1)           If, incidental to the signing of a submission to arbitration relating to a criminal matter, the parties should  also agree to suppress the criminal  aspect, even by implication, only, the submission to arbitration  will become an illegal transaction which  the court will not enforce.              

 

2)           The civil and criminal aspects of the case are two distinct matters, and while the criminal charge may not serve as the subject matter of an arbitration, the parties may submit the civil dispute to the decision of an arbitrator.

 

3)           The evidence in the present case merely shows that the appellant was interested "that the matter should not be publicised", and that does not necessarily imply an agreement to suppress a prosecution and cover up a criminal matter.

 

Per Silberg J.

 

Even if the factual contentions of counsel for the appellant had been proved, his application could not succeed, for the parties were not at least in pari delicto, and in fact the "turpitude" was on the part of the appellant himself.

 

Per Cohn J.

 

There was abundant evidence to support the conclusion of the District Court, but as the appellant did not come to court with clean hands and in fact initiated the whole matter, his application must fail.

Voting Justices: 
Primary Author
majority opinion
Author
concurrence
Author
concurrence
Full text of the opinion: 

C.A. 108/60.

 

SACKS v. MUSSARY AND OTHERS

 

In the Supreme Court sitting as a Court of Civil Appeal

 

Silberg J., Sussman J. and Cohn J.

 

Arbitration-Setting aside of submission by reason of intention to conceal criminal offence-Distinction between- civil and criminal aspects­ Applicant himself party to intef!tion to conceal-In pari delicto-Arbitra­ tion Ordinance, sec. 3.

 

The appellant and the respondents carried on business in partnership, and differences having arisen between them a submission to arbitration was signed in which the arbitrators were invited "to investigate, consider and decide the amount which Mr. Edgar Sacks (the appellant) is to pay to the partnership", this being an amount "which Mr. Edgar Sacks has to refund to the partnership on account of damages and losses caused by him." The District Court found that the subject matter of the arbitration was in fact joint property which the appellant was alleged to have stolen, and that the parties, in submitting the dispute to arbitration, intended and agreed to conceal a felony and refrain from disclosing the matter to the Police. Nevertheless an application by the appellant to set aside the submission on the ground of the above intention and agreement of the parties was refused, and an appeal was lodged.

 

Held, dismissing the appeal:

 

Per Sussman J.

  1. If, incidental to the signing of a submission to arbitration relating to a criminal

 

,

matter,  the parties should  also agree to suppress the criminal  aspect, even by implication                                                                                                                                                 ,

 

only, the submission to arbitration  will become an illegal transaction which  the court                                                                                                                                                 '

 

I

will not enforce.                                                                                                                                                 r

 

  1. The civil and criminal aspects of the case are two distinct matters, and while the criminal charge may not serve as the subject matter of an arbitration, the parties may submit the civil dispute to the decision of an arbitrator.
  2. The evidence in the present case merely shows that the appellant was interested "that the matter should not be publicised", and that does not necessarily imply an agree­ ment to suppress a prosecution and cover uf> a criminal matter.

 

Per Silberg J.

Even if the factual contentions of counsel for the appellan_t had been proved, his application could not succeed, for the parties were not at least in pari de/icto, and in fact the "turpitude" was on the part of the appellant himself.

 

Per Cohn J.

There was abundant evidence to support the conclusion of the District Court, but

 

 

 
 

 

 

 

 

 

 

as the appellant did not come to court with clean hands and in fact initiated the whole matter, his application must fail.

 

Israel cases referred to :

(1) C.A. 11/56-Egged (E.S.D.) Ltd. and others v. Moshe Sapir (1958) 12 P.D. 739.

(2) C.A. 94/50-A.B. v. C.D. (1950) 4 P.D. 791.

  1. C.A. l 10/53-Harry Jacobs v. Yli'akov Kartoz (1955) 9 P.D. 1401. English cases referred to :
  2. Russell v. Russell [1880] Ch. D. 471.
  3. Jones v. The Merionethshire Permanent Benefit Building Society,

[1892] 1 Ch. 173.

  1. Flower and others v. Sadler [1882] 10 Q.B.D. 572.
  2. Williams v. Bayley [1886] L.R. l H.L. 200. (8)              Ward v. Lloyd [1843] 64 R.R. 847.

Sh' arf for the appellants.

Gitzelter for the respondents.

SUSSMAN J. ·The four parties  to  this  action  were  iq  partnership in the business of fruit and vegetable merchants. At the end of 1955 differences of opinion arose . among them, which they submitted for decision by two arbitrators in the following terms:

"Whereas we, the undersigned, Edgar Sacks, Dov Lederman, Moshe Brick and David Mussary, are partners in a supermarket for fruit and vegetables under the name of "Rassco Market" situated in the Rassco district in North Tel Aviv.

And whereas it ha,s become necessary to ascertain the amount which Mr. Edgar Sacks has to refund to the partner­ ship on account of damages and losses caused by him.

And whereas all parties agree to submit to arbitration the ascertainment of such sums as hereinafter provided.

Now therefore all the undersigned parties hereby agree to submit to arbitration by two arbitrators, Yehudah Goldenberg Advocate and Joseph Ronnen, the accountant of the said business, to investigate, consider and decide the amount which Mr. Edgar Sacks is to pay to the partnership, taking into account the above circumstances, in his [sic] absolute discretion, and it shall be within his [sic] authority

 

 

       
   
 
 

 

 

 

 

 

to make a compromise award without needing to  give reasons for their [sic] award.

The arbitrators shall not be bound by any rules of procedure and shall not be limited as to time for making the award".

The arbitration proceedings draggeq on for close on three years and at the end of 1958 the appellant who was the defendant before  the arbitrators made it known that he was dissatisfied. He requested a stay of the arbitration proceedings and  made  application  to  order the arbitrators to state a special case to the court. Pending the hearing of this application by the court, the parties agreed that instead of this application, the court should consider another application which had been made earlier, namely, the appellant's application for leave to set aside the arbitration, in accordance with section 3 of the Arbitration Ordinance.* The learned judge refused this application with leave to appeal to this court. Hence this appeal.

  1. The main argument of counsel for the appellant is that the arbitra­ tion agreement should be invalidated since by agreeing  to  proceed before arbitrators the parties had in effect agreed to conceal a criminal offence. It appears that the respondents had accused the appellant of stealing joint property and at first wished to state this expressly in the arbitration agreement but afterwards agreed to give the arbitration agreement a more neutral form and therefore merely said that the appellant had caused damage to (he  partners,  which  he  was  called upon to make good.

 

Mr. Sharf for the appellant argued forcefully that according to the finding of the trial judge at p. 6 of his judgment, the real intention of the parties in submitting the matter to arbitration was to conceal it from the police, and if that were so, there was an agreement for con­ cealing a criminal charge which the court will not enforce.

 

  1. I have not found in  the  evidence  before  the  judge  any support for his conclusion that the parties agreed to conceal a felony and to refrain from disclosing the matter to the police. The evidence merely shows that the appellant was interested "that the matter should not be publicized." The appellant's desire that the matter should not become

 

*    "3. A submission, unless a contrary intention is expressed therein, shall be irrevocable

.except by leave of the court or agreement  of the  parties, and  shall  have the same effect  in all respects as if it had been made an order of court."

 

 

 
 

 

 

 

 

 

 

public knowledge does not necessarily  imply an agreement  to suppress a prosecution and to cover up a criminal  matter.  In  the  well-known case of Russell v. Russell (4), the court said that if two persons enter into an arbitration agreement and one of them in breach  of the agreement sues the other, the court will not exercise its discretion to stay the action in order to enable the arbitrators to proceed, if the plaintiff has been accused of a criminal offence or of some other dishonourable conduct, and therefore desires to clear his name in public and not in the private sessions of the arbitrators. Here the intention certainly was  not  that if the arbitrators were to consider the claim, the matter would not be disclosed to the police. When one person  steals something from another a criminal offence has been committed, but the thief is also obliged to return the stolen article and make good the loss  he caused  the other.  The civil and criminal aspects of the case are two distinct matters. The criminal charge certainly cannot serve as the subject matter of an arbi­ tration, but the parties may submit the civil dispute to the decision of an arbitrator. As Mr. Sharf said, an arbitration agreement  is in  the nature of a compromise, but why should _not the injured party  compromise with the thief his civil claim?

It is true that if, incidentally to the signing of the submission to arbitration, the parties should also agree to suppress the crimin'al

aspect, even by implication only, the submission to arbitration would then become an illegal transaction which the court will not enforce.

 

  1. Mr. Sharf sought support for his submission from Egged v. Sapir (I) where this court decided that the "internal" tribunal of a cooperative society is not competent to deal with an "indictment" preferred against one of the members of the society. From the very expression "indictment" used in that case, it is clear that in bringing the matter before the tribunal of the society the directors of the society intended to assume powers which were not theirs, and to deal with matters in the competence of the Attorney-General and the police. But in the case before us the civil matter alone was submitted to the arbitrators. I do not see what there is to prevent a person who has suffered an injury to claim compensation either in court or before an arbitrator, even where the act amounts to a criminal offence.       ·
  2. Mr. Sharf drew our attention to sec. 67 of the Civil Wrongs Ordinance, 1944, which requires the courts to see that the police receive information of the facts of an action if those facts support a criminal charge. I find nothing to prevent an arbitrator as well from  observing  the mandate of the section, nor have I found in the Ordinance any

 

 

       
 
   
 

 

 

 

 

 

 

intimation whatever that an arbitrator is not competent to deal with a claim for damages even if it appears to him that one of the parties is suspected of a criminal offence, particularly where, as in the  present case, the respondents can also re_ly upon  the  partnership  agreement and are not confined to the provisions of the Ordinance.

  1. I have sai that even if a civil matter is submitted  to  the award of an arbitrator, the arbitration agreement will-like any other agree­ ment-be tainted if the parties have agreed to frustrate the administration of justice by agreeing to cover up an offence. Mr. Sharf argues rightly that such an agreement to conceal an indictable offence need not be made expressly but it is sufficient if it is made by implication: In support, he cited the judgment in Jones v. The Merionethshire Permanent Building Society (5). The facts were that the agreement was made not with the debtor himself who had been accused of stealing money but with his relatives, and the court inferred, as an implied term, that in consideration for the promise of those relatives to compensate the injured party the latter agreed to keep silent about the criminal aspect of the matter.

But when the agreement is made· between the creditor and the debtor himself, we follow the rule established in Flower v. Sadler (6), upon

which the judge in the present case also relied: see also A.B. v. C.D. (2). This·ruie is·to the effect that even if the creditor has threatened the debtor with  criminal   proceedings  to  make  him  pay  the  debt,  this  does not

amount to coercion or duress in respect of which a court  of  Equity would hold the agreement invalid, had it been made with a third party: see Williams v. Bayley (7). The reason for this distinction is that when a man seeks to collect a debt owed him by the debtor, the court does not deal with him as scrupulously as it does when enquiring into the conduct of a person who binds him elf contractually with a third party who "volunteers" to pay the debt of another in order to impose upon him responsibility for making good the damage caused him by that other person. Prima facie it may be contended that whenever a creditor has threatened a debtor to institute criminal proceedings, it  may  genera,lly be inferred that if the debtor  yields  and  pays  the  debts,  the  creditor will refrain from turning the matter over to the police, on the principle that "a positive may be deduced from  a  negative."But  if  the  courts were to go as far as to hold that in every such case there was an implied agreement to suppress a crime, they would in effect frustrate the principles established in Flower v. Sandler (6), and more than a century  before that in Ward v. Lloyd (8). I do not lay down that even in the case of an agree­ ment entered into between the creditor and  the  debtor  himself-as distinct from an agreement  between  the creditor  and a  third  party who

 

 

 

 

 

pays the debt on behalf  of  the debtor-such  a coodition  to  suppress a crime is inconceivable, but· Mr. Sharf has not referred us to any pre­ cedent which deals with this matter, and in the Jones case (5), as stated, the agreement was not made with th debtor himself.

  1. The conclusion which I have reached may be tested in this way. Suppose that for one reason or another the respondents  had  informed the police of the crime which was committed. Would they have thereby broken the agreement with the appellant? They  certainly  would  not have broken an express term and I see no reason for concluding that they would have broken an implied  term. The respondents  have agreed  not to take legal action against the appellant, but I have not found that they agreed to keep the matter secret from the police.
  2. Since I have reached this conclusion, I see no need to express an opinion concerning the question raised before us, whether the appellant, the person charged with theft and desirous that the matter should not be made public, is at all entitled to the assistance of the court.

For these reasons I would dismiss the appeal and affirm the judgment of the District Court.

SILBERG J. I concur in the judgment of my learned colleague, Sussman J., since I am also of the opinion that the factual contentions of counsel for the appellant have not been proved. My concurrence is not, however, to be construed as acquiescing in the view that if "an agreement for suppression" among the parties had been established,  we would  have had to allow the appeal. It seems to me that even in such a case the appellant would have gone away empty-handed, because  then  the rule ex turpi causa non oritur actio would apply. In Jacobs  v.  Kartoz  (3), it was held that where the parties are in  pari delicto  the plaintiff  cannot rely upon the illegal contract to affirm it, nor upon its illegality to avoid it. The applicant in the present case was the appellant who sought to have the arbitration agreement set aside. Without deciding positively whether the  appellant  himself-as  distinct  from  the  opposing  side-would indeed have been guilty of an offence under sec. 129 of the Criminal Code Ordinance*, the turpitude in the matter was certainly not borne equally by both sides-on the contrary, it was greater on the part of the appellant. For this reason alone the appellant cannot  persuade the court to grant his application.

 

 
 

 

 

* "129. Any person who asks, receives or obtains, or agrees or attempts to receive or obtain...benefit of any kind for himself... upon any agreement of understanding that he will...or will abstain from...prosecution for...a felony,...is guilty of a misdemeanour."

I

 

COHN J. The learned  judge  in  the  District  Court  established  as  a fact that "It was the intention  of  the  parties  that, instead  of  bringing the matter to the attention of the authorities, proceedings should tak'e place before arbitrators", and further that "the true intention in making the arbitration agreement was to settle the m tter in a form  that  would not involve proceedings before a criminal court." In my opinion there was abundant evidence before the court on which it could make such findings, and this  court  should  not  interfere  with  findings  of  fact  of a court of first  instance.  For  myself  I  accept  Mr.  Sharfs  argument that the learned judge erred in the conclusion of law  which  he drew from these  facts  in  holding  that  there  was  here  no  offence  under sec. 129 of the Criminal Code Ordinance. 1936. I myself have no doubt that in view of the findings of fact of the learned judge there is no escaping the conclusion that, at least prima  facie,  an  offence  under  sec.  129 was proved. This section does not speak, as English  law  apparently does, of the stifling of the prosecution. This section is satisfied if the compounding is expressed by the grant of any benefit whatever, or  by the concealment of a crime from the authorities, or even by delay in prosecuting the charge or withholding evidence in connection there­ herewith.

If there was no actual compounding here-and I express no opinion as to whether there was such or not-Mr. Sharf is right in his argument that there was at least some delay and since the parties intende5i, as indicated, that the arbitration between  them  should  take  the  place of a criminal action, the conditions set out in sec. 129 have been met.

Nevertheless, I agree with my learned colleagues that this appeal should be dismissed. My reason is that this appellant does  not  come with clean hands any more than the respondents  who  under sec.  129  are the principal offenders. Not only did the appellant a'ssist, by counsel and deed, in submitting the relevant matter to arbitration and  con­ cealing it from the criminal court but, according to the evidence which reached the court, it was he who initiated the  whole  matter,  even  if only for the purpose of avoiding publicity; and he cannot now  be heard in argument as ifhe were not the prime mover.

 

Appeal dismissed. Judgment given on November 7, 1960.

Full opinion: 

Roker v. Solomon

Case/docket number: 
LCA 6339/97
Date Decided: 
Thursday, December 23, 1999
Decision Type: 
Appellate
Abstract: 

This translation only covers the dissent by Justice Englard and a portion of the response by Justice Turkel.

 

FactsThe parties owned apartments in a four-apartment condominium. The Appellants submitted a request for a building permit to expand their apartment into the building’s common property, to which the Respondents objected. The local committee granted a building permit. The Respondents filed suit in the Haifa Magistrates Court, which granted a temporary injunction but ultimately denied the Respondents’ suit for a permanent injunction.  An appeal was then filed in the District Court, which initially denied a request for temporary injunction, but later decided to bar the Appellants from continuing construction. The District Court granted the appeal, however, in the two-month interim period during which there was no injunction in force, the Appellants succeeded in completing the expansion of the apartment.

 

The Respondents instituted proceedings in the Magistrates Court for demolition of the addition. The court ordered the Appellants to restore the situation ad integrum, demolish any construction performed by them in the common property, and to pay the Respondents damages for suffering and loss of enjoyment of the common property. An appeal was filed in the District Court. In denying the appeal, the court held that any change in the common property requires the prior approval of a general meeting of the apartment owners; that any construction in the common property without consent is an infringement thereof, and constitutes a permanent deprivation of its use by the other apartment owners; and that a building permit does not itself legitimize construction involving infringement of the property rights of other apartment owners in the common property.

 

In seeking leave to appeal, the Appellants did not dispute the legal presumptions of the trial court. Their main argument was that the circumstances of the matter do not justify an order to demolish the structure unlawfully built on the common property. Rather, the court should exercise discretion in regard to the remedy of demolition. Inasmuch as the questions as to whether a court has such discretion in the case of construction on another’s land, and if so, how to exercise it, were new and of significant legal importance, the Appellants were granted leave, and the appeal was heard by an expanded panel of seven justices.  The appeal was denied (per Justice J. Turkel, President A. Barak, Justices M. Cheshin, E. Mazza, S. Levin concurring, T. Strasberg-Cohen concurring and dissenting, Justice I. Englard dissenting).

 

Justice I. Englard (dissenting):

 

In his dissent, Justice Englard addressed the question of whether a court has discretion in regard to the remedy of demolition of an unlawful structure built on common property.

 

In exploring the issue of abuse of right, Justice Englard turned to Jewish law and the concept of “kofin al midat s’dom” [“one may be compelled not to act meanly”]. The conception is that when a person deprives another of benefit, where that benefit costs him nothing, his conduct is deemed midat s’dom, and the law will compel him to desist.

 

In the opinion of Justice Englard, it is only proper that Jewish law serve as a source of inspiration in interpreting the provisions of sec. 14 of the Land Law.  It would be appropriate that the clear moral tendency found in the Jewish legal tradition in regard to the concept of ownership, the purpose of which is to limit a person’s rule over his property, would find expression in the law of the State of Israel as a Jewish and democratic state. In addition to the personal moral dimension of the rule “kofin al midat s’dom”, the rule also comprises what may be a more important social dimension.

 

Justice Englard was of the opinion that a demolition order would constitute an abuse of the property right in the common property. Demolishing the addition to the apartment, demolishing the storage units built in accordance with a building permit, and restoring the situation to its original state do not stand in a reasonable relationship to the – somewhat abstract – fundamental interest of the Respondents in maintaining the totality of their right in the common property. The balance of interests clearly tends in favor of preserving the existing situation, while awarding damages to the other residents for the infringement of their right to use the common property.

 

Moreover, it would appear that the solution of awarding damages rather than ordering demolition is also consistent with the Jewish law approach under the principle of “kofin al midat s’dom”. Although the owners suffer some loss of the use of the common property, in light of the “beneficiary’s” willingness to pay for the use of the common property it would seem that demolition of the structure would, under the circumstances, constitute midat s’dom that might, perhaps, also comprise an element of “bal tashhit” [“do not destroy/waste”].

 

Justice J. Turkel:

In responding to Justice Englard, Justice Turkel agreed that the principle of “kofin al midat s’dom” is an important principle in Jewish law’s rules of equity. But this rule does not have the power to uproot a positive commandment of the Torah, and the Torah expressly states: “You shall not move your neighbor’s landmarks, set up by previous generations, in the property that will be allotted to you in the Land” (Deut. 19:14). Moreover, an examination of Jewish law sources appears to show that the principle was not employed in a manner that infringes rights in real property. Thus, the principle “kofin al midat s’dom” cannot serve the Appellants, who built unjustly and unlawfully.

Voting Justices: 
Primary Author
majority opinion
Author
concurrence
Author
concurrence
Author
concurrence
Author
concurrence
Author
dissent
Author
dissent
Full text of the opinion: 

This translation only covers the dissent by Justice Englard and a portion of the response by Justice Turkel.

 

LCA 6339/97

 

 

Appellants:                              1.  Moshe Roker

                                                2.  Rina Roker

 

                                                            v.

 

Respondents:                          1.  Moshe Solomon

                                                2.  Hanna Solomon

                                                3.  Yair Barker

                                                4.  Yaale Barker

 

 

The Supreme Court as Court of Civil Appeals

[Dec. 23, 1999]

Before: President A. Barak, Deputy President S. Levin, and Justices E. Mazza, N. Cheshin, T. Strasberg-Cohen, J. Turkel, I. Englard

 

Judgment

 

Justice I. Englard:

            We are addressing this request for leave to appeal as if leave were granted, and as if an appeal was filed in accordance with the leave granted.

1.         Before us is a dispute among neighbors in a condominium, which has persisted for over ten years. The reason for the dispute is construction carried out in the common property of the building by the owners of one apartment. After several cycles in the courts, an order was issued against the owners of one apartment (hereinafter: the Appellants), pursuant to the request of the owners of two other apartments (hereinafter: the Respondents), requiring the Appellants to restore the situation ad integrum, and demolish any construction performed by them in the common property, as well as to return joint possession of the entire common property seized by the Appellants to the Respondents. The Appellants were also ordered to pay the Respondents damages for suffering and loss of enjoyment of the common property, in the amount of NIS 10,000.

2.         An appeal was lodged in the District Court against this judgment issued by the Haifa Magistrates Court on Nov. 5, 1996, by Judge R. Tovi-Friedman. That appeal was dismissed on Sept. 28, 1997, in a judgment by President M. Slutzky, Judges S. Finkelman and S. Wasserkrug concurring. The court reemphasized that any change in the common property requires the prior approval of a general meeting of the apartment owners; that any construction in the common property without consent is an infringement thereof, and constitutes a permanent deprivation of its use by the other apartment owners; that any infringement of the common property, even without any attendant damage, is sufficient to justify a restraining order; and that a building permit does not, in and of itself, legitimize construction involving infringement of the property rights of other apartment owners in the common property. The District Court therefore ruled that inasmuch as the Respondents had been harmed by the erection of a structure on the common property without their consent, they are entitled to the remedy of restitutio ad integrum by means of a demolition order, and to being granted the possibility of using the common property. They Respondents were also entitled to damages for suffering.

3.         That judgment of the Haifa District Court is the subject of the appeal at bar. Actually, the Appellants do not dispute the legal presumptions of the trial court. Their main argument is that the circumstances of the matter do not justify an order to demolish the structure unlawfully built on the common property. In other words, their claim is that the court should exercise discretion in regard to the remedy of demolition. Indeed, the questions as to whether a court has such discretion in the case of construction on another’s land – and if so, how to exercise it – are new, and of significant legal importance. Therefore, after hearing the arguments of the parties, the original panel decided that the proceedings would continue before an expanded panel of this Court. In view of the expansion of the panel, the President ruled that the parties would be permitted to submit written summaries of their arguments, and that the decision would be made on the basis of the material in the Court’s file, with the addition of the briefs submitted by the parties, without need for further supplemental pleadings. This was, indeed, done. We reviewed the material in the file, and the briefs submitted by the parties, and decided, as stated, that due to the importance of the subject, leave to appeal would be granted.

4.         The starting point of our examination is that the Appellants’ construction on the common property was unlawful. Therefore, in principle, the Respondents have a right to restititio ad integrum. Thus, exercising discretion by the court to refrain from demolishing the structure is not a matter of course, but rather depends upon the special circumstances of the instant case. Therefore, the details of the case regarding the conduct of the parties, as well as the external circumstances, are of importance. I will present them in brief:

(a)        We are concerned with a four-apartment condominium built in the nineteen fifties. In the early nineteen eighties, it became known that it was possible to increase the floor-area by some 40%, totaling about sixty square meters. The homeowners’ committee held several meetings to consider expanding the various apartments. The Appellants, who were interested in executing a plan to expand their apartment, submitted a request for a building permit in 1986.The Respondents submitted an objection to the plan, and the local committee decided to conduct an inspection of the building, which took place on Nov. 19, 1986. On Jan. 5, 1987, the local committee decided to grant a building permit subject to several conditions, among them that separate storage units would be built for the Respondents in place of the area that they had been using in the existing bomb shelter. It should be noted that the loss of the use of the shelter as a storage area was one of the reasons for the Respondents’ objection to the request for a building permit. The Respondents appealed the decision before the district committee, which decided to deny the appeal on May 14, 1987.

(b)        On June 1, 1987, the Respondents filed suit in the Haifa Magistrates Court for a permanent injunction against the Appellants. The Respondents also filed a motion for a temporary injunction, which was granted on Nov. 16, 1987. The Magistrates Court handed down its decision on Sept. 5, 1989, denying the Respondents’ suit for a permanent injunction, on the grounds that the Respondents had consented in principle to the expansion of the Appellants’ apartment. However, the Magistrates Court left the temporary injunction in place pending appeal. The appeal was filed on Sept. 13, 1989, but a request to extend the temporary injunction was denied by the District Court on Oct. 10, 1989. On Dec. 19, 1989, the Haifa District Court decided to prevent the Appellants from continuing construction beyond what had been completed to that date. However, in the interim period during which there was no injunction in force – that is, between Oct. 10, 1989 and Dec. 19, 1989 – the Appellants succeeded in completing the expansion of the apartment in accordance with the plan.

(c)        The Respondents’ appeal to the District Court was granted on Aug. 29, 1990, holding that there was no basis for the Magistrates Court’s finding in regard to the Respondents’ consent to the construction plan. The result was that, in the framework of this suit, the Appellants were prohibited from performing any further construction. The court added that “this does not represent any finding on the question of whether the Appellants (the Respondents before us – I.E.) can now institute new proceedings for restoring the situation to its original state”. The Appellants were granted leave to appeal by this Court, but ultimately withdrew their appeal, and it was therefore dismissed on March 8, 1995.

(d)       After the conclusion of the first campaign – successfully from their perspective – in the District Court, the Respondents began the current campaign to restore the situation to its original state by demolishing the structure. I will briefly describe the construction. The Appellants are the owners of the apartment on the first floor. Part of the apartment rest on columns, and part on the shelter. The Appellants closed in the space between the columns, attached part of the shelter to it, and added an addition on the side of the building, on the lawn. In place of part of the shelter, they built – in accordance with the requirements of the local committee – two storage units behind the shelter, in conformance with standards, while apparently excavating the property slope. According to an expert estimate from 1995, the cost of removing the construction stands at some NIS 40,000, while restoring the lawn and garden would cost some NIS 50,000.

5.         It is true that the Appellants carried out the construction when there was no injunction in force, and while the judgment of the Magistrates Court permitting the construction still stood. However, upon the overturning of that judgment upon appeal, their construction on the common property became (retroactively) illegal. Moreover, the District Court rightly held in the current campaign that the Appellants cannot claim to have acted in good faith. As stated, the Respondents filed an appeal against the decision of the Magistrates Court ten days after it was given. The Appellants were aware of the determined objection of the Respondents, and therefore good faith cannot be claimed in regard to the construction in the disputed area, not to mention that the judgment in their favor had not, at the time, become final.

6.         I will, therefore, return to the question of principle: Does the court have discretion in regard to the remedy of demolition of the structure under these circumstances of unlawful construction in the common property?

21.       However, for the purpose of finding a source for preventing abuse of a right, we do not actually have any need to graze in foreign pastures. This concept is clearly expressed in Jewish legal tradition in the famous principle stating: “kofin al midat s’dom” [“one may be compelled not to act meanly”] [1] (Ketubot 103a; Eiruvin 49a; Bava Batra 12b; 59a; 168a). This combination of manner and compulsion is unique to the Jewish conception of the role of the state, which is not limited to the interpersonal area – in accordance with the approach of the liberal state – in preventing harm to another person. Rather, as Maimonides defined it, the Law of Moses is intended to bring the human being to a state of moral perfection and intellectual perfection, where the last is the primary objective of humankind (Guide for the Perplexed, III:54). However, in this area of moral perfection, Judaism, too, was also aware of the Kantian problem of enforcing morals. In Kant’s view, the law, as a normative system of external compulsion, stands in contrast to morality as a normative system that we must obey from a recognition of internal obligation. The Sages, as well, were of the opinion that coercing an individual to act morally is far from moral perfection. It is against the background of this tension between compulsion and personal moral perfection that we can understand the halakhic disagreements concerning the scope of legal compulsion in regard to “midat s’dom”.

22.       As Rabbi A. Lichtenstein pointed out in his deeply illuminating article LeBeirur ‘Kofin al Midat S’dom’, Hagut Ivrit Be-Amerika, vol. I, 362 (1973) (Hebrew), to the best of his knowledge, there is no source in early rabbinic literature that describes this type of conduct [midat s’dom] in abstract, universal terms. One important source that refers to the general nature of midat s’dom as a human characteristic is to be found in the Mishna (Avot 5:10):

There are four types of character in men: He that says “Mine is mine, and yours is yours” – this is the middle [neutral] quality, and some say this is midat s’dom. He that says “Mine is yours and yours is mine” – is an am ha’aretz [uneducated person]. He that says “mine is yours and yours is yours” – is a pious person. He that says “Mine is mine and yours is mine” – is a wicked person.

            It would seem that we have here a tannaitic[2] dispute as to the character of one who says “mine is mine, and yours is yours” – is this morally neutral or midat s’dom? Many scholars have made exerted efforts to clarify the relationship between the two views, and the prevailing approach is to harmonize the two. In principle, “mine is mine, and yours is yours” is the legal approach, and is necessarily value-neutral, inasmuch as its purpose is to preserve the “his” of each person. Rashi may be pointing this out in his commentary to Avot in stating (ad loc., s.v. “zo mida beinonit”): “As we found in regard to Samuel of Ramah, of whom it was said: ‘Then he would return to Ramah, for his home was there’ (I Samuel 7:17)”. It would seem that Rashi’s intention is to refer us to the continuation of the verse: “and there he would judge Israel”. In other words, he had clean hands because he took care not to benefit from others, as he and all Israel testify: “you have found nothing in my possession, and they responded ‘He is’” (I Samuel 12:5). Thus, that is the proper legal value: to protect a person’s rights against harm by another. Notwithstanding the desire for moral perfection, Judaism does not coerce a person to the pious manner of “mine is yours, and yours is yours”. However, in special circumstances, the neutral manner of “mine is mine, and yours is yours” may – as “some say” – become an actual midat s’dom. That would occur when a person who behaves in that manner puts the emphasis on “mine is mine”, while absolutely ignoring the interests of others. A salient example of such a situation is preventing benefit to another in a situation of “this one benefits, and the other loses nothing”, see Rashi, Eiruvin 49a, s.v. “midat s’dom”: “sheli sheli”.

23.       Indeed, in the view of the “Rishonim”,[3] the focus of the Talmudic discussions treating of midat s’dom is on the factual situation – that itself became a legal principle – of “this one benefits, and the other loses nothing”. The conception is that when a person deprives another of benefit, where that benefit costs him of nothing, his conduct is deemed midat s’dom, and the law will compel him to desist. There are many, lengthy disputes among Talmudic sages and later halakhic decisors in regard to the details of the rule, and this is not the place for examining them. For an examination of the subject in modern literature, see, in addition to Rabbi Lichtenstein’s article, N. Rakover, Unjust Enrichment (5748) (Hebrew), A. Weinrot, Abuse of Rights in Jewish Law (“Kofin al Midat S’dom”), 18 Dinei Yisrael 53 (5755-5756) (Hebrew);  Shmuel Shilo, Kofin Al Midat S’dom: Jewish Law’s Concept of Abuse of Rights, 15 Is.L.Rev. 49 [abstract and full text available at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2676836].

24.       It would appear that the scope of incidence of the “kofin al midat s’dom” rule in the framework of the principle of “this one benefits, and the other loses nothing” may be broader than that of the accepted doctrine of abuse of rights. While there are many disagreements among halakhic scholars on the question of the existence of a loss by the owner of the property, it would seem that in some cases the status of the “beneficiary” in halakha is preferred to that of the person relying on the doctrine of abuse of right in most, if not all, legal systems. However, the opposite situation – in which the balance of interests on the basis of a utilitarian test does not correspond with the principle of absence of loss according to the halakhic tests – is also possible.  In such a situation, the result may be that the status of the “beneficiary” would be preferred under the doctrine of abuse of right.

25.       For our purposes, I will suffice with one example from halakha according to which a person is permitted to trespass upon another’s property on the basis of the principle of “this one benefits, and the other loses nothing” as an expression of “kofin al midat s’dom”.  I am referring to the rule established by the Shulhan Arukh in accordance with Maimonides – contrary to the objection of Rabbeinu Yaakov Baal HaTurim [Rabbi Jacob Ben Asher, ca. 1269-1343, author of the Arba’ah Turim  [a.k.a. the Tur) – trans.] – in regard to “one who places a small ladder that does not have four rungs in the courtyard of his neighbor or in his field …”. The owner of the property cannot prevent the owner of the ladder from placing his ladder for his own use, as long as it causes no harm to the former. See Maimonides, Mishneh Torah, Hilkhot Shekhenim 7:8; 8:4; 12:1-4. “… however, if he paced a small ladder, he cannot prevent it, since they say to him: you suffer no loss thereby, as whenever you wish, you can remove it”, and see the Magid Mishneh [Rabbi Vidal of Tolosa (14th cent.)] commentary ad loc: “This is not mentioned in the discussion in the Gemara, but it is mentioned in the Gemara in regard to many rules where as long as this one benefits and the other suffers no loss, kofin oto al midat s’dom …”.  As opposed to this, see Tur, Hoshen Mishpat 153, which adds, after quoting Maimonides: “and this would not seem so, as how can he use his neighbor’s [property] against his will”?!. This objection by the Baal HaTurim is rejected by his commentators the Bayit Hadash [Rabbi Joel Sirkis (1561-1640)] and the Beit Yosef [Rabbi Joseph Karo (1488-1575), author of the Shulhan Arukh] ad loc. The Bayit Hadash notes that “when it involves no invasion of privacy, and his anger is solely due to the trespass, kofin al midat s’dom”. And see: Tur, Hoshen Mishpat 173, and the Bayit Hadash, ad loc., ss. 3. For the halakha, see Shulhan Arukh, Hoshen Mishpat 173:13, and the commentaries ad loc.    

 26.            It is only proper that Jewish law serve as a source of inspiration in interpreting the provisions of sec. 14 of the Land Law, and not just due to its obscure, incoherent language.  In my view, it would be appropriate that the clear moral tendency found in the Jewish legal tradition in regard to the concept of ownership, the purpose of which is to limit a person’s rule over his property, would find expression in the law of the State of Israel as a Jewish and democratic state. I would note that in addition to the personal moral dimension of the rule “kofin al midat s’dom”, the rule also comprises what may a more important social dimension. After all, it was the absence of this moral dimension that sealed the fate of the people of Sodom for whom the principle is named. See: Sanhedrin 1099a, and see Ezekiel 16:49; “Only this was the sin of your sister Sodom: Arrogance! She and her daughters had plenty of bread and untroubled tranquility; yet she did not support the poor and the needy”.

27.       From all of the above, we may, therefore, conclude that the doctrine of abuse of right in land has gained a place in our law, and in that framework, the principle of kofin al midat s’dom, as well. In light of this development, we should reexamine the approach of President Olshan, as expressed in CA 281/61 Shlusser v. Katz, IsrSC 15 2329, 2333. First, President Olshan holds as follows:

If a suit for an injunction is filed against a respondent who is a trespasser, the latter cannot object by claiming that the injunction, if granted, would severely infringe his vital interests …

Therefore, despite the rule that granting an injunction is discretionary, the respondent must first show some grounds for his claim that the complainant must grant him a right to pass through the disputed property. 

And he continues:

A person cannot demand some benefit in another’s property simply because it is convenient for him or because he requires it and the matter does not cause any harm whatsoever to the other, even if this person’s difficulty may lead people to sympathize with him. Moral considerations should not be confused with equitable considerations in the legal sense. When a matter is dependent on the goodwill of the other, “goodwill” should not be imposed upon the other for equitable considerations. We have never heard of such a rule.

35.       As noted, the abuse of right doctrine should not be limited to cases of an improper motive by the complainant. The additional test – as we see in the aforementioned Swiss case – is an objective assessment of the mutual interests in light of the circumstances of the case. In weighing the mutual interests of the parties, I am of the opinion that a demolition order would constitute an abuse of the property right in the common property. Demolishing the addition to the apartment, demolishing the storage units built in accordance with a building permit, and restoring the situation to its original state do not stand in a reasonable relationship to the – somewhat abstract – fundamental interest of the Respondents in maintaining the totality of their right in the common property. The balance of interests clearly tends in favor of preserving the existing situation, while awarding damages to the other residents for the infringement of their right to use the common property.

36.       This conclusion is clearly consistent with the spirit of the tests under sec. 74 of the Civil Wrongs Ordinance [New Version], and it is proper that, as far as possible, the considerations for granting parallel remedies according to the two systems, which both serve the objective of directly protecting property interests, be consistent. Moreover, it would appear that the solution of awarding damages rather than ordering demolition is also consistent with the Jewish law approach under the principle of “kofin al midat s’dom”. Although the owners suffer some loss of the use of the common property, in light of the “beneficiary’s” willingness to pay for the use of the common property it would seem that demolition of the structure would, under the circumstances, constitute midat s’dom that might, perhaps, also comprise an element of “bal tashhit” [“do not destroy/waste”]. (See Maimonides, Mishneh Torah, Hilkhot Melakhim 6:10: “Not only trees, but anyone who breaks utensils, tears garments, and destroys buildings … transgresses the command of do not destroy …”. However, it should be noted that takanat hashavim [rehabilitation] does not apply to cases of trespass upon property in the halakhic sense. See: Tur, Hoshen Mishpat 376, Beit Yosef and Bayit Hadashad loc., quoting Rashba (Responsa Rashba, III:188, and particularly see Or Same’ah, II:11.The Author [i.e., R. Joseph Karo, author of the Shulhan Arukh – trans.] disagrees with the Responsa Mabit [R. Joseph b. Joseph di Trani (1505-1585)] III:143, who was of the opinion that a distinction should be drawn in regard to takanat hashavim in regard to real property, whether accidental or willful. The Or Same’ah [R. Meir Simcha of Dvinsk (1843–1926)] also disagrees with this idea, which appears in Sha’ar Mishpat [R. Israel Isser b. Zeev Wolf (ca. 1750–1828)] 360, according to which an accidental trespasser can prevent the demolition of his structure by paying the property owner for his land. The author of Sha’ar Mishpat premises this idea – intended to prevent substantial loss – on the principle of returning lost property in the framework of “swarms of bees” (Bava Kama 114a-b). On this issue in practice, see: Maimonides, Mishneh Torah, Hilkhot Gezeila vAveida 6:14; Tur, Hoshen Mishpat 274, 370; the gloss of the Rema [R. Moses Isserles (1520-1572)] on Shulhan Arukh, Hoshen Mishpat 274. Indeed, even in halakha we find many opinions in regard to the scope of kofin al midat s’dom in the context of “this one benefits, and the other loses nothing”. We would note in this regard, the comments of the Ba’al HaNetivot [R. Jacob b. Jacob Moses Lorberbaum  of Lissa (1760-1832)] in his Mishpat HaUrim commentary on Shulhan Arukh, Hoshen Mishpat, 154:3:

And if one loses a small amount and one a large amount, it would seem that he makes up for him the small loss, as kofin al midat s’dom, but only when it is solely a monetary loss, but if the loss is in the land itself, he can say that land is worth a lot to me, as we see in Bava Kama 12 [b] see there.

            This is not the place to elucidate the distinction between a monetary loss and a loss of the land itself (compare, in general, the abovementioned article by Weinrot, p. 71ff.), nor is it my place to decide halakha. It is sufficient to note that making up for a loss by monetary payment is a consideration in the halakhic sources in the framework of kofin al midat s’dom.

            Therefore, if my opinion were adopted, the appeal would be granted, and the judgments of the Magistrates Court and the District Court would be vacated in regard to the remedy of restitutio ad integrum. Inasmuch as my conclusion is not acceptable to my colleagues, I see no reason to address the question of payment of damages by the Appellants for their use of the common property.

 

Justice J. Turkel

Ha! he who builds his house with unfairness, and his upper chambers with injustice” (Jeremiah 22:13).

Introduction

1.         I will begin by presenting the main points in utmost brevity. The owners of an apartment in a condominium extended their apartment by building on the common property without the consent of the other apartment owners. The Magistrates Court and the District Court granted the suits of the latter, and ordered that the trespassers restore the situation to its original state by demolishing the structure that they built on the common property, and returning possession to the joint owners. The trespassers were also ordered to pay damages to the other apartment owners for their suffering. In the opinion of my esteemed colleague Justice Englard, for reasons that he presented in detail, the significant expense that would be borne by the Appellants in restoring the situation to its original state tip the scale in their favor, and therefore, the judgments of the lower courts should be vacated. I will put the cart before the horse and say that I utterly reject that conclusion.

Kofin al Midat S’dom?

22.       I will briefly address the approach of Jewish law, if only to set the halakha – or what I believe to be the halakha, in my humble opinion – straight, and “to exalt the Torah”.

            The principle of “kofin al midat s’dom” (Mishna, Avot 5:10; TB Bava Batra 12b; 13a; 59a; Ketubot 103a; Eiruvin 49a; Maimonides, Hilkhot Shekhenim 7:8; 12:1-4) – which means: a person is coerced not to act in the manner of the people of Sodom – is an important principle established by the Sages in Jewish law’s rules of equity. But this rule does not have the power to uproot a positive commandment of the Torah. The Torah expressly states: “You shall not move your neighbor’s landmarks, set up by previous generations, in the property that will be allotted to you in the Land” (Deut. 19:14), and Rashi explains: “You shall not move [lo tasig] [your neighbor’s] landmark: A term similar to ‘they shall be turned back [nasogu ahor]’ (Isa. 42:17). That he moves the boundary marker of the land backwards into his neighbor’s field in order to enlarge his own. But has it not already been stated: ‘You shall not commit robbery’ (Lev. 19:13)? What does ‘You shall not move [your neighbor’s landmark]’ teach us? It teaches us that one who uproots his neighbor’s boundary transgresses two negative commandments. One might think that this applies even outside the Land of Israel. Therefore it says, ‘the property that will be allotted to you in the Land’. In the Land of Israel one transgresses two negative commandments, whereas outside the Land of Israel, one transgresses only the commandment of ‘you shall not commit robbery’.” This commandment was also stated in the ceremony of the blessings and the curses on Mount Gerezim and Mount Ebal: “Cursed be he who moves his neighbor’s landmark” (Deut. 27:17). And Rashi explains there: “Who moves back his neighbor’s landmark, moving it back and stealing the land. A term similar to ‘is turned back [vehusag ahor]’ (Isa. 59:14).” (Rashi, Deut. 27:17). Thus, we do not make recourse to the principle “kofin al midat s’dom” to allow an act of uprooting a boundary and stealing land.

            Moreover, an examination of the sources appears to show that this principle was not employed in a manner that infringes rights in real property. It would seem that the only instance that might arguably be seen as an infringement of real-property rights is that of recourse to the principle in order to prevent a person from opening a window in a wall of his house that would overlook his neighbors’ courtyard (TB Bava Batra 59a); Maimonides, Hilkhot Sekhenim 7:8. It should be noted that Maimonides’ approach in this regard was criticized by the most respected halakhic decisors, who took pains to distinguish and restrict the rule. In any case, it would seem to me that, at the end of the day, we may conclude that the view of halakhic scholars is that, as a rule, a person cannot be compelled to waive his property rights and permit others to benefit from his property, even if the matter involves no economic cost whatsoever. And indeed, even according to the approach of those who hold that compulsion is possible in some situations, we do not employ the principle of kofin al midat s’dom in regard to substantive property interests (see Weinrot’s interesting article, Abuse of Rights in Jewish Law (“Kofin al Midat S’dom”), 18 Dinei Yisrael 53 (5755-5756) (Hebrew), and the references cited there and elsewhere. And see CA 538/80 Zarhi (Avrahami) v. Koresh, IsrSC 36 (3) 498, in which the Supreme Court, per Sheinbaum J., rejected the use of the principle in a similar case).

            Thus, the principle “kofin al midat s’dom” cannot serve the Appellants, who, as stated at the outset, built what they built unjustly and unlawfully.

 

           

 

 

[1] Translator’s note: “Strict translation of this phrase, which is ‘one is compelled not to act in the manner of Sodom’ is not very helpful. The rule is interpreted to mean that if A has a legal right and the infringement of such right by B will cause no loss to A but will remove some harm from, or bring a benefit to B, then the infringement of A's right will be allowed. Such a concept at once brings to mind the modern view concerning abuse of rights.” Shmuel Shilo, Kofin Al Midat S’dom: Jewish Law’s Concept of Abuse of Rights, 15 Is.L.Rev. 49 [abstract and full text available at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2676836].

[2] Trans: The term “tanna” refers to the rabbinic sages of the Mishnaic period (approximately 10-220 CE).

[3] Trans: Halakhic scholars active in the 11th-15th centuries, prior to the publication of Joseph Karo’s Shulhan Arukh.

Full opinion: 

Dweikat et al. v. State

Case/docket number: 
HCJ 390/79
Date Decided: 
Wednesday, October 10, 1979
Decision Type: 
Original
Abstract: 

[This abstract is not part of the Court's opinion and is provided for the reader's convenience. It has been translated from a Hebrew version prepared by Nevo Press Ltd. and is used with its kind permission.]

 

For this petition, we must consider the legality of establishing a civilian town (settlement) in Elon Moreh, on the outskirts of the city of Nablus, on land privately owned by Arab residents. On the morning of June 7, 1979, Israeli citizens, assisted by the IDF, began to settle on a hill east of the Jerusalem-Nablus road. The hill is entirely on rocky and undeveloped land. The land was privately owned by, and registered to, the petitioners in the Nablus registry. Two days before the settlers arrived on the land, the Commander of the Judea and Samaria area, signed an Order for the possession of land that declares the lands were possessed for military needs.

 

The petitioners approached this court on June 14, 1979, and on June 20, 1979, an order nisi was granted against the respondents, ordering them to show cause why the court should not declare the Orders of Possession invalid. An interim order was also issued to prohibit any additional digging, construction, or settlement of additional citizens on the relevant land.

 

In the responding affidavit, the Chief of the General Staff explained that a civilian settlement at that location was required for security purposes, because in a time of war, military forces may leave the base in order to execute mobile missions or attacks, whereas the civilian settlement remains in its place. Being properly armed, it controls its surroundings in observation and protection of nearby traffic arteries, in order to prevent the enemy from seizing control. Opposing the Chief of General Staff, the Minister of Defense believed that these security needs could have been met in ways other than a settlement at the relevant site. Additionally, according to Lieutenant General (Res.) Bar-Lev, during wartime, IDF forces would be grounded to secure the civilian settlement, instead of engaging in combat with enemy forces.

 

The main issue the court considered (in a majority opinion by Deputy President Landau), was whether it may be legally justifiable to build a civilian settlement on the relevant site, despite having taken possession of private property for such purposes. For each and every case it must be examined whether military needs – as this term must be interpreted – did indeed justify taking possession of private land.

 

The legal framework for deciding this petition is defined first and foremost by the Order of Possession issued by the area commander, an order that is directly rooted in the powers that international law grants a military commander in territories occupied by his forces during a time of war. Additionally, the discussion is framed by the tenets of the law that has been implemented by the Israeli military commander in the Judea and Samaria area – this too according to the laws of war under international law. Substantively, we must examine under domestic Israeli law whether the Order of Possession was issued lawfully according to the authorities granted to the Government and the military by Basic Law: The Government and by Basic Law: The Military. Customary international law is in any event part of Israeli law to the extent it does not conflict with domestic legislation.

 

The court discussed the Beit El case (HCJ 606/78), in which a civilian settlement was found to comply with Article 52 of the Hague Regulations, which allows taking possession of land “for the needs of the army of occupation”, and held that temporary use of private land is permissible when it is necessary “for all kinds of purposes demanded by the necessities of war.” Here, the Court interpreted military needs to include “ensur[ing] public order and safety” under Article 43 of the Hague Regulations, as well as – under Article 52 – what is necessary for the military in order to fulfill its role in protecting the occupied territory from hostile activity, which may come both from outside and from within. It must be demonstrated, according to the facts of the case, that military needs were those which effectively motivated the decision to build a civilian settlement at the relevant site. The court found that here, the professional opinion by the Chief of the General Staff, in itself, did not lead to the decision to build the settlement of Elon Moreh, but that the propelling force behind the decision of the Ministerial Committee for National Security Affairs and of the Government was actually the strong desire of the people of Gush Emunim to settle the heart of the Land of Israel, as closely as possible to the city of Nablus. Both the Ministerial Committee and the Government majority were determinatively influenced by reasons that are of a Zionist worldview as to the settling of the entire Land of Israel.

 

Military needs, under international law, cannot be construed, by any reasonable interpretation, as including national security needs in their broad sense. Where the needs of the military are concerned, one would expect military officials to initiate the settlement on that particular site, and that the Chief of the General Staff would be the one to bring, according to such initiative, the military’s needs before the Government for approval of the settlement. Here, it is clear that the process was inverted: the initiative came from the political level and the political level reached out to the Chief of the General Staff for his professional opinion. The fact that those charged with assessing the military needs were not those who initiated the process to settle that particular site, but that, instead, their approval of that site was given only after the fact, in response to the initiative of the political level, demonstrates that there, in fact, was no military necessity to take private property in order to build a civilian settlement, as required by the terms of Article 52 of the Hague Regulations. It was not proven that in establishing this civilian settlement, the military preceded the act of settlement with thought and military planning. Instead, the pressure exerted by the people of Gush Emunim was what motivated the Ministerial Committee. Military considerations were subordinate to the political decision to build the settlement. As such, this does not meet the strict demands of the Hague Regulations as to preferring military needs over the individual’s right to property.

 

The Court also addressed the issue of how a permanent settlement can be established on land that was possessed only for temporary use. The decision to establish a permanent settlement that is intentionally designed to stand in its location in perpetuity – and even beyond the duration of the military rule in Judea and Samaria – meets an insurmountable legal obstacle, because a military administration cannot create within its territory “facts on the ground” for the purposes of its military needs that were, in advance, intended to exist past the end of the military rule in that area, when the fate of the territory after the end of the military rule is yet unknown.

 

The concurring opinion by Justice Witkon reiterated that the legal framework is the state authorities’ actions both in light of the domestic (or “municipal” as it is commonly termed in this context) law and in light of international law. There is no dispute that the force of the orders, in terms of the domestic law and really also in terms of customary international law (Hague Convention), is contingent upon their being “for military needs.” Here, however, even the experts charged with state security are divided as to the need for settlement in the relevant location

 

Basic Law: The Military addresses the order of the chain of command between three bodies – the Government, the Minister of Defense and the Chief of the General Staff. In terms of the hierarchy between them there is indeed no doubt that the Chief of the General Staff is below the Minister and they are both below the Government. But here the question is not whose order trumps, but rather whose opinion is more acceptable to the court.

 

In such a situation of a draw, when the opinion of the giver of the respondents’ affidavit should not be presumed to be superior to the opinions of other experts, the court asks: who bears the burden of proof? Justice Witkon held that the burden is placed upon the respondents. The law does not give the commander’s assertion that the taking of possession in required for military needs the force of a presumption – let alone that of conclusive evidence – that indeed it is so. Moreover, it is not sufficient that the commander sincerely and subjectively believes that the taking of possession was essential, in order to place the question beyond judicial review. The court need not be convinced of the sincerity of the consideration, but rather of its correctness.

 

The Court must not allow a serious infringement of property rights unless it is satisfied that it is necessary for security purposes. Here, as noted, the Minister of Defense himself was not persuaded this possession was necessary. It is not the court’s business to engage in political or ideological debates; but it is the court’s duty to examine, whether pure security considerations justify taking possession of land for the purposes of settling at that location. To determine this, Justice Witkon thought it important to know what the settlers’ position was. If they were not motivated, primarily, by security purposes, the court struggled to accept that this indeed was the purpose of their settlement.

 

Included within customary international law are the rules of the Hague Convention, so this Court should examine the lawfulness of the taking of possession in light of Article 52 of the Hague Regulations. Here, too, the test is the military need, and when one is not persuaded such need exists under the criteria of municipal law, one would not be persuaded, in any event, that it exists under the criteria of the Hague Convention either.

 

The question whether voluntary settlement falls within the prohibition over “transfer[ring] parts” of a “population” for the purposes of Article 49(6) of the Geneva Convention is not easy, and, as far as we know, it has yet to be resolved in international case law.

 

In his concurring opinion, Justice Bechor found that, had the court reached the conclusion that the military commander operated in this case in order to ensure military needs, and that he initiated that action for the purposes of ensuring such needs, which were the dominant factor in his decision, in light of all the circumstances and the timing as described in detail in the Deputy President’s opinion, he would have endorsed his action. But, as the Deputy President demonstrated in his opinion, the action of the military commander exceeded in this case the limits of its power under international law.

Voting Justices: 
Author
majority opinion
Author
concurrence
Author
concurrence
Non-writer
majority opinion
Non-writer
majority opinion
Full text of the opinion: 

[Emblem]

 

In the Supreme Court as High Court of Justice

 

   HCJ 390/79

 

Before:                                    The Honorable Justice Landau – Deputy President

                                    The Honorable Justice Witkon

                                    The Honorable Justice Asher

                                    The Honorable Justice Ben Porat

                                    The Honorable Justice Bechor

           

 

The Petitioners:

 

                                    ‘Izzat Muhamamad Mustafa Dweikat et al.

 

                                    versus

 

The Respondent:

 

  1. The State of Israel
  2. The Minister of Defense
  3. The Military Commander for Judea and Samaria
  4. The Military Commander for Nablus Sub-District
  5. Felix Menahem
  6. Shvut Avraham

                                   

                                    Objection to Order Nisi of date 25 Sivan 5740 (June 20, 1979)

 

Adv. E. Khouri

                                    On behalf of Petitioners 1-16

 

                                    Adv. A. Zichroni, Adv. A. Feldman

                                    On behalf of Petitioner 17

 

                                    Adv. G. Bach, State Attorney

                                    On behalf of Respondents 1-4

                                   

                                    Adv. R. Cohen, Adv. M. Simon

                                    On behalf of the Respondents 5-6

 

 

 

 

Abstract

 

For this petition, we must consider the legality of establishing a civilian town (settlement) in Elon Moreh, on the outskirts of the city of Nablus, on land privately owned by Arab residents. On the morning of June 7, 1979, Israeli citizens, assisted by the IDF, began to settle on a hill east of the Jerusalem-Nablus road. The hill is entirely on rocky and undeveloped land. The land was privately owned by, and registered to, the petitioners in the Nablus registry. Two days before the settlers arrived on the land, the Commander of the Judea and Samaria area, signed an Order for the possession of land that declares the lands were possessed for military needs.

The petitioners approached this court on June 14, 1979, and on June 20, 1979, an order nisi was granted against the respondents, ordering them to show cause why the court should not declare the Orders of Possession invalid. An interim order was also issued to prohibit any additional digging, construction, or settlement of additional citizens on the relevant land.

In the responding affidavit, the Chief of the General Staff explained that a civilian settlement at that location was required for security purposes, because in a time of war, military forces may leave the base in order to execute mobile missions or attacks, whereas the civilian settlement remains in its place. Being properly armed, it controls its surroundings in observation and protection of nearby traffic arteries, in order to prevent the enemy from seizing control. Opposing the Chief of General Staff, the Minister of Defense believed that these security needs could have been met in ways other than a settlement at the relevant site. Additionally, according to Lieutenant General (Res.) Bar-Lev, during wartime, IDF forces would be grounded to secure the civilian settlement, instead of engaging in combat with enemy forces.

 

The main issue the court considered (in a majority opinion by Deputy President Landau), was whether it may be legally justifiable to build a civilian settlement on the relevant site, despite having taken possession of private property for such purposes. For each and every case it must be examined whether military needs – as this term must be interpreted – did indeed justify taking possession of private land.

 

The legal framework for deciding this petition is defined first and foremost by the Order of Possession issued by the area commander, an order that is directly rooted in the powers that international law grants a military commander in territories occupied by his forces during a time of war. Additionally, the discussion is framed by the tenets of the law that has been implemented by the Israeli military commander in the Judea and Samaria area – this too according to the laws of war under international law. Substantively, we must examine under domestic Israeli law whether the Order of Possession was issued lawfully according to the authorities granted to the Government and the military by Basic Law: The Government and by Basic Law: The Military. Customary international law is in any event part of Israeli law to the extent it does not conflict with domestic legislation.

 

The court discussed the Beit El case (HCJ 606/78), in which a civilian settlement was found to comply with Article 52 of the Hague Regulations, which allows taking possession of land “for the needs of the army of occupation”, and held that temporary use of private land is permissible when it is necessary “for all kinds of purposes demanded by the necessities of war.” Here, the Court interpreted military needs to include “ensur[ing] public order and safety” under Article 43 of the Hague Regulations, as well as – under Article 52 – what is necessary for the military in order to fulfill its role in protecting the occupied territory from hostile activity, which may come both from outside and from within. It must be demonstrated, according to the facts of the case, that military needs were those which effectively motivated the decision to build a civilian settlement at the relevant site. The court found that here, the professional opinion by the Chief of the General Staff, in itself, did not lead to the decision to build the settlement of Elon Moreh, but that the propelling force behind the decision of the Ministerial Committee for National Security Affairs and of the Government was actually the strong desire of the people of Gush Emunim to settle the heart of the Land of Israel, as closely as possible to the city of Nablus. Both the Ministerial Committee and the Government majority were determinatively influenced by reasons that are of a Zionist worldview as to the settling of the entire Land of Israel.

 

Military needs, under international law, cannot be construed, by any reasonable interpretation, as including national security needs in their broad sense. Where the needs of the military are concerned, one would expect military officials to initiate the settlement on that particular site, and that the Chief of the General Staff would be the one to bring, according to such initiative, the military’s needs before the Government for approval of the settlement. Here, it is clear that the process was inverted: the initiative came from the political level and the political level reached out to the Chief of the General Staff for his professional opinion. The fact that those charged with assessing the military needs were not those who initiated the process to settle that particular site, but that, instead, their approval of that site was given only after the fact, in response to the initiative of the political level, demonstrates that there, in fact, was no military necessity to take private property in order to build a civilian settlement, as required by the terms of Article 52 of the Hague Regulations. It was not proven that in establishing this civilian settlement, the military preceded the act of settlement with thought and military planning. Instead, the pressure exerted by the people of Gush Emunim was what motivated the Ministerial  Committee. Military considerations were subordinate to the political decision to build the settlement. As such, this does not meet the strict demands of the Hague Regulations as to preferring military needs over the individual’s right to property.

The Court also addressed the issue of how a permanent settlement can be established on land that was possessed only for temporary use. The decision to establish a permanent settlement that is intentionally designed to stand in its location in perpetuity – and even beyond the duration of the military rule in Judea and Samaria – meets an insurmountable legal obstacle, because a military administration cannot create within its territory “facts on the ground” for the purposes of its military needs that were, in advance, intended to exist past the end of the military rule in that area, when the fate of the territory after the end of the military rule is yet unknown.

The concurring opinion by Justice Witkon reiterated that the legal framework is the state authorities’ actions both in light of the domestic (or “municipal” as it is commonly termed in this context) law and in light of international law. There is no dispute that the force of the orders, in terms of the domestic law and really also in terms of customary international law (Hague Convention), is contingent upon their being “for military needs.” Here, however, even the experts charged with state security are divided as to the need for settlement in the relevant location

Basic Law: The Military addresses the order of the chain of command between three bodies – the Government, the Minister of Defense and the Chief of the General Staff. In terms of the hierarchy between them there is indeed no doubt that the Chief of the General Staff is below the Minister and they are both below the Government. But here the question is not whose order trumps, but rather whose opinion is more acceptable to the court.

In such a situation of a draw, when the opinion of the giver of the respondents’ affidavit should not be presumed to be superior to the opinions of other experts, the court asks: who bears the burden of proof? Justice Witkon held that the burden is placed upon the respondents. The law does not give the commander’s assertion that the taking of possession in required for military needs the force of a presumption – let alone that of conclusive evidence – that indeed it is so. Moreover, it is not sufficient that the commander sincerely and subjectively believes that the taking of possession was essential, in order to place the question beyond judicial review. The court need not be convinced of the sincerity of the consideration, but rather of its correctness.

 

The Court must not allow a serious infringement of property rights unless it is satisfied that it is necessary for security purposes. Here, as noted, the Minister of Defense himself was not persuaded this possession was necessary. It is not the court’s business to engage in political or ideological debates; but it is the court’s duty to examine, whether pure security considerations justify taking possession of land for the purposes of settling at that location. To determine this, Justice Witkon thought it important to know what the settlers’ position was. If they were not motivated, primarily, by security purposes, the court struggled to accept that this indeed was the purpose of their settlement.

Included within customary international law are the rules of the Hague Convention, so this Court should examine the lawfulness of the taking of possession in light of Article 52 of the Hague Regulations. Here, too, the test is the military need, and when one is not persuaded such need exists under the criteria of municipal law, one would not be persuaded, in any event, that it exists under the criteria of the Hague Convention either.

The question whether voluntary settlement falls within the prohibition over “transfer[ring] parts” of a “population” for the purposes of Article 49(6) of the Geneva Convention is not easy, and, as far as we know, it has yet to be resolved in international case law.

In his concurring opinion, Justice Bechor found that, had the court reached the conclusion that the military commander operated in this case in order to ensure military needs, and that he initiated that action for the purposes of ensuring such needs, which were the dominant factor in his decision, in light of all the circumstances and the timing as described in detail in the Deputy President’s opinion, he would have endorsed his action. But, as the Deputy President demonstrated in his opinion, the action of the military commander exceeded in this case the limits of its power under international law.

 

Judgment

Deputy President Landau

For this petition, we must consider the legality of establishing a civilian town (settlement) in Elon Moreh, on the outskirts of the city of Nablus, on land that is privately owned by Arab residents. A similar issue was decided by this Court in HCJ 606/78, Suleiman Taufic Ayuv et al. v. the Minister of Defense and 2 Others; Jamil Arsam Mataua and 12 Others v. the Minister of Defense and 3 Others, IsrSC 33(2) 113, 127, 124-129, 128-129, 131, 132-133, 120, 126, 116, 118, 119 (hereinafter for brevity: the Beit El matter), on March 13 1979. We ruled there that the establishment of two civilian towns on private lands in Beit El near Ramallah and in the B Valleys by Tubas violated neither domestic Israeli law nor customary international law, which constitutes part of domestic law, as both towns were established for military purposes, as we interpreted the term.

It was said in the Beit El case (bottom of page 128), in terms of the justiciability of this issue, that the problem of the settlements “is in dispute between the government of Israel and other governments, and that it is liable to be at issue at fateful international negotiations in which the Government of Israel is involved.” Meanwhile, the intensity of the dispute has not since subsided in the international arena; moreover, it has intensified within the Israeli public discourse, as well, as reflected in the very decision to build a civilian settlement in Elon Moreh, which was adopted by a majority vote in the Israeli cabinet. This, therefore is a pressing issue that is hotly debated within the public. In HCJ 58/68, Binyamin Shalit v. Minister of Interior , IsrSC 23(2) 477, 521, 530 (the issue of “who is a Jew”), I wrote (at the bottom of page 521) of “… the grim result in which a court seemingly abandons its rightful place, above the disputes that divide the people, with its justices themselves entering the fray…”, and on page 530, I explained – as one of the minority justices – that the Court must refrain from ruling on the dispute there, when it has no valid source for its ruling. I added that even in such case, “there may be instances where a justice sees himself as compelled to respond with his personal position on matters pertaining to his own worldview, though it is controversial.” This time we have valid sources for our ruling and we need not, and further – must not, when adjudicating, involve our personal views as citizens. Still, there is great concern that the Court might be seen as having abandoned its rightful place in entering the fray of public controversy, and that its decision might be received by part of the public with applause and by the other part with complete and passionate rejection. In this sense, I see myself here as obligated to rule in accordance with the law, in any matter lawfully brought before this Court. That is what compels me, knowing full-well in advance that the public at large would pay no attention to the legal reasoning, but only to the ultimate conclusion, and that the Court, as an institution, could have its rightful stature compromised, beyond the disputes that divide the public. But what can we do? This is our role and this is our duty as justices.

On the morning of June 7, 1979, Israeli citizens, assisted by the Israel Defense Forces (IDF), began to settle on a hill, located about 2 kilometers east of the Jerusalem-Nablus road, and about the same distance south east of the intersection of that road with the road descending from Nablus toward the Jordan Valley. The operation was carried out with the assistance of helicopters and heavy machinery. A road was forged from the Jerusalem-Nablus road to the hill. The entire hill is rocky and undeveloped land (aside from a small plot on the site’s north-west side, which was plowed and planted only recently, and in the opinion of the respondent’s expert, this was done out of season, at a location where there is no prospect of any financial gains from the produce). However, forging the 1.7 kilometer road, required harming the existing sorghum crops, in a territory of about 60 meters long and 8 meters wide, as well as about six four-year-old olive plants.

The hill is located within the lands of the Rujeib village, which is located nearby to the northwest. The seventeen petitioners, who are residents of the village, hold plots registered to their names in the Nablus registry after having gone through a process of land regulation. The total area of their plots is about 125 Dunams. The petitioners hold no rights of ownership in the land of the forged road.

On June 5, 1979, two days before the settlers arrived on the land, Brigadier General Binyamin Ben Eliezer, the Commander of the Judea and Samaria area, signed an Order for the possession of land number 16/79 (hereinafter: “Order of Possession” or “Order of Possession n. 16/79” – ed. note). The heading of the Order of Possession reads: “Under my authority as area commander, and because I believe it to be required for military needs, I hereby order as follows:…”. And in the body of the Order the signer declares a territory of about 700 dunams, defined by a map that was appended to the order, as “possessed for military needs.” Petitioners’ plots are included within this territory. Section 3 of the order stipulates that any lawful owner or holder of the land included in the territory would be permitted to submit, to a Claims Department Officer, a claim for periodical use fees, due to the possession of the land, and for compensation for any real damage caused in the course of the taking of possession. Under section 5, “notice of the contents of the order will be given to owners or holders of land located in the territory.” A similar order pertaining to the terrain of the road to the hill (number 17/79) was signed only on June 10, 1979 – three days after the settlement on the land. As for giving required notice to the land owners, including the petitioners, it turns out that only on the actual day of the settlement on the land, at 8 am, around the time the works on the site began, a notification of the order was given to the leaders (mukhtars) of the Rujeib village, who were summoned to the office of the Nablus military ruler. Written notices were given to the leaders only on June 10, 1979, for delivery to the land owners. In the responding affidavit for this petition, Lieutenant General Raphael Eitan, the Chief of the General Staff, says that it would have been appropriate to give advance notice to the land owners of the intent to possess the land, as is customary as a general rule in similar cases, and that he has instructed that, in the future, such notices be given to the relevant land owners at an appropriate time before the possession of the land. It is unclear why those in charge deviated from the prevailing custom this time. It seems that the arrival on the land was organized,  as if it were a military operation, exploiting the element of surprise, with the intent of preempting the “risk” of this Court’s intervention, as some the land owners had already approached the Court prior to the commencement of the work on the site.

The petitioners approached this Court on June 14, 1979, and on June 20, 1979 an order nisi was granted against the respondents – the Government of Israel, the Minister of Defense, the regional Military Commander of Judea and Samaria, and the Military Commander of Nablus – ordering them, inter alia, to show cause why the Orders of Possession should not be invalidated and why the instruments and structures on the land should not be removed in order to prevent the building of a civilian settlement on the land. Additionally, an interim order was issued to prohibit any additional excavation or construction on the relevant land, as well as the settlement of any additional citizens on it, in addition to those who settled on it before the interim order was granted. This interim order is in effect until today, with certain changes made at the request of the settlers over the course of the hearing of the petition.

In the responding affidavit, the Chief of the General Staff explained that in his opinion establishing a civilian settlement at that location is required for security purposes, and that his position as to the security significance of the territory and the settlement on it was brought to the knowledge of the Ministerial Committee for National Security Affairs,. The Ministerial Committee resolved in its meetings on May 8, 1979 and May 10, 1979 to approve the possession of the land through an Order of Possession for the purposes of building the settlement, and, following these decisions, which were approved by the Cabinet in its meeting on June 3, 1979, the area Commander of Judea and Samaria issued the Order of Possession in question. Lieutenant General Eitan, in his affidavit, elaborated on the important contribution of civilian settlements to the protection of the Jewish population, dating back to before the establishment of the state, as well as during the War of Independence. He discussed the security purposes that these settlements fulfill in terms of regional defense and in terms of the IDF’s organization, both in periods of calm and in times of emergency. With great emphasis, the Chief of the General Staff expressed his unequivocal opinion regarding the importance of regional defense, suggesting serious criticism of those who neglected regional defense, bringing it to an “all time low,” in his words, by the 1973 Yom Kippur war, when the military’s mindset still rested on the laurels of the victory in the Six Day War. However, “after the 1973 War, regional defense was restored to its greatness, which it was denied by hubris and fundamentally wrongful consideration as to its contribution.” Today, the regional defense communities are armed, fortified, and properly trained for their mission to protect the area where they live, and their location on the ground is determined with consideration for their contribution to controlling the area and assisting the IDF in its various missions. The Chief of the General Staff explained the unique importance attributed to a civilian settlement, as opposed to a military base, because in war time, the military units may leave the base for the purposes of executing mobile missions or attacks, whereas the civilian settlement remains in its place. Being properly armed, it controls its surroundings, in observation and protection of nearby traffic arteries, in order to prevent the enemy from seizing control. This is particularly pertinent when reserves are recruited in a time of war – and in this case, in a time of war on the eastern front. At such a time, the military units must move toward their designated locations, which are spread out. The import of controlling traffic arteries in order to ensure quick and uninterrupted movement, therefore grows. Nablus and its surroundings sit at an irreplaceable crossroad, rendering control of nearby roads especially important. Elon Moreh sits over a number of such roads; these are the Ramallah-Nablus road, the Nablus-Valley road through Jiftlik, and an additional road to the Valley through Aqraba and Majdal, which also runs close by to the south.

There is no doubt, and even the petitioners’ attorneys – Mr. Elias Khouri on behalf of petitioners 1-16 and the respected sirs A. Zichroni and A. Feldman for petitioner 17 – do not dispute, that Lieutenant General Eitan is absolutely sincere and deeply convinced of his positions, which are a matter of his professional expertise as the highly experienced military man that he is. But he does not conceal that there is dispute over his conclusion as to the crucial importance of building a civilian settlement on the site chosen for Elon Moreh. In paragraph 23(d) of his affidavit he says as follows:

“I am aware of the opinion of respondent no 2, who does not dispute the strategic significance of the relevant area, but believes that security needs may be met in ways other than a settlement at the relevant site.”

Respondent no. 2 is the Minister of Defense. An usual circumstance has arisen in which the respondents themselves hold diverging opinions on the subject matter of the petition, such that the Chief of the General Staff’s affidavit must be viewed as representing the opinions, both of the military authorities as well as of the Israeli Government, which decided this matter by a majority vote on an appeal submitted by the Deputy Prime Minister challenging a decision by a ministerial committee (the Deputy Prime Minister too, like the Minister of Defense, is a clear authority on military matters, having previously served as the second Chief of General Staff of the IDF). The petitioners were also permitted to submit additional expert opinions, one by Lieutenant General (Res.) Haim Bar-Lev, and the other by Major General (Res.) Mattityahu Peled. Lieutenant General (Res.) Bar-Lev expressed his professional assessment that Elon Moreh does not contribute to Israel’s security as it is unhelpful, both in combatting acts of terror and sabotage in times of calm, as well as in times of war on the eastern front, because a civilian settlement located on a hill about 2 kilometers from the Nablus-Jerusalem road cannot facilitate securing this traffic artery, and in any event there is a large military base located close to the road itself, which controls central traffic arteries to the south and to the east. In fact, according to Lieutenant General (Res.) Bar-Lev, hostile activity against the settlement during wartime, would necessitate the deployment of forces to secure the settlement, at the expense of engaging those forces in combat with enemy forces. The apparent response to these misgivings in Lieutenant General Eitan’s affidavit is that the primary significance of a civilian settlement on the relevant site is not for the purposes of combating hostile terrorist activity, and that this was not the Chief of the General Staff’s reason for taking possession of the site, but that the main importance may be revealed specifically during wartime, because, in war, the very  base that Lieutenant Bar-Lev speaks of would be vacated, and that there is no comparison between a civilian settlement that is currently integrated into the regional defense strategy and  the civilian settlements of the past, in terms of the quality of its ammunition, equipment and level of training. The opinion of Major General (Res.) M. Peled is detailed and his conclusion is that “the argument as to the security value attributed to the ‘Elon Moreh’ settlement is made in the absence of good faith and for one purpose alone – to justify taking possession of land that cannot be justified otherwise.” I did not find in Peled’s opinion any discussion of Lieutenant General Eitan’s primary reason, that is the role of a settlement located in the relevant area to safeguard the freedom of movement on nearby roads as reserves forces are spread along the eastern front during wartime. As for the opinion of Lieutenant General Bar-Lev and other military experts who share his position, I have no intention to insert myself between experts. It will suffice for me to say here, too, as we said in HCJ 258/79 (unpublished) as follows:

“In such a dispute regarding military-professional questions, in which the Court has no well founded knowledge of its own, the witness of respondents, who speaks for those actually responsible for the preservation of security in the administered territories and within the Green Line, shall benefit from the assumption that his professional reasons are sincere reasons.  Very convincing evidence is necessary in order to negate this assumption.”

 

And it was also said there that:

“In matters of professional military assessment, the Government would surely guide itself primarily by the counsel it receives from the Chief of the General Staff.”

Indeed, we mentioned there the “giver of the respondents’ affidavit,” whereas here the respondents are divided in their opinions. But as we have heard from Mr. Bach, the learned State Attorney, who argued on behalf of respondents 1-4, that despite his difference in opinion, the Minister of Defense accepted the decisions of the cabinet majority and – complying with his constitutional duties as the government-appointed supervisor of the military under section 2 of Basic Law: The Military – passed the Government’s decision on to the Chief of the General Staff for its implementation.

At the core of the discussion in this petition must stand a factual analysis, insofar as these facts have been uncovered by the evidence before us, in light of the law, and particularly in light of our ruling in the Beit El case. But before I turn to that, I must first complete the presentation of the facts themselves, as we have received additional factual material in the Chief of the General Staff’s written response to a questionnaire we drafted, after hearing the main oral arguments by the parties’ attorneys, in order that he respond to it, instead of to an oral cross examination that petitioners’ attorneys sought. The responses to the questionnaire and other documents that the learned State Attorney was permitted to submit shed additional light on the facts of the case, expanding and deepening our understanding and evaluation of these facts, beyond what was included in Lieutenant General Eitan’s affidavit and the first affidavit by Mr. Aryeh Naor, the Government Secretary, which mentioned decisions by the Ministerial Committee for National Security Affairs and by the Government in the Ministers’ Committee’s appeal. The following is the picture that is ultimately revealed:

  1. On January 7, 1979, following an unlawful protest (“an unauthorized protest” as the Government secretary puts it in his affidavit) of people from “Gush Emunim” on a road in the Nablus area, the Ministerial Committee for National Security Affairs convened, resolving the following:
    1. The Government sees the “Elon Moreh” group as a candidate for settlement in the near future.
    2. The date and location of the settlement will be determined by the Government in accordance with appropriate considerations.
    3. When determining the site for the Elon Moreh settlement the Government will take into considerations, to the extent possible, the group’s wishes.
    4. The people of “Elon Moreh” must now return to the camp from which they came.
  2. Following this resolution of the Ministerial Committee for National Security Affairs, representatives of the Ministerial Committee on Settlement Affairs conducted a preliminary tour of the area, in order to find a proper site for the “Elon Moreh” group to settle. Five alternative locations in the area were suggested, each submitted for examination by the IDF. The entities charged with the matter in the Judea and Samaria Area command and at the General Staff examined each of the proposed locations and decided, based on IDF considerations, that two of the suggested locations should be thoroughly explored. One of these locations was a site recommended by the Minister of Agriculture, who is the Chair of the Ministerial Committee on Settlement Affairs and a member of the Ministerial Committee for National Security Affairs. The second site is the site that was ultimately chosen by the IDF and is the subject of this petition (para. 2(d) of the Chief of the General Staff’s answers to the questionnaire.)

The Judea and Samaria Area command examined the possibility of finding some territory in the area that is not privately owned, but no such location was found (Ibid., para. 2(e)).

  1. On April 11, 1979 (likely after the abovementioned preliminary tour and as a result thereof) the Chief of General Staff gave his approval that General Staff authorities charged with the matter take possession of the area for military purposes (Ibid, para. 2(b)).
  2. In anticipation of a hearing that was to be held by the Ministerial Committee for National Security Affairs, the Chief of the General Staff was asked as to his opinion, and on May 3, 1979 he once more notified the above authorities at the General Staff, through his bureau chief, that in his view there is a military need for taking possession of the territory. (Ibid., loc. cit..)
  3. The opinion of the Chief of the General staff was brought to the attention of the Ministerial Committee for National Security Affairs while it discussed the settlement in its session on May 8, 1979 (Ibid., loc. cit., and the first affidavit by the Government Secretary, para. 4.) In that session, the Ministerial Committee for National Security Affairs decided to support the Order of Possession for military necessities (first affidavit by the Government Secretary, para. 3(a)).
  4. On May 30, 1979, the Ministerial Committee for National Security Affairs reaffirmed its decision from May 8, 1979 (Ibid, para. 3(b)).
  5. The Deputy Prime Minister appealed the decision by the Ministerial Committee for National Security Affairs before the Government Cabinet and on June 3, 1979 the Cabinet rejected his appeal by a majority vote and upheld the decision of the Ministerial Committee.
  6. On June 5, 1979 Brigadier General Ben Eliezer signed the Order of Possession, and on June 7, 1979 the settlers arrived on the site, assisted by the military, as recounted above.

Here, I will discuss two arguments by Mr. Zichroni on behalf of petitioner no. 17, in order to dispose of them before delving into the core matters of this petition. He argues that there was a constitutional flaw in the decision-making process in regards to the settlement, because under Basic Law: The Military, the Minister of Defense is the Chief of the General Staff’s superior, so his opinion on military matters is prioritized over the opinion of the Chief of the General Staff, as well as over the opinion of the Ministerial Committee for National Security Affairs and that of the Government itself, both of which operate under Basic Law: The Government. Consequently, the Government (or the Ministerial Committee for National Security Affairs) was unauthorized to decide contrary to the position of the Minister of Defense. This argument must be rejected. Indeed, the Minister of Defense is the supervisor of the military on behalf of the Government under section 2(b) of Basic Law: The Government, but the military is subordinate to the Government as a body, according to section 2(a) of that same Basic Law, and so the Chief of the General Staff is subject to the authority of the Government under section 3(b), though he directly answers to the Minister of Defense, as that same section provides. Therefore, as long as the Government has not decided on a particular matter, the Chief of the General Staff must follow the instructions of the Minister of Defense. However, once a matter was brought before the Government, a decision by the Government binds the Chief of the General Staff, as the Minister of Defense is but one of the members of the Government. As long as he remains a member of the Government he bears, together with his fellow ministers, joint responsibility for its decisions, including decisions made by a majority against his own opinion. Such  is also the case for decisions by ministerial committees appointed by the Government, either as a permanent committee or for a certain issue according to section 27 of Basic Law: The Government, because in the absence of an appeal to the Government, even were an appeal submitted and rejected, the fate of a decision by a ministerial committee is as the fate of a decision by the Government in its meeting, as provided by section 32(c) of the Government Operations Regulations.

The road is now open to discussing the main issue: whether it may be legally justifiable to build a civilian settlement on the relevant site, despite the taking of possession of private property for such purposes. In the Beit El case, we resolved a similar question in the affirmative, both under domestic, municipal Israeli law, as well as under customary international law, because we were persuaded that military needs required building the two civilian settlements in question, on the very sites where they were built. It is self-evident, and Mr. Bach also notified us that this was well explained during the meetings of the government, that this ruling does not constitute the Court’s endorsement of all takings of possession of private land for the purposes of civil settlement in Judea and Samaria, but that for each and every case it must be examined whether military needs – as this term must be interpreted – did indeed justify taking possession of private land.

At the outset of this discussion stands now – unlike in the Beit El case – the argument by two settlers of the “Elon Moreh” site who are the members of the settlers’ council and who were permitted (Motion 568/79) to join this petition as respondents, since Justice Y. Cohen who decided the motion found them to have a material interest in the petition. In their affidavits and pleadings, these additional petitioners painted a broad picture, far beyond what was argued by the original respondents. In the affidavit given by Mr. Menachem Reuven Felix, it was explained that the members of the group settled in Elon Moreh because of the divine commandment to inherit the land given to our forefathers and that “the two elements therefore of our sovereignty and settlement are interlinked” and that “the act of settling the people of Israel in the land of Israel is the act of security that is most real, most efficient, and most true. But the settlement itself… does not stem from security purposes or physical needs but from the force of a calling and from the force of Israel’s return to its homeland.” And he later declares:

“Elon Moreh is located in the heart of hearts of the Land of Israel in the deepest sense of the word, indeed both geographically and strategically, but first and foremost it is the place where this land was first promised to our first forefather and it is the place where the first property of the father of our nation, which this Land – the Land of Israel – is his namesake, was acquired.

Therefore, with all due respect to security considerations, and though its sincerity is not doubted, in our view it neither adds nor detracts.”

And after citing Numbers, 33, 53: “And you shall take possession of the land and settle in it, for I have given you the land to possess”, he adds as follows:

“Whether some of the settlers of Elon Moreh will be incorporated into regional defense according to IDF plans, or not, settling the Land of Israel , which is the calling of the People of Israel and the State of Israel, is in any event in the safety, wellbeing, and in the best interest of the People and of the state.”

Regarding petitioners’ arguments, which are based on international law, including various international treaties, he has adopted an explanation received from his attorney, that international law bears no relevance because the conflict is an internal dispute between the People of Israel returning to their homeland and the Arab residents of the Land of Israel and that this is not an “occupied territory” or “held territory” but the heart of the Land of Israel, our right over which is undisputed, and second – because even factually and historically we are concerned with Judea and Samaria which were part of the British Mandate and were conquered by physical force by our neighbor to the east – an act of conquest and annexure never recognized by anyone (except for England and Pakistan.) This is the crux of the affidavit.

Even those who do not share the views of the giver of the affidavit and his cohort must respect their profound religious faith and the spirit of devotion that motivates them. But we who preside in a state committed to the rule of law, where religious law is applied only to the extent permitted by secular law, must apply the laws of the state. As to the  giver of the affidavit’s views regarding property rights in the land of Israel, I assume he does not mean to say that under Jewish law it is permissible to void the private property, for any reason, of anyone who is not of our religion. After all, our scriptures state explicitly that “the foreigner living among you will be as a citizen and you shall treat him as your own as you were foreigners in the land of Egypt” (Leviticus 19:34.) In the literature submitted to us by the other respondents, I found that the Chief Rabbi, I.Z. Hertz, of blessed memory, mentioned this verse when the British Government solicited his opinion on the draft of the language of the Balfour Declaration. In his response, he said that referencing the civil and religious rights of the non-Jewish communities in the Declaration’s draft was but a translation of that same fundamental principle from the Torah (Palestine Papers 1917-1922, Seeds of Conflicts (John Murray) p. 13). This was the authentic voice of Zionism, which insists upon the Jewish people’s right of return to its homeland that was also recognized by other nations, for instance in the preamble to the Mandate for Palestine, but never sought to strip the residents of the land, members of different peoples, of their civil rights.

This petition includes a compelling response to the argument which seeks to interpret the historical right guaranteed to the People of Israel in the Torah as violating property rights under private property law. After all, the legal framework for deciding this petition is defined first and foremost by the Order of Possession issued by the area commander and this order is, by all accounts, directly grounded in the powers that international law grants a military commander in territories occupied by its forces during a time of war. Additionally, the discussion is framed by the tenets of the law that has been implemented by the Israeli military commander in the Judea and Samaria area – this too according to international humanitarian law. These tenets are found in Proclamation No. 1 published by the military commander on June 7, 1967 whereby on that day the IDF entered the area and assumed control and the establishment of security and order, as well as in Proclamation No. 2 from that day that establishes in its section 2 that:

“The law that applied in the area on June 6, 1967 will remain in effect, to the extent it does not conflict with this Proclamation or any other proclamation or order issued by me and with appropriate changes resulting from establishing the rule of the IDF in the area.”

Also, section 4 of that same proclamation should be mentioned, where the commander of the Judea and Samaria area declared:

“Movable and immovable property… that was owned or registered to the Jordanian Hashemite state or government or a department or agent thereof or any part thereof, located in the area, will be passed into my exclusive possession and will be managed by me.”

These proclamations are the legal basis for the military rule in Judea and Samaria, which still exists there to this day, without having been replaced by another form of rule. Mr. Rahamim Cohen, on behalf of the additional respondents (the people of the Gush Emunim group) directed our attention to the Jurisdiction and Powers Ordinance, 1948, which establishes in section 1 that “any law that applies to the State of Israel in its entirety will be considered to apply to the entire territory which includes the territory of the State of Israel and over the Land of Israel which the Minister of Defense defined by proclamation as being held by the IDF.” Although the Minister of Defense did not issue a proclamation defining Judea and Samaria as occupied by the IDF for the purposes of this section, but – as Mr. R. Cohen says – the main point is that the Provisional State Council, as the sovereign legislature of the State of Israel, authorized the Minister of Defense to issue orders as to any part of the Land of Israel: this mere authorization is testament to the fact that the Provisional State Council as the legislature, saw the State of Israel as sovereign over the entire Land of Israel.

This is a forceful point, but it must be rejected. The fact of the matter is that the Minister of Defense did not issue an order based on his authority under section 1 of the above Ordinance in terms of the area of Judea and Samaria (and the Government of Israel did not even extend the law of the State of Israel onto that area, as it did in terms of East Jerusalem, in a decree based on section 11 of the Law and Administration Ordinance, 1948.) When addressing the legal foundations of Israeli rule over Judea and Samaria, we are concerned with the legal norms actually, and not merely potentially, in effect. The fundamental norms upon which Israeli rule in Judea and Samaria were in fact enacted were and are, as said, to this day, norms of military rule rather than the application of Israeli law, which involves Israeli sovereignty.

Here we must command again to memory, like in previous petitions that came before this court, an important argument that Israel expresses in the international arena. This argument is based on the fact that at the time that the IDF entered Judea and Samaria this area was not held by any sovereign whose possession of it received general international recognition. Mr. Rahamim Cohen reiterated this argument with much force. In the Beit El case I said (on page 127) the following:

“This petition does not require our consideration of this problem, and we therefore join this dispute here to that bundle of disputes which I discussed in HCJ 302/72, 306/72, Sheik Suleman Hsain Udah Abu Hilo v. the Government of Israel; Sheik Sabah Abud Ala Oud Al Salima v. the Government of Israel, IsrSC 27(2) 169, 179, 176, 177, 184, there on page 179 which remain open in this Court.”

I believe that in the petition before us, as well, that it can be resolved only according to the presumption at the basis of the Order of Possession. These presumptions indicate the bounds of the discussion for the additional respondents as well.

We therefore must examine the legal force of the relevant Order of Possession under international law from which the military commander who issued it derives his authority. In addition, we must examine whether the order was issued lawfully under Israeli law, because – as was in the Rafah Approach case (HCJ 302/72, p. 169 on p. 176) – we must assume here, too, that the authority for such review exists personally in regards to officials in a military administration who belong to the state’s executive branch as “people who fulfill public functions under law” and who are subject to the review of this Court under section 7(b)(2) of the CourtsLaw-1957. On the merits, we must examine under domestic Israeli law whether the Order of Possession was issued lawfully according to the powers granted to the Government and the military by Basic Law: The Government and by Basic Law: The Military. In the Beit El case, we conducted each examination – that according to domestic Israeli law and that according to international law –separately. I have already discussed above, according to the mentioned Basic Laws, the argument about the decision making process regarding the possession of the land, taken on the Governmental level. I can now conduct the primary discussion combining the two examinations together, as customary international law is, in any event, part of Israeli law to the extent it does not contradict domestic law (see, the Beit El case, at 129.).

Counsel for all the parties focused their arguments on comparing the matter before us to the facts of the Beit El case and to the ruling there, with one side seeking to reveal the similarities between the two, and the other side emphasizing the distinctions. Mr. Bach added to this and reiterated the non-justiciability claim that he made already in the Beit El case and that was already rejected there in no uncertain terms, in the words of my honorable colleague Justice Witkon (at the top of page 124):

“I was not impressed by this argument whatsoever… assuming – an assumption that indeed was not confirmed in this case – that one’s property was harmed or was completely denied to them, it is hard to believe that a court will wash its hands from that person because their rights may be subject to dispute in a political negotiation. This argument did not add weight to the respondents’ other arguments…”

For my part, I added that (on p. 128-29) although the special aspect of the case requiring interpreting section 49(6) of the Geneva Convention must be seen as non-justiciable, petitioners’ claim is generally justiciable before this court, as it involves property rights. Mr. Bach maintained his argument was misunderstood, because, in this opinion, the matter of justiciability is merely a function of the matter at hand, and the matter is on one hand bitterly controversial politically and on the other hand concerns undeveloped and rocky land at some distance from the Rujeib village itself. And he again quotes an article by Professor Jaffe published in in 74 Harvard Law Review, 1265, pp. 1302-1304.

The argument was well understood even at the time; repeating it does not add to its force. At the time, I excluded section 49(6) of the Geneva Convention from the discussion entirely, because as part of treaty-based international law, it is not binding law in an Israeli Court, but I joined the opinion of my honorable colleague as to the matter’s justiciability in terms of the Hague Regulations, because, as customary international law, they do indeed bind the military administration in Judea and Samaria. I will act similarly here and refrain from discussing the matter before us in terms of section 49(6) of the Geneva Convention. But concerning an individuals’ property rights, we cannot dismiss the matter with a claim of the right’s “relativity.” Under our legal system, the individual’s property right is of significant legal value which is protected by both civil and criminal law, and it does not matter, as far as a land owner’s entitlement to protect their property under law is concerned, whether the land is cultivated or rocky.

The principle of the protection of private property applies also in the laws of armed conflict, as expressed in Article 46 of the Hague Regulations. A military administration that wishes to infringe upon private property rights must demonstrate legal authority and cannot exempt itself from judicial oversite on the grounds of non-justiciability.  

For his part, Mr. Zichroni attempted to distinguish our ruling in the Beit El case, because there the court justified the civilian settlement with military needs tied to combating hostile terrorist activity in times of calm, whereas, here, the Chief of the General Staff emphasizes in this affidavit primarily the military need in a civilian settlement on the relevant site in case of actual war on the eastern front. But there is no basis for this distinction. The Beit El case, too, concerned the needs of regional defense designed to be integrated into the general system of defending the country specifically in times of war – and see the quote from Major General Orly there, at 125, as well as my comment at the top of page 131, that “the military’s powers at times of active war and at times of calm cannot  be strictly distinguished. Even if today there is quiet in the area near Beit El, it is best to take preventative measures.” My honorable colleague, Justice Ben Porat, said this with additional emphasis (Id, at 132-33.) And again in the Matityahu case, HCJ 258/79 (unpublished) on p. 4 of the opinion, we said that such matters cannot be viewed from a static perspective, ignoring what might happen in the future, whether as a result of hostile activity from outside or from within the occupied territory, and proper military planning must account, not just for existing dangers, but also for dangers that might be created as a result of dynamic developments in the area.

The question then circles back: Have respondents demonstrated sufficient legal authority to take possession of the petitioners’ lands? The Order of Possession was issued by a military commander and states at the outset that the Order was issued “under my authority as commander of the area and because I believe it to be required for military needs.” It should be recalled here that in this Order the area commander chose at the outset language that was less determinate than that used in the order given in the Beit El case. The Order of Possession stated that possession of the land where the Beit El base stands, and on whose outskirts the construction of a civilian settlement commenced only eight years later – was “imperatively and overwhelmingly demanded by military needs.” There, we justified the civilian settlement on the basis of Article 52 of the Hague Regulations, which allows taking possession of land “for the needs of the army of occupation.” On page 130 I also referenced the words of Oppenheim who believes that temporary use of private land is permissible when it is necessary “for all kinds of purposes demanded by the necessities of war.” I mentioned the British Manual of Military Law, which supports the temporary use of the privately owned land and buildings for the purposes of “military movements, quartering and the construction of defence positions.”

We also rejected (on page 130) the argument by Mr. Khouri that the phrase “for the needs of the army of occupation” includes only the immediate needs of the military itself, and noted (at the bottom of page 130) that the “primary role of the military in an occupied territory is to ‘ensure…public order and safety,’ as provided by Article 43 of the Hague Regulations. What is necessary for this end, is in any event necessary for the needs of the occupying military in terms of Article 52.” In a similar fashion. we might say here, too, that what is necessary for the military in order to fulfill its role in protecting the occupied territory from hostile activity. which may come from outside and from within, this, too, is necessary for military needs in terms of Article 52.

Thus far I concur with Mr. Bach that possession of privately owned land for the purposes of a civilian settlement is potentially justified under Article 52 of the Hague Regulations  – and we found no other source for this in international law. Under what circumstances? When it is proved, according to the facts of the case, that military needs were those which in practice brought upon the decision to build a civilian settlement at the relevant site. I reiterate that there can be no doubt that according to the professional view of Lieutenant General Eitan, building a civilian settlement at this location accords with the needs of regional defense, which has particular significance in ensuring the safety of the traffic arteries when military forces must disperse at times of war, but I have concluded that the Chief of the General Staff’s professional opinion would not, in itself, have led to the decision to build the settlement of Elon Moreh, but for further reason that was the propelling force behind the decision of the Ministerial Committee for National Security Affairs and of the government cabinet, that is – the strong desire of the people of Gush Emunim to settle the heart of the Land of Israel, as closely as possible to the city of Nablus. As for the discussions in the Ministerial Committee and the cabinet, we could not investigate them through reviewing their minutes, but even without them we have sufficient indication in the evidence before us, that both the Ministerial Committee and the cabinet majority were determinatively influenced by reasons stemming from a Zionist worldview as to the settling of the entire Land of Israel. This worldview is clearly revealed from a notice by Mr. Bach on behalf of the Prime Minister during the Court’s hearing on September 14, 1979, in response to additional respondents’ affidavit in paragraph 6 of his affidavit, to which I called attention during the Court’s hearing on the previous day. I recorded Mr. Bach’s words verbatim, for their significance and the status of the person on whose behalf Mr. Bach spoke, as following:

“I spoke to the Prime Minister yesterday and he authorized me to state, after the matter was raised during yesterday’s session – that on many occasions, in Israel and abroad, the Prime Minister emphasizes the right of the People of Israel to settle in Judea and Samaria and this is not necessarily related to discussions taking place in the Ministerial Committee for National Security Affairs concerning national and state security , when what is up for discussion is a specific matter of taking possession of some site or another for security purposes. In the Prime Minister’s view, these matters are not in conflict, but they are still distinct. As for what was said about the Prime Minister’s intervention, this was in the form of raising the issue for discussion before the Ministerial Committee for National Security Affairs, of which the Prime Minister is the chair and where section 37(a) of the Government Operations Regulations, concerning deliberations of the Ministerial  Committee for National Security Affairs, mandates that the Prime Minister determines the topics on the agenda, by his initiative or at the request of Committee members. He took part of the discussion in the Committee and expressed his clear and unequivocal opinion there in favor of issuing an Order of Possession for the purposes of building that settlement. This, as noted, considering, inter alia, the opinion of the Chief of the General Staff.”

The view as to the People of Israel’s right, which is expressed in these words is based on the tenets of Zionist theory. But the question again before this court in this petition is whether this worldview does indeed justify the taking of private property in a territory that is subject to military administration. As I attempted to clarify, the answer depends on the correct interpretation of Article 52 of the Hague Regulations. I believe that the military needs discussed in this article cannot be construed to include, by any reasonable interpretation, national security needs in their broad sense, as I have just described them. I shall again bring the words of Oppenheim, id., in section 147, at 410:

“According to Article 52 of the Hague Regulations, requisitions may be made from municipalities as well as from inhabitants, but so far only as they are really necessary for the army of occupation. They must not be made in order to supply the belligerent’s general needs.”

Military needs for the purposes of Article 52 may therefore include the needs that the Chief of the General Staff discussed in his responding affidavit, that is the needs of regional defense and of securing traffic arteries to allow reserves forces to disperse uninterruptedly at time of war. At the meetings of the Ministerial Committee the resolution was undertaken “considering inter alia the opinion of the Chief of the General Staff,” in the language of Mr. Bach’s notice (emphasis added – M. L.). The decision of the Ministerial Committee from January 7, 1979 guarantees Gush Emunim that the time and location of the settlement would be decided by the cabinet “in accordance with appropriate considerations,” and that while determining the location for the settlement the government would consider, as much as possible, the wishes of the Elon Moreh group. I would not be mistaken were I to assume that what Mr. Bach said on behalf of the Prime Minister reflects the spirit of the discussion in the Ministerial Committee. I do not doubt that indeed the Chief of the General Staff’s position was among the other factors that the Committee considered. But I believe this to be insufficient in order uphold the decision under Article 52, and these are my reasons:

I.                When it comes to military needs, I would expect that military officials initiate the establishment of a settlement on a particular site, and that the Chief of the General Staff would be the one to bring, according to such initiative, the military’s needs before the political echelon for approval , should it find no political reasons barring it. The Chief of the General Staff’s affidavit of response does seem to indicate that this was the decision-making process. But from the more complete picture that emerged after the Chief of the General Staff responded to the questionnaire presented to him, as well as from the additional documents submitted by Mr. Bach, it was made clear that the process was inverted: the initiative came from the political echelons, which then reached out to the Chief of the General Staff for his professional opinion. The Chief of the General Staff then expressed a positive opinion, in accordance with the conception he has always held. This is entirely clear from the responses of the Chief of the General Staff to the questionnaire, in paragraph 2:

“1. To the best of my knowledge, the body that initiated the settlement in the Nablus area was the Ministerial Committee for National Security Affairs.

2. I did not approach the political echelons with a proposal to build the settlement in Elon Moreh.

3. There was no preexisting plan to build a civilian settlement on the relevant site approved by a competent military authority.”

It also became evident from one of the additional documents that on September 20, 1973 then GOC of the Central Command, Major General Rehavam Ze’evi submitted to the then Chief of the General Staff a detailed proposal for settlement in the occupied territories. The proposal said, in regard to agricultural settlements in Samaria, that it would be “difficult, because of a shortage of available land.” This teaches us that the prevailing view at the time was still that private property ought not be taken for the purposes of settlements. And indeed, Major General Orly argued in July 1978 in HCJ 321/78 (unpublished) (the Nabi Salah case) as follows:

“7. When identifying the location that would be settled near the village of Nabi Salah, those acting on respondents’ behalf were guided by the principle laid out by government policy not to take possession of private property for the purposes of settlement.”

In the petition before us we find something of a change in this position, as the first affidavit by the Government Secretary, in paragraph 5, addresses this matter as follows:

“In response to the petitioners’ claims… as to the Government policy in regard to taking possession of the lands:

  1. I hereby clarify that the policy of the Government of Israel not to seize private lands, to the extent possible and consistent with security needs, still stands.
  2. When the government believes that the security needs requires as such, it approves requisition of private land but instructs the military to exclude from the taken property, to the extent possible, cultivated land.”

As for Major Commander Ze’evi’s plan, it should be noted that his proposals did not gain the approval of any authorized military or civilian body. The plan did include a suggestion to establish a Jewish town in the Nablus area, but not on the site now chosen for the Elon Moreh settlement, though not far from it.

In paragraph 4 of his questionnaire answers, the Chief of the General Staff replies to the question:

“Did you approve a civilian settlement on the relevant site because you believed to begin with that it was necessary there for the purposes of regional defense or because you post facto found that, were a civilian settlement to be established on this site, it would integrate into the system of regional defense?”

With:

“I approved taking possession of the land in question in this petition for purposes of the settlement because this fit the military needs in this area, as I saw them to begin with, and it is consistent with my security approach as to the needs of security and protection of the State of Israel as explained in sections 9-20 of the main affidavit.”

But when the perception of the security needs did not initially bring upon the initiative to settle that same site, but, rather, approval only came retroactively, in response to the initiative of the political echelon – I do not believe that this passive approach indicates that from the beginning there was a military necessity to take private property in order to build a civilian settlement, under the terms of Article 52 of the Hague Regulations. This time, therefore, it was not proven that in building the civilian settlement the military preceded the act of settlement with thought and military planning, as we have said in the Beit El case (on page 126.)

II.              And more on the question of the military necessity: I cited above the language of the decision by the Ministerial Committee for National Security Affairs from its meeting on January 7, 1979, as it was quoted in the Government Secretary’s second affidavit. Recall that those deliberations followed a protest by Gush Emunim on a road in the Nablus area. The resolution stated that “when determining a site for the Elon Moreh settlement, the Government will consider, as much as possible, the wishes of the group,” and, as if as in exchange for this promise, the people of Elon More were required to return to the camp from which they came, that is to end their unlawful demonstration. I see this as clear proof that the pressure by Gush Emunim was what motivated the Ministerial  Committee to address the matter of a civilian settlement in the Nablus area in that meeting. Afterwards, the matter was passed to the Ministerial Committee for Settlement Affairs, in order that it send its representatives on a preliminary tour for the purposes of selecting potential locations for settlement by the “Elon Moreh” group in the Nablus area. These representatives selected five locations and, from among the five, the IDF approved the relevant site. It follows, that the IDF did not take part in selecting those five sites, but was given the opportunity to choose among five sites selected by the political level. This process does not comply with the language of Article 52, which in my opinion requires the advance identification of a particular tract of land, because that specific location is necessary for military needs. And as said, it is natural that the initiative for this would come from the military level that is familiar with military needs and plans them in advance with military forethought.

In this regard, Mr. Bach argued that the military must first consider whether there are candidates for a possible civilian settlement willing to go to the location where their settlement is required for military needs. I agree, but again, this is contingent upon military planning that was approved by a competent military authority that would first search for candidates to settle a particular site. Here the opposite occurred: first came the desire of the Elon Moreh people to settle as closely as possible to the city of Nablus, and only then, due to the pressure they exerted, came the approval by the political level to build the settlement on that site. The political consideration was, therefore, the dominant factor in the Ministerial Committee’s decision to establish a settlement on that location, though I believe that the Committee and the Government majority were persuaded that the settlement fulfills military needs as well, and I therefore accept the Chief of the General Staff’s statement that for his part he did not consider governmental or political factors, including the pressure by the people of Gush Emunim, when he prepared to submit his professional opinion to the political level. But the military consideration was subordinate to the primary, political decision to build the settlement. As such, it does not meet the strict demands of the Hague Regulations for preferring military needs over individual property rights. In other words, would the Government’s decision to build the settlement on that site have been made in the absence of pressure from the Gush Emunim people and ideological and political considerations? I have been persuaded that but for these, the decision would not have been made in the circumstances that existed when it was made.

I wish to add several words regarding dominant and subordinate reasons in state authority decision making. In HCJ 392/72, Emma Berger v. Haifa District Planning and Building Committee, IsrSC 29(2) 764, Justice I. Cohen mentioned the debate around the matter of plurality of purposes as it appears in the third edition of De Smith’s book, Judicial Review of Administrative Action, on page 287 onward. Of the five tests proposed there, Justice Cohen opted for the test of whether the wrongful consideration or purpose had a real impact on the authority’s decision. For my part, I am willing to adopt a test more lenient with the authority, as proposed there by De Smith (top of page 289), which is:

“What was the dominant purpose for which the power was exercised? If the actor pursues two or more purposes where only one is expressly or impliedly permitted, the legality of the act is determined by reference to the dominant purpose.”

(In footnote 74, below the line, the author presents examples from English case law where this principle has been applied).

What I explained at length above reveals which outcome this test’s application must bring in the circumstances of the case before us, when the initiative for the settlement did not come from the military level. Thus. I will quote the words of the author there, on page 291, which seem apt to our matter as well:

“… it is sometimes said that the law is concerned with purposes, but not with motives, this view is untenable in so far as motive and purpose share a common area of meaning. Both are capable of meaning a conscious desire to attain a specific end, or the end that is desired. In these senses an improper motive or purpose may, if it affects the quality of the act, have the effect of rendering invalid what is done.”

III.             And I have yet to address and additional reason that must bring the reversal of the decision to take possession of the petitioners’ land – a reason that stands independently, even without regard to the other reasons I have so far detailed. In the Beit El case a serious question was raised: how could a permanent settlement be founded on land that was possessed only for temporary use? There we accepted Mr. Bach’s reply:

“The civilian settlement may exist in that same location only so long as the IDF still holds the territory under the Order of Possession. This possession itself may end someday as a result of international negotiations that may be culminate in a new agreement that would be valid according to international law which will determine the fate of this settlement, as it would the fate of other settlements located in the occupied territories” (Id, p. 131.)

The settlers themselves did not express their own position in that case, as they were not joined as parties. This time we cannot accept this excuse. Here, the submitter of the affidavit on behalf of the settlers explicitly says in paragraph 6 of this affidavit:

“Supporting an Order for Possession with security considerations in their narrow technical sense, rather than their basic and comprehensive sense, as explained above, has but one meaning: the temporary nature of the settlement and the possibility of its being replaceable. We absolutely reject this terrifying conclusion. It also is inconsistent with the Government’s decision in regard to our settlement in this location. In all the discussions, and many assurances we have received from the ministers of the Government, and above all the Prime Minister himself – and the Order of Possession at hand was issued as a result of the Prime Minister’s personal intervention – they all see the settlement of Elon Moreh a Jewish settlement as permanent as Degania or Netanya.”

It should be noted that this paragraph includes two parts. Its first part considers the position of the settlers; the other part what they have heard from ministers. We were not asked to permit the submission of a countering affidavit by the Government or by any minister to rebut the words attributed to them in the second part of this paragraph and thus we must accept them as truthful. This indeed being the case, the decision to establish a permanent settlement that is intentionally designed to stand in its location for all time – and even beyond the duration of the military rule in Judea and Samaria – meets an insurmountable legal obstacle, because a military administration cannot create within its territory “facts on the ground” for the purposes of its military needs that were in advance intended to exist past the end of the military rule in that area, when the fate of the territory after the end of the military rule is yet unknown. This is seemingly a contradiction that joins the other evidence before us in this petition to reveal that the decisive consideration that motivated the government to decide upon the relevant settlement was not the military consideration. In these circumstances, even a legal declaration as to the taking of possession alone, rather than expropriation of the property, cannot change the face of things – that is taking possession that is the core content of property, in perpetuity.

On the basis of all this, I believe the order nisi must be made absolute, in regard to the petitioners’ lands that were taken under Order n. 16/79.

Justice Asher

I agree.                       

Justice Ben Porat:

I agree.

Justice Witkon:

I too believe that the law is with the petitioners.

Like in the Beit El case (HCJ 606, 610/78,) here, too, we must examine the state authorities’ actions both in light of the “domestic” (or “municipal” as it is commonly termed in this context) law and in light of international law. These are two different issues, and as said in the Beit El case (id, p. 116): “The activity of a military rule in an occupied territory may be justified for military, security purposes and yet it is not out of the question that it is flawed under international law.” The domestic law which is subject to discussion here is the law that is relevant to two orders issued by the commander of the Judea and Samaria area under his powers as a commander in an occupied territory (Order n. 16/79 and Order n. 17/79.) In these Orders the commander stated that he “believes it necessary for military needs…” and he declared that taking possession of the lands is “for military needs.” And indeed, there is no dispute that the force of the orders, in terms of domestic law and really also in terms of customary international law (Hague Convention), is contingent upon their being “for military needs.” We elaborated on the content of “the military need” and the extent of our intervention in the discretion of military authorities in Rafah Approach (HCJ 302/72, Abu Hilo v. The Government of Israel) and in the Beit El case. We emphasized and reiterated that the scope of our intervention is limited. In the Beit El case I said (ibid., page 118) that the authority “is vested in the hands of the military officials, and for the Court to intervene in the exercise of their authority, it must be satisfied that this exercise was an abuse of power and a pretext for other purposes.” Similarly, my honorable colleague the Deputy President wrote as follows, ibid., (p. 126):

“We have repeatedly emphasized before, including in HCJ 302/72 (pp. 177, 179, 184) that the scope of this Court’s intervention in the military considerations of the military administration are very narrow, and a Justice would certainly refrain from substituting his personal beliefs in terms of political and security matters for the military considerations of those charged with securing the State and public order in the occupied territory.”

We additionally clarified in the Beit El case that a military, security need and the establishment of a civilian settlement do not necessarily contradict one another. As we said there (p. 119):

“The main point is that in terms of the pure security consideration it is undisputed that the presence of settlements – even ‘civilian’ settlements – of citizens of the occupying power in the occupied territory significantly contributes to the security in that area and facilitates the military’s ability to perform its duty. One need not be an expert in military and security affairs to understand that hostile elements operate more easily in an area that is only populated by a population that is indifferent or sympathetic to the enemy rather than an area where there are also people who may monitor them and notify the authorities of any suspect activity. Terrorists may not find refuge, assistance or supplies with them. This is simple and needs no elaboration. We will only mention that according to the respondents’ affidavits, the settlers are subject to the military authority, whether officially or due to the circumstances. They are there thanks to the military and its permission. Therefore, I still hold the opinion, that seemed to me correct in the Rafah Approach, case that Jewish settlement in an occupied territory – and as long as a state of belligerency continues to exist – fulfills real security needs.”

It need not be emphasized that with everything we said in these two decisions (and in others like them) we did rule that from that point onwards, any civilian settlement in an occupied territory serves a military purpose. We held that each case must be examined according to its particular circumstances. There, we were persuaded that indeed the taking of possession in order to build a civilian settlement served a security purpose. Here I am not persuaded that such was the purpose.

How is this case different from those that came before? The most important difference, is that here, even the experts charged with state security are divided as to the need for settlement in the relevant location. As they did there, here too security authorities presented us with affidavits meant to persuade us as to the security and military needs for taking possession of the land and building a civilian settlement on it. But whereas there the evidence was consistent and unequivocal, here, in terms of Elon Moreh, the evidence reveals that the experts disagree amongst themselves on the military need. On behalf of the Petitioners, we received the affidavit by Major General (Res.) Mattityahu Peled, as well as the letter by Lieutenant General (Res.) Haim Bar Lev, which ought to be quoted in full:

“To the best of my professional estimation, Elon Moreh does not contribute to the security of the State of Israel, and this for the following reasons:

  1. A civilian settlement located on a hill far removed from main traffic arteries has no significance in combating hostile terrorist activity. The mere location as an isolated island in the heart of an area densely populated by Arab residents may facilitate attempts to attack. Securing travel to and from Elon Moreh and securing the settlement itself would divert security forces from essential missions.
  2. In a case of war on the eastern front, a civilian settlement located on a hill about two kilometers east of the Nablus--Jerusalem road would be unable to ease safeguarding this traffic artery. Moreover, there is a large military base located near the road itself, and it controls the traffic arteries to the south and to the east. Indeed, should there be terrorist activity at time of war, the IDF forces would need to stay in place in order to protect the civilian settlement, rather than focus on combating enemy armies.”

More than this, the petitioners stated in their petition that “according to what they learned from the media, respondent 2 (the Minister of Defense) stated there was no security or military need for the land.” Generally, we do not consider information given to us by rumor, but here is confirmation for the disputing position of the Minister of Defense from the giver of the affidavit himself – the Chief of the General Staff, Mr. Raphael Eitan – who said in section 23(d) of this affidavit:

“I am aware of the opinion of the respondent 2, who does not dispute the strategic importance of the relevant area, but believes that it is possible to realize these security needs by means other than building a settlement on the relevant site.”

This situation, of a dispute between the Minister of Defense and the Chief of the General Staff on the mere need of taking possession, is unprecedented in Israeli jurisprudence, and it is also difficult to find examples in foreign countries for where a judge was required to choose between the opinions of two experts – one being the minister charged with the relevant matter and the other being the person heading the executive mechanism. The State Attorney attempted to overcome this difficulty by relying on section 3(b) of Basic Law: The Military, which reads: “The Chief of the General Staff is subject to the authority of the Government and subordinate to the Minister of Defense.” It is true, argued the State Attorney, that the Chief of the General Staff answers to the Minister, but here the matter was subject to the Government’s decision, where the Minister of Defense was among the minority, and thus his disputing position is overruled by the majority, which accepted the opinion of the Chief of the General Staff. I fear this response by the State Attorney is beside the point. Basic Law: The Military addresses the order of the chain of command between three bodies – the Government, the Minister of Defense, and the Chief of the General Staff. In terms of the hierarchy between them, there is indeed no doubt that the Chief of the General Staff is below the Minister and they are both below the Government. When the Chief of the General Staff receives an order from the Minister that conflicts with other orders he receives from the Government, it is possible – and I do not wish to express my opinion in this regard – that he would be obligated to follow the order of the Government over the orders of the Minister. But here the question is not whose order trumps, but rather whose opinion is more acceptable to the Court. It is possible one (for instance, a judge) may withdraw his opinion in light of that of his peers, but the fact that the Minister accepted the decision of the majority does not lead to a conclusion that he withdrew his opinion. On the contrary, we must assume that he stands by his opinion and has left to us the duty to say which of the opinions – his or that of the Chief of the General Staff – should be accepted.

It is well known that courts are asked to determine matters that require special expertise – expertise that is generally beyond the judges’ grasp. We are presented with opinions by respected experts and these completely contradict one another. This happens frequently in trials concerning medical issues, as well as, for example, in cases involving patent infringements, which raise problems in chemistry, physics or other natural sciences. In security affairs, when the petitioner relies on the opinion of a security expert, while the respondent relies on the opinion of someone who is both an expert and responsible for the state of security in the country, it is only natural that we attribute special weight to the opinion of the latter. As the Deputy President Landau said in the Naalin case, HCJ 258/79 (unpublished): “In such a dispute regarding military-professional questions, in which the Court has no well founded knowledge of its own, the witness of respondents, who speaks for those actually responsible for the preservation of security in the administered territories and within the Green Line, shall benefit from the assumption that his professional reasons are sincere reasons.” According to this rule, I could possibly have seen myself obligated to prefer the opinion of Lieutenant General Eitan over the opinion of Lieutenant General (Ret.) Bar-Lev, though in terms of their expertise, I do not know who is preferable. But when the choice is between the Chief of the General Staff and the Minister of Defense, I believe this rule should not be applied. There is no way to say that one is charged with ensuring safety whereas the other is not. They are both responsible.

In such a situation of a draw, when the opinion of the giver of the respondents’ affidavit should not be presumed to be superior to the opinions of other experts, we must ask ourselves: who bears the burden of proof? Must the petitioners satisfy us that the land was taken for non-military or security purposes, or shall we demand that the respondents – the military authorities – persuade us that this taking of possession was necessary for this purpose? I believe that the burden is upon the respondents. The law does not give the commander’s assertion that the taking of possession is required for military needs the force of a presumption – let alone that of conclusive evidence – that indeed it is so. Moreover, it is not sufficient that the commander sincerely and subjectively believes that the taking of possession was essential, in order to place the question beyond judicial review. We need not be convinced of the sincerity of the consideration, but rather of its correctness (see the well-known dispute Liversidge v. Anderson (1942) A.C. 206; (1941) 3 All E.R. 338; (1942) 110 L.J.K.B. 724; 116 L.T. 1; 58 T.L.R. 35; 85 S.J. 439 (H.L.), and the article by R.F.V. Heuston, L.Q.R. 86, p. 22. And see also: Ridge v. Baldwin (1964) A.C. 40; (1963) 2 W.L.R. 935; 127 J.D. 295; 107 S.J. 313; (1963) 2 All E.R. 66; 61 L.G.R. 396; 79 L.Q.R.  487; 80 L.Q.R. 105; 127 J.P.J. 251; 234 L.T. 423; 37 A.L.J. 140; 113 L.J. 716; (1964) C.L.J. 83 (H.L.)). And in our law, the Kardush case, HCJ 241/60, Mansur Taufik Kardush v. The Registrar of Companies, IsrSC 15, 1151; and FH 16/61, Registrar of Companies v. Mansur Taufik Kardush, IsrSC 16, 1209. The law I presented at the outset conditions the legality of the possession on the existence of a military need. Obviously,  the Court must not allow a serious infringement of property rights unless it is satisfied that this is necessary for security purposes. The State Attorney himself did not claim he is exempt from the burden of persuasion and labored to present us with all of the materials. As said, had we only had before us the evidence on behalf of the respondents, or had the respondents’ experts disputed the petitioners’ experts, I may very well have given the respondents the benefit of the doubt. But here, as noted, we were told that the Minster of Defense, himself, is not persuaded that this possession was necessary. It is true that the office of a minister is a political office and there is no requirement that the minister himself be an expert in military matters. But here we have the dissenting opinion of a Minister of Defense, who, as a former head of the IDF Operations Directorate and former commander of the air force, himself is a prominent security expert. The State Attorney did not dispute this, either. Where such a minister is not persuaded, how can we – the judges – be expected to be persuaded? When he does not see a military need for building a settlement in this particular location, who am I to question him?

This is also the primary reason that brings me to distinguish this case from all the previous cases and to reach a conclusion different from that reached in those cases. This should be coupled with two more things, though of lesser importance. First, in the cases of Rafah Approach and Beit El, my point of departure was that the Israeli settlements, located on lands taken from their Arab owners, were necessary for the security forces in their daily combat against terrorists. “One need not be an expert in military and security matters,” I said in the Beit El case at 119, “in order to understand that terrorist elements operate more easily in a territory populated only by a population that is indifferent or sympathetic to the enemy, than in a territory where there are also people who may monitor them and notify the authorities of any suspect activity. There, terrorists shall not find refuge, assistance and supplies.” This time the Chief of the General Staff, Lieutenant General Eitan, explained to us that the main security benefit in building the settlement on this site is its integration into the system of regional defense in case of a “total” war. I went back to review the affidavit that Major General Tal submitted to us at the time for the Rafah Approach case, and indeed, there, only prevention of terrorist activity at times of calm was discussed. I similarly reviewed the affidavit of Major General Orly in the Beti El case, although I did find – after additional review of the affidavit – that he also spoke of regional defense needs. These considerations were expressed in the opinion of my colleague Justice Landau (there, p. 124). In any event, in that case, two possessed territories were discussed: one actually on potential terrorists’ path, and the other bordering an important military base (Beit El.) There can be no serious doubt that, in terms of their immense strategic value, these sites – and only they – could have fulfilled the designated security role and that they were irreplaceable. Here, on the other hand, I cannot say the matter is free of any doubt.

The third aspect in which the case before us is different than the previous cases is a result of the settlers’ affidavit. Recall that in the Beit El case the settlers were not joined as petitioners and that they were not given the opportunity to voice their arguments. We presumed that their presence in the area was wholly for the purposes of security and defending the homeland. In the words of my honorable colleague the Deputy President (id., p. 127): “… given that the majority of the military is reserves forces, it is well known that at the time of need the residents of peripheral civilian residential areas become, even in personal matters, subject to military command.” And I said (id., at 119): “… the settlers are subject to the military’s authority, whether officially or by virtue of the circumstances. They are there thanks to the military and by its permission. Therefore, I still hold the opinion, that seemed to me correct in the Rafah Approach, case that Jewish settlement in an occupied territory – and as long as a state of belligerency continues to exist – fulfills real security needs.”

This time we heard from the representatives of the settlers themselves, and it seems we must not ignore the heart of their argument. Let me emphasize: I do not wish to address recent events, which revealed the people of “Gush Emunim” (among which the settlers before us are counted) as people who do not accept the authority of the military and do not hesitate to express their resistance through violence. I do not wish to address these events because we do not have certified knowledge as to the level of the support for the actions of others in other locations by the settlers before us. Therefore, I did not come to question that were the settlers to be called upon for reserve duty, they would be subjected to the military’s authority, as would any soldier. Indeed, the words of the giver of the settlers’ affidavit raise a different question. He says, explicitly, that:

“Members of the Elon Moreh group and myself settled in Elon Moreh because we were ‘commanded to inherit the land given by God to our forefathers, Abraham, Isaac and Jacob and we shall not leave it to other nations or in desolation’ (the Rambam, Book of Commandments.) The two elements, therefore, of our forefathers and our settlement are interwoven with each other.”

He adds and says in that same affidavit:

“Though superficially it seems that there is no link between the motivations of the settlers and the Order of Possession, the truth is that the act of settling the Land of Israel by the People of Israel is actually the real and most efficient security activity. But settlement itself, as inferred from the previous section, is not the product of security reasons and physical needs, but of destiny and of the return of Israel to its homeland.”

It is true that the settlers do not rule out the security considerations but that these are, as they maintain, secondary and completely insignificant. They state in their affidavit:

“Therefore, with all due respect to security considerations, and though its sincerity is not doubted, in our view it neither adds nor detracts.”

Very strong words indeed. Needless to say, the settlers deserve praise for their candor that did not allow them to pretend or to conceal their true motives. But the question plagues me: these settlers, who openly declare that they came to settle Elon Moreh not out of security considerations, and whose contribution to security – to the extent it is positive – is but a byproduct, could it still be said of them, as I said in the Beit El case, that they are there thanks to the military and by its permission? Of course, one can act to benefit another without the latter’s knowledge or involvement, but a privilege or benefit that the beneficiary rejects wholeheartedly, can we enforce it upon him? And let it be clear: without any dispute over the words of my honorable colleague Justice Landau, for my part, I need not argue with the settlers over their religious or nationalist ideology. It is not our business to engage in political or ideological debates. But it is our duty to examine whether pure security considerations justify taking possession of land for the purposes of settling these settlers at that location, and it seems to me that in this context, it is important to know what the settlers’ position is. If they did not come, primarily, for security purposes, I am hard pressed to accept that this indeed is the purpose of their settlement.

It remains for me to briefly address another argument by the settlers. In their view, Judea and Samaria should not be considered to be an “occupied territory” subject to IDF rule, but as part of the State of Israel. They rely, first and foremost, on the historical destiny of the Land of Israel, and in addition, in terms of the law, they claim that when the land was conquered during the Six Day War there was no other sovereign that lawfully held this area. The claim is familiar from the writings of Professor Blum (3 Isr. L. Rev. 279, 293) and was also positively considered by Professor J. Stone (see No Peace No War in the Middle East, published in Australia in 1969). The settlers’ attorney also mentioned the fact that the Israeli legislature never defined the state’s borders and only stipulated in section 1 of the Jurisdiction and Powers Ordinance, 1948, that “any law that applies to the State of Israel in its entirety will be considered to apply to the entire territory which includes the territory of the State of Israel and over the Land of Israel which the Minister of Defense defined by proclamation as being held by the IDF.” He also referenced the amendment to the Law and Administration Ordinance, 1967 (and see in this regard Professor A. Rubinstein, The Constitutional Law of the State of Israel, 1969, p. 46). The implication of this claim is twofold. If it concerns an act that occurs within the territories of the state, surely international law does not apply to it, but then military regulations and orders issued under such regulations are invalid in the area that is part of the state. The State Attorney replied correctly that if the settlers arrived at the site other than by force of the Order of Possession issued by the area commander, their entire presence there is without basis. After all, there was no dispossession under Israeli law here. This response is rooted in good law. Additionally, were there serious doubt as to the status of the relevant area, we would have been compelled to approach the Minister of Foreign Affairs and request an official document that defines the area’s status. This question is not “justiciable” and in such matters the Court must follow Government decisions.

This settles the issues of domestic, municipal law. Because in light of the material before us I am not persuaded that the taking of possession was justified under municipal law, I need not actually examine the legality of the taking of possession under international law as well. But lest my refraining from discussing this aspect be misunderstood, I shall add several comments. The issue is legally complex and warrants clarification. As said in the Beit El case, there is a distinction between customary international law and treaty-based international law. The former is part of the municipal law, whereas the latter is not, unless it has been ratified through national legislation. Included within customary international law are the rules of the Hague Convention, so this Court should examine the lawfulness of the taking of possession in light of Article 52 of the Hague Regulations, as did my honorable colleague, the Deputy President. Here, too, the test is the military need. If one is not persuaded such need exists under the criteria of municipal law, one would not be persuaded, in any event, that it exists under the criteria of the Hague Convention either. On the other hand, the Geneva Convention must be seen as part of treaty-based international law and therefore – under the approach common in common law countries as well as in our system – the injured party has no standing to approach the court of the country against whose government he wishes to raise claims and assert his rights. Such standing is given only to states that are parties to the Convention. Such litigation cannot be conducted in a state court but only in an international forum. Therefore, I said in the Rafah Approach case and reiterated in the Beit El case, any expression of opinion on our part as to the lawfulness of the civilian settlement under the Geneva Convention is merely a non-binding opinion, from which a judge would do well to refrain.

Any yet, here too, the State Attorney invites us to affirm to the authorities that under the Geneva Convention, as well, there is nothing wrong in granting the settlers possession of the land for the purposes of their settlement. As his argument goes, this is not inconsistent with the humanitarian provisions of this Convention that are acceptable to the State of Israel. Recall, we are concerned with Article 49(6) of the Geneva Convention, which prohibits the occupying nation from deporting or transferring parts of its civilian population into the occupied territory. It is a mistake to think (as I have recently read in one of the newspapers) that the Geneva Convention does not apply to Judea and Samaria. It does apply, though, as noted above, it is not “justiciable” in this Court. Nor would I say that the “humanitarian” provisions of the Convention address only protecting human life, health, liberty, or dignity, and not property. No one knows the value of land as we do. But the question whether voluntary settlement falls within the prohibition over “transfer[ring] parts” of a “population” for the purposes of section 49(6) of the Geneva Convention is not easy, and as far as we know, it has yet to be resolved in international case law. Therefore, I prefer, here too, not to settle this matter; moreover, in light of the conclusion I reached on the matter, both under domestic law and under customary international law (Article 52 of the Hague Convention), it requires no determination. But my refraining from determination must not be interpreted as support for either of the parties.

For these reasons – in addition to those detailed by my honorable colleague the Deputy President – I believe the order must be made absolute.

 

Justice Bechor:

I concur with the comprehensive opinion of my honorable colleague the Deputy President (Landau), which contains a thoughtful and persuasive response to some hesitations I had in the matter.

Both the military commander and the Government acted in this case by virtue of the powers international law grants to a military which, as a result of hostilities, occupies a territory that is not part of the state to which the law of the land applies (the municipal law). As my honorable colleague demonstrated, we must adjudicate this case according to the law that applies to the issue and that governed the actions of both the government and the military commander. It is not within our authority to consider policy questions or questions rooted in religious belief or a national and historical worldview. And this is a limit that we must not, and may not, exceed, whatever our personal beliefs and worldviews. The actual language of the Order issued by the military commander is rooted in the powers that international law grants a military that occupies a territory that is not – legally – part of the state’s territory. On this basis then the decision must be made.

My honorable colleague, Justice Witkon, in his opinion, extensively discussed the matter of the disagreement between the Chief of the General Staff and the Minister of Defense. In my opinion, this question, too, has been answered in the opinion of the Deputy President (Landau). In this matter, we must distinguish between the military commander’s decision, within his power under international law, and the power of the Minister of Defense and of the Government, under municipal law. When the discussion revolves around international law, the test is whether the military commander operated out of military reasons in order to ensure the military goal. This is a matter for the military commander, and, in this regard, the opinion of the ministerial level is insignificant, as the power under international law is granted to the military commander alone and not to the minister of defense or to the government. Where the military commander acted within his power, there is no flaw in the exercise of this power, even if the ministerial level, in this case the Minister of Defense, is of a different opinion. It is another situation entirely, when the broader question of the municipal law level arises. On this level, the opinion of the military command is the first port of call but is not the end all be all. On this level, as my colleagues said, the Chief of the General Staff is “subject to the authority of the Government and subordinate to the Minister of Defense”. It is true that the Minister of Defense holds a different opinion than the Chief of the General Staff in this matter, but on the policy level, even the opinion of the Minister of Defense is not the end all be all either, and – as reflected by the words of the Deputy President – the final word is that of the Government.

Had we reached the conclusion that the military commander operated in this case in order to ensure military needs, and that he initiated that action for the purposes of ensuring such needs which were the dominant factor in his decision, in light of all the circumstances and the timing as described in detail in the Deputy President’s opinion, I would not be hard pressed to approve his action, though other opinions – even contradictory ones – exist and though even the opinion of the Minister of Defense differs. But, as the Deputy President demonstrated in his opinion, the action of the military commander in this case exceeded the limits of his powers under international law.

The Deputy President also addressed the question arising from the contradiction between taking possession of the land for military needs, which is temporary, and building a civilian settlement as a permanent settlement. It is well known that civilian settlement has always constituted an integral part of the system of regional defense, within a broader system of regional civil defense, and things to this effect were said also in HCJ 606+610/78, Beit El, and HCJ 258/79, Matityahu. We must distinguish here between two things. Integrating the civilian settlements in the system of regional defense began many years ago, even before the founding of the state, and continued after the state was founded within the state’s territory. In all this time, there has always been the premise that the civilian settlements were permanent settlements and this was of no legal flaw because the settlement followed the founding of the state in territory that was within the territory to which state law applied. Even in the time before the founding of the state the intention was always that such settlement would be permanent settlement on land owned by the settling institutions. Here, we are concerned with temporary possession, and thus the contradiction between it and creating permanent settlements. This question was made more poignant in this petition for the first time, perhaps primarily because respondents 5 and 6 were joined, and because of their clear position.

As noted, I join the opinion of the Deputy President (Landau).

 

It was decided to render the order nisi absolute and declare the Order of Possession n. 16/79 invalid in terms of the lands owned by the petitioners, whose registration details were brought in paragraph 2 of the petition, and to order the respondents 1-4 to vacate from the petitioners’ lands the civilian settlers who settled on them as well as any structure built upon them and any object brought to them. There is no place to issue any order in terms of the road lands taken under Order n. 17/79, as none of the petitioners hold any ownership rights for the road lands.

We grant respondents 1-4 30 days from today in order to comply with the permanent order.

Respondents 1-4 will pay petitioners 1-16 their expenses in this petition, at a total sum of 5,000 Israeli Pounds, and that same amount to petitioner 17. There is no order as to costs for respondents 5 and 6.

Given today, 1 Cheshvan 5740 (October 10, 1979).

                 

 

 

Seedis v. Seedis

Case/docket number: 
Special Tribunal 1/50
Date Decided: 
Wednesday, July 28, 1954
Decision Type: 
Appellate
Abstract: 

In a suit between husband and wife before a Rabbinical Court, it was held that the husband by virtue of a usufruct accorded to the husband by Jewish law, was entitled to receive the rent of a certain property registered in the Lands Registry in the wife's name. The Rabbinical Court had purported to exercise jurisdiction under Article 51 and 53 of the Palestine Order in Council, 1922, in terms of which "suits regarding marriage" or "matters of marriage" are within the exclusive jurisdiction of the religious courts. The wife petitioned the High Court of Justice to restrain the levy of execution on the property referred to, and as the matter related to the jurisdiction of the religious courts, it was referred by the High Court of Justice to the Special Tribunal constituted under s. 55 of the Order in Council.

           

It was held by the Special Tribunal that the expressions "suits regarding marriage" and "matters of marriage" referred to above are not restricted to suits or matters concerning the existence of the marriage tie, but also cover claims for the enforcement of rights, including rights to property, which are derived from the status of marriage, and that the Rabbinical Court, therefore, had correctly assumed jurisdiction in the present case.

Voting Justices: 
Primary Author
majority opinion
majority opinion
majority opinion
Full text of the opinion: 

Special Tribunal 1/50

 

           

ESTHER SEEDIS

v.

CHIEF EXECUTION OFFICER AND SHMUEL SEEDIS

 

 

In the Supreme Court sitting as a Special Tribunal under Article 55

of the Palestine Order in Council, 1922.

[July 28,1954]

Before Agranat J., Landau J., and Rabbi  Y. Hochman 1)

 

 

Family Law - Husband and wife - Income from wife's property during marriage - "Matter of marriage" - "Suits regarding marriage" - Palestine Order in Council, 1922, Articles 51 and 53 - Jurisdiction - Rabbinical Courts.

 

 

 

            In a suit between husband and wife before a Rabbinical Court, it was held that the husband by virtue of a usufruct accorded to the husband by Jewish law, was entitled to receive the rent of a certain property registered in the Lands Registry in the wife's name. The Rabbinical Court had purported to exercise jurisdiction under Article 51 and 53 of the Palestine Order in Council, 1922, in terms of which "suits regarding marriage" or "matters of marriage" are within the exclusive jurisdiction of the religious courts. The wife petitioned the High Court of Justice to restrain the levy of execution on the property referred to, and as the matter related to the jurisdiction of the religious courts, it was referred by the High Court of Justice to the Special Tribunal constituted under s. 55 of the Order in Council.

           

            It was held by the Special Tribunal that the expressions "suits regarding marriage" and "matters of marriage" referred to above are not restricted to suits or matters concerning the existence of the marriage tie, but also cover claims for the enforcement of rights, including rights to property, which are derived from the status of marriage, and that the Rabbinical Court, therefore, had correctly assumed jurisdiction in the present case.

           

Palestine cases referred to:

 

(1)   S.T. 1/28 - Hayeh Sarah Alpert v. Chief Execution Officer, Jerusalem and Others ; (1920-1933), 1 P.L.R. 395.

(2)   C.A. 240/37 - Palestine Mercantile Bank Ltd. v. Jacob Fryman and Another ; (1938), 5 P.L.R. 159.

(3)   C.A. 72/31 - Ibrahim Elias Nasr v. Nijmeh Elias Nasr; (1920-1933), 1 P.L.R. 648.

           

Israel cases referred to :

 

(4)   H.C. 116/49 - Esther Seedis v. Chief Execution Officer, District Court, Jerusalem ; (1950). 4 P.D. 266.

(5) C.A. 376/46 - Aharon Rosenboim v. Yona Miriam Rosenboim; (1950), 2 P.E. 5.

(6) C.A. 16/45 - Yosef Albrance v. Yohanan Shmeterling ; (1950), 4 P.D. 573.

(7) C.A. 26/51 - Shimon Cotik v. Tsila (Tsipa) Wolfson ; (1951), 5 P.D. 1341.

(8) S.T. 1/49 - Aharon Rosenbaum v. Sheina Miriam Rosenbaum ; (1953), 7 P.D. 1037.

(9)   C.C. 367/49 - Malka Zilbershtein v. Yohan (Yohanan) Zilbershtein ; (1950/51), 3 P.M. 137.

 

English cases referred to:

 

(10) Parapano and Others v. Happaz and Others ; [1894] A.C. 165.

(11) In re Martin, Loustalan v. Loustalan ; [1900] P. 211.

 

Cyprus case referred to :

 

(12) Despinou Theophilo v. Haralamba Abraam ; (1895), 3 C.L.R. 236.

           

Levitsky and Mack for the petitioner.

Mizrahi for the respondents.

 

AGRANAT, J. giving the judgment of the court. The question we have to answer is whether the Rabbinical Court, at the time it heard this case, had exclusive jurisdiction to determine the claim of a husband to compel his wife to hand over to him the income of her property of the kind known in Jewish law as nichsei melog1). We say "at the time" because counsel for both parties agreed that in view of section 2 of the Women's Equal Rights Law, 1951, the institution of "nichsei melog" has no further place in Israel substantive law.

 

            This question has been referred to us for consideration by the High Court of Justice after it had been petitioned by the wife in the case of Esther Seedis v. Chief Execution Officer, Jerusalem (4), for an order restraining the Chief Execution Officer from enforcing the judgment of the Rabbinical Court which was given on June 22, 1947. This judgment was to the effect that the wife's property and its income were charged according to Jewish religious law in favour of the husband ; that the husband was entitled to collect from the tenants the rent of a house at 16, Ben Yehuda Street, Jerusalem, which was registered at the Land Registry, Jerusalem, in the name of the wife: and that "the wife could do nothing to prevent him".

 

            We should note at once, however - and counsel for the husband has not contested this - that the judgment of the Rabbinical Court cannot be made effective because of the provisions of Section 10 of the Jurisdiction of Rabbinical Courts (Marriage and Divorce) Law, 1953. There are two reasons for this:

           

(a) The judgment was given before the State came into existence ;

 

(b) The judgment was given in the wife's absence.

 

            For the purpose of our decision we assume - and counsel for the parties have not claimed otherwise - that at the time the claim was entered the parties were members of the Jewish Community and Palestinian citizens.

           

            The High Court in its judgment (4) summarised the contentions of the parties with regard to jurisdiction as follows : -

           

            "Counsel for the husband claimed that enjoyment of the income of nichsei melog was one of four things to which a husband became entitled on marriage, that this right was therefore the result of the marriage tie and that consequently the claim to enforce it was the same kind of claim as was included in Article 53(1) of the Palestine Order in Council, 1922, under the term 'matters of marriage' ; that, furthermore, the Rabbinical Court gave to its judgment the heading of 'Disputes in a matter of marriage'. To this the answer of counsel for the wife was that Article 53(1) mentioned 'matters of marriage' and not 'matters resulting from marriage' nor 'matters connected with marriage'. This meant that if it were correct to consider the right of a husband to the income of nichsei melog as a matter resulting from marriage, then a claim to enforce this right was not the same as 'a matter of marriage' but a matter which came under the law of property - and as far as personal status was concerned, it was neither important nor essential but of secondary consideration, and for that reason Article 53 (l) did not apply to such a claim at all."

 

            Counsel for the parties again repeated these arguments in this court. Mr. Levitsky for the wife, however, added a new point. He said that even if this kind of claim must be considered in law to belong to "matters of personal status", although it was not included in the definition contained in Article 51 of the Order in Council, still it was not a "matter of marriage" nor was it one of the matters which were subject to the sole jurisdiction of the Rabbinical Courts as provided in Article 53(1), in which case it might be that the Rabbinical Courts would have jurisdiction to deal with the husband's claim to the income of nichsei melog but that this jurisdiction was subject to the consent of the parties and consequently was not exclusive.

           

            Further, Mr. Levitsky relied on three judgments : -

(a) that of Cheshin, J. in Rosenboim v. Rosenboim (5) ;

(b) that of Olshan, J. in Albrance v. Shmeterling (6) ; and

(c) that of Kennet, J. in Zilbershtein v. Zilbershtein (9).

 

            We should like, first of all, to discuss the problem whether, for the purpose of deciding the question of jurisdiction, it is necessary to consider this kind of claim as a matter of personal status, assuming that the institution of nichsei melog was not one of the matters that was included in the definition in Article 51. This question was referred to by Silberg, J. in the case of Cotik v. Wolfson (7), but was not decided as it was not necessary to do so. In our opinion the clear language of the second sentence of Article 51(1) of the Palestine Order in Council, 1922 - and particularly the word "means" - leaves no doubt that with regard to status the provisions of this section create a numerus clausus, as Silberg J. aptly puts it.

           

            Also in Article 47, where the legislator conferred jurisdiction on the civil courts in matters of personal status, he emphasised the words "as defined in Article 51". Hence when the legislator apportioned, in the Palestine Order in Council, the jurisdiction of the courts in matters of personal status between the civil courts on the one hand and the religious courts on the other, he meant this to be only in respect of those matters which were set out in Article 51 and no others.

 

            The conclusion, therefore, is that if it is at all possible to consider the claim for the income of nichsei melog as a matter of personal status, then this is only because it is included in the term "suits regarding marriage" in Article 51(1) or in the term "matters of marriage" in Article 53(1).

           

            But before we answer the question whether these terms would also cover matters connected with nichsei melog, it would be as well to explain shortly the nature of this institution. When a man marries he becomes entitled, according to Jewish law, to the income of two kinds of property belonging to his wife, (a) nichsei tzon barzel and (b) nichsei melog. Nichsei tson barzel comprise property which the wife brings as dowry to her husband and for the safety of the capital of which he remains responsible. As the Shulhan Aruh puts it: "If they are lost, it is his loss - and if they increase, it is his increase. Similarly if they depreciate or are stolen - the loss is his." (Shulhan Aruh, Even Ha-Ezer, 85, B.) Property which the wife brings to the husband does not become nichsei tson barzel so as to make the husband liable for it "unless its value had been assessed in a definite sum of money or he had expressly assumed responsibility for it" (ibid., C.). Nichsei melog, on the other hand, comprise property for which the husband is not responsible and the income of which he is entitled to enjoy. Should the capital decrease or increase, the loss or the profit will be that of the wife. ("Should they be lost, or increase, or depreciate or be stolen - it is she who benefits or loses, as the husband is entitled to receive only the income" (ibid., B).)

           

            With regard to claims from third parties to the income of either kind of property, the husband is entitled to institute the same even without the express authority of his wife. (Tur, Even Ha-Ezer, 85.)

           

            And finally one has to distinguish, of course, between property which the wife brings to her husband as explained above and property which she keeps under her sole control in consequence of arrangements to that effect made between herself and her husband.

           

            As we have already indicated, the problem before us is reduced to the question whether the claim of the husband to the income of his wife's nichsei melog should be considered in law as a "suit regarding marriage" or as a "matter of marriage". If that was the intention of the legislator, he would have done well had he given a separate heading to the definition in Article 51(1) as for instance "effects of the marriage" or "matrimonial property" - expressions usually used for the purpose of classification in private international law (see Wolff, Private International Law, 2nd Edition, p. 146, Lorenzen, Selected Papers on Conflict of Laws, p. 88) - or, as counsel for the wife suggested, "matters arising from marriage" or "connected with marriage" or the like.

 

            While this is a consideration which weighs heavily with us in favour of the wife, we do not consider it decisive. For it is inconceivable that the legislator also intended to exclude from the general connotation of the expression "matters of marriage" claims for restitution of conjugal rights and such claims are certainly in respect of rights resulting from or connected with marriage.

           

            The truth of the matter is that the interpretation of the term "matter of marriage" which is found in Article 53(1) must not be so restricted as to exclude a claim for a right resulting from the status of marriage, that is to say, it must not be restricted to matters that concern the one and only question, namely, the existence or nonexistence of the marriage tie. In other words we must conclude that the term "matter of marriage" has a wider and more comprehensive meaning than that conveyed by the sole word "marriage" and that it also covers claims for rights which certainly come into being as a result of the marriage tie and which give content and significance to the status of marriage.

           

            When we put the problem in this light to Mr. Levitsky, he gave us a twofold answer: (a) That one cannot consider rights which are created by the marriage tie and which have a direct bearing on the married life of the couple, such as conjugal and maintenance rights, as being the same as rights which are essentially in respect of claims for money or property pure and simple even though they too are the result of the marriage status ; (b) that in any event when the legislator intended to grant jurisdiction in a matter of money to the Rabbinical Courts, he gave a separate heading to it and used the word "alimony", therefore it must be presumed that he, the legislator, did not intend to grant jurisdiction to these courts in other matters relating to money or property.

           

            We are of the opinion that neither of these answers solves our problem. As to the first one has to remember that on the one hand it is possible to consider even rights to money or property as having a direct influence on the marriage and it was for just this very reason that these rights were granted by various laws either to the husband or to the wife according to the particular point of view of the legislator of the law applicable ; and this is also the view of Jewish law. The Levush. 85, 17. (Rabbi Mordechai Yaffe) says as follows: -

           

"Should the husband wish to part with (literally : sell) land which belongs to the nichsei melog of the wife, for several years at a yearly income all of which he proposes to receive in advance, he will not be permitted to do so..... 'because of the welfare of her home'. This means that her interests are better served by the land remaining with him and that he should receive a small income yearly in order that the expenses of the home should be adequately provided for.... "

            (See also Tur, Even Ha-Ezer, 85.)

           

            On the other hand, the payment of alimony to a wife, during her husband's desertion, whilst she is living apart from him, need not necessarily have any influence on the married life of the couple.

           

            From the point of view of jurisdiction therefore it is difficult to find a logical basis for the distinction between the right to payment of money such as in the nature of alimony and the right to payment of money or to property on a different claim which arises in favour of a husband or wife from the marriage itself. The common feature is that both are claims for the fulfillment of obligations arising from the status of marriage.

           

            The second answer which was suggested by counsel for the wife is more weighty, but again it is not sufficient to turn the scales in her favour. This is because it may well be said that the special emphasis on the term "alimony" was made in the wording of the Article so as to distinguish payments due on account of alimony from those due on account of maintenance. Indeed even if the legislator had not specifically used the term "alimony" we would have been obliged, in the words of Assaf, J. in the case of Rosenboim v. Rosenboim (5), "to consider as a matter of marriage the money which a husband is bound to give to his wife for her upkeep..... because it is one of the main obligations resulting from marriage". To this Olshan, J. also agreed in the case of Albrance v. Shmeterling (6).

 

            Similarly in the case of Alpert v. Chief Execution Officer (l), the Special Tribunal held that the claim of a widow for maintenance from the husband's estate was a "matter of marriage" because her right to "maintenance" resulted from the marriage "and that it was therefore within the exclusive jurisdiction of the Rabbinical Court." Clearly, this interpretation completely contradicts the contention of Mr. Levitsky that monetary rights cannot be included amongst the claims that are within the exclusive jurisdiction of the Rabbinical Court because they were not specifically mentioned in the Order in Council. Indeed, Mr. Levitsky was not unaware of this contradiction and has therefore suggested that we ignore altogether the rule established in Alpert's case (l), as the only way of overcoming the difficulty. But we are of the opinion that this is no way at all, especially as counsel for the wife has given no special reason which would justify our refusal to follow a rule has been valid for many years.

           

            Let us now examine this problem in another light. When the Mandatory legislator divided the jurisdiction in matters of personal status between the courts, his general purpose was to preserve the position as it was during Turkish rule. For this too is one of the tests that we have to consider - in accordance with the opinion which was expressed in the case of Rosenbaum v. Rosenbaum (8). In this connection, what Young has to say (in Corps de Droit Ottoman, Vol. II, p. 2) is important. As translated by Smoira, P. in the case of Rosenboim v. Rosenboim (5), it is as follows :

           

"The various communities of non-Moslem Ottoman subjects have complete jurisdiction to decide all questions which concern each community. . . . . in matters of marriage, including dowers, mohar, maintenance as between husband and wife (nafaka) and divorce".

           

            The importance of these words is twofold. First, Young includes in the word "marriage", dowers, mohar, and maintenance, that is to say, all the range of monetary rights resulting from the marriage tie. Second, the inclusion of suits for dower and mohar within the jurisdiction of non-Moslem religious courts means that, as far as Jews are concerned, the Rabbinical Courts do have jurisdiction to deal with claims concerning properties of the wife which are nichsei tson barzel and nichsei melog. For as regards jurisdiction, there is no difference in principle between the rights of a husband in these two kinds of property of his wife and the right to "dower" and "mohar".

 

            At the end of the chapter from which the above quotation was taken, Young gives the text of Hatti Humaioun of 1856. This is a political declaration which was made by the Sultan, in paragraph 12 of which he confirmed once more the privileges in juridical matters which the non-Moslem communities had enjoyed from time immemorial in the Ottoman Empire.

           

            And in the case of Parapano v. Happaz (10), the Privy Council relied, inter alia, on this declaration by the Sultan, when it held that matters of "marriage, divorce, alimony and dower" were in the Ottoman Empire within the jurisdiction of the religious courts of the non-Moslem communities which, it was presumed from the start, would apply in such cases the religious law of each community.

           

            It is true that the question that had to be decided in the Para-pano case (10) by the Privy Council was regarding the law that had to be applied. But in order to come to the conclusion that it was the canon law of the Roman Catholic Church that had to be applied (on a question of legitimacy of an Ottoman subject who was a member of that Church) the Privy Council proceeded from the fact that in the Ottoman Empire the juridical jurisdiction in these matters was in the tribunals of these communities.

           

            But, generally speaking, choosing which law to apply is one thing and deciding which court has jurisdiction is another. Only here both these problems have become tied up together because of the historical background just mentioned.

           

            And following this rule, the Supreme Court of Cyprus held in the case of Theophilo v. Abraam (12) that the canon law of the Eastern Church applied to a claim for the return of a dower. In so doing the court defined the term "dower" as understood in that law as follows :

           

"..... the object of the dower is to provide a fund for the purposes of defraying the burdens and obligations arising from the existence of the marriage ; that the husband has the control of the property given as dower ; that the property is the property of the wife and must be handed back by the husband on the dissolution of the marriage to the person giving the dower, in those cases where the dower-giver has stipulated this to be done, or to the wife. The husband is only liable for loss or damage to the property, where such loss or damage arises from his own fraud or his own negligence. The husband will not be liable for any loss or damage, provided he had shown such care as he ordinarily takes in the management of his own property."

 

            It seems to us that any one who examines this definition of "dower" will notice at once the similarities in essentials that exist between this institution of the canon law of the Eastern Church on the one hand and the rights according to Jewish law of the husband in the property which the wife brings to him on marriage as above described, on the other hand. And does this not make it clear that in the days of Ottoman rule suits concerning the latter as well as the former were within the jurisdiction of the non-Moslem religious courts?

           

            We have found further support for this view - that is that the jurisdiction of the Rabbinical courts was equal in extent to that of the courts of the various Christian communities in this field - in the Firman of August 21, 1854, which the Sultan Abdul Majeed issued to Mr. Albert Cohen, the emissary of the Central Organization of French Jewry (Consistoire Central des Israelites de France). This reads as follows :

           

            "All the rights, the privileges and all the immunities which had been granted or which will be granted in the future to any Christian community whatsoever shall apply at one and the same time to the Jews as well, for the paternal heart of His Majesty the Emperor will never permit that there should be the slightest discrimination amongst his non-Moslem subjects."

 

            (Extract from Monatsschrift fur Geschichte und Wissenschaft des Judentums, 1854, Vol. 3, p. 346 ; see also Jewish Encyclopaedia, Vol. 4, p. 156, under Albert Cohen ; also Young, Vol. 2, p. 153, note 5).

           

            Also Mr. Goadby, in his book on International and Inter-religious Private Law in Palestine, lays down that according to Article 51 of the Palestine Order in Council, suits regarding marriage include suits regarding "dowry" because "this was the Turkish practice" and "consequently such suits are within the 'exclusive jurisdiction' of religious courts according to Articles 53 and 54 of the Order in Council" (ibid.

pp. 116, 158, 159, note 2).

 

            In short, the examination of the problem in the light of the general tendency of the Mandatory legislator to leave the position in this field as it was during Ottoman rule, leads us to the conclusion - although this must not be taken yet as absolute proof - that a claim by a husband for the income of nichsei melog is a matter of marriage which was within the exclusive jurisdiction of the Rabbinical Court.

 

            Let us try to solve this problem in the light of the answer to the question, to which particular branch of the law does the right of the husband to the income of his wife's property belong? It seems to us that if we are bound in law to consider this right as coming under the matrimonial law and not under that relating to property, we will be bound to conclude - for the reason given below - that indeed only the Rabbinical Court had jurisdiction to deal with a claim of this nature. Because we are dealing with laws which were promulgated by an English legislator, we will have to rely on English jurisprudence to find our answer. This means that we would have to ask ourselves the question, to which branch of the law would an English court consider a claim to belong, which resembled in essentials a suit for the income of property like nichsei melog ? We have to remember in this connection that according to the common law the husband became entitled on marriage to his wife's movable property and the income of her immovable property was also subject to his absolute control so long as she was married to him (Lush on Husband and Wife pp. 5, 7). It is true that this law was altered by the Married Women's Property Act, 1882. The common law further provided, in its time, that a will made by a woman when she was unmarried, became null and void on her marriage and this rule was adopted by the English legislator in s. 18 of the Wills Act, 1837, which is still valid today. In the case of In re Martin (11), the Court of Appeal held that the rule which made a woman's will null and void on her marriage, when applied to a will whereby she disposed of movable property, was part of the matrimonial law. The reason for this is due to the provision of the common law that the movable property of the wife passes on her marriage to her husband and on marrying she loses the power to dispose of it or to leave it by will to another person. As Vaughan-Williams, L.J. put it (at pp. 239-240) :

 

"And I think that his wife's property in the movables having thereby ceased, it follows, quite independently of the eighteenth section of the Wills Act, that this loss of the power of disposition put an end to her will while it was still ambulatory...   for I think that the rule of English law which makes a woman's will null and void on her marriage is part of the matrimonial law, and not of the testamentary law."

           

            It should be noted, in parenthesis, that in the above case, the marriage which made the will null and void took place before 1882 and thus the judgment shows the position as it was before the enactment of the Married Women's Property Act, 1882.

           

            We learn from this English judgment, therefore, that the general rule of the common law to the effect that the movable property of the wife passes to her husband on her marriage is also part of the matrimonial law. This means that the right of the husband to the income of nichsei melog, which he has claimed in the case before us, belongs to this same branch of the law.

           

            If this is correct, it is reasonable to conclude that, at the time, the Mandatory legislator intended that a claim of the kind described above should be determined, in the absence of a general matrimonial law, according to the law of each respective community as far as members of a recognized religious community and Palestine citizens were concerned. And Goadby (at p. 159, ibid.) lays it down that "the effect of marriage upon the property of the spouses in Palestine, whether movable or immovable, will be governed by the personal law." But if the rules of the personal law apply in such a suit, then there is no escaping the conclusion that only a religious court has jurisdiction to entertain it and this for the following reason : let us suppose for one moment that the contrary was the correct conclusion, that is to say that it was the District Court which had jurisdiction in this matter. In that event it would be unable to apply the personal law as required by Article 47 of the Order in Council, in as much as the District Court can apply this law only in matters of personal status as defined in Article 51 and the very grant to the District Court of jurisdiction is based on the assumption that the claim here was not one relating to "marriage" and therefore was not one of the matters included in the definition of personal status which was given in Article 51(1). The conclusion is that the only possible source of the hypothetical authority of the District Court to determine a claim for the income of nichsei melog is to be found in Article 38 of the Order in Council, 1922, and at the hearing the provisions of Article 46 of the Order would have to be applied by the court. It follows also that, as there is no local matrimonial law and as the right of a husband in his wife's property must be decided according to the matrimonial law, the court would have to apply those very rules of the common law which the English legislator had found it necessary to do away with more than 70 years previously. The District Court would also have to act in accordance with the principle which was laid down in the case of Palestine Mercantile Bank Ltd. v. Fryman (2), to the effect that where there was no Ottoman provision dealing with any particular branch of the law, the relevant rule of the common law must be resorted to. Now in other branches of the law as well, the prospect also exists in this country of having to resort to certain rules of the common law which are no longer applicable at all in England itself and it is most difficult to believe that the Mandatory legislator intended at the time that this should be the case in connection with the matrimonial law in so far as it would be applicable to members of the recognised communities who were Palestinian citizens.

 

            Further it is very doubtful in our opinion - also because of the judgment in the Mercantile Bank case - whether the District Court would have the right to apply the rules of the common law at all to a matter of this kind, and this is because of the proviso at the end of Article 46 of the Order in Council to the effect that these rules apply "so far only as the circumstances of Palestine and its inhabitants . . . . . permit".

           

            For instance, according to the law of her community, the Moslem wife had unfettered control over her property. (Fyzee, Outline of Muhammadan Law (1949) at p. 99 ; also Wilson, Muhammadan Law, 6th edition, at p. 126.) It is inconceivable that the Mandatory legislator intended to impose on her the disabilities of the common law on this subject which we have mentioned.

           

            In such a case, therefore, the District Court would be faced with a lacuna in the local law. It might then be said as was said by Kennet J. in Zilbershtein v. Zilbershtein (9), at p. 140, that, "as there was no provision in the civil law to the contrary, the rights of the wife were equal to those of the husband and the marriage had not deprived her of these rights". Should the District Court be of this opinion and decide the issue in such a case along these lines, then our answer would be that there was nothing in that argument that could weaken the conclusion which must follow from the view - and there can be no other view - that at the time the Mandatory legislator was not willing that there should be a lacuna in connection with the matrimonial law applicable to a married couple who were Palestinian citizens belonging to a recognised community with regard to the relations between them not in connection with the rules regulating the rights which such had in the property of the other. We have to add further that Kennet J. cited Article 1771 of the Mejelle and section 82 of the Ottoman Law of Civil Procedure as authority for saying that the Ottoman Law contained a positive provision to the effect that the wife "had the right to own separate property without any limitation" and that this law had remained unchanged "till now". With all respect, we are not at all convinced by these citations. Article 1771 of the Mejelle concerns the onus of proof when husband and wife "disagree as to the things in the house in which they dwell". It owes its origin no doubt to the rule in Islamic law that a married women has full control over her property. (Vide supra.) For as is well known, the "provisions of the Mejelle are based on the substance of Islamic law". (See the introduction of Frumkin J. to his Hebrew translation of the Mejelle). As regards the second Law that was cited, section 82 is to the effect that the provisions of section 80 of this same Law were not to apply "when the contracting parties are husband and wife". It is obvious that the section concerns only the case where one spouse desires to prove against the other the existence of rights which had been acquired through an oral agreement between them. This is clear also from the judgment of Nasr v. Nasr (3), on which Kennet J. relied. For a claim to enforce a right derived from such an agreement does not come under the matrimonial law at all. Consequently it should certainly surprise no one to find that in the course of the hearing of that case "no one disputed nor doubted the fact that the wife had the right to possess separate property without any limit" and we must not conclude from this case that, before the enactment of the Women's Equal Rights Law, such a rule existed in the civil law.

 

            The inevitable conclusion therefore is that the claim which we have been considering for the income of nirchsei melog did not come within the jurisdiction of the District Court but that it came within the term "a matter of marriage" and was within the exclusive jurisdiction of the Rabbinical Court. For the sake of clarity it is as well to summarise the reasons which have led us to this conclusion as follows:

 

(a) If the claim in question has to be considered at all as a matter of personal status according to the definition contained in Article 51(1) of the Order in Council, then this is because of the terms "suits regarding marriage" and "matters of marriage" which are used in that article and in Article 53(1);

 

(b) These terms should not be restricted only to suits that are concerned with the existence or not of the marriage tie. They should also cover claims for enforcing certain rights which spring from the marriage status as, for example, restitution of conjugal rights. From the point of view of jurisdiction, there is no logical basis for differentiating claims in respect of these rights and claims in respect of rights in property or money which are also derived from the marriage status;

 

(c) In the case of Alpert (1), too, the claim of the widow for maintenance out of her husband's estate until she received what was due to her under the Ketuba was held to be a "matter of marriage" which was within the exclusive jurisdiction of the Rabbinical Court;

 

(d) But for the specific use of the term "alimony" in the Order in Council, as already mentioned, it would have been possible to consider as a "matter of marriage" also the claim of a wife for maintenance during the lifetime of the husband;

 

(e) But because this term was specifically used by the Mandatory legislator in the Order in Council, it does not necessarily follow that when this is not the case we should come to a different conclusion. For it is quite possible that the intention of the legislator was to stress the differences which he had emphasised regarding the kind of claim in connection with alimony and maintenance when he divided the jurisdiction between the civil and the religious courts;

 

(f) During the period of Turkish rule, the claim of a Jewish husband to rights in his wife's property was considered as a matter of marriage which was within the jurisdiction of the Rabbinical Court. This fact may serve as a pointer to the intention of the legislator of the Order in Council in view of his well known desire not to make changes, generally speaking, with regard to the jurisdiction which the religious courts of the communities had at that time in matters of personal status;

 

(g) The provisions of a law which grant to a husband, on his marriage, rights in his wife's property, belong to the matrimonial law. It is logical to suppose that at the time the Mandatory legislator intended that the personal law should apply in the case of a married couple who were members of a recognised community and Palestinian citizens, whereas, according to Article 47, the District Court could not apply the personal law of the parties unless the dispute concerned one of the specified matters of personal status;

 

(h) We must not ascribe to the Mandatory legislator an intention that the District Court should apply the rules of the common law regarding marriage when deciding on a claim by a husband for rights which he had in his wife's property in a dispute of a married couple of the kind mentioned above. Nor is the common law applicable in such a case as if there were a lacuna in this branch of the local civil law. The inevitable conclusion therefore is that jurisdiction to hear such a case was not given to the District Court but that it was given exclusively to the religious court.

 

            We should like to consider another point. We noted above, where we explained the nature of the institution of nichsei melog, that the husband was entitled to claim from third parties the income from this kind of property without the necessity of receiving authority from his wife, that is to say in his own name. In his judgment in Albrance v. Shmeterling (6), Olshan J. was of the opinion that the personal law does not apply in a dispute between the husband and a third party. At p. 295, the learned judge says as follows: -

           

"Even if we were to suppose that their personal law was Jewish religious law, and even if according to this law every promissory note given to the wife for rent must be considered as 'income' belonging to the husband – it does not yet follow from this, that commercial relations between a married woman and a third party are subject to the personal law applicable to husband and wife in their relations with such other. If the position was as claimed by counsel for the respondent, we would reach a conclusion which was unreasonable".

 

And at p. 296, Olshan J. added:

 

            " 'A suit regarding marriage', as set out in Article 51, is a suit between two parties to a marriage... The fact that according to Article 47 a dispute in such a case has to be determined according to the personal law of the parties is no evidence that any other person in his commercial dealings with a married woman is, according to the Order in Council, subject to the personal law applicable to a matter of marriage between herself and her husband and according to which each acquires certain concrete rights by virtue of the marriage. The interpretation given to Article 51 by counsel for the husband... is likely to bring choas to the commercial and economic life of the country. It would make every commercial transaction with a married woman dangerous and insecure and this state of affairs would not be confined to just Jewish married women, for Articles 47 and 51... apply to the whole population of the State".

 

            There is no conflict between this view and what we are deciding in this case, because rights which result from the relationship between husband and wife are one thing and the husband's standing vis-a-vis rights acquired by his wife in transactions with third parties is another. The fact that a certain law regulates the relations between husband and wife does not necessarily mean that the same law also regulates the relations between the husband and third parties as regards rights which the wife acquired thereby (compare Wolff, ibid., p. 355). In other words it is not impossible to consider as "a matter of marriage" the husband's claim to the income of his wife's nichsei melog when it is made against the wife and to regard the husband's claim to the income of the same property as "a matter which is subject to the law of property" when made against a third party.

           

            We therefore hold that the Rabbinical Court did have jurisdiction to determine the claim which was made by the husband for the income of nichsei melog of his wife and to give the judgment it delivered on June 22, 1947.

           

Judgment given on July 28,1954.

 

1) In terms of section 9(1) of the Courts Ordinance, 1940, the Special Tribunal constituted under Art. 55 of the Palestine Order in Council, 1922, to decide whether or not a case is one of personal status within the exclusive jurisdiction of a Religious Court, shall consist of two Judges of the Supreme Court and "the president of the highest court in Palestine of any religious community which is alleged by any party to the action to have exclusive jurisdiction in the matter, or a Judge appointed by such president."

 

1) Nichsei melog : Property which belongs to the wife and of which the husband has only the usufruct without any rights to the capital and without responsibility for its loss or deterioration.

 

Full opinion: 

Al-Qi'an v. State

Case/docket number: 
P.C.A. 3094/11
Date Decided: 
Tuesday, May 5, 2015
Decision Type: 
Appellate
Abstract: 

[This abstract is not part of the Court's opinion and is provided for the reader's convenience. It has been translated from a Hebrew version prepared by Nevo Press Ltd. and is used with its kind permission.] 

 

An Application for Permission to Appeal, which was adjudicated as an appeal, on a decision to grant the Respondent's motions to evict the Applicants from the land it owns in the northern Negev. Background: The Applicants belong to a Bedouin tribe that has been residing in the area in dispute for approximately 60 years. In the framework of the proceedings in the lower instances, it was discovered that the Applications are licensees and not trespassers, who settled on the location following instructions of the State, and that the State duly revoked the license. The majority of the members of the tribe moved to a regulated Bedouin town (Hura), and those who remained, including the Applicants, are being required to evacuate their houses, while being offered to move to Hura; as part of the overall solution that the authorities have formulated, and as part of a scheme to establish Hiran – an urban community town, with a general character, on the location.

 

*

 

The Supreme Court rejected the appeal by a majority of opinions (by Deputy President E. Rubinstein, with the concurrence of Justice Hendel, and against the dissenting opinion of Justice D. Barak-Erez) on the following grounds:

 

Permission of appeal was granted because of the issue at the background of the Application, which concerns the settlement of the dispersed Bedouin population on State lands in the Negev. This is a matter of public sensitivity and importance, which government authorities and Israeli society have frequently been dealing with for decades. However, it was emphasized that the ruling is limited to this case.

 

On the merits of the appeal, the majority opinion was that on the legal level the Applicants' arguments should not be accepted on the following grounds:

 

First, because  the arguments that are at the core of the Application concern planning aspects (arguments that are directed against the planning of the town of Hiran, and more broadly – through such planning objections – against the government decision to establish the town of Hiran, and its policy in the matter of the regulation of Bedouin settlement in the Negev) – these arguments constitute an indirect challenge of the decisions of the authorities, which the Applicants should have raised in a direct challenge in other procedural frameworks, and they do not belong in the framework of their defense against the eviction motion filed by the Respondent.

 

Inter alia, it was emphasized that the Applicants' arguments are not "denied in limine" merely because their contents are administrative and constitutional, since the mere fact that a certain argument bears an administrative or constitutional nature is not enough to determine that it does not at all belong in a civil proceeding. It is definitely possible that there will be a situation in which such arguments will be raised in an "organic" manner – without belonging to another specific procedure – in the framework of proceedings that, by their nature, are civil and not administrative-constitutional, particularly in legal relationships between the individual and the authority.

 

Second, and beyond the necessary, the Court addressed the Applicants' constitutional and administrative arguments, and held that in this case it cannot be said that the Respondent did not act in a reasonable and proportional manner, and in a way that ultimately does not amount to a violation of the rights of the Applicants, despite their allegations in this matter. The question of the reasonableness of the decision to evict the Applicants was examined while emphasizing two considerations: the policy relating to the regulation of Bedouin settlement in the Negev, and the fact that the eviction of the Applicants does not leave them in a hopeless situation. They may move to the town of Hura, at the beneficial terms and conditions that were prescribed, and this pulls the rug from under the claim of infringement of right to property; Alternatively, the Applicants, just as any other citizen, may purchase a lot in the town of Hiran, when it will be established, in accordance with the terms that apply to everyone. With regard to this option, the Court suggests that the Respondent consider granting a certain benefit to proven licensees in the marketing tenders;

 

Justice D. Barak-Erez, in a dissenting opinion, believes that considering the special characteristics of the case – once it became clear that the Applicants are licensees and not trespassers, who settled on the location in accordance with the State's instructions, the authorities were obligated to exercise renewed discretion regarding the format of the eviction and the compensation that will be granted to the residents in the framework of the eviction proceedings, and since this was not done – the State should be instructed to reconsider the compensation that is to be granted to the Applicants in the framework of the eviction proceedings, while examining the possibility of preserving their linkage to their residential environment.

Voting Justices: 
Primary Author
majority opinion
majority opinion
Primary Author
dissent
Full text of the opinion: 

In the Supreme Court

 

P.C.A 3094/11

 

Before:                                                His Honor Deputy President E. Rubinstein

                                                His Honor Justice N. Hendel                                                                                      Her Honor Justice D. Barak-Erez

 

The Applicants:                      1.    Ibrahim Farhud Abu Al-Qi’an et al

                                               2.    Atwa Issa Abu Al-Qi’an et al

 

v.

 

The Respondent:                    The State of Israel

 

An Application for Permission to Appeal the Judgment of the Be’er Sheva District Court (Deputy President S. Dovrat and Judges R. Barkai and A. Vago) in C.A. 1165/09 dated February 28, 2011

                                                     

Date of Session:                                  12th of Sivan, 5774 (June 10, 2014)

 

On behalf of the Applicants:  Adv. Hassan Jabareen; Adv. Suhad Bishara

 

On behalf of the Respondent: Adv. Moshe Golan; Adv. Hani Trudi

 

 

J U D G M E N T

 

Deputy President E. Rubinstein:

 

1.An application for permission to appeal the judgment of Be’er Sheva District Court (Deputy President S. Dovrat and Judges R. Barkai and A. Vago) in C.A. 1165/09, dated February 28, 2011, which denied the Applicants' appeal of the judgment of Be’er Sheva Magistrate Court (Judge G. Gideon) in C.C. 3341/04, dated July 30, 2009; this judgment granted the Respondent's motion to evict the Applicants and to issue a permanent injunction order against them with respect to the land owned by the Respondent, which is located in the area of the Yatir River in the Northern Negev. As will be described, the Applicants, who are members of the Abu Al-Qi’an Bedouin tribe (hereinafter: the "Tribe"; the "Al-Qi’an Tribe"), have been living for the past 60 years in an unrecognized Bedouin village "Atir - Umm Al-Hieran") (hereinafter: the "Village"), named after the two complexes that comprise it, which we will address below; As will be detailed below, these proceedings address the Respondent's motion to evict the Applicants from the land it owns, alongside the establishment of the urban town of Hiran at this location, in accordance with the outline schemes that regulate the region.

 

2.Before presenting the factual background story, I will, at the outset, state the bottom line of my position, which is that after examining all of the material, I am of the opinion that the application for permission to appeal should be granted and the application should be adjudicated as an appeal, however, the appeal itself should not be accepted. As is known, permission for an appeal to a third instance is considered in matters that go beyond the boundaries of the parties towards a broader public or legal question. Whilst at the end of the day, and despite the Applicants' arguments, as will be specified below, the Application does not raise a general issue on the legal level that exceeds the parties' concrete matter - the Respondent, fundamentally, is the owner of the land and is entitled to evict the Applicants therefrom, insofar as the matters are examined as a motion for eviction; However, the issue at the background of the Application, which concerns the settlement of the dispersed Bedouin communities on State lands in the Negev, is a matter of public sensitivity and importance, which government authorities and Israeli society have frequently been dealing with for decades. Furthermore, while the Applicants in this Application are two families, consisting of  only 13 people out of all residents of the Village at hand, the eviction impacts hundreds of residents, and this, of course, must not be taken lightly. However, as I will elaborate below, I am of the opinion, after examining the matter, that the appeal should not be accepted – first, because the arguments at the core of the Application deal with planning aspects, and their natural and proper place is not within this proceeding since they constitute an indirect challenge of statutory decisions of the authorities, which were thoroughly addressed; Secondly – and beyond the necessary – I am of the opinion that in the circumstances of the matter at hand, one cannot say that the Respondent did not act in a reasonable and proportional manner, and in a way that ultimately does not amount to an infringement of the rights of the Applicants, despite their allegations in this matter.

 

Background and Previous Proceedings

 

The Al-Qi’an Tribe and the Atir - Umm Al-Hieran Village

 

3.As mentioned, the Applicants are members of the Abu Al-Qi’an Bedouin tribe. The history of the Tribe in the years prior to settling on the land which is the subject of this case is in dispute between the parties. However, everyone agrees that in 1956, pursuant to the directive of the military governor of the Negev, the members of the Tribe moved to the area located in the Yatir River region, and split into two complexes: the Atir complex, where Applicant 1 and his family live, and the Umm Al-Hieran complex, where Applicant 2 and his family live. It will be noted here that according to the Respondent, the two neighborhoods do not constitute one village, but are rather two separate complexes that have different settlement characteristics (without taking a position on this matter and for the sake of convenience, I have chosen to refer to both of the complexes together as the "Village"). Similarly, the number of Tribe members residing in the Village is also in dispute – according to the Applicants there are approximately 1,000 people and according to the Respondent there are approximately 750 people; the distance between the complexes is also in dispute – according to the Applicants it is approximately one kilometer and the Respondent estimates it to be two kilometers or more. There is no dispute that the majority of Tribe members moved to the Bedouin town of Hura, and that those who remained – including the Applicants – are the minority. In any event, there is no question that the Village houses are located on land owned by the Respondent, that was registered in its name on May 9, 1978, at the end of settlement proceedings pursuant to the Land Rights Ordinance [New Version], 5729-1969[1]. Additionally, all of the structures in both complexes were built without permits and in violation of the law, and face demolition orders which were issued in 2003 pursuant to Section 212 of the Planning and Building Law, 5725-1965. In this context and for the sake of presenting a complete picture, it will be noted that this Court recently rejected applications for permission to appeal that were filed against the demolition orders (P.C.A. 3082/14, the decision of Justice U. Shoham dated September 14, 2014), and that the execution of the orders was recently stayed by a decision of the Kiryat Gat Magistrate Court until March 17, 2015 (C.L.F. 2136-09 the decision of Deputy President O. Adam dated December 15, 2014). The Village is not connected to basic infrastructures and its residents do not receive welfare, health or education services therein. The Bedouin town of Hura, which is recognized by the authorities and which offers such community services to its residents and the residents of the region, is located approximately five kilometers southwest of the Village. As will be described in detail, starting in the 1980’s, the Respondent negotiated with the residents of the Village with the objective of vacating their houses and relocating to Hura, and indeed most of them moved there, in consideration for receiving a land lot at that location; The Respondent is also, at the present time, offering the Applicants a land lot in Hura, assistance in developing it and connecting it to infrastructures, as well as monetary compensation, in consideration for them vacating the Village. The details of the proceedings that will be presented below can be tiresome, due to repetitiveness that stems from the multitude of proceedings, however, I saw it fit to present the entire picture to the extent possible.

 

The Planning Proceedings with respect to the Village

 

4.The region where the Village is located is regulated in the Southern District Planning Scheme, DPS 14/4 (hereinafter: the "District Planning Scheme"). For the sake of good order, I will hereinbelow address each complex separately:

 

The Umm Al-Hieran Complex – The decision to establish the new town of Hiran is grounded in Government Decision no. 2265 from July 21, 2002, in which the establishment of 14 new towns in the northern Negev was declared, based on the work of the "Be’er Sheva Metropolitan" Steering Committee. This decision was implemented in Amendment no. 27 of the District Planning Scheme, which includes, inter alia, a specific planning scheme for establishing the town of Hiran (scheme number 107/02/15, hereinafter: the "Town Planning Scheme") which was published for validation on May 21, 2003; It will be noted that the establishment of Hiran was also promoted as part of the planning of a cluster of towns with similar character around the Shoket Junction, in the framework of Planning Scheme DPS 23/14/4, the "Be’er Sheva Metropolitan" master plan (hereinafter: the "Be’er Sheva Metropolitan"), which was published for validation on August 8, 2012. The Town Scheme covers an area that is owned entirely by the Respondent and designates for demolition approximately 50 structures that were built in the Umm Al-Hieran complex. On April 23, 2008, the District Planning and Building Committee decided to deposit the Town Scheme; the Regional Planning and Building Council decided, on December 8, 2009, on the "Establishment of a new suburban community town, Hiran, in the northern Negev, east of Meitar". On October 29, 2010, and after the reexamination of the scheme in light of the fact that the "Integrated National Planning Scheme for Construction" (NPS 35) came into effect, the deposit of the scheme was published. On January 11, 2011, a number of Umm Al-Hieran residents – including 6 of Applicant 1's daughters – filed their objection to the scheme with the Regional Council's Objections Committee, and it was denied in a decision dated December 5, 2011. An appeal on this decision, which was filed with the National Planning and Building Council's Appeals Sub-Committee (hereinafter: the "Appeals Committee"), was also denied in a decision dated September 24, 2012 which I will address below. On July 24, 2013, the planning proceeding was completed with the publication of the scheme in the Official Gazette (Reshumot); see also Government Decision 878 dated November 10, 2013, entitled "Promoting the Establishment of a New Town in the Negev – Hiran", in the following language:

 

"Further to Government Decision no. 2265 dated July 21, 2002, and in accordance with the recommendation of the Regional Planning and Building Council dated December 8, 2009 regarding the establishment of a new suburban community town named "Hiran" in the northern Negev, east of Meitar, to order the Ministry of Construction and Housing act to establish a new town in the Negev – "Hiran" as follows:

1.To promote the establishment of the permanent town from a broad perspective while considering all of the aspects of establishing the town, with the assistance of the relevant government ministries.

2.To prepare, within 60 days, an inter-ministerial plan for realizing the establishment of the town, in coordination with the Mevuot Arad Plan.

3.To act immediately and in accordance with the law in order to enable the immediate absorption of the core settlement group at the location."

 

The Atir Complex – This complex is regulated in the framework of the Yatir Forest" Scheme 264/03/11, which addresses forest areas and agricultural areas in the region, including the prescription of their designations and the actions permitted therein, in accordance with the principles outlined in National Planning Scheme (NPS) 22. In this framework, the scheme designates the houses of the Tribe members that are located in the complex for demolition, in accordance with the location’s classification as "a metropolitan recreation area and a proposed park forest"; On June 8, 2009, the District Committee's subcommittee decided to deposit the scheme with conditions, and it was approved by the Subcommittee on Principle Planning Matters (the "SPPM") on December 12, 2010. Upon the deposit of the scheme, a number of objections were filed, and on December 10, 2012, the Objections Committee instructed the approval of the scheme, subject to a few changes that were made thereto, while denying the objections of the residents of Atir. An appeal filed by the residents was denied in the Appeal Committee's decision of October 20, 2014.

 

The Proceedings before the Magistrate Court

 

5.In April, 2004, the Respondent filed two motions to evict the Applicants from the land and to receive a permanent injunction order – C.C. 3326/04 against Applicant 1, and C.C. 3341/03 against Applicant 2; Pursuant to a decision dated April 20, 2006, and due to the identical causes of action, the hearings in the two claims were consolidated. The Respondent claimed that the Applicants took possession of the land it owns and that they are not licensed to be there, with or without consideration, but rather squatted on the land and built thereon illegally. It was further argued that as early as in the 1980's the Respondent held negotiations with the members of the Tribe in order to evict them from the land, and the majority of them indeed consensually moved to live in the town of Hura; also, that the eviction of the Applicants does not violate their right to housing since the Respondent is currently offering them alternative housing in Hura. In response to the motion, it was argued that the Applicants only found out that the Respondent owns the land adjacent to filing their answer, and that laches applies to the motion and that the statute of limitations has expired. On the merits of the matter, they argued that they are the owners of rights to the land, and alternatively, have an irrevocable license thereto, which they purchased for consideration. It was argued that prior to 1948, members of the Tribe resided on the lands owned by them in the area of "Wadi Zuballa" (which is currently in the area of Kibbutz Shoval), and that since then, at the orders of the Military Governor of the Negev, they have moved three times: in 1948, to the area of Khirbet Al-Hozeil; later on - at an unknown date – to the Jigily area (near Kibbutz Lahav); and in 1956, to the land in dispute. It is argued that upon their relocation to the Yatir River, the Sheikh of the Tribe was leased 7,000 dunams in the area. The Applicants also referred to a document dated August 28, 1957 (hereinafter: the "Lubrani Document") in which, so it is argued, Mr. Uri Lubrani – the Advisor on Arab Affairs in the Prime Minister's Office at the time – states that the members of the Tribe agreed to transfer their place of residence from the Beit-Kama – Lahav region to the vicinity of the Yatir River, and in consideration received leasing rights to the State lands at that location. It is also argued that the members of the Tribe paid the authorities for the right to reside at the location; moreover, that their waiver of their rights to Wadi Zuballa served as consideration in purchasing the license to the land which is the subject of this matter. The Applicants further argued that the authority's conduct throughout the years indicates its consent to granting a license to possess the land, and for example, that the residents of the Village received governmental assistance to rehabilitate structures which were ruined in a flood that occurred in the area in 1997; and that until the filing of a warning order in July, 2003, and the filing of the eviction motions, no demolition or eviction proceedings have been taken against them. The Applicants further argued that their eviction from the land would violate their right to housing, and that the eviction motions stem from the Respondent's intention to establish a Jewish town at the location, which constitutes unlawful discrimination based on grounds of nationality and violates the principle of equality.

 

6.As mentioned, the Magistrate Court accepted the Respondent's claim and ruled that it is the owner of the land; that laches does not apply to its claim, since the laches clock begins to run from the time of the notice of revocation of the license to use the land; and that the Applicants did not prove the purchase of rights to the land by virtue of prescription or conflicting possession, since their settlement on the location was at the consent of the Respondent rather than by virtue of a vested right. Furthermore, it was ruled – contrary to the Respondent's argument – that the Applicants are not presumed to be squatters on the land but rather are licensed to be there, but that the license was granted for free, without consideration, and is revocable at any time. In this context, it was emphasized that the Applicants did not prove their alleged rights to the land at Wadi Zuballa. It was further ruled that their settlement on the land and their development thereof do not, in and of themselves, testify to the purchase of proprietary rights therein; that the Applicants' structures were built unlawfully and do not entitle them to any compensation as a condition to their eviction; that neither the investments in the location by the Village residents nor the government assistance granted to them make the license irrevocable; and that while the Applicants' arguments regarding discrimination and violation of their constitutional rights could justify granting remedy in the constitutional and administrative fields of law, before the appropriate instance – they do not establish a right to the land and do not serve as a defense against the eviction motion in this proceeding. Hence, the court instructed that the Applicants be evicted from the land.

 

The Proceedings Before the District Court

 

7.In their appeal, the Applicants repeated their arguments that the eviction motions against them were filed as part of a comprehensive process, the objective of which is to establish a Jewish town at the location. They reiterated the history of the members of the Tribe, while arguing that the license that the Respondent had granted them to settle on and work the land constitutes a government promise, based upon which they invested in the location with the expectation of staying there. Alternatively, they argued that they should be deemed licensees with a paid – irrevocable – license to the land, based on the grounds specified above. Alternatively, it was argued that the Respondent's claim was fundamentally tainted by mala fide and unlawful discrimination, since, as mentioned, it was filed in order to establish a Jewish town. It was further stated that the Respondent did not meet the burden lying on it to point to a public interest which can justify their eviction from the land in these circumstances. The District Court denied the Applicants' appeal, while adopting the Magistrate Court's conclusions; it was emphasized that the Respondent is the owner of the land, and that the Applicants have no right therein. It was also noted that the Applicants did not file a claim memorandum for the land or an appeal on the Respondent's registration thereof. The court further ruled that the Applicants were not given a government promise with respect to the land and that the existence of a lease agreement between the parties, evidencing the grant of a license to the land for consideration, was not proven. It was further held that since the eviction proceedings deal with parties' concrete matters, the place for challenging the planning schemes through administrative and constitutional arguments is in other instances. It was additionally emphasized that the Respondent offered the Applicants a housing solution in the form of alternative land in the town of Hura. It was, however, noted that the Respondent relied in its claims on a "standard" squatting cause of action that depicted the Applicants as squatters who unlawfully took possession of the land; while the truth of the matter is that they relocated their place of residence to the land decades ago, in accordance with the authorities' demand, and were settled there for years with the permission of the Respondent, until it decided to revoke it.

 

The Application for Permission to Appeal

 

8.First, it was argued that the Application raises a general legal question that justifies intervention by a third instance, and that is whether it is appropriate to adjudicate the Applicants' constitutional and administrative law arguments in the framework of the eviction proceedings, given that we are dealing with their eviction from public lands to which they arrived pursuant to the authorities' demand, and on which they have been residing for years with the Respondent's permission and consent; or, whether these arguments should be discussed in other proceedings, while the courts in this proceeding should adjudicate the issue limited to the parties' matter. The Applicants argued that in this case, it is appropriate to deliberate these matters on a public level, rather than only examining the dispute on the private level, in which a land owner who gave a free license may revoke it at any time. It was also argued that the decision to evict the Applicants is an administrative decision, and as such should be examined through the prism of administrative and constitutional law; more specifically, it was argued that the decision lacks relevant factual background, since it was adopted with the purpose of establishing a Jewish town on the location. On the merits of the matter, the Applicants reiterated that they are licensees on the land, and that their investment thereon constitutes consideration in itself. In this context, it was argued that the illegality of the construction does not derogate from the above, since the members of the Tribe were relocated to the location by the authorities, and they had no choice other than to make it suitable for living. The Applicants further argued that the Respondent's decision to evict them must be examined in accordance with the principles of the State’s release from a contractual engagement, and accordingly, it must justify such a release on public grounds. It was additionally argued that even if the Applicants' license to the land  is revocable, the Respondent should not be allowed to revoke it because of considerations of justice,; since the Applicants have been residing in the location for many years at the authorities' demand, and their eviction could cause them significant financial and mental damage.

 

9.Finally, the Applicants argued that evicting them in order to establish Hiran constitutes unlawful discrimination and violates their right to equality, property and dignity. It was argued that the Respondent should have included their houses in the planning of the town, and that its decision violates the equality that is required in allocating land resources, and does not take into consideration their rights as natives. The Applicants' argument regarding violation of their right to property was grounded on their investment in the land, and their argument regarding violation of the right to dignity - on the unique fabric of life that they have created in the Village over the years. It was further argued that these violations do not meet the tests of the limitation clause, since the eviction is not for a proper cause; that the Respondent's decision does not meet the proportionality tests, since if the purpose of the eviction is to develop the land for residence, this can also be obtained without the eviction; and that the eviction is the most harmful means, especially in light of the option to legitimize the construction in the Village in the framework of the Planning Scheme.

 

The Respondent's Response to the Application

 

10.In response to the Application it was argued that it does not raise a legal question that bears public implications, but rather addresses the concrete matters of the parties, and primarily focuses on factual determinations. In general, it was argued that when it comes to the eviction of the Applicants, the Respondent acted with consideration and proportionality – from granting a free license to the land, through the negotiations it conducted with the members of the Tribe, and to the housing solution it offered in the past, and is offering in the present, to the residents of the Village – and in a manner that neither deviates from proper administrative activity nor involves any violation of rights. It was specifically argued that the fact that the Respondent owns the land is not disputed, and that the Applicants' position that the license had been paid for is unfounded, since they did not prove their alleged rights to Wadi Zuballa. As for the classification of the license that was granted, it is argued that it was granted for free and is revocable at any time, and that the Applicants' investment in the land, which was made without the Respondent's approval and unlawfully, does not make it irrevocable. The Respondent further reiterated that as early as during the 1980's, it negotiated with the members of the Tribe for their eviction from the land, and that there is no substance to the Applicants' arguments that they were granted a government promise regarding the land, or that a representation was made through its conduct that they would be able to stay on the land for an unlimited period of time. In this matter, the Respondent added that the assistance that the Tribe received from the authorities was given as an act of good will, and cannot establish consent to a permanent settlement. It was further argued that the Applicants had a very extended period of time to prepare for the eviction, while being offered an alternative housing solution in Hura, which could have prevented any alleged harm; and that in light of the said solution, the Applicants' claims that they will be left without a roof over their heads were unfounded. Finally, it was noted that there is no substance to the Applicants' arguments regarding violation of basic rights and mala fide, since the Respondent is acting to establish towns for the dispersed Bedouin populations – including Hura – which are connected to basic infrastructures and recognized by the welfare services, instead of unrecognized villages, such as Atir - Umm Al-Hieran; and that the Respondent's actions do not amount to discrimination, particularly in light of its said willingness to provide the Applicants with an alternative housing solution.

 

Update Notice on behalf of the Respondent dated October 22, 2013 – the Appeals Committee's Decision

 

11.The planning proceedings regarding the land were completed concurrently with these proceedings. Accordingly, the Respondent filed, for our review, the Appeals Committee's decision dated September 24, 2012, in which the appeal, which was filed by 64 of the Umm Al-Hieran residents regarding the planning of the town of Hiran, was denied. The Appeals Committee's decision first reviewed the decision of the Objections Committee dated December 5, 2011, in which it was ruled, inter alia, that the earlier settlement of the members of the Tribe was actually in the Atir complex, while an examination of aerial photos shows that there were no buildings in the Umm Al-Hieran areas when the planning began, and that the expansion on the location occurred in recent years in an attempt to "set facts on the ground"; that those objecting – who at that point objected to the detailed scheme for the establishment of Hiran – did not file any objection to Amendment no. 27 of the District Planning Scheme, something that was emphasized in light of the fact that the change also included a specific scheme for establishing a different town by the name of "Omrit", which was not established due to an objection that was filed at that early stage; and that the majority of the Tribe members relocated to the town of Hura, a solution that is currently still available for the members of the Tribe who remain in Umm Al-Hieran. In the appeal, it was argued that the approval of the scheme means that a Jewish town will be established at the expense of the Bedouin population, in a manner that implements a policy of residential separation and discrimination. It was also argued that the decision is contrary to the principles of administrative law which require the authority to act fairly and efficiently while promoting the interests of the entire public, and that the planning authorities ignored the situation on the ground when they did not consider including the houses of the Village in the Town Scheme. It was further argued that carrying out the scheme constitutes a violation of equality, the right to property and the right to dignity, including the right to housing, a disproportional infringement that is not for a proper cause. In summary, it was argued that the committee's decision is an additional layer in the discriminatory policy in allocating resources for the residential needs of the Bedouin population in the Negev.

 

12.In the Appeals Committee's decision it was first stated that it is not possible, by means of challenging the planning institutions' decisions, to object to the mere establishment of the town of Hiran, and that the Applicants should have objected to the government decision by virtue of which such decisions were adopted. Moreover, it is inappropriate, at this detailed stage of planning, to challenge the decision not to establish a town in the complex for the dispersed Bedouin populations. In this context, it was noted that the investigator who was appointed to hear the objections to the scheme recommended to avoid legitimizing the existing settlement in Umm Al-Hieran, inter alia, since the town of Hura provides the designated planning solution for the members of the Tribe. It was further stated that the scheme is not intended for establishing a town for Jews only, and that the policy of establishing towns for the dispersed Bedouin populations, alongside establishing towns for the general public, does not constitute discrimination, and even takes the needs of the Bedouin into consideration. It was emphasized that for years the government has been establishing designated towns for the Bedouin based on the understanding of their unique needs; and that alongside this, there is also the need to establish towns in the area for the general public. It was further stated that if the appellants will so desire, they will be able to purchase a lot in the town. It was also stated that the Respondent, as the owner of the area, agrees that they are free to file a detailed scheme that will be able to provide a fitting response to their housing needs, and that such a scheme will be discussed within a short period of time. It was also noted that the District Committee's representatives did not, in principle, see a "material difficulty", in including the Applicants’ houses in the scheme, but that it is not possible due to the Lands Administration's objection; in this context, it was stated that in the planning institutions' decision whether to legitimize illegal construction, weight should be given to the principle of protecting the rule of law, and the owner of the land should not be forced to legitimize illegal construction thereon, especially when such construction was done by someone who does not have rights to the land . It was also noted that when the planning proceedings began, there were a small number of tin shacks in the Umm Al-Hieran complex, and that the mass of residential houses on the location was only created in recent years. As for the allegations of discrimination and deprivation, the committee thoroughly reviewed the steps taken by the government and the resources allocated to regulate the settlement of the members of the dispersed populations in the Negev, while emphasizing the preferential and benefiting policy that is applied towards them. It was specifically stated that many resources were invested in settling the members of the Al-Qi’an tribe, including developing the town of Hura to accommodate them.

 

The First Hearing on November 20, 2013

 

13.In the hearing, the Applicants' attorneys reiterated their argument that the Respondent, who applies administrative authority in its decisions, must provide a relevant justification to the eviction decision; it was argued that in the circumstances of this matter, when the Applicants relied on the Respondent's actions, the court must address their arguments on the constitutional and administrative level, and not refer them to file a petition against the planning proceedings. It was further argued that the Applicants were aware of the existence of the scheme to establish Hiran, but not of the fact that their houses were not included in the scheme; and that they did not file an objection as part of the planning proceedings since the Respondent only revealed that the town of Hiran is only planned for a Jewish population in the proceeding before the Magistrate Court. The Respondent's attorney stated that, indeed, the investigator initially recommended establishing a Bedouin town in the Atir complex, to which the residents of Umm Al-Hieran would be able to move, but that this recommendation was rejected because of various planning considerations. It was also emphasized that the town of Hiran is planned for the general population and not necessary for Jews, and anyone wishing to do so may reside there by purchasing a lot. In this context, it was noted that in planning towns for the dispersed Bedouin populations, their patterns of life are taken into consideration, and that this is not possible when planning general towns (for example, in terms of the average size of a lot). The Respondent's attorney emphasized that it may be possible to allow a change in the plan that would be suitable for some of those requesting to live in Hiran, however, the town is not defined as Bedouin, but rather as general. Finally he argued that the eviction motions did not land on the Applicants "out of the blue"; that the planning proceedings were neither challenged by the Applicants before the planning entities nor by a petition to the High Court of Justice; and in any event, the planning proceeding with respect to Umm Al-Hieran ended when the Appeals Committee's decision was granted. At the end of the hearing a decision was granted whereby the execution of the judgment, which is the subject of the Application, will be stayed until the Application is ruled upon; the parties were also given permission to file complementary documents.

 

 

 

 

Update Notice on behalf of the Applicants dated December 22, 2013

 

14.In the notice it was argued that from a planning perspective there is nothing preventing the recognition of Umm Al-Hieran in the Planning Scheme. It was also argued – based on things said in the hearing before us, so it was claimed – that according to the Respondent, Hiran is not intended for Bedouin citizens, and therefore the Applicants' cultural affiliation constitutes a material reason for their exclusion from its planning. In this context, it was noted that in 2012 the "Hiran" settlement group was established near Umm Al-Hieran, consisting of Jewish families waiting to live in the town to be established. It was further argued that the Respondent did not examine whether it is possible to legitimize the houses in the Atir complex, and that the revocation of the decision to adopt the investigator's recommendations was based on irrelevant considerations.

 

The Respondent's Response dated January 14, 2014

 

15.In the response, it was noted that the Applicants' arguments against the Planning Scheme belong in the framework of the planning proceedings, and it was again emphasized that the Applicants did not petition the High Court of Justice in this matter. It was also emphasized that the Town Scheme designates the area for the establishment of a general town, and therefore it is not possible to legitimize the Umm Al-Hieran complex in its framework. The Respondent further argued that the Atir and Umm Al-Hieran neighborhoods do not constitute one village but are rather two separate complexes, which have different settlement characteristics. It was noted that the investigator explicitly stated that, from a planning perspective, the Umm Al-Hieran complex is not suitable for the establishment of a Bedouin town, as opposed to her recommendation regarding the Atir complex. In this context, the Respondent stated that the investigator's recommendation regarding the Atir complex was not to recognize it as a town or establish a town there, but rather to determine the area as an area in which it will be possible to plan a town in the future; and that the District Committee’s final decision, not to adopt this recommendation, stemmed from relevant planning considerations and a broad perspective, and was primarily based on the need to continue to establish the status of the town of Hura and to utilize the many resources that were invested therein by building neighborhoods for the Village's residents. It was further argued that the Respondent never said that the town of Hiran is not intended for Bedouin citizens, but that a general town in which any person can reside is planned at that location, as opposed to a town that is specifically planned for the dispersed Bedouin population.

 

Supplemental Arguments on behalf of the Applicants dated March 6, 2014

 

16.The Applicants argued, with respect to the Umm Al-Hieran complex, that the eviction decision was adopted in order to settle a different population in the location, and that their cultural affiliation was at the base of the decision. The Respondent's statements that although the Bedouin are allowed to reside in the new town, it is not suitable for them, were brought to support this argument. With respect to Atir, it was argued that designating the location as a park forest for pasture, does not justify evicting its residents, and that the Respondent did not at all examine a planning option of legitimizing the neighborhood. It was also argued that the Respondent did not point to a public justification to revoke their license, especially when, from a planning perspective, there is nothing preventing the inclusion of the residents of the Village in the scheme; that its decision was based on the notion that the Applicants are squatters on the land, contrary to the facts; that as mentioned, the eviction violates the Applicants' right to dignity, equality and property, and constitutes unjust distribution of the land resources in the region; and that the said violations are not proportional and are not for a proper cause.

 

Reminder Hearing dated June 10, 2014

 

17.In the decision dated April 27, 2014, we ordered that a reminder hearing take place before a judgment is granted; at the start of the hearing, we asked the Respondent's attorney whether it is possible to integrate the Applicants' houses in the Town Planning Scheme, and thus reach a practical solution. In response, we were told that the plan is detailed in a way that makes it impossible to deviate from it at this point. The Applicants' attorney argued that even though it is a detailed planning scheme, amendments can still be made to it, if the Respondent is willing to allow it; that public interest warrants first and foremost considering the integration of the existing situation into the planning of the region; and that one must not cling to the fact that detailed plans have already been prepared when it is argued that the plans, in their current format, were not prepared for a proper purpose. At the end of the hearing, we ordered the Respondent to file its position with respect to the possibility of integrating the Applicants' houses in the planning of Hiran, after the parties will conduct a joint meeting on the matter.

 

Update Notice on behalf of the Respondent, dated October 5, 2014

 

18.The Respondent notified that the parties met but did not reach agreement. It was argued that the Applicants' houses were built illegally, and it is not possible to leave them standing. It was also stated that the Applicants would be able to reside in the town of Hiran as any other citizen, in accordance with the rules prescribed therefor. The Respondent further argued that the present proceeding is not the appropriate forum for such allegations against government decisions, the District Planning Scheme and the Town Planning Scheme, especially when the scheme has already gone through all of the planning stages, including final approval. It was further argued that when the members of the Tribe came to the region, they first settled in the Atir complex, and that the bulk of the settlement in the Umm Al-Hieran complex only happened in recent years and without permission; it was further stated that the Respondent has been acting to regulate the settlement of the members of the Hura Tribe since the 1980's, taking into account considerations that are based on the manner the population is dispersed and, inter alia, the fact that better services can be provided to larger concentrations of population. On a practical level, it was argued that the structures in the location do not comply with the Planning Scheme; and on a principle level, that the Respondent does not wish to build a separate Bedouin neighborhood in the town, which would compromise its general character. It was also clarified that nothing is formally preventing the integration of houses located within the boundaries of the town by way of amending the plan; but, in the case at hand, it is not appropriate to legitimize the Applicants' houses, which were built illegally. Finally, it was emphasized that if any of the Applicants will want to live in the town, this will not prevent the demolition of his house, and that the benefits that are given when regulating the settlement of Bedouin citizens will not be granted to him when settling in the town of Hiran, since it is a general town; however, that there is a possibility that even in such a case, such resident will be given, ex gratia, compensation for the demolition of his house, subject to the approval of the Respondent's Compromise Committee.

 

Response and Update Notice on behalf of the Applicants dated November 16, 2014

 

19.In the Applicants' response, it was stated that the Applicants' representatives suggested to approach professional entities to prepare a planning alternative that would allow establishing a new town that will include the integration of the Village's houses, and that the Respondent, on its part, did not offer alternatives to the eviction of the Applicants, and even clarified that there is no place to establish a Bedouin neighborhood in Hiran. They further argued the Respondent should not be allowed to evict the Applicants, who have been living in the location as licensees for approximately 60 years, in order to establish a town without Bedouin people at Umm Al-Hieran, and to designate the area in Atir as a park forest. It was emphasized that the members of the Tribe have been recognized as licensees on the land, thus distinguishing them from the other members of the dispersed populations who are deemed to be squatters and that the Respondent's attempt to undermine this determination must be rejected. Finally, the Applicants argued that the Application is not an objection to the planning proceedings, but rather an examination of the legality and reasonableness of the administrative decision to evict them; that they did not protest the government decision or the Planning Schemes because these did not explicitly state that the town of Hiran is planned as a "Jewish" town that would not include their houses; that in the circumstances of the case, the existence of the Applicants' houses – even though they were built without a permit – actually works towards recognizing and regulating them so as to prevent unnecessary eviction.

 

Ruling

 

20.As mentioned at the outset, I will suggest to my colleagues to act pursuant to our authority in Regulation 410 of the Civil Procedure Regulations and adjudicate the Application for Permission to Appeal as an appeal, but not accept the appeal. It will again be emphasized that a "standard" examination of the Application – that is, in light of the customary rules regarding eviction proceedings, and in light of the facts of the case as were determined in the earlier instances – does not, in and of itself, raise a legal question of principle that justifies granting permission to appeal. As was elaborately detailed, the Respondent is the owner of the land in dispute, which was registered in its name in the framework of regulation proceedings; the Applicants did not purchase a right to the land , but rather settled on it as gratuitous licensees, whose license was duly revoked by the Respondent. In this state of affairs, there is no justification to intervene in the judgments of the earlier courts. As mentioned, in light of the general issue at the background of the Application – and since we are dealing with the eviction of many from their current place of residence – I deemed it appropriate to suggest granting permission to appeal and addressing the Applicants' arguments in detail. There is no denying that the matter at hand is intertwined with the general matter of the settlements with the Bedouin in the Negev, which is a public dispute that is being deliberated in the government and the Knesset. Therefore, the courtroom was filled not only with Bedouin from the Negev, but also with many Knesset Members, almost all of whom were from the Arab public. Indeed, the matter of the lands in the Negev and the rights of the State, on the one hand, and the rights of the Bedouin citizens, on the other hand, is one of the most difficult matters challenging the government system, and it involves charged emotions and political disputes; but we will state here that our ruling is limited to the case before us. While our eyes and ears are not shut to the public matters, these issues go beyond this case to the dispute on the situation in the Negev, the growing and flourishing massive illegal construction there, which anyone driving on the roads of the Negev cannot but notice, and the many attempts to settle it through negotiations, some of which will be described below. In the same breath, we will say that it is obvious that at issue is the eviction of people who have been residing on the location for many years, it is neither an expulsion or an abandonment, but the proposed eviction involves various offers of relocation, construction, compensation and housing options, either in the town of Hura, to which most of the residents of the illegal villages discussed have moved, or in the town of Hiran, which is about to be established, at "general" purchasing terms but apparently with compensation for the investments in construction (even though it was illegal), because of the extended period of time.

 

On the legal level, I am of the opinion that the Applicants' arguments should not be accepted for the following two reasons: First, their arguments in this proceeding do not actually relate to the question of ownership of the land or the classification of the license to it, but rather they are directed against the planning of the town of Hiran, and more broadly – through such planning objections – against the government decision to establish the town of Hiran, and its policy in the matter of regulating Bedouin settlement in the Negev. These arguments constitute an indirect challenge of the decisions of the authorities, which the Applicants should have raised in other procedural frameworks. Second, it does not appear that the Respondent's actions do not coincide with the duties imposed upon an administrative authority; they do not involve a violation of the Applicants' legal rights, and in any event, even if there was a violation – it is proportional.

 

The Background Issue – Regulation of the Settlement of the Dispersed Bedouin Populations in the Negev

 

21.We will again highlight that the Application before us wishes to bring before, once again, a sensitive and complex political-legal-social issue which has not yet been completely solved – the issue of resolving the questions involved in settling the members of the dispersed Bedouin populations on the lands of the Negev. This matter has been at the focus of many petitions and motions in the past (see in the past decade, inter alia, HCJ 8062/05 Al-Atrash v. The Minister of Health (2005), a petition to obligate the authority to connect a house in an unrecognized village to the national electricity grid; C.A. 9535/06 Abu Masad v. The Water Commissioner (2011) (hereinafter: the "Abu Masad Case"), a motion to compel the authorities to connect running water for the members of the dispersed populations; HCJ 8211/08 Abu Masad v. The Minister of Health (2011), a petition to establish a health clinic in an unrecognized Bedouin village; HCJ 4714/12 Hamid v. The Minister of Interior (2012), a petition to allow the members of the dispersed populations to vote and be elected in the municipal election in the regional councils, near the location of their settlements; and see recently in the matter of enforcement of an administrative promise regarding the eviction of land in the Negev region, C.A. 4228/11 Mansur v. The State of Israel (December 15, 2014)); This matter is also at the base of petitions currently pending in this court (for example, HCJ 1705/14 Afash v. The Regional Planning and Building Council , a petition that is directed against a planning scheme that involves the eviction of an unrecognized Bedouin village named "Wadi Al-Naam"; HCJ 4220/12 Al-Okabi v. The State of Israel which focuses on the eviction of the residents of the Al-Arakib village, near the town of "Gvaot-Bar").

 

22.To illustrate the legal complexity of this matter, I found it appropriate to quote from the decision of the Appeals Committee, dated September 24, 2012, which eloquently described it as follows:

 

"As is known, the matter of the Bedouin settlement in the Negev is very complex. This is derived from, inter alia, the Bedouin's claims to ownership of land which, in general, they have difficulty establishing from a factual and legal perspective; from the material differences between the principles of Israeli law in the matter of rights to the land  and the internal property rules that have guided the Bedouin for generations; from the manner of tribal settlement and the dispersing of the settlements; from the fact that this is a population with a nomadic history; from the vast scope of illegal and "wild" construction in these settlements and its dispersing over expanded areas … from the lack of infrastructures for the unrecognized settlements; etc. etc." (paragraph 110 of the decision).

 

In addition, see the words of President (ret.) A. Grunis in A.P.A. 2219/10 Chairperson of the Abu Basma Local Planning and Building Committee v. Amutat Regavim [published in Nevo] (2013), which were said in the explicit context of planning and building in the Negev:

 

"As was mentioned, the matter of settling and building in the dispersed Bedouin populations in the Negev bears social and legal complexity of the highest degree. The complexity is manifested in many intertwined aspects, including: the difficulty in determining a planning policy; the legal and historical disputes regarding ownership of the lands; the actual planning reality; lack of statutory plans; difficulties in enforcing planning and building laws and deficient enforcement; the limited resources allocated for enforcement. One can generalize and say that the complexity is great even compared to planning and building issues that rise in other areas in the State of Israel" (paragraph 13 of the judgment)

 

Generally speaking, the case before us is clearly characterized by the complexity described above – we are dealing with a Bedouin tribe, who moved to the area in dispute approximately six decades ago, pursuant to instructions by the authorities; according to the property laws of our legal system, the members of the Tribe did not purchase ownership rights to the land, despite having settled there by license; they built extensively  and illegally on the location without permits; the majority of the members of the Tribe moved to Hura – a Bedouin town, which is regulated and connected to infrastructures – and those who remained are being required to evacuate their houses, while being offered to move to Hura; in the framework of the overall solution that the authorities have formulated, and as part of a scheme to establish a different town, with a general character, on the location.

23.We will not address the government policy on the matter of settling the dispersed Bedouin populations, as this is not subject to review in this proceeding. The entire matter of the Bedouin in the Negev has a complex history; see the interesting article by Hanina Porat "The Development Policy and the Question of the Bedouin in the Negev in the State's Early Years, 1948-1953" Reflections on the Resurrection of Israel (Iyunim Betkumat Yisrael), 7 (5757-1997), 389, in which there is a description of the complexity of the relationship, and especially see on pages 436-438, and the problems described which are very reminiscent of the present. The State has indeed been dealing with the matter of lands, their cultivation and the rights to them in the case of nomad populations, such as the Bedouin, since its establishment; regarding the Mandate period and the purchase of lands for Jewish settlement see H. Porat From Wilderness to Settled Land, The Purchase of Lands and the Settlement of the Negev 1930-1947 (5756-1996); regarding the legal situation, see ibid, first chapter, pages 1-18; see also Havatzelet Yahel's article, "Land Disputes Between the Negev Bedouin and Israel" 11(2) (2006) 1-22; as well as the article by H. Yahel, R. Kark & S.J. Frantz, "Fabricating Palestinian History: Are the Negev Bedouin an Indigenous People? Middle East Quarterly (Summer 2012), 3. See also H. Zandberg, Israel Lands, Zionism and Post-Zionism (5767-2007), 143, which states that the majority of the Negev lands are Mewat lands. According to Section 6 of the Ottoman Land Law of 1858 Mewat land is land "which is not in the possession of anybody, and, not having been left or assigned to the inhabitants, is distant from town or village so that the loud voice of a person from the extreme inhabited spot cannot be heard, that is about a mile and a half to the extreme inhabited spot, or a distance of about half an hour”[2]; see P. Albeck and R. Fleischer Land Laws in Israel (5765-2005) 86; for extensive review see M. Duchan Land Laws in the State of Israel, 5713-1952 47-50.

However, for a more complete picture and an understanding of the material at hand, hereinbelow is a brief review of the steps the government has taken in the matter in the last decade: on September 29, 2003, as part of decision no. 881, the government declared a comprehensive plan for the resolution of the unrecognized villages problem, in the framework of which seven new Bedouin towns were recognized under a new local council named "Abu Basma" (for a complete picture, it will be noted that this council has since been dissolved, as part of a decision of then Minister of Interior, Eli Yishai, dated November 5, 2012, and has been split into two regional councils "Neve Midbar" and "Al-Kasom"); Later on, on July 15, 2007, government decision no. 1999 was adopted, in which it was decided to establish the Authority for the Regulation of Bedouin Settlement in the Negev, and the Minister of Housing and Construction was charged with appointing a public committee that would examine and present its recommendations on the matter. Accordingly, a committee headed by retired Justice E. Goldberg, former State Comptroller (hereinafter: the "Goldberg Committee"), was established in government decision no. 2491 dated October 28, 2007. The Committee's recommendations were submitted to the Minister of Housing and Construction on December 11, 2008, and the essence thereof was a proposal to formulate a policy that would bring into consideration the claims of the Bedouin population with regards to rights to the land, on the one hand, and the State's needs and resources, on the other hand, while emphasizing that such policy should be implementable within a short period of time. The Report of the Committee for a Policy Proposal for Regulating Bedouin Settlement in the Negev (the Goldberg Report) includes extensive background regarding the history of the matter, as well as various positions of the members of the committee, including reservations. On January 18, 2009, in the framework of government decision no. 4411, it was decided that the report's recommendations will be the basis for the regulation of Bedouin settlement in the Negev and a team, headed by Ehud Prawer of the Prime Minister's office, was appointed to implement them; On May 31, 2011, approximately two years later, the report of the implementation team (hereinafter: the "Prawer Report") was published, and it recommended an outline that would be implemented within a defined schedule and which included, inter alia, and primarily: granting compensations for the ownership claims of the members of the dispersed populations, comprehensive planning of the regulation of the dispersed Bedouin populations as part of the Be’er Sheva Metropolitan Plan, enhanced enforcement against illegal construction, and a plan to advance the economic development and growth of the dispersed populations. Further thereto, it was decided, in government decision no. 3703, dated September 11, 2011, to implement the recommendations of the Prawer Report, along with the publication of a legislative memorandum for the regulation of Bedouin settlement in the Negev, based on the outline proposed therein; it was also decided to conduct a “listening process” to the members of the dispersed populations, and to integrate its conclusions in the legislative memorandum. Accordingly, and in line with government decision no. 5345 dated January 27, 2013, the conclusions that were formulated following the listening process (hereinafter: the "Begin Report", named after former minister Ze'ev Binyamin Begin who led this process), were integrated in the Regulation of Bedouin Settlement in the Negev Bill, 5773-2013 (Government Bills 761 (May 27, 2013), which passed the first hearing on June 24, 2013 (for critique see R. Levine-Schnur Regulating Bedouin Settlement: A Disengagement Plan for the Negev (The Israel Democracy Institute, December 2013)); however, the bill's legislative proceedings are currently on hold, and it was explained that this is in order to allow further discussions.

 

24.As described, many resources have been invested to date in formulating and promoting an efficient and fair solution to this matter, with which the authorities have been dealing for many years (for a description of the steps taken by the government since the 1970's, see the Goldberg Committee Report, on page 19, in the chapter entitled "Committees and More Committees"). It will be emphasized that many positive changes occurred over the years with regard to this matter; many individual disputes were settled by consent – for example, in the case at hand, when the majority of the members of the Tribe agreed to move to the town of Hura; new towns have been built on Negev lands, both towns with a Bedouin character, and towns that were meant for the general public; concurrently, enforcement was tightened with respect to illegal construction in the region, which was becoming very extensive, including in the area which is the subject of our discussion, and this is not denied. However, as mentioned, the bill that was meant to bring into action the policy that strives for a comprehensive solution has not yet matured into a binding law in the State of Israel. I will only note that in our opinion time is of the essence, and that the situation does not improve as years pass without a comprehensive and implemented solution, which is essential for the well-being of the entire public; this, because planning and developing of the Negev, settling the residents of the dispersed populations in a regulated and legal, relevant and fair manner, and the elimination of the illegal construction in the region are all national tasks of the highest importance.

 

Indirect Challenge and Proper Procedural Routes

 

25.As mentioned, the Applicants claim that the decision to evict them in order to establish a town that is not Bedouin, whilst not including their houses in the planning of such town, was adopted in a manner that does meet the obligations of the administrative authority, and amounts to a violation of their basic rights, which does not comply with the conditions of the limitation clause in the Basic Law: Human Dignity and Liberty According to them, this decision manifests a discriminatory policy and ignores other planning options, including the inclusion of the Village's houses in the town. However, the Applicants, who are professionally represented and are aware of their rights, should have directed these arguments in the framework of other proceedings. I will clarify: While these arguments are allegedly directed only towards the decision to evict, they are being argued before us in the form of challenging the mere establishment of Hiran, which derives from the government's overall policy with respect to the matter of the Bedouin settlement in the Negev.

 

The Applicants indeed claim that their Application is not directed against the planning proceedings themselves, but rather seeks to examine the decision to revoke the license that was granted to the Applicants and to evict them, while the reference to the Planning Scheme is incidental to the examination of the Respondent's considerations when adopting the said decision; In their notice dated November 16, 2014, it was even noted that "if and to the extent that the Court will decide that the license is irrevocable, it will not, in light thereof, cancel or change the scheme, but rather the planning institutions will be required to examine the schemes and change them in accordance with the new ruling" (paragraph 31). However, it appears that this is an artificial distinction that results in an indirect challenge; The fact is that the majority of the Applicants' arguments, and particularly that the Hiran town scheme should include the Village's houses, are in fact focused on planning considerations and aspects which are clearly within the authority of the planning entities. As mentioned, these arguments belong to other proceedings, which the Applicants did not initiate, and do not belong in the framework of their defense against the eviction claim filed by the Respondent. I will add that it is evident that, on a practical level, it is difficult to completely separate the claim for removal from the planning proceeding, since without the removal of the Applicants, it will be impossible to realize the establishment of the town of Hiran in furtherance with the planning proceedings. However, on the legal level, we are dealing with two separate matters, and the Applicants could have voiced their position in both of them – not only in the removal proceeding: the removal claim is adjudicated in the civil courts; and the government decisions, which are subject to judicial review in the High Court of Justice, as well as the rulings of the planning entities and the planning entities, which are ordinarily addressed either in the framework of the planning proceedings, or in the Administrative Matters Courts and in the Supreme Court, as applicable, and in accordance with that prescribed in the Administrative Matters’ Courts Law, 5760-2000. This distinction is not a trivial matter; the legislator prescribed how each matter will be handled and this court is not a destination for creating chaos.

 

26.The Applicants had a number of procedural options in the framework of which they could have presented their arguments; Firstly, and particularly with respect to the arguments regarding the mere establishment of the town of Hiran at the location at hand, and with respect to discrimination in allocation of the land resources – the could have petitioned the High Court of Justice against government decision no. 2265, dated July 27, 2002, in which it was decided to establish the town of Hiran; it will be emphasized that the Applicants' arguments include objections to the government's policy in the matter of regulating Bedouin settlement in the Negev, which resulted in the decision to establish Hiran. I will note that residents of Umm Al-Hieran, who filed objections to the specific planning schemes, also indirectly challenged this decision in their arguments against the mere establishment of the town of Hiran. As the Objections Committee stated in its decision dated September 24, 2012, this manner of objection to government decisions is inherently unusual, since the planning institutions may assume, based on the presumption of regularity, that these decisions are adopted lawfully (see A.P.A. 8354/04 The Association for Aid and Protection of the Right of the Bedouin in Israel v. The National Planning and Buildings Council – Appeals Sub-Committee (2005), in paragraph 20 of Judge Y. Adiel's judgment; Indeed, it will be emphasized that in order for a government decision to be challenged before the High Court of Justice, it must be an operative decision – such as a decision to establish a town – in accordance with the principle of the finality of administrative decisions; see for example, in a similar matter, HCJ 6094/12 Salim Abu Al-Qi’an v. The Government of Israel (2012); HCJ 6747/05 Tel-Sheva Local Council v. The Ministry of Interior (2008), in paragraph 9 of Justice U. Fogelman's judgment)). As was stated in the decision of the Objections Committee: "In these circumstances, one cannot object today to the mere establishment of the new town or its necessity at this time, in the framework of the objections to the proposed plan, and any such objection should have been voiced at earlier stages, and in fact, at the stage when the government decision was adopted, following which the District Planning Scheme was promoted and approved (paragraph 66). It appears that this is a fortiori the case in the matter at hand, when the Applicants are presenting such arguments before us, after so much time has passed, and after the decisions and planning train has left the station.

 

27.Secondly, the Applicants' arguments, particularly those that relate to the way the town was planned and the option of including their houses, are directed against the decisions of the various planning entities and should have been argued in accordance with the mechanism prescribed therefor. For example, first of all, the Applicants could have objected to the Town Planning Scheme that was published for validation on May 21, 2003, as part of the approval of Amendment no. 27 of the District Planning Scheme (see, inter alia, Sections 100-112 of the Planning and Building Law for the mechanism of objections to plans that have been deposited). It will be emphasized that at such early stage it was possible to object to general and principle determinations with respect to the character of the town and its planning – such as, for example, with respect to it being planned as a general, and not Bedouin, town; or regarding the exclusion of the Applicants' houses from it – but not at the advanced stage when the actual objections were filed, after the scheme was approval by the SPPM and when the scheme being challenged is a specific scheme, that specifies the change to the Planning Scheme. In this context I will mention that even those residents of the Village who filed objections, directed general and principle planning arguments by means of objections to the detailed scheme, and not at the stage of the approval of Amendment no. 27 to the District Planning Scheme; in the words of the Appeals Committee in its decision dated October 10, 2014, in the matter of the Atir Complex: "When addressing a detailed scheme, the District Committee is not permitted to ponder over normative planning determinations which were expressed in the Regional Planning Scheme or in the District Planning Scheme. These schemes prescribed general planning norms, which the district committee must fill with specific content which will befit such norms and coincide therewith". (paragraph 58; on the normative hierarchy between the planning schemes see HCJ 2920/94 Adam Teva V'Din et al v. The National Planning and Building Council, PD 50(3) 441 (1996); A.P.A. 9654/06 The Society for the Protection of Nature et al v. The National Council's Appeals Sub-Committee (2008); A.P.A. 8489/07 Richter v. The Specific Sub-Committee of the District Planning and Building Committee (2009) paragraph 26 of President (ret.) A. Grunis' judgment).

 

28.That stated above is all the more relevant knowing that the town of "Omrit", which was planned in the framework of Amendment no. 27 to the District Planning Scheme, was not established – as mentioned – due to the objection of the council of unrecognized villages, which was filed at that early stage (on the importance of strict adherence to the mechanism of filing objections in the framework of the planning proceedings, see HCJ 3459/10 Al-Othman v. The Government of Israel (2011), in paragraphs 9-11 of Justice U. Fogelman's judgment). Additionally, even after the appeals were denied by the National Council, a petition could have been filed to the Administrative Matters’ Court regarding the Appeals Committee's decisions; in this matter it will be noted that according to item 10(a) of the First Schedule of the Administrative Matters’ Courts Law, the Administrative Matters Court has the authority to adjudicate planning and building matters; excluded from this authority are, inter alia, decisions regarding a national or district planning scheme, against which a petition will be filed to the High Court of Justice (see, for example, HCJ 8119/10 Friedman v. The Minister of Interior (2011)); The objections of the residents of the Village were filed against the detailed planning scheme for the establishment of Hiran, and therefore, prima facie, a petition against the decisions of the Appeals Committee in the case at hand belongs in the Administrative Matters’ Court. As is known, an appeal by right or by permission, as applicable, on a judgment of an Administrative Matters’ Court can be filed to this Court sitting as an Administrative Appeals Court; see Section 12 of the Administrative Matters’ Court Law and Regulation 33 of the Administrative Matters’ Court (Procedures) Regulations, 5770-2000. However, the Applicants did not file such a petition, neither with respect to the Atir complex nor with respect to the Umm Al-Hieran complex. The Applicants also could have petitioned the High Court of Justice against the SPPM's decision to approve Amendment no. 23 of the District Planning Scheme, in which the designation of Atir and Umm Al-Hieran in the framework of the Be’er Sheva Metropolitan Plan was decided upon (as mentioned, this petition addresses the District Planning Scheme – DPS 23/4/14 Be’er Sheva Metropolitan) – such steps were not taken. Above and beyond the necessary, I will further note that it is reasonable to assume – even though we are not setting rules in this matter – that if such a petition were to be filed at the present time, the argument of laches would be raised; from the subjective aspect of laches, there is a question whether the Applicants have not already waived their right to approach the High Court of Justice or the Administrative Matters Court regarding the planning matters. In any event, instead of directing their arguments in the administrative route, the Applicants chose to raise them in the framework of the current proceeding, before three instances, and in the proceedings in the criminal route that related to the eviction orders that were issued, also before three instances (see the abovementioned P.C.A 3082/14). Objectively speaking, alleged changes occurred on the ground, which if reversed would a priori involve damage to the Respondent and maybe even to third parties – this in any event is true with respect to the government decision dated July 21, 2002, and the Appeals Sub-Committee decision with respect to Umm Al-Hieran, dated September 24, 2012 (with regard to laches see A.P.A. 2611/08 Binyamin v. The Tel Aviv Municipality (2010), in paragraph 15). Either way, in my opinion, it is difficult to accept the Applicants' arguments that they did not file such a petition or objections as part of the planning proceedings because they did not know that a town with a general character, which does not include the Village's houses, was being planned on the land. First of all, it stands to reason that both the declaration of the establishment of Hiran in a government decision and Amendment no. 27 of the District Planning Scheme, were published for all to see, as is customary, and in a manner that would have allowed the Applicants to know about their existence (for the provisions regarding the deposit of building plans and the right to review them see Sections 89-96 of the Planning and Building Law). This is especially when, as mentioned, an objection was filed to the establishment of the town of Omrit, which was also planned in the framework of Amendment no. 27. It appears that in this situation – as especially given the existence of negotiations since the 1980's regarding the Tribe's eviction from the Village – it is difficult to assume that the Applicants were not at all aware of the planning schemes at an early stage. Addressing this at the this time means turning the procedures upside-down and attempting to put spokes in the wheels of the process. This must be said, since the right and relevant move would have been to initiate steps at the appropriate time; and the Applicants are accompanied by legal counsel.

 

29.In summary, the Applicants' arguments before us deviate from the eviction proceedings and even from the eviction decision, since they are directed against other principle and planning matters and constitute an indirect challenge, when, as described, they could have been raised in the form of a direct challenge. The words of Judge Shoham in the above mentioned P.C.A. 3082/14 are appropriate in this matter:

 

"As for the arguments on the administrative and constitutional level, the applicants had the option of approaching the appropriate judicial instances and objecting to the decision of the National Council's Appeals Sub-Committee. The applicants also had the option of objecting before the competent court to the 2002 government decision to establish the town of Hiran on the location. Nevertheless, the applicants chose, time and again, to raise administrative and constitutional arguments in the framework of an indirect challenge, in a proceeding that relates to the revocation of eviction orders, instead of doing so in the form of a direct challenge before the competent instances. It is not superfluous to reiterate that it is not possible to challenge the decisions of the Appeals Sub-Committee and the government decisions in this procedure by way of an indirect challenge" (paragraphs 12-13)

 

30.I will now discuss the Applicants' arguments that a principle legal question arises here regarding the applicability of constitutional and administrative law in a civil court adjudicating an eviction claim by the authority. It will be emphasized that there is no principle case law that disconnects civil law from constitutional and administrative law, and each case is examined on its own merits, and subject to the rules of jurisdiction that were outlined in statutes and in case law; the civil and criminal courts – including this court when sitting as a court of civil and criminal appeals – are entrusted with constitutional and administrative law, and their legal tool kit includes the principles and rules of administrative and constitutional law, even when not addressing a High Court of Justice proceeding or an appeal on an administrative petition. Indeed, the administrative courts and the High Court of Justice have special procedures, but this does not turn them into a different entity. This is even more relevant when dealing with relations between the individual and the authority, which of course, is bound by an enhanced obligation to avoid violating individual rights, along with other administrative duties, even when acting in a private capacity (see Daphne Barak-Erez Administrative Law – Volume 3 (5773-2013) (hereinafter: "Barak-Erez – Volume 3") in chapter 23; Barak-Erez – Volume 1 (5770-2010), on pages 15, 98, 204). In the case at hand, we are dealing with a matter which by its nature has civil aspects and administrative law aspects. Legally, the eviction of land is fundamentally a civil law matter, but it is obvious that when at hand are planning and building proceedings, on the one hand, and people who have been settled on the land for years, on the other hand, the matter is not separated from principles such as the right to be heard and the right for a hearing, and building and planning matters. However, even sensitive legal proceedings are not exempt from proper procedures.

 

31.I will emphasize in this context that the Applicants' arguments are not "denied in limine" merely because their contents are administrative and constitutional; it is of course possible that there will be a situation in which such arguments will be raised in an "organic" manner – without belonging to another specific procedure – in the framework of proceedings that, by their nature are civil and not administrative-constitutional; see for example, the constitutive constitutional judgment in C.A. 6821/93 United Mizrachi Bank v. Migdal Ltd. Kfar Shitufi PD 49(4) 221 (1995), in which heavy constitutional matters were examined and addressed, incidental to a proceeding that began as a monetary claim. The constitutional discourse has permeated into all legal fields, especially vis-à-vis the authorities. On more than one occasion, this Court has used the provisions of the Basic Laws in order to grant relief in civil litigation between two private parties (see, for example, D. Barak-Erez and I. Gilead "Human Rights in Contract Law and Tort Law: The Quiet Revolution" Kiryat Hamishpat 8, 11 (5769); A. Barak "Protected Human Rights and Private Law" Klinghoffer Book on Public Law (I. Zamir editor) 162 (1993)); In the context of corporate law, see C.A. 4263/04 Kibbutz Mishmar Haemek v. Adv. Tommy Manor, Liquidator of Efrochei Hatzafon Ltd. (2009), Justice A. Procaccia's opinion); this is a fortiori the case when dealing, as in the case at hand, with a legal relationship between the individual and the authority. Without setting rules in the matter, it is theoretically possible that constitutional and administrative arguments which will not constitute an indirect challenge – such as arguments relating to a person's property, which is explicitly protected in the Basic Law: Human Dignity and Liberty, will be raised in the framework of an eviction proceeding – particularly since at hand is a relationship between the individual and the authority; this is not the case here. In this context it is also appropriate to address – even briefly – the existence of "civil-administrative" or "administrative-civil" proceedings, which are anchored in both of these legal spheres. Such is, for example, a compensation claim stemming from tender laws, which is prescribed in the third schedule of the Administrative Matters’ Court Law, and which is referred to as an "administrative claim". Such a claim is heard before the Administrative Matters’ Court and its cause of action is administrative – since it is taken from tender laws – but the requested relief is civil in its nature (compensation) and not administrative in the ordinary sense (for example, a mandatory injunction order revoking or instating an administrative decision), and on a procedural level, the Civil Procedure Regulations apply thereto, unlike administrative petitions and appeals and proceedings before the High Court of Justice (Barak-Erez – Volume 3, on pages 174-176; A.P.A. 9660/03 Municipality of Rechovot v. Schwadron (2005); 3309/11 Kotlarsky v. Tel Mond Local Council (2013)); The courts have ruled that in this type of claim, which is characterized by its "normative duality", administrative, material and procedural aspects apply – for example, the court can apply in limine arguments from administrative law, such as laches or failing to exhaust remedies – albeit at a lower intensity than in administrative petitions and appeals (for example, by considering the laches consideration in the framework of the compensation, as opposed to denying the claim in limine; for elaboration on this matter see the Schwadron case and the Kotlarsky case; I. Zamir Administrative Authority – Volume 3 1608 1686 (5774-1984) (hereinafter: "Zamir"); G. Shalev Contracts and Tenders of the Public Authority 141-143 (5760-1999). In a similar case – an "ordinary" civil claim directed against an obvious administrative act – I was of the opinion that it is appropriate to apply such "normative duality", which characterizes administrative claims, and apply the doctrine of laches in administrative actions against the authority (C.A. 5110/05 The State of Israel v. Steinberg (2007).

 

32.In summary, the mere fact that a certain argument is characterized as constitutional or administrative does not prescribe that it is entirely inappropriate for a civil proceeding. It will be noted, with respect to the distinction between administrative and constitutional law, that judicial review on the administration's discretion is directly impacted by constitutional law, to the extent that some courts which apply such review do not mention the traditional causes of review, but rather examine the administrative act in the prism of the limitation clause in the Basic Law: Human Dignity and Liberty, at least if and to the extent the interests that were violated by the administrative act were recognized as rights (see Barak-Erez – Volume 2 (5770-2010) on pages 625-630; see Barak-Erez – Volume 1, pages 71-76 with respect to the impact of the basic laws on administrative law.) One, of course, can argue against the exaggerated use of constitutional arguments where they are not necessary, but this is not at issue in the case at hand. However, in this case, the Applicants could have raised their arguments by way of a direct challenge as specified, and a late indirect challenge is inappropriate; this is not a matter of procedural nuance but rather a matter of substance.

 

I will add that the circumstances of this matter provide a clear manifestation of the rationale of not acceding to an indirect challenge, in the absence of a tangible option of acceding to the Applicants' arguments: Had they been examined directly in a timely manner, this Court – had it found it worthy to do so – could have "sent the ball" back to the court of the planning institutions or even of the government, to hold new discussions and even order changes to their plans with respect to the land. However, in light of the circumstances – after many years and resources were invested in the planning scheme, whilst the objections mechanisms were not properly utilized – this is not feasible. Planning proceedings cannot continue indefinitely, and one must take caution not to create an infinite "planning loop" with perpetual circular motion from which one cannot break free, and which will result in the authorities' plans, which complied with the criteria of all of the planning stages, not being realized; such is the case at hand, there is no other choice than not to accede to the Applications. The prolongation of the planning proceedings is a "sore evil" that should not be exacerbated (see A.P.A. 109/12 Central District Planning and Building District Committee v. Givat Hairusim Event Hall Ltd. [published in Nevo] (2012)). It is difficult to accept the idea that after planning proceeding that focus on the examination of objections and reservations, and which became "administratively conclusive", and during which legal reservations and petitions were not filed despite professional representation – everything should now go back to square one, as though nothing has happened. The planning route has spoken; the residents are not, heaven forbid, abandoned, and are not being evicted without a roof over their heads; their history in the area and the fact that they are citizens of the State who have rights and duties necessitated offering solutions for their eviction. Indeed, as was specified before us, those moving to Hura were offered an entire set of rights, including developed lands and additional benefits.

 

33.Furthermore, as to the applicability of administrative law, the civil courts operate in the framework of the jurisdiction granted to them by virtue of the Courts Law [Consolidated Version], 5744-1984, and particularly by virtue of Section 51, which grants general jurisdiction to the Magistrate Court to address civil claims (up to a certain amount), and Section 40 of the law that grants general jurisdiction to the District Court to address "any civil or criminal matter that is not in the jurisdiction of the magistrate court". These courts also undertook, on a substantive level, to address administrative matters, which were perceived as "civil claims" or "civil matters", even though the boundaries of this jurisdiction are not sufficiently clear (Zamir, on pages 1610-1611, 1711). Furthermore, according to Zamir, the civil courts also have authority to address administrative matters by way of an indirect challenge through Section 76 of the Courts Law, pursuant to which "If a matter is duly brought before the court and a question, which needs to be ruled upon in order to examine the matter, is incidentally raised, the court may rule thereon for the purpose of such matter, even if the matter of the question is within the exclusive jurisdiction of another court or tribunal." In the matter at hand we have been dealing with a removal proceeding; the administrative aspect arises, as described, from the Applicants' defense arguments before the Magistrate Court and thereafter, in their appeal arguments before the District Court and in the current Application, and is not required in order to rule on the eviction matter itself. However, since at issue are proceedings vis-à-vis an administrative authority, the necessary tangency to administrative law exists.

 

In any event, an argument against the manner in which an administrative authority was exercised will only be adjudicated in an indirect challenge in extraordinary cases since "as a rule, the courts will not tend to grant relief in the case of an indirect challenge" (P.C.A. 2385/14 Ben Gurion University in the Negev v. Be’er Sheva Region Municipal Union [published in Nevo] (2014), in paragraph 11; C.A. 7958/10 Pelephone Communications Ltd. v. The State of Israel [published in Nevo] (2012), in paragraphs 31-32 of my opinion, and the references presented there). In the case at hand the exceptions which ordinarily justify an examination by means of an indirect challenge do not apply: "When an administrative act is flawed by a severe moral or legal flaw which is obvious on the face of things; in addition, the litigating party must also prove the existence of special circumstances that justify non-compliance with the provisions of the law, such as special urgency or irrevocable damage which is expected to be caused thereto as a result of the performance of the decision within a short period of time before approaching and receiving an answer from a judicial instance" (ibid). Furthermore, as Justice Y. Zamir stated, "a scent of taking the law into one's own hands and unjustified laches in raising arguments" emerges from the indirect challenge (P.C.A. 4398/99 Harel v. The State of Israel, PD 54(3) 637, 646-647 (2000)). It will be noted that according to the relative voidness rule, an indirect challenge will only be beneficial when the administrative flaw would have resulted in voidness, although an erosion of the rule has been evident, in the sense that courts have also recognized the possibility of an indirect challenge when the result of the flaw is not voidness – see Barak-Erez – Volume 2, on pages 822-827).

 

34.In any event, in light of the sensitivity involved in this case, and since the civil courts are not "disconnected" from constitutional and administrative law, I have deemed it appropriate, within the limits of the authority to exercise indirect review, to briefly address the Applicants' administrative and constitutional arguments, even though this proceeding is not the natural place to do so. The Respondent is acting here as the owner of proprietary rights to land, and, as a public trustee, it is required to make decisions that relate to the management of the assets and their allocation in a manner that coincides with the principles of public law (see Barak-Erez – Volume 3, in page 20; HCJ 6698/95 Ka'adan v. The Israel Lands Administration, PD 54(1) 258 (2000) (hereinafter: the "Ka'adan Case"); HCJ 244/00 The New Discourse Organization for a Democratic Discourse in Israel v. The Minister of National Infrastructures, PD 56(6) 25 (2002)).

 

35.Did the Respondent act fairly? I will mention that this duty is deemed the most important one imposed on the authority, from which other specific duties are derived: it is the "broadest common denominator of the various duties imposed on administrative authorities" (Barak-Erez – Volume 2, on page 630). This statement does not require evidence, and is considered to be "basics", but this Court returns to it time and again ("The State's obligation to diligent fairness in its conduct in all of its ways is as clear to me as the noon-day sun, to the extent that it does not need supporting references" C.A. 10011/07 Foor Investment Management Company v. The Ashkelon Assessment Officer (2010) in paragraph 17 of my opinion; C.F.A. 3993/07 Jerusalem Assessment Officer 3 v. Ikafood Ltd. (2011) in paragraph 6 of my opinion and the references presented there; and see recently A.P.A. 7752/12 Assal v. The Israel Land Administration (2014) in paragraph 25). It appears to me – and this is the main point here – that one cannot say that the Respondent did not act in a fair and bona fide manner with respect to the eviction of the Applicants. First, the Respondent conducted negotiations with the members of the Tribe starting in the 1980's, regarding their eviction from the Village, in return for receiving a lot in the town of Hura. It was back then that the Respondent disclosed its intention to evict them, even though at such stage this had not been expressed in the form of a government decision and detailed planning proceedings. Over the years, a number of neighborhoods were built in the town of Hura in order to take in the members of the Tribe; as mentioned, the town of Hura is recognized by the authorities, is connected to basic infrastructures, and offers community services to its residents and to the residents of the region. The Respondent's offer to the Applicants to move to Hura, where they are entitled to receive a new lot and additional benefits is still open. Indeed, as a trustee of public lands – the Respondent must act for the benefit of the entire public – both for the benefit of the Bedouin population and the benefit of other populations. We will add – with regard to transparency – that the Respondent acted in a disclosed manner and duly published its decisions. It appears that the Respondent's actions in this context were based on a relevant factual and normative foundation, inter alia, the government decision to establish Hiran, the Applicant's lack of rights to the land and the illegal construction thereon, the existence of an immediate and available solution in the form of moving to the town of Hura and the existence of negotiations to realize these objective since the 1980's. With respect to the planning proceedings in particular, it will be noted that the planning institutions' decisions were adopted after they examined the aerial photos of the area of the Village, and as mentioned, based on the investigator's recommendations. In this last context I will add that, prima facie, there does not appear to be any flaw in the SPPM's decision to reconsider and revoke its decision to adopt the investigator's recommendation. An administrative decision can be reconsidered, as long as it is not done based on irrelevant considerations. It appears that the decision to revoke was based solely on planning considerations, mainly the need to continue to establish the town of Hura as the planning solution for the members of the Tribe.

 

36.Moreover, prima facie, there does not appear to be any flaw of unreasonableness in the decision to evict. This is not an arbitrary decision; it was part of a process following a government decision, in the framework of a broader move of regulating the settlement in the Negev by the owner of the land. The decision to evict does not, in the circumstances at hand, deviate from a reasonable balance between interests of the entire public and those of the Village's residents; the granting of good terms to the Applicants to relocate to Hura in order to allow the establishment of a general town. Prima facie, the planning proceedings for Hiran are not flawed by unreasonableness. Although, as mentioned earlier, it is possible that it would have been appropriate to bring the Village's houses into consideration in the planning of the town to begin with, both because the eviction motion – but not the actual planning proceedings – was originally based on the argument that the Applicants are squatters on the land, when in fact they were there as licensees; and because of the thing stated by the planning institutions that, from a principle/planning perspective, there was nothing to prevent the inclusion of the Applicants' houses in the Town Planning Scheme. Additionally, the policy that the government adopted in the matter in recent years actually indicates an attempt to legitimize – when possible and at terms and conditions – existing construction of the members of the dispersed populations in the framework of the settlement of the Negev (see below paragraph 36). However, nothing stated above derogates from the fact that, prima facie, once the decision to evict and the planning proceedings have passed all of the relevant stages in the law, they are not, based on their concrete content, tainted by unreasonableness.

 

37.As to the Applicants' arguments regarding the violation of equality, including discrimination in the allocation of land to the Bedouin population, the Respondent, as an administrative authority, is obligated by the principle of equality, including in the allocation of State lands; the authority is entrusted with such lands and must take public considerations into account when planning and allocating them. However, the planned town does not prevent members of the dispersed populations from living therein but rather is planned as a town with a general character, and not as a Bedouin town, with all that that entails from a planning perspective; anyone desiring to live in Hiran may do so, subject to the law and the terms prescribed therein. Indeed, it stands to reason and it is also stated in the State's responses and in the planning institutions' decisions, that the majority of the population that will wish to live there is Jewish – and accordingly the detailed scheme includes the establishment of institutions that are intended for the religious Jewish public, such as a ritual bath and a synagogue; however, this does not prevent residents from the dispersed populations from living in the town, nor does it "prevent giving a different 'national color' to the educational institutions and/or the religious institutions within the boundaries of the scheme in the future, if and to the extent this will turn out to be necessary, all, taking into consideration the dynamics of the settlement on the ground" (paragraph 87 of the Appeals Committee's decision); it was further noted that the "Hiran" settlement group constitutes a negligible percent of the anticipated number of residents in the town (according to the Respondent, approximately 5%). As mentioned, the possibility of compensating those who will decide to live in Hiran is being discussed, because of the investments in their previous residences. We will also mention the possibility to receive a lot and additional benefits in the town of Hura, as the vast majority of the members of the Tribe chose. It could be argued that by planning towns only for Bedouin residents the authority is acting in a manner that actually somewhat discriminates members of other populations; however, as it was held in HCJ 528/88 Avitan v. The Israel Land Administration PD 43(4) 297 (1989) – in which a Jewish resident's petition to purchase a lot in the "Segev Shalom" Bedouin village was denied – the equality principle coincides with the possibility of planning separate towns for minority communities, in a manner that will allow them to maintain their character (see Barak-Erez – Volume 3, on page 562; for critique on such planning policy also in the context of the Ultra-Orthodox population, and the members of the Arab minority, see G. Gontovnik, Discrimination in Housing and Cultural Groups – Between Legal Walls and Social Fences (5774-2014), on pages 246-252, and the references mentioned there in note 391). This matter is extremely complex in and of itself, but this is not the place to address it.

 

38.The Applicants argued that their right to property was violated, and according to them, their houses should have been legitimized as part of the planning of the town. Indeed, the Applicants were settled on the ground, by license from the Respondent, for more than a few years – and are not, as the Respondent initially claimed, squatters like in other places; of course, the question which arises is what weight should to be attributed to this. In any event, one cannot say that the mere presence on the land and the construction thereon vested them with proprietary rights to the land; their houses were built without permit and illegally. It is obvious that the authority should not be obligated to legitimize illegal construction; furthermore, protecting the rule of law and preventing the encouragement of construction crime constitute legitimate planning considerations (see recently, A.P.A. 6738/13 The State of Israel v. S. Y. Shepets Vaknin Construction Contractors Ltd. (December 2, 2014) in paragraphs 3-5 of my opinion). The aforesaid also coincides with the correct approach vis-à-vis illegal construction, which unfortunately is a common phenomenon, against which the authorities must act with full force (see, for example, P.C.A. 4088 Badir v. The Israel Land Authority (2014) in paragraph 22). Indeed – and this also emerges from the State's notice dated October 5, 2014 – with respect to the members of the dispersed populations, and in light of the special circumstances that have been created, particularly since many of them were transferred to their place of residence by the authorities, this consideration can support the legitimization of illegal construction, subject to a broad perspective of the dispersal of the population on the lands of the Negev and within the boundaries of the Be’er Sheva Metropolitan Plan, and while taking the needs of all of the populations into consideration (regrading this matter see the Goldberg Report, in paragraph 110, and the Begin Report, on pages 5-6; see also A.P.A. 9057/09 Igner v. Hashmura Ltd. (2010) and A.P.A. 65/13 Haifa District Planning and Building Committee v. Naot Mizrachi Ltd. (2013));

 

It will further be mentioned that all of the reports prepared in this matter, as well as the explanatory notes for the legislative memorandum for regulating Bedouin settlement in the Negev, stated that enhancing the enforcement against illegal construction, alongside finding a solution that is satisfactory to the members of the dispersed populations, is a fundamental principle of the proper policy (see the Goldberg Report, in paragraph 63; the Abu Masad Case, in paragraph 62 of Justice A. Procaccia's judgment). In this case, the Respondent objects, for reasons that are based on broad planning considerations, to legitimizing the Applicants' houses, and it cannot be forced to do so, especially when they do not possess rights to the land . Furthermore, even if the Applicants did possess rights to the land , this would not be sufficient to derogate from the planning authorities' powers – subject, of course, to the law and the authority's administrative duties – pursuant to the case law that the use of property is subject to planning (C.A. 377/87 Kalka Nachum Ltd. v. The State of Israel, PD 41(4) 673 (1987); P.C.A. 2041/11 Kibbutz Yagur v. The Haifa District Planning and Building Committee [Published in Nevo] (2011)). As far as I am concerned, I would like to clearly emphasize that in my opinion legitimizing illegal construction creates a "boomerang effect" and the authorities must apply great caution when doing so it.

 

39.Again: I have not failed to notice the fact that the eviction motion was originally based on the unlawful squatting argument, when in fact the Applicants were there by virtue of a gratuitous and revocable license; This is why it was argued that the decision to evict was adopted based on a factual background that was lacking. In this matter it was noted in the Appeals Committee's decision that there is a principle impediment to legitimizing the construction on the location since it is illegal; and that the mere fact that the Applicants had settled there by license does not constitute a legitimization for illegal construction on the location, and it cannot violate the Respondent's right to evict the land. However, I do not rule out the possibility that it could have influenced the planning considerations at the basis, such that the possibility of including the Applicants' houses in the planning of the town would have been considered. It will be noted in this matter that the government decision to establish the town and the subsequent planning proceedings occurred several years before the Goldberg Report which recommended, inter alia, to include and legitimize the houses of the dispersed populations in the plan as part of the planning of the Negev region, wherever possible, in accordance with planning and other considerations: "In principle, it is recommended to recognize, to the extent possible, each of the unrecognized villages that has a minimal mass of residents, as will be determined, and which will have a municipal carrying capacity, strictly provided that such recognition will not contradict a district planning scheme" (paragraph 110 of the report); this principle is also expressed in the Begin Report. However, as mentioned, this is subject to broad considerations that are considered by the authorities, and in the case at hand, one must remember that the majority of the members of the Tribe settled in Hura, and that the illegal construction increased over the years. In this latter matter I will quote from the decision of the National Council's Appeals Committee dated September 24, 2012, paragraph 105:

 

"In any event, we will note that the factual background presented before us supports the arguments of the representatives of the District Committee and the Administration, that the main mass of structures in the Umm Al-Hieran complexes was indeed built in recent years, when the preparation of the motion to establish the new town of Hiran had already begun, while the older Bedouin settlement, of the members of the Al-Qi’an tribe is in the Atir complex, which is not within the boundaries of the scheme. This fact was reported to us by "direct testimony" of Ms. Ruth Chen and Ms. Michal Darwin Kleinhaus, who were present in the oral hearing before us, on behalf of Architect Yoram Fogel, who prepared the plan for the Administration, and who informed us that in 1998, upon the beginning of the planning of the town of Hiran, when they themselves visited the area of the scheme, together with the district planner and additional entities, they discovered that there were only a few individual structures spread out, and there were mostly tin shacks in the area. Aerial photographs that were submitted to us from 1995 and 1998, and which were also presented to the objections sub-committee, support this state of affairs. We will note that similar data also emerge from aerial photographs of the Israel Mapping Center, in the GIS Department of the Ministry of Construction and Housing, where available data from the years 1999 through 2010 were found. The findings that emerge from these aerial photographs are that during the mentioned decade construction accelerated in the two concentrations in the area of the location of stage A of the Hiran scheme – the central one on the hill and the southern one in the wadi. Thus, while in 1999 there were 10 structures in the central site and 12 structures in the southern site (and it is possible that some of the structures served and serve agricultural purposes, and not necessarily residential ones), in 2004 there were 13 and 12 structures, respectively; in 2007 there were 16 and 17 structures, respectively; in 2008 there were 18 and 18 structures, respectively; and in 2010 there were 23 and 13 structures, respectively; in other words, during the decade the number of structures almost doubled to approximately 40 structures. We will note that the stated in the Lubrani Document, upon which the appellants relied, does not present a settlement picture that is contradictory to these findings, quite the opposite. Mr. Lubrani specifies in this document, inter alia, that the members of the Al-Qi’an tribe 'which consists of approximately 200 persons, settled following the War of Independence, on abandoned land around Beit Kama – Dvir – Lahav […] without lease agreements … due to pressure that was applied by the military government … approximately 2/3 of them agreed … to relocate their place of residence to the vicinity of Atir…' (emphasis added). Meaning, the early settlement was in Atir, as opposed to Umm Al-Hieran. If this is not sufficient, the representatives of the District Committee are correct that had there been houses in the Umm Al-Hieran complex in the early Bedouin settlement, it would have been expected that during the discussions regarding District Planning Scheme 27/14/4 – which was initially promoted as a joint scheme for the towns of Hiran and Omrit – an objection against the town of Hiran would have been filed by the Council of Unrecognized Villages, due to the settlement of the dispersed populations in the area, while in fact, such an objection was filed only with respect to the town of Omrit."

 

40.In summary, it is will be emphasized in this context – without in any way taking lightly the difficulty involved in evicting a person from the place where he resided for many years – that the eviction of the Applicants indeed does not leave them in a hopeless situation. They may move to the town of Hura, at the beneficial terms and conditions that were prescribed, and this pulls the rug from under the claim of infringement of right to property; approximately two thirds of the members of the Tribe did so. At the present time, after the adoption of decision no. 1028 of the Israel Lands Administration – which increases the compensation given to the members of the dispersed populations in return for their eviction of the unrecognized villages –Applicants who will move to Hura will be entitled to better terms than those received by the members of the Tribe who moved during the 1980's and 1990's. Alternatively, the Applicants, just as any other citizen, may purchase a lot in the town of Hiran, when it will be established, in accordance with the terms which apply to everyone. Furthermore, according to the Respondent's notice dated October 5, 2014, a Village resident who will purchase a lot in the town of Hiran may be entitled to receive compensation for the demolishing of his house – subject to the approval of the compromise committee – a benefit that is ordinarily granted to the members of the dispersed populations who move to a Bedouin town. Furthermore, in our opinion, the Respondent should consider, in an appropriate and fair manner, that residents who will prove that they are from the "core historical group" who arrived at Umm Al-Hieran as licensees, receive a certain benefit in the framework of the marketing tenders in the new town of Hiran; this would also give certain attention by the authorities to the fact that some of those affected by the matter were licensees and not squatters. It will be noted, for the completion of the picture, that a number of members of the Tribe who reside in Hura recently filed a petition to obligate the authorities to market lots in neighborhood 12 of the town to them (HCJ 7348/14 Kiyan et al v. The Authority for the Regulation of Bedouin Settlement in the Negev ). In response to the petition, it was argued that these lots are first and foremost intended for the members of the Tribe who are on the land that is intended for the establishment of Hiran, and that there is no intention to market them until there is a ruling in the current Application. In light of that stated, on December 14, 2014, a decision in Petition 7348/14 was granted, pursuant to which the parties will submit their updated position after the granting of a judgment in this Application. Without expressing any opinion in that petition, I will note that it appears as though there is great demand for these lots, but the Respondent is obligated, as part of the plan for planning the region, to supply them to the remaining residents of Atir - Umm Al-Hieran. In such circumstances, it seems to me – even if they think otherwise - that the Applicants have a fair solution, and they should exercise it. Finally, even if it will be said that the Respondent's decisions in this case violate the Applicants' rights, and in the entirety of the matter, this is not the case, prima facie they are not flawed by lack of proportionality. Generally speaking, it can be said that the purpose of the Respondent's actions is to establish the town of Hiran. It appears that the means it took to that end do not deviate, in these circumstances, from the limitation clause and the boundaries of proportionality. It seems that the means the authority has chosen achieve their purpose; that at this time there are no other means that would be less harmful (after, as mentioned, other options were considered and ruled out); and that on the normative level (meaning, the narrow proportionality test) the purpose which the Respondent is aiming to achieve – the establishment of the general town of Hiran, on the one hand, and the enhancement of the Bedouin town of Hura – is important enough to justify the alleged infringements involved in the achievement thereof.

 

The Sum of the Matter

41.In summary, I will suggest to my colleagues to accede to the Application for permission to appeal, but not to the appeal itself, for the reasons detailed above; I am sorry that attempts to reach a compromise did not succeed, and we would have been happy had they succeeded. I will note that in the abovementioned Al-Okabi case, we also suggested to the parties, at the end of the last session in the case, to conduct a mediation proceeding in order to reach an agreement (see decision dated June 2, 2014). It is obvious that a compromise approach is appropriate in legal disputes such as these, which emerge incidentally to the matter of the Bedouin settlement in the Negev, until the long awaited constitution of a comprehensive arrangement of this matter which – to the extent possible – will prevent additional disputes of this kind which frequently land in court; if common sense will prevail and various politics will be set aside, there is a greater chance for this to happen. The authorities and the dispersed Bedouin populations alike must promote practical solutions to the disputes, and the sooner the better. Although we are not accepting the appeal, in these circumstances there is no order for expenses.

 

42.Subsequently to the above, I read the opinion by my colleague, Justice Barak-Erez. It appears that the gap between us is not very large; See paragraph 40 above and the suggestion to consider granting a certain benefit in the marketing tenders to the proven licensees. However, I am afraid that on a practical level, the meaning of a suggestion that is more far reaching than the one I suggested, such as that of my colleague, could – inter alia – significantly delay the establishment of the town of Hiran, without grounds in the planning proceedings, all as was described above. I am of the opinion therefore that we must suffice with that which is stated in paragraph 40.

Deputy President

 

 

Justice Hendel:

 

I concur with the judgment of my colleague, the Deputy President.

 

Justice

 

Justice D. Barak-Erez:

 

1.I have read the judgment of my colleague Deputy President E. Rubinstein, and while I agree with a considerable part of the principles upon which it is based, I am of the opinion that their application in the circumstances of the matter leads to a different result.

 

The Main Factual Background

 

2.In order to clarify my position I wish to pinpoint the factual base underlying the current proceeding: The Applicants, who belong to the Al-Qi’an Bedouin tribe, have been residing in the Umm Al-Hieran region since the 1950's after the State permitted them to reside there following their eviction from their previous place of residence. Thus, legally speaking, their status is that of licensees. This, contrary to the State's original arguments in this proceeding, and in a not inconsiderable part of the planning proceedings – that the Applicants are trespassers. At a certain point, as part of the development of the Negev, it was decided to plan the area in which the Applicants reside, including the establishment of a new town named Hiran on the location. The Applicants participated in the planning proceedings and filed objections to the proposed scheme, but did not exhaust these proceedings by way of filing a petition to the Administrative Matters Court against the decision of the National Planning and Building Council's Appeals Sub-Committee (hereinafter: the "Appeals Committee") after it rejected the appeal they filed. Concurrently, a proceeding was being held in the courts regarding the eviction of the Applicants from the location. This proceeding reached our doorstep in the framework of this Application. According to the Applicants, the State should have taken into consideration the fact that they were legal licensees on the location and allowed them to stay thereon, even if in the framework of the new planning, especially once the State declared before us, throughout the entire proceeding, that the new town that is being established in a "general" town, meaning, not a town that is "closed" to Bedouin citizens who will wish to live there.

 

3.Similarly to my colleague, I am also of the opinion that the Applicants cannot, at this stage, raise arguments that relate to the planning proceedings. Once the Applicants chose not to exhaust the paths that were open to them to challenge the planning proceedings, the planning decisions became a fait accompli which can no longer be appealed. Also, on a formal level, the proceeding before us is not about planning, but rather only about the matter of evicting the Applicants from the location. Hence, the question of the manner in which the planning authorities should have planned the town of Hiran is not the question presented before us and therefore, I will not rule upon it. Nevertheless, I will note that I find much logic in the approach of my colleague, the Deputy President, that it would have been appropriate to try and include the Applicants' houses in the planning scheme of the new town to begin with, considering the fact that they are licensees who have been residing there for decades, and considering that it emerged from the Appeals Committee's decision that there is nothing preventing that from a planning perspective. In reality, this was not done, and lessons should be learned from this for other planning proceedings. However, as stated, this matter is not presented to us. The matter that was presented to us revolves around the eviction of the Applicants, and that is what I will focus on.

 

The Normative Framework: The Normative Duality

 

4.The starting point for the discussion in the matter of the Applicants in this case must be the joint application of public and private law principles in their matter, in the framework of the principle of normative duality (See: Daphne Barak-Erez Administrative Law Volume 3 12-23 (2013)). This is what the Applicants argued, and on a principle level, this is a starting part to which my colleague also agrees.

 

5.Therefore, the decision to evict the Applicants, who were licensees for decades, must be examined both through the prism of the laws of license to land (see: Nina Zaltzman "License to Land" Hapraklit 42 24 (1995); Nina Zaltzman "'Gratuitous License' as 'Lending of Land'" Iyunei Mishpat 35 265, 271-272 (2012)), and through the prism of public law, which requires that decisions be reached while protecting fairness and based on the consideration of all relevant considerations.

 

6.The Laws of License to Land – a license is a flexible legal institution, the proper and just contents of which are given by the courts in the circumstances of the matter (see: Joshua Weisman Law of Property; Possession and Use 488 (2005) (hereinafter: "Weisman"). A license without consideration is generally reversible and revocable, but there are cases in which justice requires preventing the granter of the license from revoking it, for example, in the circumstances of estoppel, and each case will be decided based on its concrete facts (see: Weisman, on pages 480-484; and Miguel Deutch Property Volume 2 414-415 (1999)). As part of the justice tests that the courts applied in applications to revoke licenses to settle on land, significant weight has been attributed, inter alia, to the question of the duration of the use of the land and reliance of those residing on it (see, for example, C.A. 633/08 Israel Land Administration v. Hitman in paragraphs 23-24 of the judgment of my colleague, (then) Justice E. Rubinstein (hereinafter: the "Hitman Case)).

 

7.Public Law: Fairness, the Duty to Consider all Relevant Considerations and the Decision's Factual Foundation – as was also stated by my colleague, Deputy President Rubinstein, the authority must act fairly with a citizen with whom it interacts. This fairness requires, inter alia, willingness to genuinely consider data presented thereto that do not seemingly coincide with the authority's representatives’ previous thoughts and plans. However, administrative fairness is not limited to this. Every administrative decision must be based on the weighing of all considerations relevant to the matter. Indeed, the authority has extensive discretion with regard to balancing the considerations. However, it is not permitted to ignore a relevant consideration or not bring it into consideration to begin with (see: H.C.J.F.H. 3299/93 Wechselbaum v. The Minister of Defense, PD 49(2) 195 (1995)). Moreover, the exercise of administrative discretion must be based on a correct factual foundation. When an administrative decision is adopted based on a factual foundation that is later discovered to have been incorrect, the authority must reexamine whether it must update its decision in light of the amended factual platform underlying the matter. In the typical case, the courts address cases in which the authority adopted a decision that is desirable for an individual, and it requests to change it after it is discovered that it was based on a mistake. It has been held that if at issue is a "material mistake", it will be able to do so (see: Daphne Barak-Erez Administrative Law Volume 1 389 (2010)). This is also true, mutatis mutandis, in those cases in which the authority's original decision was harder on the individual, due to a mistake. In this case as well, the authority must reexamine whether its decision should be updated – to benefit the individual.

 

8.In furtherance thereto, it is necessary to further examine the relevant considerations that apply to the eviction of those residing on public lands, by virtue of permission they received. I am of the opinion that these considerations include, at the very least, reference to the following questions: what are the reasons underlying the decision to evict the licensees? Were the terms of the license violated? What is the intensity of the injury to the licensees and what is the degree of their reliance on the permission they had received? Does the eviction derive from a new planning of the land, and at what stage are the planning proceedings? Are the licensees entitled to receive compensation for their eviction? If the eviction derives from re-planning of the land and in such circumstances in which those licensees are indeed entitled to receive compensation for their eviction, additional questions arise: Does the re-planning allow compensation in the form of continued residence on the location as part of the construction that is being planned thereon? Does the compensation plan take into account the preferences of the licensees and the linkages they have created to the location, as well as to the community created thereon? It goes without saying that it is the authority that is entrusted with balancing between the considerations. Furthermore, the proper balance between the considerations could change from case to case. Thus, if the land is planned for public use that does not coincide with continued residence on the location (due to the planning of an industrial area, a nature reserve, etc.), there is no doubt that the weight that is to be attributed to the licensee's interest to remain on the location is small, and at times completely diminished. It will be emphasized there is an entire web of considerations which the authority must take into consideration prior to evicting the licensee from the land, and it goes without saying that he does not have an inherent "veto right" against the planning of the area on which he resides. In a State where the inventory of land is very limited, the authorities are required, and at times even obligated, to revoke licenses to land, for example, in order to crowd construction while taking into consideration the needs of future generations (see: Daphne Barak-Erez and Oren Perez "Planning in Israel's Lands: Toward Sustainable Development" Mishpat Umimshal 7 868 (2005)). However, alongside this, it is clear that revoking licenses is an administrative act that must be made based on reasoning and in a reasonable manner and in this sense, the interests of the licensees, a fortiori when dealing with licensees who have been residing on the location for decades, must also be taken into consideration prior to reaching a decision (see and compare: P.C.A. 7244/13 Salam v. The Estate of the Late Gershon Valchinsky paragraph 19 (February 18, 2014)).

 

9.The Procedural Duality – The case before us is complex not only because it combines private law and public law, but also because two procedural systems apply to it - that of the planning proceedings and that of the eviction proceedings. The planning proceeding is conducted in the planning institutions, and can eventually be appealed in the form of an administrative petition. In contrast, the eviction proceeding is performed in a separate route, generally by way of filing an eviction motion (see also: The Public Lands (Eviction of Land) Law, 5741-1981). As part of the planning proceeding, the licensees residing in an area that the State wishes to re-plan may argue that such planning should be completely avoided and the present state should remain as is, or that the re-planning should consider their preferences and the community they have formed in the location. In contrast, the scope of arguments that can be raised in the framework of the eviction proceedings depends on the question whether the planning proceeding addresses the future or has already been completed. As far as the eviction decision is reached before the planning proceeding has begun – the licensees can argue broadly against the need to evict them and the State, on the other hand, can presents reasons for the eviction that are unrelated to the future planning, for example, due to their violation of the terms of the license. In contrast, if the eviction decision is reached simultaneously with the planning proceeding or thereafter – the arguments that can be raised against it are limited to those arguments that could not have been raised in the framework of the planning proceeding. Accordingly, if the planning proceeding is complete, the licensees may argue against the compensation format that is being offered to them if they are entitled to compensation (for example, will it allow them to stay in the vicinity, even if not in the existing houses, to the extent this is possible in the framework of the new planning), but not against the mere eviction from the existing houses on the location, if these do not coincide with the new planning.

 

10.The reciprocal relationship between the two said sets of rules is especially complex when the State requests to revoke the license that was given to the licensees after the planning proceedings have already begun, but before they were completed. I am of the opinion that in this case the court must examine whether there is a good reason to revoke the license and evict the licensees regardless of the planning proceedings and what that reason is (for example, there could be significance to the question whether the terms of license were violated and whether such a violation is material). If such a reason exists the court will order the removal of the licensees even without waiting for a ruling in the planning proceedings. In contrast, if the eviction of the licensees is required for the purpose of a future realization of planning schemes that have not yet been approved, and to which the licensees object, it would, in general, be appropriate to stay the ruling on the removal motions until the exhaustion of the planning proceedings (including the legal proceedings that can be initiated against them), which are the proper "geometrical location" to address the licensees' arguments with respect to the planning of the land upon which they reside. This so as to avoid a situation in which conflicting rulings will be reached in the framework of the planning proceedings and the eviction proceedings that are being held concurrently. This will also allow the authorities that are re-planning the area in which the licensees reside to genuinely examine the question whether the new intended use of the land allows the licensees' continued residence on the location, considering the entire circumstances, including the duration of time they have resided there. This will allow to take into consideration the licensees' interests when re-planning these lands, especially when dealing with licensees who have been residing on the location for many years and who were not squatters thereon, but rather settled there to begin with at the consent of the relevant authorities.

 

11.Hence, my colleague, the Deputy President, is correct that the fact that the legal proceedings relating to the planning proceeding were not exhausted, significantly limits the scope of matters that are examined by us. The planning proceeding is the appropriate framework for examining the proper balance between the licensees' interests, including the linkages they created to their location and their reliance on the license that had been granted to them, and the public need for re-planning, as well as for examining the question of finding the solutions for the licensees to continue to reside on the location, in the framework of the re-planning.

 

The Normative Framework: From Theory to Practice

 

12.My colleague examines the question of the reasonableness of the decision to evict the Applicants from the location where they reside, while emphasizing two considerations: The policy that relates to the regulation of Bedouin settlement in the Negev and the fact that the eviction of the Applicants is accompanied by an allegedly fair plan of compensation in the format of allocating lots in another Bedouin settlement in the Negev (which includes the allocation of lots to all of the adult males in accordance with an age threshold requirement). Taking these two facts into consideration, my colleague is of the opinion that the decision that was reached is reasonable. My opinion is different. Indeed, there is no doubt that these are relevant facts. However, in the framework of the decision to evict, and specifically regarding the format of compensation involved, the State did not at all take into consideration an additional important, even critical, fact – the fact that the Applicants have been licensees on the location for decades. In this matter the State relied on erroneous information that the Applicants are trespassers. Furthermore, the State did not reexamine its decisions once the correct facts were discovered. It did not at all take into consideration the linkage the licensees developed to their place of residence, the degree in which they relied on the license and the intensity of the harm to them after residing in the location for decades. As mentioned, these considerations bear significance in the prism of the law of property, which recognizes that the revocation of a license after decades is not a trivial matter. They also bear significance in the prism of public law, which is responsible for the duty of fairness, as well as for the duties deriving therefrom, including the duty to take all the relevant considerations into consideration and to base administrative decisions on a correct factual foundation.

 

13.Given the above, I am of the opinion that it is correct to examine the case before us considering its special characteristics: The fact that at issue are persons against whom there is no claim of trespassing, persons who were licensees and who settled on the location in accordance with the State's instructions, meaning, they are not residents with an implied license, but were rather granted an explicit license to settle on the location. Particularly given the considerations that relate to the protection of public lands against trespassers, I am of the opinion that the State must act fairly when examining the matters of those against whom there is no claim of trespassing.

 

 

The Appropriate Relief

 

14.In practice, there is no dispute in the case before us that the Applicants are entitled to receive compensation for their eviction from the land, since even the State is offering such compensation. Furthermore, my colleague also recognizes the special characteristics of the Applicants and calls for them to be treated fairly. He even adds, at the margins of his judgment, a recommendation to consider granting those who wish it, a certain benefit in the framework of the marketing tenders in the new town of Hiran. This is correct, but in my opinion insufficient. Indeed, once the Appeals Committee denied the Applicants' appeal in which they requested, at the least, to legitimize their houses as part of the Hiran Town Planning Scheme, and since the Applicants did not challenge this decision, it must be deemed a fait accompli, and it is difficult to see how the Applicants can continue to live in their houses that do not comply with the planning that has become final.

 

15.However, once it became clear that the Applicants are licensees and not trespassers, the authorities were obligated to exercise renewed discretion regarding the format of the eviction and the compensation that will be granted to the residents as part of the eviction proceedings, and they did not do this. They did not do this, but rather continued to insist on the decision that originally relied upon an erroneous factual foundation, and consequently, on lacking considerations that were adapted to that factual foundation. The conclusion my colleague reached does not provide any practical reflection of the fact that the decision regarding the eviction, and especially the compensation involved therein, violated the rules of public law, and therefore it is inappropriate for the Court to allow it to be executed in its original format, without exercising renewed discretion. This result also coexists with the fact that the traditional ruling of this Court was diligent about the fact that when a motion for removal is filed against possessors of land, and in the interim it is discovered that they are in fact licensees, the motion will be denied (see: C.A. 44/65 Pritzker v. Shahin, PD 22(1) 675 (1966)). The time may have come to reexamine whether this rule is relevant to any event in which it is discovered during the legal proceeding that the possessors, are not, in fact, trespassers. However, there is no doubt that at the current time this is the binding case law and in any event, it is especially true in the case of licensees whose residence on the land resulted from an explicit instruction by the authorities, as opposed to an implicit license which can be argued after years. Hence, as the earlier instances which addressed the case have already noted, it was inappropriate to file the claim in the format in which it was filed. The result is that both in terms of procedure and in terms of substantive public law, it is impossible to reach another conclusion other than that the claim was filed in a flawed manner and that it also continued to be adjudicated without the authorities exercising renewed discretion in the matter.

 

16.Therefore, I am of the opinion that the authorities must reexamine the format of the compensation that will be granted to the Applicants in the framework of the eviction, taking into consideration, inter alia, that the Applicants are, as mentioned, licensees that have been residing on the location for approximately sixty years, and that the State adamantly states that the new town does not have a unique nature and is open to all persons, including the Applicants themselves if they will so desire. For example, the State can consider the possibility of offering the Applicants (and any of the additional residents of the location who can prove that they have been licensees on the location for many years) additional possibilities of receiving compensation, other than moving to Hura, including the possibility of receiving a lot in the new town of Hiran, in accordance with the size of the lots that is planned in this town (which is smaller than the lots offered to the Applicants in Hura) instead of receiving the lots that were offered to them in Hura (considering the fact that even the State stated in its response dated October 5, 2014, the possibility of granting compensation to any of the Applicants who will demolish his house and purchase a lot in Hiran). Additionally, the State should also consider the date of eviction, taking into consideration the fact that a stay in the eviction until the beginning of the execution of the planning in Hiran could open the path to alternative compensation by means of receiving a lot instead and building thereon in accordance with the new planning. This is not the only option, but it should also be genuinely and sincerely examined. The compensation offered in Hura may be more generous in terms of the willingness to allocate relatively larger lots, and also to the children's generation, however this does not put an end to examining other options. Since arguments on this matter were not raised before us, I will not address the questions that might arise given the preference to the selected format of compensation to allocate lots on a gender basis, questions which have complex aspects in a context such as this. In any event, as I stated above, the planning scheme that applies to the land cannot be challenged as part of this proceeding, and so can’t the demolition orders that were issued against the houses, which the Applicants built without permits, be challenged in this framework. However, the Applicants' obligation to demolish these houses does not mean that, in the framework of the eviction proceedings, their status as licensees on the location or the community they created thereon can be ignored.

 

17.As to my colleague's last remark, I will add and clarify that I do not see eye to eye with him that this suggestion would delay the establishment of the town. The result of my judgment is directed towards the compensation that will be granted in the framework of the existing planning, and we have not been presented with any data that would indicate that compensation of such or similar kind would result in delaying the establishment of the town.

 

18.Epilog: Indeed, the Applicants cannot receive the entire relief they requested, after failing to exhausted the means of challenging the planning in the region. However, one can also not reconcile with the flaws that tainted the conduct of the authorities in all that relates to the decision to evict and the compensation involved therein. I am of the opinion that there must be a practical reflection – as opposed to merely a recommendation – of the principles that my colleague outlined in his opinion. Therefore, if my opinion was to be heard, we would accept the appeal and instruct the State to reconsider the compensation that is to be granted to the Applicants in the framework of the eviction proceedings, while examining the possibility of preserving their linkage to their residential environment, as stated in paragraph 16 above.

 

Justice

 

 

 

Decided by a majority of opinions as stated in the judgment of the Deputy President.

 

Given today, the 16th of Iyar 5775 (May 5, 2015).

 

 

Deputy President                                Justice                                     Justice

 

 

 

[1] The correct title of the law is: Land Rights Settlement Ordinance [New Version], 5729-1969

 

[2] The Ottoman Land Code, Translated by F. Ongley of the Receiver General's Office in British Cyprus, http://www.archive.org/stream/ottomanlandcode00turkuoft/ottomanlandcode0...

 

Full opinion: 

Hussein v. Cohen

Case/docket number: 
HCJ 5931/06
Date Decided: 
Wednesday, April 15, 2015
Decision Type: 
Original
Abstract: 

Facts: The appeals focused upon the question of whether properties in East Jerusalem that belong to residents of Judea and Samaria are deemed “absentee property” as defined under the Absentees’ Property Law.

 

Held: In dismissing the appeals, the Supreme Court held that the Absentees’ Property Law applies to properties in East Jerusalem whose owners, beneficiaries or holders are residents of Judea and Samaria. However, in light of the significant difficulties attendant to implementing the Law in accordance with its language, in general, the authorities should refrain from exercising their statutory authority in regard to such properties except in the most exceptional circumstances, and that even then, only subject to the pre-approval of the Attorney General and a decision by the Government or a ministerial committee appointed by it. The Court’s holdings in this judgment will apply prospectively, and only where no statutory steps have been implemented in regard to the said properties.  The holdings of this judgment lead to the conclusion that the specific properties that are the subjects of the appeals are absentees’ property.  

Voting Justices: 
Primary Author
majority opinion
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concurrence
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Full text of the opinion: 

In the Supreme Court

HCJ 5931/06

Sitting as a Court of Civil Appeals

HCJ 2038/09

 

 

Before:

His Honor, President (ret.) A. Grunis

Her Honor, President M. Naor

His Honor, Deputy President E. Rubinstein

His Honor, Justice S. Joubran

Her Honor, Justice E. Hayut

His Honor, Justice H. Melcer

His Honor, Justice Y. Danziger

 

 

 

 

The Appellants

in CA 5931/06:

1. Daoud Hattab Hussein

2. Alian Issa Azat

3. Saba Naji Suleiman Alarja

4. Jamal Naji Suleiman Alarja

5. Majed Naji Suleiman Alarja

 

 

 

The Appellants

in CA 2038/09:

1. Dr. Walid Abd al-Hadi Ayad

2. Dr. Fatma Ayad

3. Mahmoud Abd al-Hadi Iyad

4. Haled Abd al-Hadi Ayad

5. Hiam Ayad

6. Ali Abd al-Hadi Ayad

7. Signe Breivik

8. Safa Abd al-Hadi Ayad

9. Hamad Ahmed Ayad

10. Fatma Abd al-Hadi Ayad

11. Hassan Salameh Ayad

12. Dr Higad Abd al-Hadi Ayad

13. Dr Fayez Ibrahim Abd al-Majid Hamad

 

 

 

V.

 

 

The Respondents in CA 5931/06:

1. Shaul Cohen

2. Adv. Ami Fulman in his Capacity as Receiver

 

3. Dan Levitt

 

4. Robert Fleischer

 

5. Yaron Meidan

 

6. Shlomo Ohana

 

7. Lilian Ohana

 

8. Moshe Ben Zion Mizrahi

 

9. The Head of the Jerusalem Land Registry

 

10. The Custodian of Absentees' Property

 

 

The Respondents in CA 2038/09:

1. The Custodian of Absentees' Property

2. The State of Israel – The Ministry Of Defence

 

 

CA 5931/06: Appeal against the Jerusalem District Court's judgment of May 9, 2006 in CF 6044/04, awarded by The HonorableJudge R. Carmel

 

 

 

CA 2038/09: Appeal against the Jerusalem District Court's judgment of October 2, 2008 in CF 6161/04, awarded by The Honorable Judge I. Inbar

     

 

 

On behalf of the Appellants in CA 5931/06 and CA 2038/09

Adv. Avigdor Feldman; Adv. Miri Hart; Adv. Shlomo Lecker; Adv. Ramsey Ketilat

 

 

On behalf of the First Respondent in CA 5931/06:

Adv. Haim Novogrotzki

 

 

On behalf of the Second Respondent in CA 5931/06

Adv. Ami Fulman

 

 

On behalf of the Third to Fifth Respondents in CA 5931/06:

Adv. A. Baron; Adv. Shirley Fleischer-Geva

 

 

On behalf of the Sixth and Seventh Respondents in CA 5931/06:

Adv. David Ohana

 

 

On behalf of the Eighth Respondent in CA 5931/06:

Adv. Eitan Geva

 

 

On behalf of the Ninth and Tenth Respondents in CA 5931/06, the Respondents in CA 2038/09 and the Attorney General:

Dr. Haya Zandberg, Adv.; Adv. Moshe Golan

 

 

Facts: The appeals focused upon the question of whether properties in East Jerusalem that belong to residents of Judea and Samaria are deemed “absentee property” as defined under the Absentees’ Property Law.

 

Held: In dismissing the appeals, the Supreme Court held that the Absentees’ Property Law applies to properties in East Jerusalem whose owners, beneficiaries or holders are residents of Judea and Samaria. However, in light of the significant difficulties attendant to implementing the Law in accordance with its language, in general, the authorities should refrain from exercising their statutory authority in regard to such properties except in the most exceptional circumstances, and that even then, only subject to the pre-approval of the Attorney General and a decision by the Government or a ministerial committee appointed by it. The Court’s holdings in this judgment will apply prospectively, and only where no statutory steps have been implemented in regard to the said properties.  The holdings of this judgment lead to the conclusion that the specific properties that are the subjects of the appeals are absentees’ property.  

 

 

JUDGMENT

 

President (ret.) A. Grunis

 

1.         The appeals before the Court focus on the question of whether properties in East Jerusalem, the rights in which are owned by residents of Judea and Samaria, constitute "absentees'" property within the meaning of the Absentees' Property Law, 5710-1950 (hereinafter referred to as "the Absentees' Property Law" or "the Law").

 

            This question arose in four cases that were heard jointly (CA 5931/06, CA 2250/06, CA 6580/07 and CA 2038/09). This Court held a considerable number of hearings in the appeals. In the course of hearing the appeals, various attempts were made to resolve the disputes between the parties. In two of the appeals, the need for the Court's decision did indeed become unnecessary. Thus, on February 13, 2014, the appeal in CA 2250/06 (Custodian of Absentees' Property v. Dakak Noha) was withdrawn after the parties reached a settlement agreement that was granted the force of a judgment. The appeal in CA 6580/07 (Custodian of Absentees' Property v. Estate of Abu Zaharaya) was dismissed on September 10, 2013, after the appellant gave notice that he was withdrawing the appeal. The time has now come to decide the remaining two appeals – CA 2038/09 and CA 5931/06.

 

The Background and Chain of Events

 

2.         The appeals before us concern properties in East Jerusalem that were determined to be “absentees’ property”, and whose owners were residents of Judea and Samaria.

 

CA 5931/06

 

3.         CA 5931/06 concerns  some five acres of land located in Beit Safafa on which fruit trees are planted (parcel 34 in block 30277) (hereinafter referred to as "Property 1"). Following to the Six Day War, the property was included in the territory to which the State of Israel extended its jurisdiction  on June 28, 1967 under the Law and Administration Order (No. 1), 5727-1967 (hereinafter referred to as "Order No. 1"). One half of the rights in the property were registered in the Jordanian Land Registry in the name of a resident of Beit Jala who sold them at the beginning of the 1970s to Jewish Israeli nationals. The rights of the Jewish purchasers were recorded in the Land Registry in 1972 and 1974. The remaining half of the rights in the property belonged to Appellants 3-5, who are residents of Beit Jala, and members of their family (hereinafter referred to as "the Alarja family"). In 1973, the majority of the Alarja family's rights in the property were sold (excluding the rights of one of its members, who owned one fourteenth of the parcel and is not party to this appeal). At the end of a chain of transactions, the rights came into the possession of Appellants 1 and 2, who are residents of Beit Safafa. Their applications to register the property in the Land Registry were declined on the ground that they had to apply to the Custodian of Absentees' Property (hereinafter referred to as "the Custodian"). In 1996, the Custodian informed them that he would not release the property.

 

4.         The Appellants filed a claim for declaratory relief in the Jerusalem District Court, to the effect that Property 1 was not absentees' property, or in the alternative, that the Custodian was obliged to release it (CF 6044/04,  Judge R. Carmel). The claim was dismissed in a judgment given on May 9, 2006, which held that the property was absentees' property. The court held that the properties in East Jerusalem of residents of Judea and Samaria are absentees' property despite the fact that the absenteeism is "technical". Hence, whether the owners of Property 1 resided in Egypt at the relevant time (as pleaded in respect of some members of the Alarja family) or were residents of Beit Jala, they were "absentees". Consequently, the rights in Property 1 were vested in the Custodian, and it was held that any disposition made in respect of it by Appellants 3-5 after June 28, 1967 (when it became "absentees' property") was invalid. The court dismissed the Appellants' plea of discrimination in comparison with the Jewish purchasers, whose rights in the property were registered in their name. In the court's opinion, the very registration of the rights did not mean that the registration was lawful, and the same could not constitute a "lever for the making of another mistake by another unlawful registration" (para. 13 of the judgment). In addition, the District Court disagreed with the judgment in OM (Jerusalem District) 3080/04 Dakak v. Heirs of Naama Atia Adawi Najar, Deceased (January 23, 2006, The Honorable Judge B. Okon, hereinafter:  the Dakak case), from which it appears that the residents of Judea and Samaria are not "absentees" according to section 1(b)(1)(ii) of the Law. We shall further refer to the Dakak case below (an appeal was filed against the judgment in the Dakak case in CA 2250/06, as noted in para. 1 above). The first appeal herein (CA 5931/06) was filed against the judgment in CF 6044/04.

 

5.         To complete the picture, it should be noted that other legal proceedings have been conducted in respect of Property 1. These were further to the deletion of the Alarja family's rights from the Land Registry in accordance with a judgment awarded in default of defense on the application of the Respondent 1 (CF (Jerusalem Magistrates) 21351/95, Judge I. Zur, partial judgment of January 31, 1996). The rights ofRespondent 1 in the property were then sold to Respondents 3-7. The Appellants filed lawsuits to set aside the said judgment and for declaratory relief according to which they are the owners of the property (CF (Jerusalem Magistrates) 10386/96, Judge. R. Shamia); CF (Jerusalem District) 1264/97, Judge B. Okon, the claim was struck out on March 23, 2003). The Custodian, for his part, filed a claim for declaratory relief to the effect that the Alarja family's rights in Property 1 constituted absentees' property, and that the transactions made in regard to its part of the property were void (CF (Jerusalem District) 1504/96,  Judge A. Procaccia). The claim was dismissed further to a settlement that was formulated between the Custodian and Respondents 1-7, which was approved by the court on March 5, 2002). It should be noted that in the latter proceedings the Appellants originally joined the position of the Custodian, including the plea that the property was absentees' property, but they then withdrew that plea with the court's approval. We would further add that in the period during which the proceedings have been heard, Appellants 1, 3 and 4 have unfortunately passed away.

 

CA 2038/09

 

6.         CA 2038/09 concerns 0.84 acres of land in Abu Dis (hereinafter referred to as "Property 2"), on which there is a residential building which, in 1964, was converted to a hotel known as the Cliff Hotel (hereinafter referred to as "the hotel"). The property is in the territory to which the State of Israel's jurisdiction and administration were extended in 1967. Its original owner (hereinafter referred to as "the deceased") was a resident of Abu Dis and a national of Jordan. The Appellants own the rights in the property by virtue of inheritance and law. On July 24, 2003, the Custodian issued an absentee certificate under section 30 of the Law in respect of Property 2. Further thereto, the Appellants filed a claim in the Jerusalem District Court for the award of declaratory relief to the effect that the property was not "absentees' property". In the alternative, they applied for the property to be released or, in the further alternative, they asked that the absentee certificate issued in respect of it be declared void (CF 6161/04, Judge I. Inbar). It should be noted that the parties were originally at issue as regards the property's location in Israel, but in the course of the proceedings they agreed that the property has been in the area of Israel since 1967. The claim was dismissed on October 2, 2008. It was held that, at the determining time, the deceased was resident in Judea and Samaria, namely outside the area of Israel, about 300 meters from the hotel, and he was not a resident of East Jerusalem. Such being the case, it was held that the property was "absentees' property", both according to section 1(b)(1)(i) of the Law (because the deceased was a national of Jordan) and by virtue of section 1(b)(1)(ii) of the Law (as he was a resident of Judea and Samaria) (the section is quoted in para. 13 below). The court disagreed with the interpretation laid down in Dakak, according to which the Law does not apply to the properties in East Jerusalem of the residents of Judea and Samaria. In the court’s view, weight should be given to the difficulties involved in the authority’s treating the residents of Judea and Samaria as "absentees" for the purpose of implementing the Law, but not in regard to the Law’s incidence. In addition, it was noted that the pleas concerning the modus operandi of the Custodian under the Law are within the jurisdiction of the High Court of Justice rather than the District Court. Furthermore, the Appellants' plea that the Custodian was precluded from exercising his powers because of a representation that the State had made to the effect that the property was not in Israel, which led to a change of their position to their detriment, was dismissed. The second appeal before us (CA 2038/09) is brought against the judgment in CF 6161/04.

 

7.         It should incidentally be noted that since 2003 there have been various developments in respect to Property 2 due to its proximity to the security fence. In that connection, part of the property was demolished with the consent of the parties, and the security forces then seized possession of it by virtue of the Emergency Land Requisition (Regulation) Law, 5710-1949. In 2013, part of the land was expropriated for security purposes by virtue of the Land (Acquisition for Public Purposes) Ordinance 1943 (hereinafter: "the Acquisition Ordinance"). These matters, which are beyond the scope of these proceedings, were tried in various different legal proceedings (see HCJ 1622/13, judgment of February 12, 2014, Deputy President M. Naor, and Justices E. Rubinstein and D. Barak-Erez); HCJ 1190/14, judgment of March 18, 2014, Deputy President M. Naor, and Justices E. Rubinstein and Y. Danziger; and ALA 6895/04,judgment of November 16, 2004 on the application for leave to appeal against the District Court's judgment in CF 6161/04 on an application for a provisional injunction)).

 

8.         Incidental to the proceedings before us, on July 18, 2013, the Special Committee under section 29 of the Law (hereinafter: "the Special Committee") deliberated on the release of the two properties involved in the appeals. As regards Property 1 (the property involved in CA 5931/06), the Respondents, represented by the State Attorney (hereinafter: "the Respondents"), stated that the Custodian was no longer in possession of the land, but only the proceeds therefrom, because the property had been purchased by third parties "in market overt conditions" (para. 31(a) of the Respondents' application of October 5, 2014). The Special Committee recommended the release of those proceeds to whichever of the Appellants were residents of Judea and Samaria and still living. As regards the Appellants who had died while the proceedings were being heard, supplementary particulars were requested, and as regards the other members of the Alarja family it was recommended not to release the proceeds of the property. As regards Property 2 (the property involved in CA 2038/09), the Special Committee recommended the release in specie of the part that had not been requisitioned for the construction of the security fence, and to release the proceeds for the part requisitioned only to the owners who are residents of Judea and Samaria, who are the ones who had held the property continuously until it had been requisitioned. Under the circumstances, the Respondents argued that the appeals had become theoretical and they moved for their dismissal. The Appellants, for their part, stated that they insisted on the appeals. According to them, if their position on the basic question concerning the application of the Law in their case were accepted, then it would not have been appropriate from the outset to view the properties as "absentees' property", and the Special Committee's decision was ultra vires. In addition, the Appellants in CA 2038/09 pleaded that in light of the security forces' seizure of Property 2 for the construction of the security fence, the decision concerning the release of the property had no real meaning. In our decision of December 28, 2014 we dismissed the application to dismiss the appeals.

 

The Parties' Arguments

 

9.         In both the appeals before us, the Appellants assert that it was not appropriate to view the properties concerned as "absentees' property". For the sake of convenience, we shall cite their basic arguments with regard to the application of the Absentees' Property Law together. We shall then separately consider their individual arguments in respect of the properties in dispute. In principle, the Appellants assert that the Law should not be applied to property in East Jerusalem whose owners, beneficiaries or holders (hereinafter referred to as "the owners of the rights") are residents of Judea and Samaria. According to them, those properties merely became "absentees' property" because of the unilateral extension of the law of the State of Israel to the areas where they are located. This occurred without the owners moving from the spot, and while they were subject to the authority and control of Israel near their property. According to them, the purpose of the Law was to contend with the unique circumstances that prevailed at the time of the State's establishment, which are now different, and the legislature could not have envisaged the reality created further to the Six Day War. According to them, the residents of Judea and Samaria have nothing at all to do with the "absentees" at whom the Law was aimed. The Appellants state that the various attorneys general over the years were also cognizant of these difficulties.

 

            They argue that the Law should, therefore, be interpreted against the background of its purpose and the historical context in which it was enacted, in the spirit of the Basic Laws, and in recognition of the need to protect their property, such that its provisions will not apply to the said properties. They propose a "pragmatic" interpretation of section 1(b)(1)(ii) of the Law, by  which the properties are prima facie considered absentees' property (the section is quoted in para. 13 below). This section deals with anyone who at any time during the period prescribed in the Law was "in any part of Palestine[1] outside the area of Israel". According to the Appellants, "outside the area of Israel" should be read as "the area outside Israeli control". That is to say that "the area of Israel" should not be viewed as relating only to the area in which the law, jurisdiction and administration of Israel has been applied. In fact, their argument is that since Judea and Samaria have been under the effective control of the State of Israel since 1967, it should not be regarded as "outside the area of Israel" for the purpose of the Law, and section 1(b)(1)(ii) of the Law therefore does not apply to the residents of Judea and Samaria. In addition, the Appellants propose adopting the interpretation that the District Court applied in Dakak, which we shall discuss further (in para. 26 below). The Appellants also propose viewing "the area of Israel" within the meaning of section 1(b)(1)(ii) of the Law solely as the area in which the law of the State of Israel applied at the time of the Law's enactment. According to the argument, that area does not include new territory over which the law, jurisdiction and administration of Israel have been applied or which is held by Israel, unless the provisions of the Law have been expressly applied to the additional territory. In the Appellants' opinion, the interpretations propounded are not contrary to section 3 of the Legal and Administrative Matters (Regulation) Law [Consolidated Version], 5730-1970 (hereinafter referred to as "the Legal Regulation Law"), from which it emerges that the properties of East Jerusalem residents that are located in East Jerusalem are not to be regarded as "absentees' property". (Section 3(a) of the said Law provides that "a person who, on the day of the coming into force of an application of law order, is in the area of application of the order and a resident thereof shall not, from that day, be regarded as an absentee within the meaning of the Absentees' Property Law, 5710-1950, in respect of property situated in that area".) According to them, the said section deals only with the residents of East Jerusalem, where Israeli law has been applied, and a negative arrangement is not to be inferred therefrom in respect of residents who are under Israeli control in Judea and Samaria. They believe that there is no foundation for the distinction between residents of Judea and Samaria, who are under Israeli control, and the residents of East Jerusalem. Alongside this, the Appellants plead that the Custodian is interpreting the broad provisions of the Law in a discriminatory and degrading way. Thus, for example, according to them, on a strict interpretation of the Law, Jewish residents of Judea and Samaria and members of the security forces who are staying there are also "absentees", but the Law is only applied to Arab residents of Judea and Samaria.

 

10.       The Appellants assert that applying the interpretation proposed leads to the conclusion that the properties involved in the appeals are not absentees' property. The Appellants in CA 5931/06 argue that the refusal to register their rights in Property 1 in the Land Registry, while the rights of the Jewish purchasers have been registered, amounts to discrimination. Moreover, they make arguments in respect of the conduct of the Custodian in their case, including in respect of the difference in his attitude toward them, compared with his attitude toward the Jewish purchasers. Consequently, they ask that we find that Property 1 is not absentees' property, or alternatively, that we order its release under section 28 of the Law, if it is indeed held that absentees' property is involved. In any event, they explain that if it is held that the property is not absentees' property, it will be necessary to conduct a factual enquiry with regard to the litigants' title thereto. The Appellants in CA 2038/09 plead that Property 2 was requisitioned contrary to the Attorney General's directives in  this regard. In addition, they wonder why it was necessary to make use of "such a Draconian and improper law", when he could have satisfied himself with the issuing of a seizure order for security purposes, the duration and purposes of which are limited, as was indeed later done (para. 29 of the summations of January 26, 2010). Moreover, they make various different arguments concerning the way in which the property was requisitioned and about the real purpose of the move. In that connection they plead laches and the Respondents' failure to act in respect of the property because of the representation that they made, according to which the property was in Judea and Samaria rather than Israel, which led to a detrimental change in the position of the Appellants in CA 2038/09. They also complain of the determination that the District Court is not competent to treat of the way in which the Law is implemented. In view of all the foregoing, they ask that we quash the requisition of Property 2 by virtue of the Law, and return it to them.

 

11.       The Respondents' position is that the Law applies to properties in East Jerusalem of the residents of Judea and Samaria. According to them, "area of Israel", in the sense of the Law, relates only to territory to which Israeli law has been applied. They warn against the serious consequences involved in adopting the interpretive approach advanced by the Appellants, which is similar to the interpretation laid down by the District Court in Dakak. According to them, the term "area of Israel" is mentioned both in respect of the location of the particular property (section 1(b)(1) of the Law) and in respect of the location of the owners of the rights in the property (section 1(b)(1)(ii) of the Law). Hence, the interpretation proposed might lead to properties in Judea and Samaria being regarded as "absentees' property" as well, when their owners are included in one of the other alternatives of section 1(b)(1) of the Law. According to them, the presumption is that this is the position in the case of many of the residents of Judea and Samaria, who were Jordanian nationals. Consequently, they assert that the Appellants' proposal will in any event be of no help to them. In addition, the Respondents object to the proposal to interpret the "area of Israel" as a "photograph" of the situation that existed at the time of the Law's enactment. According to them, there is no basis for that in the Law, and it is contrary to its purpose – to enable the transfer of ownership to the Custodian of any property situated in the area of the State and belonging to an "absentee", to be used for the development of the country. They also mention that the Law was enacted when the final boundaries of the State had not yet been formulated (and in fact the provision of section 1(b)(1)(ii) of the Law already appeared in the Absentees' Property Emergency Regulations, 5709-1948 of December 12, 1948 (hereinafter referred to as "the Emergency Regulations") which applied during the War of Independence and preceded the Law). Alongside this, the Respondents argue that a restrictive policy should be adopted when implementing the Law. According to them, the powers in the Law should not be exercised in respect of the properties at issue, unless the Attorney General's approval is first obtained. They contend that over the years a restrictive policy has indeed been adopted in the implementation of the Law, in accordance with the position of the Attorneys General. According to the Respondents, looking to the future, this modus operandi will lead to results similar to those that will be obtained as a result of finding that the Law does not apply in the instant cases. However, adopting it, as distinct from finding that the Law does not apply, is essentially of significance in respect of the past. This is because a finding that the Law does not apply in these cases means that all the acts that have been done in respect of properties of that type are void, with the substantial difficulties involved therein that they mention. In addition, the Respondents reject the Appellants' argument of discrimination in the implementation of the Law. According to them, the Custodian adopts a standard policy in respect of everyone lawfully moving outside the area of Israel, regardless of his ethnic origin. Thus, for example, the Law is not implemented in respect of State nationals, be they Jews or Arabs, even where the strict implementation of its provisions would necessitate an application to release their property.

 

            As regards the properties in dispute, the Respondents argue that, under the circumstances, the Special Committee's decision provides a proper answer to the Appellants. The Respondents reject the pleas of discrimination made in CA 5931/06 and emphasize that the improper registration in the past of the rights of Jewish purchasers does not justify similar registration now. According to them, until the 1970s the Custodian used to permit the sale of absentees' property to Israelis in order to facilitate matters for the residents of Judea and Samaria and the Gaza Strip, but that policy has been changed. In addition, they explain why the Custodian has not acted to cancel registration of the transactions made by the Jewish purchasers and they state that they did in the past act against the transfer of rights in Property 1 to the Respondent 1, who is a Jewish national of Israel. In addition, the Respondents plead that ruling on the competing rights in respect of the property involved in CA 5931/06 necessitates the review of factual and legal arguments that were not considered at the trial instance in view of its conclusion that Property 1 is "absentees' property".

 

12.       The other Respondents in CA 5931/06, the Jewish purchasers of the rights in Property 1, join in the Custodian's position on the question of principle with regard to the application of the Law. As regards the interpretation proposed by the Appellants, they state that since the Oslo Accords, effective control of a large proportion of Judea and Samaria is not held by the State of Israel and they argue that the said interpretation would necessitate equating the status of Judea and Samaria's residents with that of Israeli residents in other respects. They emphasize that they acquired the rights in Property 1 in good faith and for consideration, and they comment that the Appellants' domicile has never been established. According to them, the Appellants in CA 5931/06 are undermining the judgments that have been awarded in respect of Property 1, and their conduct in the various proceedings in respect thereof amounts to an abuse of process, inter alia in view of the change in their versions on the question of absenteeism.

 

Discussion and Decision

 

13.       The proceedings before us concern, as aforesaid, the question of whether properties in East Jerusalem, the owners of the rights in which are residents of Judea and Samaria, are "absentees' property" under the Absentees' Property Law. We would immediately emphasize that these proceedings address only such properties and not any other type of property. The point of departure for the discussion is the Absentees' Property Law, and we shall therefore commence by presenting its main provisions. "The portal" to the Law is contained in the definitions of "absentee" and "absentees' property". "Absentees' property" is defined in section 1(e) of the Law as follows:

 

            "'Absentees' property' means property, the legal owner of which, at any time during the period between Kislev 16, 5708 (November 29, 1947) and the day on which a declaration is published under section 9(d) of the Law and Administration Ordinance, 5708-1948, that the state of emergency declared by the Provisional Council of State on Iyar 10, 5708 (May 19, 1948) has ceased to exist, was an absentee or which, at any time as aforesaid, an absentee held or enjoyed, whether by himself or through another; but it does not include movable property held by an absentee and exempt from attachment or seizure under section 3 of the Civil Procedure Ordinance, 1938" [emphasis added – A.G.].

 

            The term "absentee" is defined in section 1(b) of the Law as follows:

 

             "(b) 'Absentee' means –

 

            (1) A person who, at any time during the period between Kislev 16, 5708 (November 29, 1947) and the day on which a declaration is published, under section 9(d) of the Law and Administration Ordinance, 5708-1948 that the state of emergency declared by the Provisional Council of State on Iyar 10, 5708 (May 19, 1948) has ceased to exist, was a legal owner of any property situated in the area of Israel or enjoyed or held it, whether by himself or through another, and who, at any time during the said period –

 

                        (i) was a national or citizen of the Lebanon, Egypt, Syria, Saudi Arabia, Trans-Jordan, Iraq or Yemen, or

 

                        (ii) was in one of these countries or in any part of Palestine outside the area of Israel, or

 

                        (iii) was a Palestinian citizen and left his ordinary place of residence in Palestine

 

                                    (a) for a place outside Palestine before Av 27, 5708 (September 1, 1948); or

 

                                    (b) for a place in Palestine held at the time by forces which sought to prevent the establishment of the State of Israel or which fought against it after its establishment;"

 

            It should be noted as regards the mention of "Trans-Jordan" in sections 1(b)(1)(i) and (ii) that in 1994 the legislature excluded from the application of the Absentees' Property Law certain properties, the owners of the right in which where nationals or citizens of Jordan. This was further to the peace agreement with Jordan (see section 6 of the Implementation of the Peace Agreement between the State of Israel and the Hashemite Kingdom Law, 5755-1995 (hereinafter referred to as "the Peace Agreement with Jordan Law")).

 

14.       According to the Absentees' Property Law, "absentees' property" is vested in the Custodian and the "absentees" lose their rights in it (see CA 8481/05 Lulu v. Custodian of Absentees' Property, para. 7 (February 28, 2007) (: the Lulu case)). The vesting of the property in the Custodian in accordance with the Law is not dependent upon his doing any act, and the rights in it automatically pass to him from the moment that the conditions for its being "absentees' property" are fulfilled (section 4 of the Law; CA 109/87 Makura Farm Ltd v. Hassan, IsrSC 47(5) 1, 29 (1993) (hereinafter: the Makura Farm case); CA 427/71 Faraj v. The State of Israel, IsrSC 27(1) 96, 101 (1972) (hereinafter:  theFara case"), in which it was stated that since automatic vesting is involved, the Custodian might not even be aware that a property has been vested in him; CA 4630/02 The Custodian of Absentees' Property v. Abu Hatum, para. L(3) (September 18, 2007) (hereinafter: the Hatum case; CA 8753/07 The Estate of Atalla Halil Bahij, Deceased v. Custodian of Absentees' Property, para. J (November 16, 2010)). It should be emphasized that in view of the prolonged state of emergency, which is still in force, the application of the Law continues and its operation has not yet ended. That is to say that anyone who has fulfilled or does in future fulfil the conditions for the definition of an "absentee" during the relevant period (namely since 1947 until the future end of the state of emergency) will be regarded as an "absentee" and his property in Israel will be vested in the Custodian. That is unless he has been excluded from the scope of the Law.

 

            The status of the Custodian in respect of absentees' property is the same as was that of the owner of the property, and he is entrusted with its management, care and supervision (section 4 of the Law). To that end, very extensive powers have been granted to him (see HCJ 6/50 Freund v. Supervisor of Absentees' Property, Jerusalem, IsrSC 4 333, 337 (Justice M. Dunkelblum) (1950) (hereinafter: the Freund case); Minutes of Meeting No. 123 of the First Knesset, 950, 956 (March 7, 1950) (hereinafter: the Minutes 123); Menahem Hoffnung, Israel – State Security Versus the Rule of Law, 162 (5761) (Hebrew) (hereinafter: Hoffnung)). In this connection it is provided that the Custodian may incur expenses and make investments in order to safeguard, maintain, repair and develop the property (section 7 of the Law); continue the management of a business on behalf of the absentee (section 8 of the Law, and sections 24 and 25, which concern a partnership of which an absentee is a member and properties of which absentees are co-owners); order the eviction of someone who is occupying the property without any right (section 10 of the Law); order the discontinuance of construction on the property and its demolition (section 11 of the Law). In addition, the Law requires that absentees' property be handed over to the Custodian (section 6 of the Law) and information in respect of it provided (section 21 of the Law). The Law imposes restrictions and prohibitions concerning the doing of various different acts with the property without the Custodian's consent (section 22 of the Law), and it provides that certain acts that have been done in respect of the property are null and void (section 23 of the Law). In addition, certain acts that have been done contrary to the Law are regarded as criminal offences, the penalty for which might amount to up to two years' imprisonment (section 35 of the Law). Although the Law restricts the Custodian's ability to sell and grant a long lease of immovable property that has been vested in him (section 19), it does permit him to transfer it to the Development Authority, subject to certain reservations. In this connection it should be noted that in an agreement that was made on September 29, 1953 between the Custodian and the Development Authority, all the immovable property vested in the Custodian was transferred to the Authority (according to The Government Yearbook 5715, 47). Similarly, the Law limits the liability that the Custodian bears for his acts (sections 16 and 29P of the Law), and lays down lenient evidential arrangements for him (section 30 of the Law; Makura Farm, pp. 12-13). The Law further provides that transactions made between the Custodian and another person in good faith will not be invalidated even if it is established after the fact that the property was not vested property (section 17 of the Law). Alongside this, the Law lays down various mechanisms that are apparently aimed at mitigating its serious effects. Thus, the Custodian has been authorized, in certain circumstances, to "relieve" a person of his "absenteeism" (section 27 of the Law) and to release properties that have been vested in him (sections 28-29 of the Law; for the significance of such release, see CA 263/60 Kleiner v. Director of Estate Tax, IsrSC 14 2521 (1960) (hereinafter: the Kleiner case; for further discussion of several of the decisions that have been given by the Special Committee, including its recommendation for a sweeping release of properties in certain cases, see Haim Zandberg, Israel Land, Zionism and Post-Zionism, 83-83 (2007) (Hebrew)).

 

15.       As we see, the Law grants the Custodian very extensive powers and its overall provisions create a far-reaching arrangement, at the center of which is the expropriation of the rights in absentees' property from the owners and their vesting in the Custodian. This arrangement should be understood against the special circumstances that led to its enactment. At the end of the War of Independence, and in fact even during it, the young State of Israel faced a complex, new reality. This was, inter alia, due to the enlarged area under its control and the mass departure of Arab residents, leaving behind them extensive property, abandoned and vulnerable to intrusion and unruly squatting, on the basis of "might makes right" (see Eyal Benvenisti and Eyal Zamir, “Private Property In the Israeli-Palestinian Peace Settlement”, Research of the Jerusalem Institute for Israel Studies, 77, 7-9 (1998) (Hebrew) (hereinafter: Benvenisti and Zamir, Private Property)). These challenges necessitated a rapid legal answer that would make it possible to settle the rights in, and deal with, those properties. Indeed, in the first years of the State a series of legal arrangements was laid down to contend with the complex reality that had arisen (for further reading, see for example Shlomo Ifrach, “Legislation Concerning Property and Government in the Occupied Territories”, 6 Hapraklit 18 (1949) (Hebrew); Hoffnung, pp. 159-168; Eyal Zamir and Eyal Benvenisti, "Jewish Land in Judea, Samaria, the Gaza Strip and East Jerusalem”, Research of the Jerusalem Institute for Israel Studies, 52, 28-29 (1993) (Hebrew) (hereinafter: Zamir and Benvenisti, Jewish Land)). One of the major pieces of legislation enacted in this context is the Absentees' Property Law, which was enacted in 1950 and replaced the Emergency Regulations that had been promulgated in this respect and that applied during the War of Independence.

 

16.       The Law was designed to regulate the administration of "absentees'" property by the State authorities, and make it possible to safeguard it against lawlessness (see, Minutes of Meeting No. 119 of the First Knesset, 872 (February 27, 1950) (hereinafter:  Minutes 119); CA 58/54 Habab v. Custodian of Absentees' Property, IsrSC 10 912, 918 (1956); Freund, p. 337). The purpose of the Law was not expressly defined in it and it did not prescribe for whose benefit "the absentees' property" should be safeguarded (see Minutes 123, p. 952; Shlomo Ifrach, “Thoughts on the Absentees' Property Law, 5710-1950”, 9 HaPraklit 182 (5713) (Hebrew)). The case law has held that the purpose of the Law is merely to safeguard the property for the benefit of its absentee owners, but it is also aimed at achieving the State's interests in the property, including, so it has been held, "the ability to utilize it to promote the country's development, while preventing its exploitation by anyone who is an absentee within the meaning of the Law, and the ability to hold it (or its proceeds) until the formulation of political arrangements between Israel and its neighbors, in which the fate of the property will be decided on the basis of reciprocity between the countries" (HCJ 4713/93 Golan v. Special Committee under Section 29 of the Absentees' Property Law, IsrSC 48(2) 638, 644 (1994) (hereinafter: the Golan case). For a discussion of the Law's objectives, see also CF (Haifa District) 458/00 Bahai v. Custodian of Absentees' Property, para. 26 (Judge I. Amit) (September 19, 2002) (an appeal was filed against the judgment, but the judgment in the appeal did not require an analysis of the Law's purpose (CA 9575/02 Custodian of Absentees' Property v. Bahai (July 7, 2010) (hereinafter: the Bahai case)). This approach is also consistent with statements made at the time the Law was enacted (see Minutes 119, pp. 869-870).

 

            It should be noted that the wording and title of the Law prominently emphasize the absence of the property owners (the "absentees"). Nevertheless, the background that led to its enactment and the nature of the arrangements prescribed in it might indicate that, in fact, the Law sought to determine the legal position in respect of the properties in Israel of nationals and residents of the enemy states. In any event, it appears that the Court has gained this impression in several cases dealing with these matters (see Golan, p. 645; HCJ 99/52 Anonymous v. Custodian of Absentees' Property, IsrSC 7 836, 839 (1953) (hereinafter: the Anonymous case); Kleiner, p. 2544 (per Justice A. Witkon), where it was stated that the Law is similar in character to the legislation on trade with the enemy, the consequence of which is the expropriation of the ownership of, and rights in, the property and their vesting in the Custodian. Support for this concept can also be found in the statement by the Minister of Justice, D. Libai, in the debate on the Peace Agreement with Jordan Bill (Minutes of Meeting No. 312 of the 13th Knesset, 5658 (January 23, 1995) (hereinafter: Minutes 312)). See also Benvenisti and Zamir, Private Property, pp. 13-14; para. 64 of the notice of appeal dated July 13, 2006 in CA 5931/06. Nevertheless, in the Appellants' summations in CA 2250/06 (the Respondents herein) to which the latter referred, it was asserted that the definition of "absentee" in the Law does not necessarily reflect a person's connection with an enemy state).

 

The Broad Application of the Absentees' Property Law

 

17.       Against the background of the exceptional circumstances in which the Law was enacted, it can perhaps be understood why it is worded so sweepingly and strictly. In any event, the way it is drafted, and especially the broad definitions of its underlying terms – with the emphasis on "absentee", "property" and "absentee property" – lead to the very extensive application of the Law (see HCJ 518/79 Cochrane v. Committee under Section 29 of the Absentees' Property Law, 5710-1950, IsrSC 34(2) 326, 330 (per Justice H. Cohn) (1980) (hereinafter: the Cochrane case; see also Minutes 123 and Minutes 119, pp. 870-872, which discussed the problems involved in the broad definition of "absentee", which embraces very many cases). Indeed, about 35 years ago this Court indicated that the broad definition of "absentee" is likely to lead to the Law's catching more and more people in its net, sometimes unnecessarily and contrary to its purpose. In the words of Justice H. Cohn, in Cochrane (p. 330):

 

            "In the geopolitical circumstances that existed upon the establishment of the State and at the time of the Law's enactment, it was necessary to define 'absentee' very broadly and sweepingly – despite the risk that the definition would include people who, in fact, had no legal connection with Israel's enemies, physically, ideologically or otherwise. And since the definition remains in force until the end of the state of emergency that has prevailed in Israel since the establishment of the State (section 1(b)(1) of the Law), innocent citizens who have nothing to do with absenteeism might frequently be added to the multitude of 'absentees' as defined in the Law (for example someone who is in part of 'Palestine' outside the area of Israel, - ibid., para. (ii))".

 

18.       The Law's definitions of the various terms are likely to lead to rigid results that are inconsistent with common sense or even the purpose that the Law was intended to serve. Let us demonstrate this by means of several examples – and it should be emphasized that I do not mean to lay down strict rules in respect of the cases that will be referred to,  which are cited merely for the purposes of illustration. According to the Law, it suffices if - at any time in the period between November 29, 1947 and the end of the state of emergency that was declared by the Provisional Council of State in 1948 – the owner of the rights fulfilled one of the alternatives in section 1(b)(1) of the Law (see sections 1(b) and 1(e) of the Law) for property that is in the area of Israel to be regarded as absentees' property. As aforesaid, since a declared state of emergency has existed in Israel ever since the State's establishment, any property in Israel that has been purchased in the last dozens of years by an "absentee" is, according to the wording of the Law, absentees' property. For example, a property in Israel that is purchased today by a national or subject of any of the countries mentioned in section 1(b)(1) of the Law (other than Jordan, as mentioned at the end of para. 13 above) will be regarded as "absentees' property" and immediately be vested in the Custodian. The self-evident difficulty involved in such a situation is aggravated in view of the broad definition of "property" in the Law, which includes "immovable and movable property, monies, a vested or contingent right in property, goodwill and any right in a body of persons or its management" (excluded from "absentees' property" are "movable property held by an absentee and exempt from attachment or seizure under section 3 of the Civil Procedure Ordinance, 1938" (section 1(e) of the Law)). As prescribed, "property" includes, among other things, a right to the repayment of a debt, an obligatory right to receive land, bearer shares and also contractual rights and any right that is enforceable by a lawsuit (see Bahai, paras. 7-9 and the references there). One has to wonder about the logic of the result whereby a debt that is due to an "absentee" in respect of a transaction made by him in relation to property in Israel, for example, will automatically be vested in the Custodian (see MF 89/51 Mituba Ltd v. Kazam, IsrSC 6 4 (1952), where it was held that a debt might be absentees' property. See also CA 35/68 Mualem v. Custodian of Absentees' Property, IsrSC 22(2) 174 (1968) (hereinafter: the Mualem case), which concerned bills of exchange received further to a transaction made in Iraq that were endorsed by a resident of Iraq in favor of an Israeli national. It was stated in the judgment that when the bills, which were the property of an Iraqi resident, arrived in Israel they became absentees' property (ibid., pp. 176-177)). In addition, the simple language of the Law might lead to the conclusion that the absenteeism of the holder of any proprietary right in property suffices to make it "absentees' property". This is so even if the other holders of the rights therein are not absentees, and even if his right is "inferior" to their right. Thus, for example, the very fact that someone who "enjoyed" the property was an absentee apparently suffices for it to be regarded as "absentees' property", even if its owner is not an absentee (see the Makura Farm case, p. 15).

 

            Other difficulties arise in view of the fact that "absentee" is an ongoing "status" that has no end (unless expressly otherwise prescribed or a step is initiated to release the property or its owners from their absenteeism. See CA 110/87 Elrahim v. Custodian of' Absentees' Property (August 22, 1989) (hereinafter: the Elrahim case)). Properties in Israel of whoever has fallen within the scope of the conditions for "absentee" at any time in the period between the end of 1947 and the end of the state of emergency, which is still continuing as aforesaid, are likely to be regarded as "absentees' property" and be denied him. As aforesaid, there is no automatic release from this situation, apart from a few exceptions that have been specifically defined in the Law. For example, a person will be regarded as an absentee merely because, at some stage during the said period, he was a national or citizen of Lebanon, Egypt, Syria, Saudi Arabia, Trans-Jordan, Iraq or Yemen or "was" there (as regards Trans-Jordan, see the end of para. 13 above). Hence, according to a strict interpretation of the Law, the properties in Israel of immigrants from Egypt, Iraq or Yemen that were purchased by them before or after they immigrated to Israel, are "absentees' property" (and indeed, that was the case in the Faraj case; see also Mualem. Nevertheless, it does appear that section 28A of the Law, which is mentioned in the next paragraph, resolves that difficulty, at least in respect of properties that have been purchased since arrival in Israel). That is the law, at least prima facie, in respect of the properties in Israel of all those who have visited the said countries, regardless of the purpose or length of the visit. Thus, for example, anyone who went to those places on behalf of the State, for example soldiers in battle, are likely to be regarded as "absentees" (reality has proven that the question is not theoretical; see the Anonymous case, in which a Palestinian citizen, who left Israel for an enemy country as an emissary of one of the State authorities, was regarded as an "absentee"!!). Is it reasonable or acceptable that in the circumstances described, those people should lose their rights in their property in Israel?!

 

19.       It should be noted that a solution has been provided in the Law for at least some of the difficulties arising from its broad wording. A salient example is the possibility of releasing absentees' property (sections 28-29 of the Law) and giving written confirmation that a particular person is not an "absentee" (section 27 of the Law. For a discussion of whether the section applies where a person can be defined as an absentee under section 1(b)(1)(iii) of the Law and also in accordance with one of the other alternatives prescribed in the section, see Anonymous and Bahai, paras. 11 and 13). It should be noted that according to Justice H. Cohn in the Cochrane case, those powers are the solution to the difficulties involved in the definition of "absentee" mentioned in the previous paragraphs (ibid., p. 330) (this was the position of the Court in Elrahim as well). Another example is the provision of the Law that was added in 1951, the purpose of which was to enable "absentees" who are duly present in the area of Israel to purchase rights in properties that did not constitute absentees' property on the date the Law took effect (section 28A of the Law; see Minutes of Meeting No. 234 of the First Knesset, 1254, (March 6, 1951)). Nevertheless, the Law is still far from being free of difficulties. One of the reasons is the fact that in the many years since the Law was enacted, significant geopolitical changes have occurred in the environment of the State of Israel, including Israel's wars and diplomatic arrangements that have been made with some of its neighbors. At the same time, substantial changes have also been made in Israeli law's treatment of human rights. In fact, today's circumstances are materially different from those that existed at the time of the Law's enactment some 65 years ago. Nevertheless, and despite the fact that the Law's application has been continuing all that time, not all the necessary adjustments to the changing times and circumstances have been made. This finds conspicuous expression with regard to property located in East Jerusalem, and in particular, property owned by residents of Judea and Samaria, as is the case in the appeals  before us. Before we go on to consider the specific problems arising in these cases, another note is obliged.

 

20.       In view of the foregoing, an argument might be made with regard to the invalidity of some of the Law's provisions for constitutional reasons. In other words, it could be argued that the provisions of the Law infringe the absentees' rights and in particular their constitutional right to property (section 3 of Basic Law: Human Dignity and Liberty), and that it does not fulfil the criteria that have been laid down in case law on the limiting paragraph of the Basic Law (section 8). In my opinion, it is certainly possible that at least some of the arrangements in the Law, were they enacted today, would not meet the constitutional criteria. Nevertheless, in the instant case, the provisions of the limiting paragraph are not such as to serve or to alter the conclusion with regard to the application of the Law in the cases under consideration here. This is in view of the “Validity of Laws” rule in section 10 of Basic Law: Human Dignity and Liberty, according to which the Basic Law does not affect the validity of any law that existed prior to its entry into force. This provision does not make it possible to find that any provision of the Law is void (see, for example, CFH 2316/95 Ganimat v. State of Israel, IsrSC 49(4) 589, 632-633 (per Justice T. Strasberg-Cohen), 642-643 (per Justice M. Cheshin), 653 (per President A. Barak (1995) (hereinafter: the Ganimat case); HCJ 4264/02 Ibillin Breeders Partnership v. Ibillin Local Council, para. 10 (December 12, 2006)).

 

The Absentees' Property Law and the Properties in East Jerusalem

 

21.       Section 1(b) of the Law imposes two conditions for a person to be an "absentee": the first relates to the particular property and contains the requirement that the property is situated "in the area of Israel". In this respect, "the area of Israel" has been defined as an area where the law of the State of Israel applies (section 1(i) of the Law; for a discussion of that term, see Benjamin Rubin, “The Sphere of the Law's Application, the Area of the State and Everything in Between”, 28 Mishpatim, 215, 226-227 (5755) (Hebrew) (hereinafter: Rubin)). The second condition relates to the owner of the rights in the property (the "absentee"). The "absentee" is someone who falls within one of the alternatives of section 1(b)(1) of the Law. The first alternative is defined according to the person's nationality or citizenship, and it concerns the citizens or nationals of Lebanon, Egypt, Syria, Saudi Arabia, Trans-Jordan, Iraq or Yemen (section 1(b)(1)(i) of the Law). The second alternative is defined on the basis of the location of the "absentee" and relates to anyone who was in any of those countries or "in any part of Palestine outside the area of Israel" (section 1b)(1)(ii) of the Law). The third alternative relates to Palestinian citizens who left their ordinary place of residence in Palestine for a place outside Palestine in the circumstances set out in section 1(b)(1)(iii) of the Law (section 27 of the Law nevertheless lays down cases in which an absentee will be exempted from his "absenteeism" according to this alternative; for the controversy that arose between Justices M. Landau and Y. Olshan in respect of this section and the characteristics of the different alternatives, see the Anonymous case).

 

22.       With regard to properties that are situated in East Jerusalem, until 1967 they were not "in the area of Israel", within the meaning of the Absentees' Property Law, namely the area in which the law of the State of Israel applies (section 1(i) of the Law). Consequently, until then they were not absentees' property. That changed with the Six Day War. In the War, East Jerusalem passed into the control of the State of Israel, and on June 28, 1967 the application of Israeli law, jurisdiction and administration was declared (see Order No. 1 that was promulgated by virtue of section 11B of the Law and Administration Ordinance, 5708-1948 (hereinafter: "the Law and Administration Ordinance"). See also section 5 of Basic Law: Jerusalem, Capital of Israel, which prescribes that East Jerusalem is included within the boundaries of the Jerusalem Municipality. See also HCJ 282/88 Awad v. Prime Minister and Minister of the Interior, IsrSC 42(2) 424, 429 (1988) (hereinafter:as the Awad case; CA 4664/08 Mishal v. Custodian of Absentees' Property, para. 8 (hereinafter: the Mishal case); HCJ 1661/05 Hof Aza Regional Council v. Knesset, IsrSC 59(2) 481, 512-513 (2005) (hereinafter:the Hof Aza Council case); Rubin, pp. 231-234; Benvenisti and Zamir, Private Property, pp. 23-24). In view of this, property in East Jerusalem must, of course, be regarded as situated in "the area of Israel" for the purpose of the Absentees' Property Law (see CA 54/82 Levy v. Estate of Afana Mahmoud Mahmoud (Abu-Sharif), Deceased, IsrSC 40(1) 374, 376 (1986) (hereinafter: the Levy case); HCJ 98/68 Hadad v. Custodian of Absentees' Property, IsrSC 22(2) 254 (1968)).

 

23.       Consequently, all that remains for the owners of rights in property in East Jerusalem to be regarded as "absentees" is for one of the alternatives in section 1(b)(1) of the Law to be fulfilled. In view of the broad definitions in the Law, and given the fact that many of the residents of East Jerusalem were nationals or citizens of Jordan before 1967, it appears that this condition is fulfilled in many cases, and the properties of those people in East Jerusalem should be regarded as "absentees' property". In this context it should be borne in mind that after the Six Day War not only the property in East Jerusalem passed into the area of Israel and under its control, but also the local residents (the residents of East Jerusalem who were included in the census that was conducted in June 1967 obtained the status of permanent residents in Israel and could, in certain conditions, obtain Israeli nationality). As a result, quite a strange situation arose in which the Law applied both to properties and their owners in "the area of Israel". In fact, a person could, for example, remain at home without taking any action or changing his situation or the state of the property, and his home, where he resided in East Jerusalem, became "absentees' property". This difficulty was resolved in respect of the residents of East Jerusalem with the enactment of the Legal Arrangements Law in 1970 (or to be more precise, in 1968, upon enactment of the Legal and Administrative Matters (Regulation) Law, 5728-1968, which preceded it). Section 3 of the 1970 statute prescribes as follows:

 

                        "(a)     A person who on the day of the coming into force of an application of law order [namely an order under section 11B of the Law and Administration Ordinance – A.G.] is in the area of application of the order and a resident thereof shall not, from that day, be regarded as an absentee within the meaning of the Absentees' Property Law, 5710-1950, in respect of property situated in that area.

 

(b)       For the purposes of this section, it shall be immaterial if, after the coming into force of the order, a person is, by legal permit, in a place his presence in which would make him an absentee but for this provision".

 

            The section therefore excludes whoever were residents of East Jerusalem on June 28, 1967 – when Order No. 1 was issued, whereby the law, jurisdiction and administration of the State of Israel were applied to East Jerusalem – from the definition of "absentees" in respect of their property in East Jerusalem (see Mishal, para. 8; Awad, p.429; Benvenisti and Zamir, Private Property, p. 14, 26-28; Zamir and Benvenisti, Jewish Land, p. 87). In addition, the Absentees' Property (Compensation) Law, 5733-1973 (hereinafter: "the Compensation Law") was later enacted to enable residents of Israel, including the residents of East Jerusalem, who are "absentees", to claim compensation for certain property vested in the Custodian (see Zamir and Benvenisti, Jewish Land, pp. 90-91; Benvenisti and Zamir, Private Property, pp. 14, 28-29).

 

The Case of Judea and Samaria Residents

 

24.       Let us now turn to the case before us, of residents of Judea and Samaria who have rights in property in East Jerusalem. As aforesaid, for the purpose of the Law, these properties are located in the area of Israel. The first condition for their "absenteeism" is therefore fulfilled. The second condition is that the owners of the rights in them fall within the scope of one of the alternatives of section 1(b)(1) of the Law. The alternative relevant to the instant case is that mentioned at the end of section 1(b)(1)(ii) of the Law, that an absentee is someone who at any time during the relevant period "was… in any part of Palestine outside the area of Israel." In Judea and Samaria, unlike East Jerusalem, the law, jurisdiction and administration of the State of Israel have never been applied (see, for example, HCJ 390/79 Dwikat v.  Government of Israel, IsrSC 34(1) 1, 13 (1979); Hof Aza Council, pp. 514-560; and also Rubin, pp. 223-225). It is, of course, therefore not the "area of Israel", which is defined in section 1(i) of the Law as "the area in which the law of the State of Israel applies". Some 30 years ago, this Court ruled in Levy that Judea and Samaria is "part of Palestine" within the meaning of section 1(b)(1)(ii) of the Law (ibid., p 381 (Justice A. Halima); cf Crim. App. 5746/06 Abbass v. State of Israel, paras. 5, 8-10 (July 31, 2007), where the meaning of the same expression in the Prevention of Infiltration (Offences and Jurisdiction) Law, 5714-1954 was considered in the particular context of that statute). It should be noted that in Levy the Court dismissed the plea that since Judea and Samaria is actually occupied by the IDF, it should be regarded as held territory in accordance with the Area of Jurisdiction and Powers Ordinance, 1948 and therefore also as an "area of Israel" for the purpose of the Absentees' Property Law. The Court's conclusion in the Levy case was that properties in East Jerusalem that were owned by the residents of Judea and Samaria should be regarded as "absentees' property". This concept is also reflected in later case law of this Court (see the Golan case, where the Court acted on the assumption that such property is "absentees' property").

 

25.       The said conclusion with regard to property in East Jerusalem does not derive merely from the wording of the Law. It appears that this result also reflects the intention of the legislature, at least since the Legal Regulation Law was enacted. As aforesaid, while the residents of East Jerusalem were excluded by the Legal Regulation Law from the application of the Absentees' Property Law in respect of property located there, a similar step was not taken in respect of the residents of Judea and Samaria. In my opinion, the significance of that cannot be avoided. The very fact that the legislature considered it necessary to prescribe an express arrangement excluding the residents of East Jerusalem from the scope of the Absentees' Property Law (from the date prescribed) demonstrates that, according to it, without such a provision the Law would have applied to them. In other words, this indicates that in its opinion, the Law also applies where the particular property or the owner of the rights in it became "absentee" after the Law's enactment, namely after 1950. This assumption also finds expression in the need that the legislature saw expressly to exclude certain properties from the application of the Absentees' Property Law further to the peace agreement made with Jordan in 1994 (see section 6 of the Peace Agreement with Jordan Law; and also Minutes 312, p. 5658. See also Abu Hatum, para. K.) This approach is in fact consistent with the view that the application of the Law is ongoing and has not yet reached an end (see also Golan, p. 645, where it was stated that "the assumption embodied in the Law is that the fate of absentees' property will be determined in future as a possible consequence of political settlements between the State of Israel and its neighbors". It should also be noted that at the time the Law was enacted, it was stated that it was necessary to enact a permanent law instead of the Emergency Regulations because "it was clear to the members of the committee that even after the emergency ends we shall have to deal with the absentees' property…" (Minutes 119, p. 868)). In view of the foregoing, in my opinion it is not possible to accept the argument that the definition of "the area of Israel" in the Law meant only the area in which Israeli law applied at the time of the Law's enactment, something of a "photograph" or freeze of a given situation that cannot change with time. The same applies to the argument that an express provision of the Law is necessary for it to apply to territory added to the area of the State of Israel after its enactment. The foregoing examples might demonstrate that, in truth, the opposite is the case. In addition, the failure of the legislature to prescribe a broader arrangement in the Legal Arrangements Law or another statute reflects, as I understand it, a conscious decision not to exclude others from the application of the Absentees' Property Law, like for example the residents of Judea and Samaria. That is also the impression that was gained by this Court in Levy (see ibid., pp. 382-383 (per Justice A. Halima). That is also the opinion of the learned authors Zamir and Benvenisti (see Benvenisti and Zamir, Private Property, p. 27; Zamir and Benvenisti, Jewish Land, p. 87)). Accordingly, I do not consider it possible to depart from the case law according to which the Absentees' Property Law does indeed apply to property in East Jerusalem, whose owners are residents of Judea and Samaria. It appears that any other finding would be contrary to the plain meaning of the Law and the intention of the legislature.

 

26.       In this regard, a few words should be devoted to the Jerusalem District Court's judgment in the Dakak caseJudge B. Okon). In that judgment the court considered the difference between the reality in which the Absentees' Property Law was enacted and the circumstances that have arisen in Judea and Samaria following the Six Day War. According to him, "it is difficult to conceive" that the Law should be applied to residents who are under "effective Israeli control" rather than hostile control (ibid., paras. 4-5 of the judgment). Such being the case, it was held that section 1(b)(1)(ii) of the Law, which concerns a person who is "in any part of Palestine outside the area of Israel", does not apply to a resident of areas "that are actually subject to Israeli military control, as distinct, for example, from areas under the military control of a country mentioned in section 1(b)(1)(i) of the Law" (ibid., para. 6). An appeal was filed against the said judgment (CA 2250/06, which is one of the appeals joined in these proceedings (see para. 1 above)). Ultimately, as aforesaid, the appeal was withdrawn after a settlement agreement was reached between the parties. Nevertheless, since the parties in the instant case did consider the said judgment, we have seen proper to explain our reservation as regards the way in which section 1(b)(1)(ii) of the Law was interpreted in Dakak. The said interpretation is not consistent with this Court's findings in Levy or the underlying assumption relied upon in Golan. This fact, per se, raises difficulty (as regards the departure of the trial courts from a binding precedent of the Supreme Court, see, for example, ALA 3749/12 Bar-Oz v. Setter, paras. 18-20 of my opinion (August 1, 2013)). In addition, in my opinion, the interpretation also raises difficulties with respect to the crux of the matter for the reasons detailed above. Moreover, there is substance to the Respondents' arguments that the said interpretation will in any event not exclude from the application of the Law the residents of Judea and Samaria who were Jordanian nationals or citizens or were there at any time since 1947 and have property in Israel. This is in view of the other alternatives of section 1(b)(1) of the Law. According to the Respondents, it appears that a considerable proportion of the residents of Judea and Samaria are involved. However, the interpretation that "extends" the "area of Israel" beyond that provided in the Law raises substantial difficulties. This is in view of the clear wording of the Law, which expressly provides in section 1(i) that the area in which the law of the State of Israel applies is involved, and for other substantial reasons. Moreover, a finding of this type raises complex issues in respect of the exact nature of the terms "area of Israel" and "effective control". Thus, for example, the question could arise as to whether a distinction should be made among the areas of Judea and Samaria that are termed "areas A, B and C", according to the Israeli-Palestinian Interim Agreement on the West Bank and Gaza Strip that was made between the State of Israel and the PLO on September 28, 1995 (for a discussion in a different context on the question of whether a certain area is under the control of the IDF further to the division of the said territories, see, for example, HCJ 2717/96 Wafa v. Ministry Of Defense, IsrSC 50(2) 848 (1996)). This complex question gained no consideration by those in support of using the term "effective control" in the context under discussion. In any event, it appears that this is not the proper place to decide those questions. Moreover, one should be aware that such an interpretation might lead to the Law's application to property not included in it until now. This is because the Law applies to properties in "the area of Israel" (section 1(b)(1) of the Law.) Hence, finding that Judea and Samaria is part of "the area of Israel" might lead to properties located there also becoming "absentees' property".

 

27.       In view of all the foregoing, there is no alternative but to conclude that the Absentees' Property Law does apply to properties in East Jerusalem, the rights in which are owned by residents of Judea and Samaria. However, that is not the end of it. We must consider the way in which the Law is implemented in cases like these.

 

Exercise of the Powers under the Law in the Cases under Discussion

 

28.       The finding that the said properties are "absentees' property" is very problematic, not only at the level of international law but also as regards administrative law. The Respondents do not deny this either. It should be borne in mind that those involved are residents of Judea and Samaria who have become "absentees", not because of any act done by them but because of the transfer of control of East Jerusalem to Israel and the application of Israeli law there. In addition, persons are not involved who are under the control of another state, and they are in areas over which Israel has control – albeit only certain control. In this context, we should bear in mind that in the course of the Law's enactment it was explained that section 1(b)(1)(ii) of the Law meant "people who are in fact not in the area of the State of Israel" (as the Chairman of the Finance Committee, D.Z. Pinkas, MK, said in Minutes 119, p. 868). In this sense, there is indeed a certain similarity between the residents of Judea and Samaria and the residents of East Jerusalem, although an analogy should clearly not be drawn between the cases in view of the difference in the legal status of the two areas. It appears that there is indeed a difference between the case of residents of Judea and Samaria and the case of those for whom the Absentees' Property Law was intended (see also Cochrane, p. 330, where Justice H. Cohn mentioned a person who is "in part of Palestine outside the area of Israel" as one of the cases in which the Law applies to someone who has nothing whatsoever to do with absenteeism). Indeed, there are differences between the residents of Judea and Samaria, the citizens or nationals of the hostile states in section 1(b)(1)(i) of the Law, and a person who deliberately "left his ordinary place of residence in Palestine" in the circumstances described in subparagraph (iii). In fact, the absenteeism of the residents of Judea and Samaria in respect of their property in East Jerusalem derives from the broad wording of the Law and its continuing application, due to the prolonged state of emergency (see paras. 14 and 18 above). It is difficult to believe that this was the type of case intended by the Law, which was, as aforesaid, enacted against the background of specific and exceptional events. The results of applying the Absentees' Property Law in these cases is also particularly harsh having regard to the fact that the residents of Judea and Samaria are not entitled to compensation for their properties that are vested in the Custodian. This is because the right to claim compensation by virtue of the Compensation Law is granted only to residents of Israel (section 2 of the Compensation Law; see also Benvenisti and Zamir, Private Property, pp. 14, 28-29. It must be said that there is a certain similarity between denying a person's rights to his property because it has become absentees' property and the expropriation of land for public purposes (in which connection it should be noted that the view is expressed in the literature that laying down the ability to obtain compensation under the Compensation Law in the case of Israeli residents reinforces the argument that underlying the failure to release absentees' property is a rationale similar to that underlying the acquisition of land for public purposes (see, ibid., p. 14). See also Sandy Kedar, “Majority Time, Minority Time: Land, Nation and the Law of Adverse Possession in Israel,” 21 (3) Iyunei Mishpat  665, 727 (1998)). Nevertheless, while the grant of compensation is one of the major foundations of modern expropriation law (see, for example, CA 8622/07 Rotman v. Ma'atz - Israeli National Public Works Department Ltd, paras. 65-71 of the opinion of Justice U. Vogelman (May 14, 2012)), as regards absentees resident in Judea and Samaria, the legislature has supplied no statutory arrangement to obtain compensation for the property taken from them. This further underlines the difficulty involved in applying the Absentees' Property Law in respect of them. This problem has not been ignored by the various different attorneys general over the years either. Thus, inter alia, on January 31, 2005, the Attorney General, M. Mazuz, wrote to the Minister of Finance, B. Netanyahu, who was the person responsible for the implementation of the Law (hereinafter: "the Mazuz Directive") as follows:

 

            "The absenteeism of property in East Jerusalem of residents of Judea and Samaria is of a technical character since they became absentees because of a unilateral act taken by the State of Israel for a different purpose, when both the properties and their owners were under the control of the State of Israel, and where it would appear that the purposes of the Law are not being fulfilled here. Involved are, in fact, 'attendant absentees', whose rights in their property have been denied due to the broad technical wording of the Law. Moreover, as regards residents of Judea and Samaria whose property in East Jerusalem has become absentees' property, the result is particularly harsh because applying the Law means the denial of the property without any compensation, because the Absentees' Property (Compensation) Law, 5733-1973 grants compensation only to absentees who were residents of the State of Israel at the time of its enactment" (ibid., para. 2).

 

29.       In this context it should be noted that one should be conscious of the fact that the strict implementation of the Law in regard to the residents of Judea and Samaria is also likely to lead to the property in Israel of the residents of Judea and Samaria who are Israeli nationals being regarded as "absentees' property". Thus, for example, according to this interpretation, even a property in Tel Aviv whose owner is a resident of Ariel or Beit El is vested in the Custodian. As aforesaid, in this respect the Respondents argued that the Law can indeed be understood in this way but the Custodian does not apply its provisions in such cases, just as he does not apply them in other cases of persons who lawfully move outside Israel. Let us again emphasize matters because of the extreme result that emerges from the language of the Law: any property in Israel the owner of the rights in which is a resident of Judea and Samaria is absentees' property. Hence, for example, if a debt is owed to a person who resides in Judea and Samaria by a person who resides in Jerusalem as a result of a transaction currently made between them, prima facie the debt is vested in the Custodian. Perhaps it is not superfluous to mention that this is also apt in respect of real estate in Israel of the residents of Judea and Samaria. It should also be emphasized that the Absentees' Property Law takes no interest in the religious characteristics, for example, of the "absentee" and the courts have applied its provisions to Jewish "absentees" more than once (CA 4682/92, Estate of Salim Ezra Shaya, Deceased v. Beit Taltash Ltd, IsrSC 54(5) 252, 279 (per Justice J. Kedmi) (2000)).

 

30.       In view of the said difficulties, the State authorities, under the direction of the  attorneys general, have seen fit to limit the exercise of the Custodian's powers in such cases. The chain of events in this context is described in the MazuzDirective, which was filed in the cases before us. Back in November 1968, not long after the Six Day War, it was decided in a forum headed by the Minister of Justice, under the guidance of the then Attorney General M. Shamgar, that the Law should not be implemented in respect of immovable property of residents of Judea and Samaria in East Jerusalem. Attorney General Shamgar explained the decision in the following way:

 

            "… We have not seen any practical justification for seizing property that has become absentees' property at one and the same time because its owner – who is a resident of Judea and Samaria – has become a subject under the control of the Israeli government authorities. In other words, since the property would not have been absentees' property before the date on which the IDF forces entered East Jerusalem and would not have become absentees' property had East Jerusalem continued to be part of Judea and Samaria, we have not considered it justified for the annexation of East Jerusalem, and it alone, to lead to taking the property of a person, who is not actually an absentee, but from the time his property came into our hands is in territory under the control of the IDF forces". (The letter of August 18, 1969 from Attorney General M. Shamgar to the Israel Land Administration, as cited in the Mazuz Directive).

 

            Over the years, attempts have been made to erode the said directive. In 1977, a forum headed by the Minister of Justice and the Minister of Agriculture laid down a temporary arrangement "that would be reviewed in light of the experience of its implementation". According to this arrangement, the residents of Judea and Samaria would be required to apply of their own initiative to the Custodian to continue using their property in East Jerusalem. It later became apparent that the arrangement had not actually been reviewed and that "the Law was being abused" under cover of the arrangement (the Mazuz Directive, para. 4(b); for further discussion, see the Report of the Committee for the Examination of Buildings in East Jerusalem (1992) (hereinafter:  "the Klugman Report")). The 1992 Report also described faults that had occurred in the proceedings to declare properties in East Jerusalem "absentees' property" and it stated that "the functioning of the Custodian of Absentees' Property was very flawed, by any criterion" (ibid., p. 24; see also pp. 12-13, 26). In view of that, it was recommended to make an immediate, comprehensive examination into the functioning of the Custodian. In addition, the Attorney General appointed a team to determine procedures for the exercise of the Custodian's powers (the Klugman Rport, p. 25). Further thereto it was decided to freeze the operation of the Law again and reinstate the previous policy in accordance with the 1968 directive. In 1997, the limitations that had been instituted were again eased and the Custodian was permitted to issue certificates in respect of vacant properties, with the authority of the legal adviser to the Ministry of Finance. As regards occupied properties, the authority of the Ministry of Justice was also required. According to the Mazuz Directive, it appears that only limited use of that power was actually made. In March 2000, a ministerial forum, with the participation of the Minister of Finance, the Minister of Justice and the Minister for Jerusalem Affairs, determined that any transfer of property in East Jerusalem by the Custodian to the Development Authority required approval by the said forum or such person as appointed by it in such respect. In 2004, the Ministerial Committee on Jerusalem Affairs made a decision declaring that it sought to remove all the limitations on the exercise of the Custodian's power in respect of properties in East Jerusalem. It was explained in the decision that the Custodian was vested with powers pursuant to section 19 of the Law, including to transfer, sell or lease real estate in East Jerusalem to the Development Authority (Decision no. J'lem/11 of June 22, 2004; the decision was granted the force of a government decision on July 8, 2004 (Decision no. 2207)). It should be noted that the decision was made contrary to the opinion of the Ministry of Justice and did not include in it the original proposal that the exercise of the said power would necessitate consultation with the legal adviser to the Ministry of Finance or his representative.

 

            In response, at the beginning of 2005, Attorney General M. Mazuz made it clear that the said decision could not be upheld, that it was ultra vires and not within the power and authority of the Ministerial Committee on Jerusalem Affairs. He asked the Minister of Finance to order the immediate cessation of the Law's implementation in respect of the East Jerusalem properties of Judea and Samaria residents and he expressed his opinion that there was no alternative but to reinstate the previous policy, namely to determine that "in general, use will not be made of the powers under the Law in respect of the properties under consideration, except in special circumstances and subject to prior approval by the Attorney General or such person as authorized by him for the purpose" (the Mazuz Directive, para. 6). As we have been informed in these proceedings, that position has also been adopted by the current Attorney General, Y. Weinstein, and it is also the position of the Respondents in the appeals before us (the Respondents' notification of August 28, 2013).

 

31.       Hence, there is in fact no dispute between the parties to these proceedings that the strict implementation of the Law in respect of properties in East Jerusalem, the owners of the rights in which are residents of Judea and Samaria, raises significant difficulties. This has been the opinion of the attorneys general for many years, and the Respondents do not deny it. As aforesaid, the Respondents' position is that the Law does indeed apply to East Jerusalem properties of residents of Judea and Samaria, but it is generally not to be applied in such cases. This is except in special circumstances, after obtaining authority from the Attorney General. The distinction between the application of the Law and its implementation has also found expression in the case law of this Court. Thus, in the Levy case, Deputy President Ben Porat concurred in the ruling that the Absentees' Property Law does apply to properties in East Jerusalem of the residents of Judea and Samaria. However, she noted that although those properties can be regarded as "absentees' property", the question might arise as to whether the powers of the Custodian in accordance with the Law ought to be exercised in the circumstances. This is given the fact that persons are involved are under IDF control and but for the annexation of their land for the sake of united Jerusalem, they would not have been regarded as "absentees" (ibid., p. 390). This is also consistent with the approach in the Cochrane case. As aforesaid, in that case, despite the difficulties that Justice H. Cohn saw in the broad application of the Law deriving from its sweeping wording, he did not seek to find that the Law does not apply. Instead, he explained that the solution to the cases in which the problem arises is to be found in the power granted to the administrative authorities to exclude certain parties from the application of the Law or to release absentees' property (see sections 27-29 of the Law)).

 

32.       This approach is also essentially acceptable to us. As we have detailed, it cannot be held that the Law does not apply to properties in East Jerusalem whose owners are residents of Judea and Samaria. Nevertheless, the powers that are granted by the Law in those cases should be exercised scrupulously and with extreme. In my opinion, in view of the difficulties mentioned above, it is inappropriate to exercise those powers in respect of the said properties, except in the most exceptional of situations. In addition, even where it is decided to take action in accordance with the Law – and as aforesaid, those cases ought to be exceedingly rare – the same will necessitate obtaining prior authority from the Attorney General himself, together with a decision of the Government or its ministerial committee approving the same. We thereby in fact adopt the restrictions in respect of the policy of implementing the Law that the Respondents have long been assuming. This is with the supplemental requirement that any act in accordance with the Law in respect of those properties should also be reviewed and approved by the government or a ministerial committee. Let us explain that we have considered it appropriate to entrench in case law the policy that has long been adopted, according to the Respondents, in this respect and even to make it more stringent, since experience shows that the restraints prescribed have not always been observed and in view of the repeated attempts to erode them, as aforesaid. Moreover it should be borne in mind that any decision to implement the Law in a particular case is, in any event, subject to judicial review.

 

33.       We would also note that insofar as the competent authorities believe that there is a justified need to acquire ownership of property of the type under consideration, they have available to them means other than the Absentees' Property Law that enable them to do so. Thus, for example, the Acquisition Ordinance and various provisions of the Planning and Building Law, 5725-1965 (see, for example, chapter 8 of the said Law, which concerns expropriations). Hence, the restraints that have been prescribed above do not block the way of the authorities to acquire rights in the properties under consideration by virtue of other statutory arrangements, provided that there is justification therefor, and that the conditions prescribed by law are fulfilled. Clearly, statutory tools like those mentioned are preferable to implementing the Absentees' Property Law. In other words, the Absentees' Property Law should only be applied, if at all, after all the other options under the various different expropriation statutes have been exhausted. This is in view of the problems that the Law raises and the fact that the other arrangements that we have mentioned are generally more proportionate.

 

34.       Prima facie, a ruling similar to that reached by us could also have been reached by the course delineated in the Ganimat case, that is to say by adopting a new approach to the interpretation of the Absentees' Property Law along the lines of the Basic Laws, despite the Validity of Laws rule in section 10 of Basic Law: Human Dignity and Liberty. However, since the determinations with regard to the Absentees' Property Law and its interpretation do not depend upon the Basic Law, there is no need to consider a move based on section 10 as aforesaid (see HCJ 7357/95 Barki Feta Humphries (Israel) Ltd v. State of Israel, IsrSC 50(2) 769, 781 (per Justice M. Cheshin) (1996)). As aforesaid, my decision does not relate to the constitutional aspect or the validity of the provisions of the Absentees' Property Law, but is at the administrative level concerning the way in which the powers by virtue thereof are exercised. Incidentally, it should to be noted that human rights existed before the Basic Laws, and those rights are, in my opinion, more than sufficient to lead to the conclusion that we have reached.

 

The Application of the Judgment in Time

 

35.       The final issue that is left for us to address is that of the of this judgment application in time. In our decision of September 11, 2013, we permitted the parties to supplement their briefs in regard to the application in time of a possible judicial finding that the Law does not apply in respect of residents of Judea and Samaria who have properties in East Jerusalem. Ultimately, our conclusion is, as aforesaid, that although the Law does apply to such properties, it is subject to very stringent restraints with regard to its exercise. Nevertheless, in view of the possible implications of our other finding that, in general, the powers under the Law should only be exercised in very exceptional cases, we think it proper to consider the application in time of this judgment (see HCJ 3514/07 Mivtahim Social Insurance Institute of the Workers Ltd v. Fiorst, para. 33 and the references there (per President (ret.) D. Beinisch) (May 13, 2012)). Although the parties' arguments related to the commencement date of a (possible) rule that the Law does not apply in the instant situations, they are still relevant to the rule laid down with regard to the way in which the Law is implemented. Consequently, we shall briefly cite the parties' main arguments on the application in time, insofar as they are relevant to the ruling that we have ultimately reached.

 

36.       The Respondents oppose the possibility that a case-law rule – if laid down – according to which the Law does not apply in respect of properties in East Jerusalem of the residents of Judea and Samaria would apply retrospectively. In their view, the practice of interpretation applied by them for many years, in accordance with the case law, should be respected. By that practice, the Custodian has been vested with many properties and he has transferred some of them to third parties over the years. According to them, at the present time it is difficult to produce accurate data on the number of properties, out of all the properties that have been transferred to the Custodian, which belong to the said category. In addition, they emphasize that various parties have relied on the said interpretation, and the Respondents also insist on the need for certainty and stability where rights in land are involved. They warn that adopting such an interpretation with retrospective application would lead to extensive litigation and might also have implications at the political level. The Appellants, for their part, reject the Respondents' position. They argue that there is nothing to stop applying a new interpretation to a statute that substantially harms a particular population merely on the ground that it was customary for many years. In addition, according to them, the position of the State authorities in this respect has not been consistent and uniform throughout the years, and at certain times it has departed from the "customary practice" asserted by the Respondents. In their view, following the judgment in the Dakak case, the practice changed and it cannot be said that a "customary regime that is clear to everyone" is involved. Moreover, the Appellants assert that the Respondents did not substantiate the plea that the rule should not be applied retrospectively, or supply any factual data in support of the argument that changing the rule of law "backwards" will infringe the interest of reliance. Furthermore, in the Appellants' opinion, under the circumstances, the interest of changing the law supersedes the interest of reliance. In this regard, they state that the amount of land involved is fixed and is not going to change, and that third parties who, by the actions of the Custodian, have enjoyed property rights that are not theirs should be deemed as unjustly enricheds.

 

37.       Having considered all the factors in this respect, we have reached the overall conclusion that the holdings of this judgment should only be applied prospectively (for a discussion on delaying the avoidance of an administrative decision and relative avoidance, see CFH 7398/09 Jerusalem Municipality v. Clalit Health Services, paras. 29 and 51 (April 14, 2015)). This is in the following sense: if by the time of the handing down of this our judgment, the competent authorities have not done any act in accordance with the Law in respect of a property in East Jerusalem whose owner is a resident of Judea and Samaria, then henceforth the powers by virtue of the Law should not be exercised, except in extraordinary cases and even then after exhausting other options, for example under the Acquisition Ordinance. If it is indeed decided to take action in accordance with the Absentees' Property Law, the same will necessitate obtaining prior authority from the Attorney General himself and also from theGovernment or its ministerial committee. As already mentioned, absentees' property is automatically vested in the Custodian from the moment that it fulfils the definition of "absentees' property", and the same does not necessitate the taking of any action by the Custodian. Consequently, the question of what is "an act in accordance with the Law" as aforesaid might arise. I mean the exercise of any power under the Law that is subject to judicial review, which has been performed by the competent authorities in, or in respect of a property, provided that there is written documentation thereof. It should be emphasized that "the requirement of writing" is a precondition for finding that a particular property is exempt from the application of the determinations in this judgment. The acts, the commission of which will lead to the conclusion that the property is subject to the previous law, will, for example, include steps to care for, maintain, repair or develop the held property, as mentioned in section 7 of the Law; moves that have been taken in the management of a business or partnership instead of the absentee (sections 8, 24, 25 of the Law); transferring the rights in the property to another, including to the Development Authority; discharging debts or performing obligations relating to absentees' property (as provided in section 20 of the Law); the Custodian's presenting written requirements in respect of the property to its owner (for example as provided in section 21(e) of the Law or section 23(c) of the Law; the issue of orders (for example of the type mentioned in section 11 of the Law); the giving of certificates (such as certificates under sections 10 and 30 of the Law); and incurring expenses and conducting legal proceedings in respect of the property. Moreover, the new rule will of course not apply to properties that constitute "held property", namely property that the Custodian actually holds, including property acquired in exchange for vested property (see section 1(g) of the Law). It should be emphasized that these are mere examples of acts in respect of properties as regards which further to their commission this judgment will not apply, and it is not an exhaustive list.

 

38.       The foregoing new requirements that are to be met henceforth will not apply where, prior to the award of the judgment, powers have already been exercised in accordance with the Absentees' Property Law in respect of particular property. In such cases, the law that applied prior to this judgment will apply. In such connection, the authorities will of course be bound by the restrictive policy that the Attorney General laid down with regard to the implementation of the Law in those cases. This means that where an act as described above has already been done in respect of a property of the type with which we are concerned, the mere fact that the new rules that we have laid down have not been performed will not be regarded as a defect, and certainly not a defect that would to lead to the avoidance of the decisions or acts that have been made or done in respect of the property. This finding is intended to contend with the concern that has been raised with regard to retroactive changes of the rules that applied to the land policy in East Jerusalem and to avoid "reopening" transactions made in respect of those properties, with the difficulties involved therein both materially and evidentially. In this context, we have taken into account the possibility that in a substantial proportion of cases, transactions that have long been completed and even "chains" of transactions will be involved. A different ruling might have led to ownership chaos, the flooding of the courts with lawsuits, the impairment of legal certainty and the infringement of a very large public's reliance interest. It should be noted that this approach is also consistent with the spirit of section 17 (a) of the Law, which provides that transactions that have been made by the Custodian in good faith in respect of property that was mistakenly regarded as vested property shall not be invalidated (for a discussion of this section, see, for example, Makura Farm, pp. 17-25; CA 1501/99 Derini v. Ministry of Finance, para. 4 (December 20, 2004); CA 5685/94 Amutat ELAD El Ir David v. Estate of Ahmed Hussein Moussa Alabsi, Deceased, IsrSC 53(4) 730 (1999), in which it was held that the Custodian had acted in an absence of good faith in respect of realty in East Jerusalem that he sold to the Development Authority, and the transaction was therefore invalid).

 

39.       In any event, the cases concerning absentees' property, in respect of which action has already been taken as aforesaid by the Custodian, should be resolved by means of "the release course" prescribed in sections 28 and 29 of the Law. The problems of implementing the Law in respect of properties of the type under consideration should also be borne in mind by the competent entity when deciding on the release of properties (see also Golan, p. 646). In other words, where it is sought to release one of the said properties to which this judgment does not apply, the Special Committee and the Custodian ought to give substantial weight to the difficulties involved in viewing them as "absentees' property", and also to the restrictive policy that is to be adopted, in accordance with which the Law is to be implemented in respect of them. Consequently, preference should be given to the release of property in specie. To complete the picture, we would mention that we have been informed by the Respondents in the hearings in these proceedings that rules have been laid down for the exercise of the Special Committee's discretion in accordance with section 29 of the Law with regard to the release of absentees' property in East Jerusalem of Judea and Samaria residents. According to them, the rules have been formulated along the lines of the Attorney General's position described above. The Respondents believe that a fitting solution will thereby be given in the majority of the cases under consideration, leaving room for the necessary flexibility in sensitive deliberations of this type. We have not considered it appropriate to relate to the actual rules that have been established, as they are not the focus of these proceedings, and bearing in mind that the power to address those matters is vested in the High Court of Justice (see Lulu, para. 8). Insofar as there are objections to the rules that have been laid down, they should be heard in the appropriate proceedings, rather than in the instant ones.

 

The Cases before Us

 

40.       Against the background of these general statements, we shall now rule on the cases before us. Implementing the findings mentioned above in the concrete cases before us leads to the conclusion that the properties under consideration do indeed constitute absentees' property. Properties are involved that are situated in the area of Israel, within the meaning of the Law, whose owners are residents of Judea and Samaria. Hence, the alternative of section 1(b)(1)(ii) of the law is fulfilled in respect of them. Consequently, the Appellants' pleas in both appeals aimed against the finding that Property 1 and Property 2 are absentees' property are dismissed.

 

            The Appellants' alternative application in CA 5931/06 is for us to order the release of Property 1 in accordance with section 28 of the Law. As a condition for exercising the power to release property, a recommendation of the Special Committee under section 29 of the Law is necessary (see also Golan, p. 641). As aforesaid, incidental to these proceedings, the Committee deliberated about the release of Property 1. According to the Respondents, the land involved in the dispute was sold to third parties on "market overt conditions" and the Custodian now only holds the proceeds of sale. The Special Committee recommended releasing the proceeds received for the property only to those of the Appellants who are residents of Judea and Samaria and still alive, and supplemental particulars in respect of the Appellants who have died were requested. As already mentioned, the way in which the Committee's powers have been exercised is subject to review by the High Court of Justice rather than this Court sitting as a court of civil appeals (Lulu, para. 8). Hence, insofar as the Appellants in CA 5931/06 have complaints with regard to the Special Committee's decision, the instant proceedings are not the appropriate forum. In any event, and without making any ruling, we would comment that, under the circumstances, it appears that ruling on the rights in Property 1 necessitates factual enquiry and the consideration of legal questions that were not decided in the judgment of the District Court or argued before us. That being the case, the application to order the release of the property involved in CA 5931/06 is dismissed.

 

            The Appellants in CA 2038/09 have applied for us to order the avoidance of Property 2's seizure and its restitution to them, inter alia in view of their arguments in respect of the Respondents' conduct in the case. As aforesaid, from the moment that a property fulfils the conditions for being "absentees' property", the rights in it are vested in the Custodian, including the power to seize the property. Having determined that "absentees' property" is involved it can only be returned to its original owners in the ways delineated in the Law, with the emphasis on the possibility of release under sections 28-29 of the Law. We would mention that the Special Committee also deliberated upon the release of Property 2. The Committee recommended the release of the parts of the property that had not been seized for the construction of the security fence, and to transfer the consideration for the part seized to the Appellants, who are residents of Judea and Samaria and, according to it, those who held it continuously until its seizure. In accordance with the foregoing, insofar as the Appellants in CA 2038/09 have complaints in such respect or with regard to the seizure of the property for the construction of the fence, the the instant proceedings are not the appropriate forum. Such being the case, the Appellants' application in CA 2038/09 that we order the avoidance of the seizure of the property involved in the appeal and its restoral to them is dismissed.

 

Conclusion

 

41.       Accordingly, my opinion is that there is no alternative but to conclude that the Absentees' Property Law applies to properties in East Jerusalem owned by residents of Judea and Samaria who enjoy or hold them. This is despite the considerable problem raised by treating them as "absentees' property". In this context, we should be conscious of the fact that the strict implementation of the Law's provisions to residents of Judea and Samaria is also likely to lead to serious results as regards residents of Judea and Samaria who are Israeli nationals, whose property in Israel is prima facie regarded as "absentees' property". Alongside this, the substantial difficulties are of significance in the context of exercising the powers under the Law in respect of such property. Consequently, I would suggest to my colleagues to find that the competent authorities must, in general, refrain from exercising the powers by virtue of the Law in respect of the properties under consideration. As such, I have not considered it appropriate to seal the fate of such property and prevent any possibility of implementing the Law in regard to that property. Our assumption is that there may be cases, albeit exceedingly rare, in which it might be justified to take such steps in respect of properties in East Jerusalem of the residents of Judea and Samaria. In those cases, the performance of any act in accordance with the Law will necessitate obtaining prior approval from the Attorney General himself and a decision of the Government or its ministerial committee. This amounts to the adoption of the restrictive policy assumed by the Respondents over the years, with a certain stringency in the form of adding the requirement for the Government's approval. This judgment, and in particular the finding with regard to the restrictions obliged when exercising the powers by virtue of the Law in respect of such property, will only apply prospectively, in the following sense:

 

            (a)       If by the time of the handing down of this judgment, the competent authorities have not done any act by virtue of the Absentees' Property Law in respect of a particular property in East Jerusalem owned by a resident of Judea and Samaria, the findings prescribed in this judgment will apply. Accordingly, the authorities will not be able to take steps in accordance with the Law in respect of the property without the prior authority of the Attorney General and without the approval of the Government or its ministerial committee. In mentioning an "act by virtue of the Law" we mean any act that is subject to judicial review and an act in accordance with the Law, like in the non-exhaustive list of acts contained in para. 37 above, provided always that there is written documentation.

 

            (b)       These requirements will not apply in cases where, prior to this judgment, acts in accordance with the Law were done by the competent authorities in respect of property in East Jerusalem owned by a resident of Judea and Samaria. In those cases, the previous law will apply, including the restrictive rules that have been laid down by the Attorney General in respect of the exercise of the said powers. This means that non-performance of the new conditions that we have just prescribed will not, per se, be regarded as a defect in the administrative act, and will not be such as, per se, to lead to the avoidance of the steps taken in respect of the property or to the "reopening" of transactions already made in respect of it. In such cases, the way is open to release the absentees' property along the course prescribed in sections 28-29 of the Law. When the competent authorities come to decide on the release of such properties, they must take into account the great problem involved in those properties being "absentees' property".

 

42.       In the cases before us, I would suggest to my colleagues that we dismiss the appeals. Under the circumstances, there shall be no order for costs.

 

Justice S. Joubran

 

1.         I agree with the thorough and comprehensive opinion of my colleague, President (ret.) A. Grunis, but would like to add a few words on the application of the Basic Laws as a tool in the interpretation of old legislation. In my opinion, a ruling similar to that of my colleague the President (ret.) could have been reached by an interpretation of old legislation "in the spirit of the Basic Laws", as I shall explain below, and as my colleague Deputy President E. Rubinstein has detailed in his opinion in these proceedings.

 

2.         In my view, the Basic Laws give the judge an appropriate tool of interpretation when questions of interpretation in respect of the provisions of law arise. The Validity of Laws provision in section 10 of Basic Law: Human Dignity and Liberty provides that "this Basic Law shall not affect the validity of any law in force prior to the commencement of the Basic Law". That is to say that so long as there was existing law prior to the commencement of the Basic Laws, its validity is preserved. However, in my opinion, it is not to be inferred from that provision that the Basic Laws are not to be used as a tool for the interpretation of existing law when that law is not clear and its validity is in any event dubious. The Basic Laws have given our legal system an arrangement of fundamental principles, which I believe can, and frequently should, be referred to when we are reviewing the proper interpretation or legal policy.

 

3.         Using the Basic Laws as an interpretive tool can, in my opinion, give substance to the principles and rights that are under consideration in existing legislation, and properly analyze the balance between them. I believe that such will not impair the validity of the existing law but will conceptualize their substance in a more balanced and organized discourse (cf. CFH 2316/95 Ganimat v. State of Israel, IsrSC 49(4) 589, paras. 7-12 of the opinion of Justice M. Cheshin (1995) (hereinafter: Ganimat)). So too, for example, Basic Law: Freedom of Occupation distinguishes between the validity of provisions of legislation and the interpretation of the provisions that "will be made in the spirit of the provisions of this Basic Law" (section 10 of Basic Law: Freedom of Occupation). According to Justice (as he then was) A. Barak, this is obliged as an interpretive conclusion in the context of Basic Law: Human Dignity and Liberty even without an express provision (and see: Ganimat, para. 6 of the opinion of Justice A. Barak). In this respect, his statement there is apt:

 

            "The constitutional status of the Basic Law radiates to all parts of Israeli law. This radiation does not pass over the old law. It, too, is part of the State of Israel's law. It, too, is part of its fabric. The constitutional radiation that stems from the Basic Law affects all parts of Israeli law. It necessarily influences old law as well. In truth, the validity of the old law is preserved. The radiation of the Basic Law upon it is therefore not as strong as it is upon new law. The latter might be avoided if it is contrary to the provisions of the Basic Law. The old law is protected against avoidance. It has a constitutional canopy that protects it. However the old law is not protected against a new interpretative perspective with regard to its meaning. Indeed, with the enactment of the Basic Laws on human rights there has been a material change in the field of Israeli law. Every legal sapling in that field is influenced by that change. Only in that way will harmony and uniformity be achieved in Israeli law. The law is a set of interrelated tools. Changing one of those tools affects them all. It is impossible to distinguish between old and new law as regards the interpretative influences of the Basic Law. Indeed, all administrative discretion that is granted in accordance with the old law should be exercised along the lines of the Basic Laws; all judicial discretion that is granted in accordance with the old law should be exercised in the spirit of the Basic Laws; and in this context, every statutory norm should be interpreted with the inspiration of the Basic Law" (Ganimat, para. 7 of the opinion of Justice A. Barak).

 

            My view is similar to that of Justice A. Barak and I believe, as aforesaid, that in the event that a question of interpretation arises in respect of the provisions of the law, recourse should be made to the Basic Laws, and inspiration drawn from them. In his opinion, my colleague the President (ret.) did not consider the said interpretative approach (and see para. 34 of his opinion, above) but since in the instant case we still reach a similar ruling by his method, I shall add my voice to his opinion.

 

4.         Together with all the foregoing, I concur with the opinion of my colleague President (ret.) A. Grunis.

 

Justice Y. Danziger

 

            I concur in the opinion of my colleague President (ret.) A. Grunis, who proposes to dismiss the appeals before us without any order for costs.

 

            Like my colleague, I too believe that, as a rule, the competent authorities should avoid exercising the powers by virtue of the Absentees' Property Law, 5710-1950 in respect of properties in East Jerusalem whose owners are residents of Judea and Samaria and hold or enjoy them.

 

            As regards those exceptional cases – "exceedingly rare" as my colleague defines them – when there might be justification for exercising the power, I concur with the solution proposed by my colleague, according to which the exercise of the power should be conditional upon obtaining prior approval from the Attorney General, accompanied by an approbative decision of the Government or its ministerial committee.

 

            I therefore concur in the opinion of my colleague, including his findings with regard to the prospective application of the restraints therein, as set out in paras. 41(a) and (b) of his opinion.

 

President M. Naor

 

1.         I concur in the judgment of my colleague President (ret.) A. Grunis. In my opinion, it is very doubtful whether there can, in fact, be an "exceedingly rare" case, in the words of my colleague, where it will be justified to implement the Law in respect of properties in East Jerusalem of the residents of Judea and Samaria.

 

2.         I would explain that in my view, even someone whose case has already been considered in the past by the Special Committee is entitled to apply to it again further to the fundamental observations in this judgment. As my colleague has noted, its decision is subject to review by the High Court of Justice.

 

Deputy President E. Rubinstein

 

A.        I accept the result reached by my colleague President (ret.) A. Grunis in his comprehensive opinion. This is a complex issue which involves the intricacies of the political situation in our region for which a solution has unfortunately not yet been found, and it touches on other issues involved in the dispute with our neighbors, including the refugee question, which is one of the most difficult issues, and the definition of "absentees' property" has a certain relevance thereto. As evidence of this is the fact that, over the years, various different parties have considered the matter, including attorneys general, as my colleague described, and they have sought a modus operandi that will be as fair as possible to all those concerned. That is to say that they will not go into the delicate political issues that go beyond the legal action but will be cautious and moderate in the operative implementation of legal absenteeism; and as my colleague now proposes, the same should only be with the approval of the Attorney General and the Government or a ministerial committee. That is to say that it will be considered very carefully.

 

B.        An example of the complexity and intricacy involved in the matter of absenteeism, which generally awaits the end of the dispute, is the need that arose when the peace agreement with Jordan was made in 1994 (and I would duly disclose that I headed the Israeli delegation in the negotiations on the peace agreement with Jordan) to enact the Implementation of the Peace Agreement Between the State of Israel and the Hashemite Kingdom Law, 5755-1995. The Law dealt with various matters, but section 6 prescribed as follows:

 

            "(a)     Notwithstanding as provided in the Absentees' Property Law, 5710-1950, with effect from Kislev 7, 5755 (November 19, 1994) property shall not be considered absentees' property merely because of the fact that the owner of the right thereto was a citizen or national of Jordan or was in Jordan after the said date.

 

            (b)       The provision of subsection (a) shall not alter the status of property that became absentees' property in accordance with the said Law prior to the date specified in subsection (a)"

 

            (See CA 4630/02 Custodian of Absentees' Property v. Abu Hatum (2007), para. K, which my colleague also cited.)

 

            Note that in section 6(b), as quoted above, it was provided that "the watershed" for the changes was the date of the peace agreement and no change was made to what preceded it; and in the explanatory notes on section 6 (Draft Laws 5755, 253), it was stated that "the status of properties that were absentees' property before the peace agreement will not alter". Section 6 therefore resolved difficulties that might have arisen in accordance with the legal position existing after making the peace agreement but not in respect of the past – "what was, will be" until times change. So too, mutatis mutandis, in the instant case, cautiously and moderately.

 

C.        I would also concur in principle with the observation of my colleague Justice S. Joubran with regard to the use of the Basic Laws on rights as a tool for the interpretation of the legislation to which the Validity of Laws provision in Basic Law: Human Dignity and Liberty (section 10 of the Basic Law) applies. It provides that "this Basic Law shall not affect the validity of any law in force prior to the commencement of the Basic Law". Basic Law: Human Dignity and Liberty has been with us for more than two decades. During that period, this Court has time and again repeated the rule laid down in Ganimat to which my colleagues have referred, to the effect that "the constitutional radiation that stems from the Basic Law affects all parts of Israeli law. It necessarily influences old law as well" (para. 7 of the opinion of Justice (as he then was) A. Barak; see also A. Barak, “Basic Laws and Fundamental Values – the Constitutionalisation of the Legal System Further to the Basic Laws and its Effects on Criminal Law,” in Selected Writings I 455, 468-469 (5760) (Hebrew)).

 

D.        Further thereto, this principle has been applied in the interpretation of ordinances, statutes and regulations that predate the Basic Law. Thus, for example, it has been held that the Contempt of Court Ordinance (1929) and the Religious Courts (Enforcement of Obedience) Law, 5716-1956 should be interpreted "in light of the provisions of the Basic Law", MCA 4072/12 Anonymous v. Great Rabbinical Court, para. 24 of the opinion of Justice Zylbertal (2013); so too the Crime Register and Rehabilitation of Offenders Law, 5741-1981 (CFH 9384/01 Nasasreh v. Israel Bar, IsrSC 59(4) 637, 670 (2004); The Execution Law, 5727-1967 (CA 9136/02 Mr. Money Israel Ltd v. Reyes, IsrSC 58(3) 934, 953 (2004); The Protection of Privacy Law, 5741-1981 (HCJ 8070/98 Association for Civil Rights in Israel v. Ministry of the Interior, IsrSC 58(4) 842, 848 (2004); the Defence (Emergency) Regulations 1945 (HCJ 8091/14 Center for the Defence of the Individual v. Minister of Defense, paras. 18 and 27 (2014); and so on and so forth. This is ethically anchored in what, in a different context, I happened to call "the spirit of the age" (AA 5939/04 Anonymous v. Anonymous, IsrSC 59(1) 665 (2004)), that is to say, giving case-law expression to the social developments in various spheres.

            It should be emphasized that this has also been laid down concretely with regard to the right of property, which stands at the center of the instant case. In fact, even before the well-known finding of Justice Barak in Ganimat, and even prior to the "constitutional revolution" in CA 6821/93 United Mizrahi Bank Ltd. v. Migdal Cooperative Village, IsrSC 49(4) 221 (1995) [http://versa.cardozo.yu.edu/opinions/united-mizrahi-bank-v-migdal-cooper..., Justice – as he then was – S. Levin held as follows: "With the enactment of Basic Law: Human Dignity and Liberty the normative weight of the right of property has risen to the position of a fundamental right. The provision in section 3 of the said Law that 'there shall be no infringement of a person's property' also carries weight when we come to interpret existing provisions of law…" (ALA 5222/93 Block 1992 Building Ltd v. Parcel 168 in Block 6181 Company Ltd, para. 5 (1994); and see also A. Barak, Legal Interpretation, volume III – Constitutional Interpretation, 560-563 (5754) (Hebrew); S. Levin, The Law of Civil Procedure (Introduction and Fundamentals), 33-35 (second edition, 5768-2008) (Hebrew)).

 

E.         And now to the case before us. There can be no question that the language of the Absentees' Property Law, 5710-1950 is not consistent with the right of property in section 3 of Basic Law: Human Dignity and Liberty. That infringement is, in the instant case, compounded by section 2 of the Absentees' Property (Compensation) Law, 5733-1973, which, as the President (ret.) stated, does not permit residents of the territory of Judea and Samaria to claim compensation for the properties that have been transferred to the Custodian of Absentees' Property. Indeed, under the provision of section 10 of the Basic Law we do not set upon a review of the constitutionality of the infringement: whether it is consistent with the values of the State of Israel, whether it is for a proper purpose and whether it is proportional (section 8 of the Law); and my colleague discussed at length the purpose of the Law and its answer to a complex problem that has not yet been resolved, but it can be said that what is called the "right of return" argument, with all its extensive derivatives, cannot be resolved by judicial interpretation. At the Camp David Summit in 2000, I was a member of the Israeli delegation and chaired the subcommittee that dealt with the subject of the refugees, and there was no doubt in Israel's position (which was also supported by the USA) that denied the very basis of that right as being "national suicide". Indeed, based on the case law that the Court has restated numerous times as aforesaid, the provisions of the relevant statute are to be interpreted in accordance with Basic Law: Human Dignity and Liberty. In the instant case, it appears that my colleague the President, despite not expressing an opinion on interpretation along the lines of the Basic Law in accordance with that stated in Ganimat, did in fact draw, what in my opinion is, a proper balance in accordance with the Basic Law when he determined the application of the Absentees' Property Law to the properties involved herein, and that in the instant circumstances, limited use should be made of the Absentees' Property Law, subject to various authorizations and approvals, and after the options included in other statutes have been exhausted (para. 33 of the President's opinion). I have considered it proper to add the foregoing in order to emphasize the importance of the determination in Ganimat and the scope of its application.

 

F.         Given the foregoing, I therefore concur in the opinion of my colleague President (ret.) A. Grunis, which balances between not upsetting a complex legal position, on the one hand, and great caution on the other, by means of a dual safety belt in operative decisions concerning the implementation of the Law in individual circumstances.

 

Justice H. Melcer

 

1.         I concur in the opinion of my colleague President (ret.) A. Grunis and with the remarks of my colleagues. Nevertheless, I am allowing myself to add a few comments of my own.

 

2.         My colleague President (ret.) A. Grunis writes in para. 20 of his opinion, inter alia, as follows:

 

            "In my opinion, it is certainly possible that at least some of the arrangements in the Law (the Absentees' Property (Compensation) Law, 5733-1973 – my clarification – H. Melcer), were they enacted today, would not meet the constitutional criteria. Nevertheless, in the instant case, the provisions of the limiting paragraph are not such as to help or to alter the conclusion with regard to the application of the Law in the cases under consideration here. This is in view of the Validity of Laws rule in section 10 of Basic Law: Human Dignity and Liberty, according to which the Basic Law does not affect the validity of any law that existed prior to its entry into force. This provision does not make it possible to find that any provision of the Law is void ".

 

            In para. 34 of his opinion President (ret.) A. Grunis goes on to say, in respect of the conclusions reached by him:

 

            “Prima facie, a ruling similar to that reached by us could also have been reached by the course delineated in the Ganimat case, that is to say by adopting a new approach to the interpretation of the Absentees' Property Law along the lines of the Basic Laws, despite the Validity of Laws rule in section 10 of Basic Law: Human Dignity and Liberty. However, since the determinations with regard to the Absentees' Property Law and its interpretation do not depend upon the Basic Law, there is no need to consider a move based on section 10 as aforesaid (see HCJ 7357/95 Barki Feta Humphries (Israel) Ltd v. State of Israel, IsrSC 50(2) 769, 781 (per Justice M. Cheshin) (1996)). As aforesaid, my decision does not relate to the constitutional aspect or the validity of the provisions of the Absentees' Property Law, but is at the administrative level concerning the way in which the powers by virtue thereof are exercised. Incidentally, it should to be noted that human rights existed before the Basic Laws, and those rights are, in my opinion, more than sufficient to lead to the conclusion that we have reached.”

 

 

            Although it was not necessary in all the circumstances herein specifically to consider a move based on section 10 of Basic Law: Human Dignity and Liberty, the same was possible, and it also supports the result and is even proper, as was stated by my colleagues: Deputy President E. Rubinstein, Justice S. Joubran and Justice E. Hayut.

 

            Prof. Aharon Barak recently developed an approach of this type in the interpretation given by him to section 10 of the said Basic Law in his paper, Validity of Laws (an article that is due to be published in the Beinisch Volume – hereinafter referred to as "Validity of Laws"). Further to Prof. Barak's said article, I too stated in my opinion in FH 5698/11 State of Israel v. Mustfafa Dirani (January 15, 2015), as follows:

 

            "Even if the 'Validity of Laws' section contained in Basic Law: Human Dignity and Liberty did apply here, in my opinion that does not mean that the law that has been assimilated as aforesaid, has been "frozen" and it can certainly be altered (according to its normative source and the power to do so) by interpretation or 'adaptation' to the normative environment that has been created further to the values of the Basic Laws, or due to changing times in the world (especially in a case such as this, which involves the war on terror), because 'validity is one thing and meaning is another', see HCJ 6893/05 MK Levy v. Government of Israel, IsrSC 59(2) 876, 885 (2005). In such a case, the "adaptation" or "alteration" should have regard to the 'respect provision' contained in section 11 of Basic Law: Human Dignity and Liberty, and the 'limiting paragraph' of the said Basic Law. See Aharon Barak Human Dignity, The Constitutional Right and Its 'Daughter' Rights, volume I, 392-396 (5774-2014) (Hebrew); Barak, Validity of Laws, the text at footnote 23, and also page 24 ibid. Along these lines, one should also read the development, made by my colleague the President, of the rule that the lawsuit of an enemy national should not be tried by 'adapting it' to the present day and the necessary war on terror, in accordance with the requirements of section 8 of Basic Law: Human Dignity and Liberty" (ibid., para. 16).

 

3.         The practical difference between the foregoing two courses is of importance with regard to the future (in respect of the present, both ways lead to the same result, as aforesaid).

 

            The constitutional course, just like the international-law course, might perhaps in future – if peace settlements are reached with our neighbors – open a way to special arrangements at various different levels on a reciprocal basis, including mutual compensation, as part of a broader package, in view of "the regulatory takings" (to use the American terminology), and the taking of Jewish property in similar circumstances in Arab countries. A somewhat similar process was given expression in legislation further to the making of the peace agreement with Jordan in 1994, of which my colleague the Deputy President, Justice E Rubinstein was one of the architects (see the Implementation of the Peace Agreement Between the State of Israel and the Hashemite Kingdom Law, 5755-1995), and also in some of the countries of Eastern Europe after the changes of regime that occurred there.

 

            Section 12 of the Prescription Law, 5718-1958 (hereinafter: "the Prescription Law”) may be relevant in this respect in the appropriate conditions and with reciprocity. It provides as follows:

 

"In calculating the period of prescription, any time during which the plaintiff was the guardian or ward of the defendant shall not be taken into account".

 

            Also relevant are other provisions of the Prescription Law – section 14 of the statute (which specifically mentions property vested in the Custodian of Absentees' Property in the definition of "party"), and also section 16 of the same law which talks of extending the prescription period after the interruption has ended – in the instant case, according to sections 12 and 14 of the Prescription Law. (For an interpretation of the said sections, see Tal Havkin, Prescription, 213-216, 221-227, 239-240 (2014)(Hebrew)).

 

4.         In conclusion, I would say that the future and the hope that it embodies for peace settlements at this stage raise nothing more than expectations, while the present unfortunately dictates, at most, the legal result that my colleague President (ret.) A. Grunis has presented, in which we have all concurred.

 

Justice E. Hayut

 

1.         I concur in the judgment of my colleague President (ret.) A. Grunis and also the comment by my colleague Deputy President M. Naor, who casts great doubt with regard to the very existence of an "exceedingly rare" case that would justify the implementation of the Absentees' Property Law, 5710-1950, in respect of properties in East Jerusalem that belong to residents of Judea and Samaria. I also share her approach that persons whose case has been considered by the Special Committee in the past should be permitted to apply to it again to review their case in accordance with the principles that have been delineated in this judgment.

 

2.         The examples presented by my colleague President (ret.) A. Grunis in para. 18 of his opinion well illustrate the great difficulty raised by the Law because of its broad scope, alongside the great problems that arise at the international and administrative law levels with regard to its application in cases like those before us (see para. 28 of my colleague President (ret.) A. Grunis's opinion). These difficulties have led us to choose the course of "a rule that is not to be taught"[2] or, to be more precise, "a statute that is not to be taught". This course is perhaps an inevitable necessity given the rigid statutory position that currently exists (cf. Attorney General Directive No. 50.049 of January 1, 1972 with regard to the filing of indictments for an offence of homosexuality in accordance with section 152 of the Criminal Code Ordinance, 1936. Also compare Crim.App. 4865/09 Adv. Avigdor Feldman v. Tel Aviv District Court, paras. 7-8 (July 9, 2009)), but it is important to emphasize that it, too, raises considerable problems because in countries such as ours where the rule of law applies, the provisions of law and the values that the State seeks to apply and enforce are expected to be compatible.

 

3.         Finally, I would concur with the comments of my colleagues Justice S. Joubran, Justice E. Rubinstein and Justice H. Melcer as regards the principles of interpretation to be applied in respect of the legislation that preceded the Basic Laws to which the Validity of Laws provision applies (see, for example, section 10 of Basic Law: Human Dignity and Liberty). These principles of interpretation were considered by this Court in CFH 2316/95 Ganimat v. State of Israel, IsrSC 49(4) 589 (1995), since when it has applied them again in its rulings more than once. In the instant case, my colleague President (ret.) A. Grunis, has, in his own way, reached a result that is consistent with these principles of interpretation, and I have therefore seen no need to expand on the matter.

 

            Decided unanimously as stated in the opinion of President (ret.) A. Grunis.

 

            Given this 26th day of Nissan 5775 (April 15, 2015)

 

 

 

 

 

The President (ret.)

The President

The Deputy President

 

 

 

 

 

Justice

Justice

Justice

Justice

 

 

           

 

 

           

 

                                                                                                                       

 

[1]       Translator’s note: The  Hebrew version of the Absentees' Property Law uses the term "Eretz Israel" (the Land of Israel) which refers, at least in this context, to the territory that became the State of Israel, the West Bank and the Gaza Strip after the 1948 War of Independence. The authorized translation of the Law, prepared at the Ministry of Justice, upon which this translation is based, translates the terms "Eretz Israel" as "Palestine" and "Eretz Israeli" as "Palestinian".

[2] Translators note: A talmudic concept, see, e.g: Babylonian Talmud, Tractate Shabbat 12b; Tractate Eiruvin 7a; Tractate Bava Kama 30b.

Full opinion: 

Amir v. The Great Rabbinical Court in Jerusalem

Case/docket number: 
HCJ 8638/03
Date Decided: 
Thursday, April 6, 2006
Decision Type: 
Original
Abstract: 

[This abstract is not part of the Court's opinion and is provided for the reader's convenience. It has been translated from a Hebrew version prepared by Nevo Press Ltd. and is used with its kind permission.] 

 

This petition puts to the test the question of the Rabbinical Court's authority to adjudicate a property dispute between a couple after the divorce proceeding between them has been completed, and it focuses on an alleged breach of the divorce agreement by one member of the couple. Is the matter within the jurisdiction of the Rabbinical Court or is it within the power of the civil judicial instance; and if the Rabbinical Court does indeed have authority to adjudicate the matter, what is the source of the authority and from where does this authority derive? Is it from the law; is it from the parties' agreement in arbitration or otherwise? And what is the nature of this authority?

 

The Supreme Court, sitting as the High Court of Justice, granted the petition and held (per Her Honor Justice A. Procaccia, with the concurrence of His Honor Vice President (Ret.) M. Cheshin and His Honor S. Joubran) that –

 

The High Court of Justice's intervention in religious court decisions is limited to extreme cases of ultra vires, infringement of the principles of natural justice, departure from the provisions of law aimed at the religious court or when equitable relief is necessary where the matter is not within the jurisdiction of another court or tribunal.  The subject matter of the petition justifies this Court's entertaining the matter on grounds of the Rabbinical Court's exceeding the jurisdiction vested in it.

 

The Rabbinical Court is a state judicial instance, which was established by virtue of the Rabbinical Courts Jurisdiction (Marriage and Divorce) Law, 5713-1953 (hereinafter: "the Rabbinical Courts Jurisdiction Law"), and it derives its power and jurisdiction therefrom, and it has only those jurisdictional powers that the state law has given it.

 

The original powers of the Rabbinical Court were set in the Rabbinical Courts Jurisdiction Law and they are built of exclusive powers by virtue of the law and powers that are parallel to the civil court and the Rabbinical Court that are vested by virtue of the parties' agreement. The case law has recognized the existence of the judicial instance's inherent ancillary power that derives from the original power of the Rabbinical Court by virtue of the law, and in special circumstances grants it jurisdiction to again hear a matter upon which it has ruled in the past.

 

Is the Rabbinical Court vested with jurisdiction to decide a dispute by virtue of the parties' agreement, where such jurisdiction is not in the scope of the statute that empowers the Rabbinical Court or within the ancillary powers that are vested in it? The parties' agreement to vest jurisdiction in the Rabbinical Court might take on two guises: one, simple agreement, irrespective of the provisions the Rabbinical Courts Jurisdiction Law; the other, agreement intended to empower the Court to deliberate and decide on a dispute as an arbitrator. A court's jurisdiction is vested by law and it has no power to derive it from the parties' agreement except were the law itself has seen fit to recognize such agreement in certain circumstances as the source of jurisdiction. A similar approach is also taken with regard to the judicial instance's power to adjudicate by way of arbitration. Since the state judicial instance merely has the subject matter jurisdiction conferred to it by statute, it is not vested with power to deliberate and adjudicate a matter as an arbitrator by virtue of the parties' agreement, unless it has been expressly given that power by statute. The Rabbinical Court does not have power to hear and decide a matter that is not one of those that is within its exclusive jurisdiction in accordance with the statute or within its parallel jurisdiction, even if the parties have given their agreement to its jurisdiction. According to the same way of thinking, the Rabbinical Court has no power to decide a dispute as an arbitrator by virtue of an arbitration agreement between the parties in a matter which by its nature is not within its legal jurisdiction.

 

Is the respondent's answer against the petitioner within the bounds of the Rabbinical Court's subject matter jurisdiction? The respondent's cause of action is the enforcement of a contractual indemnity provision concerning property in the divorce agreement that obtained the force of a judgement of the Rabbinical Court, further to which the parties' divorce was completed. The source of the Rabbinical Court's exclusive jurisdiction in matters of marriage and divorce in accordance with the Rabbinical Courts Jurisdiction Law does not apply because the subject of the claim is a property matter after the dissolution of the parties' marriage and a matter of "marriage and divorce" is not involved. Nor is it a matter "connected with a divorce suit". The respondent's cause of action is a new one, the subject of which is the enforcement of a divorce agreement or an application for the enforcement of a divorce award, based on a divorce agreement. The Rabbinical Court does not have jurisdiction either by virtue of the parties' agreement pursuant to section 9 of the Law, which deals with the Rabbinical Court's parallel jurisdiction that is vested by virtue of the parties' agreement in matters of personal status according to article 51 of the Palestine Orders in Council or the Succession Ordinance. Subject matter jurisdiction under section 9 is limited solely to the matters mentioned in it – matters of "personal status" as defined in the Palestine Orders in Council or the Succession Ordinance. In a dispute that does not relate to those matters, even the parties' agreement cannot vest jurisdiction in the Rabbinical Court. The Rabbinical Court therefore has no original jurisdiction to hear the respondent's claim.

 

The Rabbinical Court does not have "ancillary" inherent jurisdiction to try the respondent's claim. In the instant case, the Rabbinical Court's ancillary jurisdiction, insofar as it relates to setting aside a divorce award by reason of a defect in making the divorce agreement, that might have given the Rabbinical Court ancillary jurisdiction to try its revocation, is of no relevance. Similarly, the Rabbinical Court has not acquired ancillary jurisdiction by virtue of a material change in circumstances after making the divorce award that justifies setting aside the divorce agreement and the divorce award since the respondent's claim is for the specific performance and enforcement of the divorce agreement. Again, the Rabbinical Court's ancillary jurisdiction to retain jurisdiction in a matter pending before it until the proceedings conducted before it are concluded will not vest it with jurisdiction. The second respondent finally and unconditionally adjudicated herein and awarded the force of judgement to the divorce agreement. A property dispute that has arisen between the parties after the award of judgement gives rise to a new cause of action and necessitates the institution of new proceedings in accordance with the jurisdictional framework prescribed by law.

 

Nor does the Rabbinical Court have jurisdiction to hear the matter by virtue of the doctrine of "continuing jurisdiction". Continuing jurisdiction is vested where an instance has tried a particular matter in the past and in special circumstances need has arisen to set aside or modify an earlier decision due to a material change that has occurred in the circumstances upon which the original decision was based.  The claim seeks to enforce the agreement and has no place in the continuing jurisdiction vested in the Rabbinical Court.

 

The Rabbinical Court does not have ancillary jurisdiction to try the new cause arising further to the divorce agreement in order to interpret the agreement. Having completed and exhausted its power to rule on the matter of divorce, it no longer has ancillary power to interpret the divorce agreement or the divorce award. Moreover, in the instant case no question of interpreting the divorce agreement has arisen and a claim for its enforcement has been brought instead.

 

A rabbinical court cannot be empowered to decide a dispute between litigants in arbitration, in a matter that is not within its subject matter jurisdiction according to the statute. In the instant case, it also appears from the divorce agreement that its contents cannot be construed as an arbitration clause, equal to "an arbitration agreement" between the parties. The power of an arbitrator to decide a dispute between parties derives from an arbitration agreement. The condition precedent for arbitration is the existence of an agreement to refer a dispute to arbitration. If parties have agreed to refer disputes between them to the decision of some entity but it is not clear that a decision in arbitration is involved, then there is no arbitration agreement.

 

By deciding the respondent's lawsuit against the petitioner for the enforcement of a contractual indemnification provision in the divorce agreement, the Rabbinical Courts exceeded the power vested in them by law. Consequently, the decisions of the first and second respondents are void.

 

 

 

Voting Justices: 
Primary Author
majority opinion
majority opinion
majority opinion
Full text of the opinion: 

In the Supreme Court

Sitting As the High Court of Justice                                             HCJ 8638/03

 

Before:

His Honor, Vice President (Ret.) M. Cheshin

Her Honor, Justice A. Procaccia

His Honor, Justice S. Joubran

 

 

 

 

 

 

 

 

The Petitioner:

Sima Amir

 

 

 

 

v.

 

 

 

The Respondents:

1. The Great Rabbinical Court in Jerusalem

 

2. The Regional Rabbinical Court in Jerusalem

 

 

3. Yoseph Amir

 

 

 

 

 

 

 

On Behalf of the Petitioner:

Adv. Michael Korinaldi

 

 

 

 

On Behalf of the Third Respondent:

Adv. Nechama Segal

 

 

 

 

On Behalf Of the Rabbinical Courts System:

Adv. S. Jacoby

 

 

 

 

 

JUDGEMENT

 

Justice A. Procaccia

 

1.         This petition puts to the test the question of the Rabbinical Court's authority to adjudicate a property dispute between a couple after the divorce proceeding between them has been completed, and it focuses on an alleged breach of the divorce agreement by one member of the couple. Is the matter within the jurisdiction of the Rabbinical Court or is it within the power of the civil judicial instance; and if the Rabbinical Court does indeed have authority to adjudicate the matter, what is the source of the authority and from where does this authority derive? Is it from the law; is it from the parties' agreement in arbitration or otherwise? And what is the nature of this authority?

 

2.         The petition concerns the petitioner's motion to vacate the decisions of the Great Rabbinical Court in Jerusalem – the first respondent – of May 4 and June 9, 2003, which dismissed the petitioner's appeal against the judgment of the Regional Rabbinical Court of Jerusalem – the second respondent – of May 27, 2002, and its decisions of March 5, 2001 and June 18, 2002.

 

Background and Proceedings

 

3.         The petitioner and the third respondent (hereinafter: “the respondent") were married in 1980 and have three children. Their relationship became unstable and they motioned the Regional Rabbinical Court of Jerusalem in 1992 in order to arrange for divorce proceedings. As part of that proceeding, the couple requested the Regional Rabbinical Court to approve a divorce agreement that they had made. In the agreement, the couple agreed on the act of divorce, the custody and support of the children, and various financial and property arrangements, as follows: the three children would be in the custody of the wife until reaching the age of 18 (clause 3); the husband would pay child support in the sum of NIS 1,000 per month for all three of the children until they reach the age of 18; the sum of the child support as set in the agreement would not be increased, and in exchange, the husband would transfer his share of the couple’s apartment to the wife, including his share of the apartment’s contents and the gold objects, ownership of which would all be transferred to the wife (clauses 4(a) and (b)); the husband also undertook to discharge the balance of the mortgage loan each month (clause 6(c)). The agreement also included a condition whereby the wife undertook not to sue the husband in any court for an increase in child support, either directly or indirectly, and if the husband were sued, the wife would compensate him in such a way that he would receive half of the apartment, half of its contents and half of the gold (clauses 4 and 5 the agreement). Taking out a stay of exit order inhibiting the husband's departure from the country would also be deemed a breach of the agreement and lead to the same result (clause 13). In order to secure the wife's obligation in accordance with the agreement, a cautionary note would be registered against the apartment, pursuant whereto one half of the apartment would be transferred into the husband's name if he were sued to increase child support. The relevant provisions of the agreement are as follows:

 

                        "4.       Child Support

 

                                    (e)       For the avoidance of doubt and without prejudice to the generality of the aforegoing, child support under the agreement shall unequivocally cover all the children's needs without exception… until the children reach the age of 18.

 

                                    The mother undertakes not to sue the father in any legal instance for an increase in child support or for the satisfaction of any of the children's needs without exception beyond what the father has undertaken in this agreement, either directly (herself) or indirectly (through any institution, entity, authority, person and/or in the name of the minor and/or anyone who now and/or in future has an interest), and if the husband is sued, the wife shall compensate him and he shall receive one half of the apartment, one half of its contents and one half of the gold. The obligation is in perpetuity.

 

                                    …

 

                        5.         Indemnification

 

                                    (a)       The mother undertakes and takes it upon herself not to sue the father in any legal instance whatsoever for an increase in child support or for the satisfaction of any of the children's needs without exception beyond what the father has undertaken in this agreement, either directly (herself) or indirectly (through any institution, entity, authority, person and/or in the name of the minor and/or anyone who now and/or in future has an interest).

 

                                    (b)       If, contrary to the abovementioned, the father is sued for an increase in child support and/or satisfaction of any of the children's needs, whether the lawsuit is brought by the mother and/or the mother in the name of the children or by an entity, authority, institution and/or anyone who now and/or in future has an interest, beyond what the father has undertaken in this agreement, then the mother undertakes to transfer one half of the apartment into the father's name and one half of its contents and one half of the gold. The obligation is in perpetuity.

 

                                    (c)       To secure the wife's obligations in this agreement, a cautionary note shall be registered, pursuant whereto one half of the apartment shall be transferred into the husband's name if the husband is sued to increase child support…"

 

            The agreement also includes a provision with regard to the exclusivity of the Rabbinical Court's jurisdiction in the event of a dispute between them after the divorce, in the following terms:

 

                        "9.       Cancellation of Mutual Claims And/or Complaints

 

                        …

 

                        10.       …

 

                        11.       If after the divorce, differences arise between the couple, they undertake to file the lawsuit solely in the Rabbinical Courts.

 

                        12.       …

 

                        13.       The wife undertakes not to take out a stay of exit order preventing the husband's departure from the country, and taking out such an order shall constitute a breach of this agreement, and the husband shall be entitled to obtain one half of the value of the apartment, of the contents and of the gold.

 

                        …"

 

            The divorce agreement was given the effect of judgement by the Rabbinical Court, and on May 26, 1992 the couple was divorced.

 

4.         About five years later, in June 1997, the couple's children (through the petitioner) filed a child support motion against the respondent in the Jerusalem Family Court (FC 10330/97). The motion was mainly intended to increase the child support upon which the couple had agreed in the Rabbinical Court to NIS 6,700. This was, inter alia, due to the petitioner's claim that the respondent was not paying the mortgage payments as undertaken by him in the divorce agreement. In the answer of defense, the respondent defended the claim on its merits. According to him, he was living off a general disability pension of NIS 1,200 per month, from which he was paying child support. The Family Court (per Judge N. Mimon) held in its judgement that the children's monthly support should be increased to a total of NIS 2,000 for both minor children together, and the sum of NIS 500 for the other child until his enlistment to the IDF; with respect to the minors, it was further held that from the time they reached the age of 18 until they completed their service in the IDF, the child support for them would be reduced by NIS 700, and upon completion of their military service the liability for their support will be terminated; if they do not enlist, the liability for them would be terminated when they reach the age of 18. With regard to the other child, upon his enlistment to the IDF and until his discharge, support of NIS 300 would be payable for him.

 

            On September 20, 1997, about three months after the motion to increase child support was filed in the civil court, the respondent filed a motion in the Regional Rabbinical Court of Jerusalem "for a declaratory judgement and specific performance" of the divorce agreement. In the motion, he pleaded that the petitioner had breached the divorce agreement several times and in several different aspects, as follows:

 

                        "8        (a)       The defendant (the petitioner – AP) filed a motion to increase child support in the name of the minors before this Honorable Court on February 28, 1993 – a motion that was dismissed by the Court

 

                                    (b)       The defendant filed another motion on November 6, 1994 and at the end of that motion the wife again applied for an increase in child support.

 

                                    (c)       The defendant motioned for a stay of exit order that was cancelled on July 21, 1997.

 

                        9.         (a)       The defendant went further, and when she saw that her motions were being dismissed by the Honorable Rabbinical Court, she  filed a motion to increase the child support in the name of the minors in FC 10330/97 in the Jerusalem Family Court.…

 

                                    (b)       As part of the motion in Family Court, the wife applied for a stay of exit order that the Court approved.

 

                                    (c)       Moreover, at about the time she filed the motion, the defendant filed a motion for a stay of exit order on July 22, 1997, after the previous order inhibiting departure from the country had been set aside, and the Chief Execution Officer approved it".

 

            He pleaded that the wife had therefore breached clauses 5 and 13 of the divorce agreement. On the basis thereof, the respondent sued the wife for one half of the apartment and its contents and one half of the gold.

 

5.         After filing his motion to the Regional Rabbinical Court, the respondent traveled abroad for more than two years and abandoned his motion. After returning to Israel, he renewed the motion in the Rabbinical Court. The petitioner pleaded in her defense, that the subject of the motion was " breach of a divorce agreement" and according to the law laid down in HCJ 6103/93 Sima Levy v. The Great Rabbinical Court in Jerusalem, PD 48(4) 591 (hereinafter: "Sima Levy Case") the Rabbinical Court did not have jurisdiction to adjudicate the motion. As for the merits of the motion, the petitioner argued that the respondent had come to court with unclean hands because he had breached the divorce agreement by not paying the mortgage payments as he had undertaken in the divorce agreement. The Regional Rabbinical Court, in its decision of February 25, 2001, referred the issue of jurisdiction raised by the petitioner to the Rabbinical Courts' then legal counsel on rabbinical jurisdiction, Adv. E. Roth, for his opinion.

 

            During the same month (February 2001) the petitioner filed a lawsuit in the Jerusalem Family Court against the respondent for "declaratory judgement as to the revocation of the indemnity provision in the divorce agreement" (FC 10331/97). This was based, inter alia, on the argument that the respondent breached the divorce agreement by not paying the mortgage payments as he had undertaken in the divorce agreement. The petitioner further requested that the Court declare the revocation of clauses 11 and 13 of the divorce agreement, pleading that they were "contrary to public policy and the law". The respondent argued in his defense that the claim should be summarily dismissed due to the proceedings conducted on the same issues in the Rabbinical Court.

 

            On March 4, 2001, and before the Family Court had awarded its decision on the respondent's motion for the summary dismissal of the petitioner's claim, the opinion of the legal counsel on rabbinical jurisdiction, Adv. Roth, was filed in the Rabbinical Court. In his opinion, with reference to clause 5(b) of the divorce agreement, the Rabbinical Court did not have jurisdiction to adjudicate the respondent's motion after the divorce. Nevertheless, he believed that clause 11 of the divorce agreement could be treated as an arbitration clause in accordance with the Arbitration Law, 5728-1968 (hereinafter: "the Arbitration Law"). By virtue of the rules of arbitration, the Rabbinical Court is empowered to adjudicate the suit as an arbitrator in accordance with the rules and restraints governing an arbitrator. He further added that, in his opinion, it was unnecessary for the couple to sign an arbitration deed, since clause 11 of the divorce agreement constituted an arbitration deed in all respects.

 

            Following the opinion of the legal counsel, Adv. Roth, the Regional Rabbinical Court decided on March 5, 2001 that it was vested with jurisdiction to adjudicate the respondent's suit "since in the Court's opinion clause 11 constitutes an arbitration deed".

 

            On May 14, 2002, and before the Regional Rabbinical Court's judgement had been awarded in the respondent's suit, the Family Court awarded its decision in the respondent's motion for the summary dismissal of the petitioner's suit. It reviewed the question of the Rabbinical Court's jurisdiction to try the respondent's claim, whether as a court empowered by virtue of statute or as an arbitrator, but it decided to stay the award of its decision on jurisdiction on the ground that:

 

                        "Mutual respect of legal instances requires that after a decision has been awarded by the Rabbinical Court holding that it has jurisdiction to adjudicate the suit that has been filed with it as an arbitrator, the award of a decision on jurisdiction should be stayed until the proceedings in respect of jurisdiction have been exhausted by the plaintiff, who will perhaps wish to act by applying on appeal to the Great Rabbinical Court or by applying to the High Court of Justice to clarify whether her position with regard to jurisdiction will be allowed, or even by motioning to vacate an arbitral judgment as provided in section 24 of the Arbitration Law…"

 

            On May 27, 2002, the Regional Rabbinical Court awarded its judgement in the respondent's motion. The court was divided in its opinion between the three judges, and the decision was made, in the words of the judgement, in accordance with –

 

                        "the third opinion, which was the decisive one of the three, since there are several doubts regarding the interpretation of the agreement, and there is a doubt as to whether it constitutes a breach according to Halachic authorities and the circumstances. Therefore, the case should be decided according to the law, and if the apartment has already been transferred into the wife's name, it is not possible to take away her ownership of the apartment because of a doubt, and of course the wife is liable to comply with all of the obligations in the divorce agreement.... If the apartment has not yet been transferred, it is not possible to order the plaintiff ... to transfer his share of the apartment into the wife's name ....

If the plaintiff has already signed a power of attorney and delivered it to the wife, it would appear that the wife cannot be precluded from exercising the power of attorney in order to transfer the plaintiff's share of the apartment into the wife's name…. On the other hand, if the husband still needs to sign transfer documents and the like, he should not be made to help transfer the dwelling into the wife's name in any way whatsoever….

With regards to the gold objects that the wife has received, it would also appear that she cannot be made to return them to the husband because they are in her possession and in this way her possession is valid…"

 

            As mentioned above, according to the Rabbinical Court's decision of March 5, 2001 it decided the respondent's suit as an arbitrator, but on June 18, 2002 it awarded another decision that was headed "Clarification", according to which:

 

                        "The Rabbinical Court makes it clear that it was the Rabbinical Court that approved the agreement and that there was an undertaking that all matters involved in the agreement would be tried solely by the Rabbinical Court. Therefore, since both parties undertook in the agreement, and the Rabbinical Court also approved the agreement, the Rabbinical Court consequently has jurisdiction to hear and adjudicate the matter, and the Rabbinical Court awarded the judgement by virtue of its jurisdiction, and there was no need for the Rabbinical Court to adjudicate the same as arbitrator, and although the Rabbinical Court could also adjudicate the matter as an arbitrator, the Rabbinical Court also had jurisdiction to try the matter as an adjudicating court in accordance with the aforegoing".

 

6.         The petitioner appealed to the Great Rabbinical Court against the Regional Rabbinical Court's judgement of May 27, 2002. Her main plea in the appeal was that the Regional Rabbinical Court did not have jurisdiction to adjudicate the respondent's suit, either as a competent court by virtue of the law or as an arbitrator, and its judgement is therefore void. As to the actual merits, she argued that the Regional Rabbinical Court had made an error "of judgement" and "disregarded facts" by not giving proper weight to the fact that it was the respondent who was in breach of the divorce agreement by not making the mortgage payments as he had undertaken in the divorce agreement. Consequently, on that ground too, on the merits of the case, the Regional Rabbinical Court's judgement should be vacated. The respondent also appealed to the Great Rabbinical Court against the said judgement.

 

            The Great Rabbinical Court, in its decision of May 4, 2003, dismissed the petitioner's appeal with respect to jurisdiction and held that the interpretation of the divorce agreement indicated that it concerned the couple's agreement for "property in consideration for child support". That interpretation affects the substance of the complaint that the respondent filed to the Rabbinical Court, and it demonstrates that it is a suit to revoke the divorce agreement as opposed to a motion for the enforcement of an indemnity provision. That being the case, the Rabbinical Court had jurisdiction to adjudicate the respondent's motion by virtue of its original (primary) authority because "indemnification was not involved, but property and child support and the connection between them, and those matters of property division and child support are certainly matters of personal status that are governed by section 9 of the Rabbinical Courts Jurisdiction Law". The Rabbinical Court was also vested with original (primary) jurisdiction to adjudicate the suit in view of clause 11 of the divorce agreement, which provides that if differences arise between the petitioner and the respondent after the divorce, the two undertake to file the motion solely to the Rabbinical Courts. The Rabbinical Court mentions that at the hearing, the respondent also pleaded avoidance of the Get and the divorce because according to him the Get had been given by mistake. Consequently, on that ground too, the Rabbinical Court had original (primary) jurisdiction to adjudicate the claim. According to the Rabbinical Court, it also had jurisdiction by virtue of its "continuing" jurisdiction, because the respondent was "applying expressly for the revocation of the property arrangement as a result of a change in circumstances concerning child support". Finally, the Great Rabbinical Court held that the jurisdiction to adjudicate the respondent's suit was vested in the Regional Rabbinical Court, when "the jurisdiction is the essential jurisdiction vested in the Rabbinical Court, rather than jurisdiction by virtue of the Arbitration Law". The Great Rabbinical Court adjourned the deliberation on the appeal itself to a later date.

 

            On June 9, 2003 the Great Rabbinical Court awarded another decision, this time with regard to the respondent's appeal against the Regional Rabbinical Court's judgement. In its decision, the Great Rabbinical Court ordered the matter to be remitted to the Regional Rabbinical Court for it to try the argument, which had not been tried in the Regional Rabbinical Court, that the petitioner had breached the divorce agreement by suing for increased child support in the Regional Rabbinical Court in 1993.

 

The Petition

 

7.         In her petition before us, the petitioner seeks to set aside the decisions of the Great Rabbinical Court and the Regional Rabbinical Court, according to which the Rabbinical Court had jurisdiction to adjudicate the respondent's motion, both as original (primary) jurisdiction and by virtue of an arbitration clause.

 

            This Court issued an order nisi in the petition.

 

The Parties' Arguments

 

8.         The petitioner's essential argument in her petition herein is that the Rabbinical Court lacks jurisdiction to adjudicate the property dispute that has arisen between her and the respondent in respect of the divorce agreement that was made between them. According to her, the Rabbinical Courts are not vested with original (primary) jurisdiction to adjudicate the suit. Moreover, they do not have continuing jurisdiction to hear the respondent's suit. The respondent's motion to obtain one half of the property, which was transferred to the wife, is based on the cause of enforcing an indemnity provision in the divorce agreement. This cause is based on a plea of breach, if one occurred, after the divorce agreement was made and the judgement of the Rabbinical Court giving it force and effect was awarded, and after the couple had been duly divorced. A subsequent breach of the divorce agreement in respect of property after the parties' divorce cannot be bound in retrospect with the divorce agreement and the judgment that materialized in the past. From the divorce and onwards, motions that relate to the breach of the divorce agreement are not a part of matters of personal status. The Rabbinical Court therefore lacks jurisdiction to adjudicate them, and jurisdiction in respect of them is vested in the civil court. Moreover, it was argued that the respondent himself breached the divorce agreement by not paying the mortgage payments as he had undertaken to do in the divorce agreement. His breach of the agreement has civil-financial character, which also demonstrates that his suit after the divorce is subject to the jurisdiction of the civil, rather than religious, court. The petitioner further pleads that clause 11 of the divorce agreement does not amount to an arbitration clause and does not purport to establish an agreement for arbitration. Instead, its wording and contents merely demonstrate its determination, by agreement of the parties, to which court the couple's motions after the divorce should be filed. This agreement, per se, does not vest jurisdiction in the Rabbinical Court. In view of all of this, and based on other grounds too, upon which we shall not focus, the Rabbinical Courts' decisions on jurisdiction are void.

 

9.         The respondent's position in his petition is that the Rabbinical Court is vested with jurisdiction to adjudicate the suit he filed to it. In this respect, he relies on the provision of the divorce agreement, according to which the parties expressly agreed to vest the Rabbinical Court with jurisdiction to try any future dispute between them concerning the agreement. He pleads that, according to case law, a matter that can be bound from the outset with the divorce suit, such as property matters, and it was agreed in the divorce arrangement to vest jurisdiction in the Rabbinical Court in respect to them, is also within its jurisdiction after the divorce. He further asserted that the meaning of the cause of the action that he filed was the revocation of a conditional undertaking given under the agreement, as opposed to the enforcement of a contractual indemnification arrangement. That is to say that the respondent entered into a conditional undertaking to transfer property to the petitioner in consideration for the child support being set in a binding amount and not being increased, and for motions not to be brought in this matter. Since that condition had not been fulfilled, the property undertaking that he had given is void. A contractual indemnification provision is not to be treated in the same way as a conditional property undertaking, with regard to which the Rabbinical Court has continuing jurisdiction even after the divorce. Alternatively, it is argued, the Rabbinical Court has jurisdiction to entertain the respondent's suit according to the law of arbitration, by virtue of clause 11 of the divorce agreement, which constitutes an arbitration agreement, even if the word "arbitration" is not mentioned in it.

 

Judgment

 

10.       This Court's intervention in the decisions of religious courts is limited to extreme cases of ultra vires, infringement of the principles of natural justice, departure from the provisions of law aimed at the religious court or when equitable relief is necessary where the matter is not within the jurisdiction of another court or tribunal (sections 15(c) and (d)(4) of the Basic Law: the Judiciary; HCJ 323/81 Vilozni v. The Great Rabbinical Court, PD 36(2) 733; HCJ 1689/90 E'asi v. The Sharia Court, PD 45(5) 148, 154-155; HCJ 1842/92 Blaugrund v. The Great Rabbinical Court PD 46(3) 423, 438; HCJ 5182/93 Levy v. The Rehovot Regional Court PD 48(3) 1, 6-8).

 

            The subject matter of the petition herein justifies this Court's entertaining the matter on grounds of the Rabbinical Court's exceeding the jurisdiction vested in it for the reasons explained below.

 

The Question

 

11.       The couple signed a divorce agreement containing property and child support arrangements. In the scope of the property arrangements, they agreed to limit and not increase child support. They added a condition according to which if motions to increase child support were filed by the wife, directly or indirectly, or if she took out stay of exit orders, these actions would have certain property consequences. The parties further agreed that if differences arose between the couple after the divorce, they undertook to conduct the claims solely in the Rabbinical Courts. Indeed, after the divorce, disputes did arise between the parties following motions to increase child support that were brought against the husband, and stay of exit orders were taken out. Further thereto, the husband filed a suit in the Rabbinical Court claiming a breach of the divorce agreement by the wife and requesting to receive one half of the property because of that breach. In those circumstances, after the couple's divorce, is the Rabbinical Court vested with jurisdiction to adjudicate the husband's property suit, which is based on an alleged breach of the divorce agreement by the wife? Or is the exclusive jurisdiction to deliberate and adjudicate that claim vested in the civil court?

 

            The subsidiary questions that are to be decided can be divided into two:

 

            First is whether the Rabbinical Court has jurisdiction by virtue of the law to adjudicate a property claim based on a breach of the divorce agreement after the divorce has been completed, by virtue of one of the following:

 

            (a)       Original-primary jurisdiction by virtue of statute to hear and adjudicate issues pertaining to the divorce;

 

            (b)       the Court's "ancillary" jurisdiction to adjudicate matters connected with the divorce after its completion, as interpreted and expanded by case law.

 

            The Second is whether the Rabbinical Court has jurisdiction to decide a property claim based on the breach of a divorce agreement by virtue of the parties' agreement, and what legal significance is to be given to this agreement.

 

            We shall consider these questions.

 

The Starting Point

 

12.       The starting point underlying the analysis of the Rabbinical Court's scope of jurisdiction is based on several fundamental assumptions:

 

            First, the Rabbinical Court is a state judicial instance, which was established by virtue of the Rabbinical Courts Jurisdiction (Marriage and Divorce) Law, 5713-1953 (hereinafter: "the Rabbinical Courts Jurisdiction Law"), and it derives its power and jurisdiction therefrom. As such a state judicial instance, the bounds of the Rabbinical Court's powers are defined and fashioned in accordance with the state law.

 

            Second, every state judicial instance, including the religious court, has merely those jurisdictions that the state law has granted it; it is the statute that established it, and it is the one that defined its powers and assigned them to it. In doing so, the statute assumed, as part of the basic concept of democratic government, that in the granting of judicial powers also lay judicial limitations. Anything that has not been granted to the judicial instance is outside and beyond its power, and it must not surpass its acknowledged boundaries and into areas that have not been entrusted to it and go beyond its responsibility. That is the principle of legality that characterises the structure of democratic government, upon which rests the perception of the status of the government authorities, including the courts. It is on the basis of this principle that the realm of jurisdiction that is vested in the state judicial instances, of which the Rabbinical Courts form part, extends.

 

            Third, the definition of the judicial powers of the various different courts, including the Rabbinical Courts, derives from statute, and statute is subject to interpretation by case law. The case law's interpretation of the extent of the powers vested in the judicial instance is intertwined with the provisions of the statute as the primary source of the power vested in the judicial instance, and it is intended to serve its purpose. In reviewing the boundaries of the religious court's power we shall therefore assume that the religious court is vested with the powers that have been granted to it by the statute, as they have been interpreted by case law, and it has only what the law has given it. As the Court stated (per Justice Landau) in HCJ 26/51 Menashe v. The Chairman and Members of the Rabbinical Court in Jerusalem, PD 5 714, 719:

 

                        "The Rabbinical Courts of our country exist in accordance with the general law, which determines their place in the state courts system, and the questions relating to the spheres of their jurisdiction should generally be resolved in accordance with the same principles as govern other courts".

 

            This is what distinguishes Rabbinical Courts from arbitrators, internal tribunals and voluntary tribunals, which are not established by virtue of statute but mainly by virtue of contract or regulations, and the scope of their jurisdiction is determined pursuant thereto. These entities are essentially governed by the principles of the private law that creates them and they are not part of the country's state judicial system.

 

            As Justice Zamir stated in HCJ 3269/95 Yosef Katz v. The Jerusalem Regional Rabbinical Court, PD 50(4) 590, 602:

 

                        "The Rabbinical Court is established by virtue of statute and its jurisdiction derives from the statute. Its budget comes from the State Treasury and its judges receive salaries like state employees; it sits in judgement beneath the symbol of the State and it writes its judgements on State paper; the orders that it issues speak in the name of the State and are enforced by the State. The Rabbinical Court is not a private entity but a state institution. It is therefore subject to public law and review by the High Court of Justice. Amongst other things, the Rabbinical Court is obliged to respect and observe the fundamental principle that governs every government agency, namely the principle of legality. According to that principle, the Rabbinical Court has nothing other than the power granted to it in accordance with the statute" (emphasis added).

 

            In this respect Justice Cheshin stated in the Sima Levy Case (ibid, p. 616):

 

                        "The legal system takes a grave view of a judicial entity acting beyond the bounds set for it by the law; hence, the case law holds that a lack of subject matter jurisdiction plea stands out and the court will consider it at any stage of the litigation, even where a party first raises it on appeal".

 

            (See also HCJ 816/98 Eminoff v. Eltalaff, PD 52(2) 769, 796-7; HCJ 512/81 The Hebrew University Archaeology Institute v. The Minister of Education, PD 35(4) 533, 543-4; HCJ 30/76, MF 150/76 Siho v. The Karaite Jewish Community Religious Court, PD 31(1) 15, 17-18.)

 

            The state judicial system, and its various different courts, both civil and religious, is built on common norms that govern all its agencies. Thus, for example, it has been held in the past that the fundamental principles that govern civil judges also apply to rabbinical judges. The rabbinical judge, like the civil judge, is part of the judicial authority and in his position he is subject to the same basic rules as obligate any judicial officer:

 

                        "He is not an arbitrator between parties who voluntarily apply to him. He operates by virtue of state law and his authority extends over the whole public with all its diversity, opinions and views. Like a civil judge, a rabbinical judge enjoys independence in matters of judgement. The laws concerning conditions of service, immunity, appointment, discipline and the like that govern the rabbinical judge are very similar to those that govern a civil judge. Like the civil judge, so too the rabbinical judge must, by his action, ensure the public's trust in his judgement. The public is not only the religious public. The rabbinical judge deals with the whole people and he must by his conduct ensure the trust of the whole people, both secular and religious". (Per Justice Barak in HCJ 732/84 MK Tzaban v. The Minister of Religious Affairs, PD 40(4) 141, para. 16.)

 

            In this context, case law has also drawn a clear distinction between a person's fitness as a rabbinical judge of the Israeli Rabbinical Court and his fitness as a community rabbi. On enactment of the Dayanim (rabbinical judges) Law a clear separation was created between judicial and rabbinic functions, and a mix between the two in judicial work is no longer consistent with the concept of state law. In the words of the Minister of Religious Affairs Warhaftig, when he presented the Dayanim Law draft on first reading in the Knesset, as cited in the Tzaban Case:

 

                        "With the establishment of the State of Israel we adopted this course. We distinguished between those functions and separated between rabbis and rabbinical judges" (Knesset Proceedings Session 5457, 1954, p. 2182).

 

 

 

            As Justice Goldberg added on this subject in the Tzaban Case:

 

                        "The main power of the Rabbinate rests in its traditional authority over those who come 'to seek God', whilst the rabbinical judges' authority when sitting in judgement does not depend on the wishes of the litigants but is enforced in the context of the judicial system prescribed for it by the legislature. In this sphere, the rabbinical judges perform the function of 'judging the people', with its varied opinions and views".

 

 

            The religious function of the rabbinical judge as rabbi is not intertwined with the judicial function that he performs as a rabbinical judge and is separate from it. The Rabbinical Court cannot therefore rely on its religious power in order to assume jurisdiction in a matter that exceeds its powers and authorities in accordance with state law (Schiffman, Family Law in Israel, 5755, Vol. I, p. 42).

 

            Against this background there is difficulty with the argument that is sometimes made that the Rabbinical Court might perform a dual function: on the one hand, a state judicial function imposed upon it by virtue of state law, and on the other hand, a religious court in monetary matters by virtue of the parties' agreement. Like any public entity that performs a function in accordance with the law, so the Rabbinical Courts, which operate by virtue of statute must also discharge the responsibility owed by them by virtue of statute and decide the matters entrusted to them. As part of the state judicial system, they possess only the jurisdiction that the statute has placed in their hands. That is the essence of the principle of legality that underlies public administration and the judicial system (Katz Case, ibid, p. 607); hence, even if Jewish law and tradition permit a Rabbinical Court to adjudicate and decide disputes in a certain manner, that does not suffice to authorize it to do so because "the Rabbinical Court, as a state institution, must act within the authority vested in it by state law" (Katz Case, ibid, p. 607). To the same extent, a civil court, which is part of the judicial authority, may not assume an authority or function that does not derive from state law (Tzaban Case, ibid, p. 152).

 

            It is against this background that we shall examine the question of the Rabbinical Court's jurisdiction to decide the respondent's property suit against the petitioner based on a breach of the divorce agreement, and the relief deriving therefrom. A comprehensive analysis of the issue of jurisdiction in a similar context can be found in the judgement of Justice Cheshin in the Sima Levy Case and it will guide and direct us.

 

The Rabbinical Court's Original – Primary Jurisdiction

 

13.       The original primary powers of the Rabbinical Court were set in the Rabbinical Courts Jurisdiction Law and they are built on two tiers: exclusive powers by virtue of the statute; and parallel powers of the civil court and the Rabbinical Court that are vested by virtue of the parties' agreement. The exclusive powers comprise matters of marriage and divorce, as well as matters that are duly bound up in the motion for divorce, including wife and child support. Parallel jurisdiction that is vested by agreement relates to matters of personal status in accordance with article 51 of the Palestine Orders in Council and the Succession Ordinance. The relevant provisions are as follows:

 

                        "1.       Jurisdiction in matters of marriage and divorce

 

                        Matters of marriage and divorce of Jews in Israel, nationals or residents of the State, shall be under the exclusive jurisdiction of rabbinical courts.

 

                        …

 

                        3.         Jurisdiction in matters incidental to divorce

 

                        Where a suit for divorce between Jews has been filed in a rabbinical court, whether by the wife or by the husband, a rabbinical court shall have exclusive jurisdiction in any matter connected with such suit, including support for the wife and for the children of the couple.

 

                        …

 

9.         Jurisdiction by consent

 

In matters of personal status of Jews, as specified in article 51 of the Palestine Orders in Council, 1922 to 1947, or in the Succession Ordinance, in which a rabbinical court does not have exclusive jurisdiction under this Law, a rabbinical court shall have jurisdiction after all parties concerned have expressed their consent thereto."

 

The Rabbinical Court's powers – both the exclusive ones (marriage, divorce and matters bound with divorce) and the jurisdiction in accordance with the parties' agreement in matters of personal status – are original-primary powers by virtue of the statute to hear and rule on the matters that fall within the scope of those powers.

 

Power Ancillary to Original Jurisdiction

14.       The Case law has recognized the existence of a judicial instance's inherent ancillary power that derives from the original power of the Rabbinical Court by virtue of the statute and in special circumstances grants it jurisdiction to again hear a matter upon which it has ruled in the past. Such is, for example, the jurisdiction of the civil and religious courts to vacate a judgement awarded by them that is based on an agreement between the parties, in the making of which there has been a defect. Such a material defect might lead to the revocation of the agreement and therefore also to revocation of the judgment that rests upon it, and the instance empowered to decide its revocation is the one that rendered the judgment (HCJ 124/59 Glaubhardt v. The Haifa Regional Rabbinical Court, PD 13 1490; CA 151/87 Artzi Investment Co. v. Rachmani PD 43(3) 489, 498-500). Additional expression of such ancillary jurisdiction occurs when there is a material change in the circumstances of the matter, that has occurred after the award of judgement by consent, which makes its continued performance unjust (Sima Levy Case, ibid, pp. 605-6; CA 442/83 Kam v. Kam PD 38(1) 767, 771; CA 116/82 Livnat v. Tolidano PD 39(2) 729, 732; CA 219/87 Rachmani v. Shemesh Hadar, Building Company Ltd et al. PD 43(3) 489, 498-500). The recognition of this ancillary jurisdiction is intended to bring about a proper balance between the judgment’s finality on the one hand, and the interest not to leave in effect a judgment, the enforcement of which has become extremely unjust due to a change in circumstances. Inherent jurisdiction is also vested in the judicial instance, including the Rabbinical Court, to retain jurisdiction in respect of a matter that is pending before it until the proceedings have been completed. So long as final judgement has not been awarded, jurisdiction continues until the judicial court has completed its work. Once a final, unconditional judgment has been awarded, the work is completed (Sima Levy Case, p. 607; CA 420/54 Ariel v. Leibovitz PD 9 1337; ALA 2919/01 Daniel Oshrovitz v. Yael Lipa (Fried) PD 55(5) 592; J. Zussman, The Civil Procedure (seventh edition, 5755) 550).

One of the expressions of ancillary jurisdiction relates to the existence of the Rabbinical Court's "continuing jurisdiction", the essence of which is that, under certain conditions, where the Rabbinical Court has in the past heard a particular matter, its continuing jurisdiction to hear it again will be recognized. The continuing jurisdiction also derives from the inherent power of the judicial instance. Its basic purpose is to give expression to the duty of mutual respect and the need for harmony between judicial instances where there is parallel jurisdiction between them, and in order to avoid parties running from one judicial instance to another. It has nevertheless already been explained that continuing jurisdiction is not intended to undermine or derogate from the original powers vested in the judicial instances in accordance with statute. Its purpose is essentially "to vest power to vacate or modify an earlier decision due to a change that has occurred in the circumstances upon which the first decision was based" (per Justice Cheshin in the Sima Levy Case, ibid, p. 608, 610). Such are matters of child support and custody, which by their nature are subject to material changes of circumstance, and the original judicial instance therefore has inherent jurisdiction to reconsider them when the appropriate conditions arise.

It should be made clear that no inherent power has been recognized for a civil or religious court to exercise its original authority again in order to interpret a judgement awarded by it. Hence, a Rabbinical Court that has granted a divorce does not have inherent jurisdiction to interpret the divorce agreement and the judgement that awarded it force and effect (Sima Levy Case, ibid, pp. 612-13).

These are the characteristics of the original jurisdiction that is vested in the Rabbinical Court in accordance with the statute, alongside its ancillary powers that are sparingly exercised in special circumstances by virtue of its inherent jurisdiction, in order to complete the judicial act and make it a complete and just deed.

We shall now examine the question of whether the Rabbinical Court has jurisdiction to adjudicate a dispute by virtue of the parties' agreement, where such jurisdiction is not set in the statute empowering the Rabbinical Courts, and is not within the scope of the ancillary jurisdiction vested in it.

The Rabbinical Court's Jurisdiction by Virtue of the Parties' Agreement

15.       The parties' agreement to vest jurisdiction in the Rabbinical Court might take on two guises: one, simple agreement to grant the Court jurisdiction in a particular case, regardless of the provisions the Rabbinical Courts Jurisdiction Law; second, agreement intended to empower the Court to hear and rule on a dispute as an arbitrator. Can such agreement by the parties vest power in the Court that is not granted to it by the empowering statute or embodied in its ancillary powers?

The Israeli state judicial system and the various different judicial instances, derive their powers from statute. It is the statute that establishes them, it is what delineates the bounds of their activity and it is what defines the sphere of their subject matter and territorial jurisdiction. This is also the case in respect to the civil judicial instances; and so it is with respect to the special judicial systems, including the courts of Israel's different religious communities. These include the Rabbinical Courts in Israel.

By defining the powers of the various different judicial instances in Israel, the statute intended not only to delineate the function and responsibility of the system and its various different arms. It also sought, at the same time, to deny the power of a judicial instance to hear and adjudicate a matter which it was not charged with by the statute and which is not within its inherent jurisdiction. The definition of the judicial instances' powers has a dual dimension, both positive and negative: it constitutes a source of power and responsibility on the one hand, while denying the exercise of authority and power that have not been so conferred; the judicial instance has only what the statute that established it has vested in it, and insofar as it has been made responsible to adjudicate disputes within the scope of the power vested in it, it is under a duty that derives from the statute and the concept of democratic government not to try or adjudicate a matter that is beyond its statutory power.

A preliminary and mandatory condition for the satisfactory activity of any judicial system is a clear and exhaustive definition of the framework of powers and the apportionment of functions that rest with its various different instances. Without an exhaustive and specific definition of powers the systemic structure, built in accordance with the statute, is blurred and the stability of its functioning is not secured. The harmony necessary in the area of operation of the different judicial arms and the relationship between them is impaired; the allocation of professional, administrative and budgetary resources to the different instances is disrupted, and direct harm might occur to the efficacy of the judicial system and the level of judicial performance. The uniqueness of the responsibility owed by the judge, which requires the existence of a clear framework of authority, alongside which is the responsibility and duty to rule, becomes blurry. Thus, recognizing the power of a judicial instance to adjudicate matters, the power and responsibility for which have not been legally transferred to it, might materially disrupt the internal balance required in the structure of the judicial system and severely undermine its standing and performance.

A consequence of the aforegoing is that the power of a judicial instance, as such, be it civil or religious, is acquired by law and it has no power to be derived from the parties' agreement, except where the statute itself has seen fit to recognize such agreement in certain circumstances as a source of the power to adjudicate. Thus, for example, with regard to the effect of the parties' agreement, the law has distinguished between the apportionment of subject matter jurisdiction and territorial jurisdiction between judicial instances. It is willing to acknowledge, in certain conditions, the parties' agreement as a valid source for changing the territorial jurisdiction that has been prescribed. Section 5 of the Civil Procedure Regulations, 5744-1984 provides that when an agreement between parties as to the place of jurisdiction exists, the lawsuit will be filed to the court in that area of jurisdiction. The relative flexibility regarding territorial jurisdiction, and the willingness to recognize the parties' agreement as the source of such jurisdiction, stems solely from the statute and derives its power from its provisions. That is not the case in respect of subject matter jurisdiction. Generally, the law does not recognize that the parties' agreement has power to depart from the rules of subject matter jurisdiction, as crafted by state legislation.

A similar approach is also taken with regard to the judicial instance's power to adjudicate by way of arbitration. Since the state judicial instance merely has the subject matter jurisdiction conferred to it by statute, it is not vested with power to hear and rule a matter as an arbitrator by virtue of the parties' agreement, unless it has been expressly given that power by statute. In general, a judicial instance is not supposed to adjudicate a matter that is referred to it as arbitrator. However, in certain circumstances, the law has expressly recognized the power of a civil instance to adjudicate a dispute in departure from the ordinary rules of procedure. Thus, for example, in the area of small claims, section 65 of the Courts Law (Consolidated Version), 5744-1984 provides that if a lawsuit has been filed in the small claims court, the judge may, with the parties’ consent, try the claim as arbitrator, and the provisions of the Arbitration Law will govern the matter, with certain restrictions; in addition, a court hearing a civil matter has been empowered, with the parties’ consent, to decide a matter before it by way of settlement (section 79A of the Courts Law) or to refer a matter, with the parties' consent, to arbitration or conciliation (sections 79B and 79C of the Courts Law). The said authorities are all vested in the court by virtue of statute. They assume that the subject of the dispute is within the subject matter jurisdiction of the court hearing the case and they give it special procedural means that are intended to facilitate and expedite the process of deciding the dispute and bringing about a just result. The various judicial instances have not been generally empowered by law to hear and decide matters that are not included in the scope of their subject matter jurisdiction by virtue of the parties' agreement, either as arbitrators or otherwise. Since such authority has not been conferred to them, it is, ipso facto, denied and does not exist.

The Rabbinical Courts are an integral part of the Israeli judicial system. They were established by virtue of the Rabbinical Courts Jurisdiction Law and they derive their power and authorities from the state statute. They have nothing other than what is vested in them by the statute, and they are subject to the set of powers of the statute in their judicial work, as interpreted over the years by case law. Along those lines, this Court has held in the Katz Case that the Rabbinical Court is not empowered to issue a Letter of Refusal in monetary matters that is intended to compel a party to submit to the Rabbinical Court's jurisdiction by ostracizing and disgracing the recalcitrant party; and in HCJ 2222/99 Gabai v The Great Rabbinical Court PD 54(5) 401, the opinion was expressed that the Rabbinical Court lacks legal authority to issue a forced settlement decision, without the parties' consent, thus forcing a judgment on the parties without determining facts on the basis of evidence, if it is unable to decide in accordance with the law.

It emerges from this that the parties' agreement as such cannot, per se, grant jurisdiction to the Rabbinical Court, unless, it has been recognized by the law as a primary source of authority. Thus, the parties' agreement has been recognized as a source of the Rabbinical Court's jurisdiction pursuant to section 9 the Rabbinical Courts Jurisdiction Law, in matters of personal status of Jews pursuant to article 51 of the Palestine Orders in Council or according to the Succession Ordinance, which are within the parallel jurisdiction of the Rabbinical Court and the civil instance. Nevertheless, the Rabbinical Court does not have power to hear and decide a matter that is not of the kind found within its exclusive jurisdiction in accordance with the statute or within its parallel jurisdiction, even if the parties have given their consent to its jurisdiction. Such agreement does not derive from a legally recognized source of authority in the law and it cannot, per se, vest jurisdiction in a state judicial instance.

The Rabbinical Court's Jurisdiction by Virtue of an Arbitration Agreement

16.       According to the same line of reasoning, the Rabbinical Court has no power and authority to decide a dispute as an arbitrator by virtue of an arbitration agreement between the parties in a matter, which by its nature is not within its legal jurisdiction. The Court has not been vested with jurisdiction by law to decide disputes as an arbitrator and the parties' agreement cannot vest it with such power.

The issue of the Rabbinical Court's jurisdiction to arbitrate financial and other matters that go beyond the powers granted to it in accordance with the Rabbinical Courts Jurisdiction Law has caused consternation and confusion over the years. It appears that, in reality, the Rabbinical Court assumes the role of arbitrating matters that are beyond the scope of its subject matter jurisdiction (Katz Case, ibid, pp. 606-8; CA 376/62 Bachar v. Bachar, PD 17(2) 881, 882, 885; CA 688/70 Doar v. Hamami, PD 25(2) 396, 399; M. Alon, Jewish Law – History, Sources and Principles, third edition, vol. III, 5748, 1529). Justice Barak considered the inherent difficulty of a state judicial instance's need to adjudicate a dispute by arbitration where it was not empowered to do so by law, saying:

"The first possible argument is that the motion to the Rabbinical Court is like that to an arbitrator and embodied in the Arbitration Law, 5728-1968. That possibility – which has used in practice and can be encored as a year-long custom - raises serious problems in principle. Thus, for example, it can be asked whether it is proper for a judicial entity, whose powers are prescribed by law, to assume additional judicial powers, by being empowered as an arbitrator. Is it conceivable that parties would motion the magistrate’s court to try a pecuniary claim, that is outside its jurisdiction, as an arbitrator? From the state's point of view, is it justifiable to use judicial time and tools (whether of the civil or religious courts) for matters outside the jurisdiction that the law has granted the judicial authorities? Is there no fear that the public be confused as to which decisions the judicial instance has awarded as the government and those that it has awarded as arbitrator?"

(HCJ 3023/90 Jane Doe (a minor) v. The Rehovot Regional Rabbinical Court PD 45(3) 808, 813-14; see also S. Ottolenghi, Arbitration, Law and Procedure (fourth edition, 5765) 167-8; Schiffman, ibid, vol. I, 37.)

In HCJ 2174/24 Kahati v. The Great Rabbinical Court, PD 50(2) 214, this Court (per Justice Dorner) once again referred to the practice, adopted from time to time by the Rabbinical Courts, of deciding disputes as arbitrators in matters that are not within their jurisdiction. It expressed skepticism with respect to the validity of the practice. However, as in the previous case, it again left this question open without making any conclusive ruling, since such a ruling was not necessary in that case (cf. Aminoff, ibid, pp. 792-3).

17.       There is indeed an inherent difficulty in recognizing the Rabbinical Court's power to decide a dispute in a matter on which it has not been given jurisdiction by law (cf. Ottolenghi, Dispute Resolution by Alternative Means, Israeli Law Yearbook, 5752-5753, p. 535, 550-1). In the past, the Mandate government empowered the Rabbinical Courts to act as arbitrators by means of section 10(d) of the Israel Knesset Regulations of 1927, but upon the establishment of the State, the “Israel Knesset”, within its meaning under the Mandate, ceased to exist and it was held that those Regulations no longer had any force or effect (Crim. App. 427/64 Yair v. The State of Israel PD 19(3) 402; HCJ 3269/95, ibid, p. 622-3; Schiffman, ibid, p. 39). It cannot therefore be argued that the said section might serve as the source of the Rabbinical Courts' power as arbitrators. Moreover, upon enactment of the Arbitration Law, it was proposed that an arbitration decision made by a religious court when ruling as an arbitrator would in all respects, except with regard to the appeal, be treated as a judgement of the court sitting in accordance with its jurisdiction prescribed by statute, and that the award would not require confirmation under the Arbitration Law. That proposal was not accepted (Knesset Proceedings 5728, pp. 2966-7).

It is indeed difficult to settle the governing perception that views the judicial system as an arm of government, which derives its power and authority from statute, while acknowledging the possibility that the selfsame system can acquire other subject matter authorities deriving merely from the parties' agreement that do not originate from the empowering law. The Israeli Rabbinical Courts, that are part of the Israeli judicial system, integrate with the said perception and, like the other judicial instances, operate in accordance with the principle of legality of the arms of government (see the dissenting opinion of Justice Tal in the Katz Case, distinguishing between the power of religious courts as a state authority and the power they have, in his opinion, by virtue of Jewish law, which is not connected with state law).

18.       Apart from the essential difficulty inherent in the judicial decision of the Rabbinical Court as an arbitrator, which is not consistent with the principle of legality of the government authorities, other difficulties arise from the said procedural practice. The practice blurs the spheres of the Court's own activity in respect of the procedural basis upon which its decision rests: is it a decision within the scope of the Court's state power that is subject to review by the High Court of Justice in accordance with section 15 of the Basic Law: the Judiciary, or is it an extra-statutory power that is built on a different foundation originating from the parties' agreement and subject to review by a different judicial instance, like the District Court, in accordance with the Arbitration Law (cf. Jane Doe Case, ibid, para. 7)? In more than a few cases the parties might misunderstand the nature of their agreement to vest jurisdiction in the Rabbinical Court as they do not always understand the meaning and implications of their consent. Moreover, usually, in the course of such adjudication, strict attention is not paid to enquiring into the existence of an arbitration agreement or the application of the Arbitration Law and the rules pursuant thereto, such, for example, the mechanism for the confirmation and revocation of an arbitral award and the role of the District Court as the competent instance in accordance with the Arbitration Law (Ottolenghi, ibid, p. 168; Dichovski, The Standing of a Rabbinical Court Dealing with Property Law As Arbitrator, The Jewish Law Yearbook 16-17 (5750-5751) 527; MF 268/88 Delrahim v. Delrahim, DCJ 49(3) 428; SC 2329/99 Kfir v. Kfir, PD 55(2) 518, para. 5). An arbitral judgment made by the Rabbinical Court frequently does not undergo confirmation or revocation proceedings in the District Court as required by the Arbitration Law for the purpose of its execution, and the Rabbinical Court has no power to confirm an arbitral judgment (Kahati, ibid, p. 220; HCJ 5289/00 Mograbi v. The Great Rabbinical Court, Takdin Elyon 2000(2) 581; Kfir Case, ibid, para. 5). Furthermore, a situation in which the District Court, by virtue of the Arbitration Law, might oversee the Rabbinical Court's decisions as an arbitrator might harm the proper balance between the instances and aggravate the tension between the civil and religious judicial arms (A. Porat, The Rabbinical Court As Arbitrator, Kiriat Mishpat II (5762) 503, 521-4; Dichovski Case, ibid, p. 529).

The Rabbinical Court, purporting to act as an arbitrator between the parties, still operates under cover, and with the characteristics, of its state role. To that end it makes use of the court's physical and organizational system, which is financed by the state; it adjudicates disputes as an arbitrator in the scope of the court calendar, as part of its ordinary work; the overall services, the organizational and professional arrangement and the government budget are also used by it in that function, which by its nature does not have a state character. The time that it should devote to matters of personal status in its official capacity is partly assigned by it to a different judicial function that is not for the state, despite appearing to carry the state seal in the eyes of the public at large, who finds it difficult to distinguish between the judicial function and the extra-statutory function performed by the Court. This intermingling of functions is inconsistent with the principle of legality and a correct definition of the functions and powers of a state judicial instance (Katz Case, ibid, p. 608; Schiffman, ibid, pp. 37-8).

19.       Mention ought to be made to the approach of Prof. Shochatman in his paper entitled The Rabbinical Courts' Jurisdiction in Matters Other Than Personal Status (Bar Ilan University Yearbook on Humanities and Judaism, vols. 28-29 (5761) p. 437, p. 449 et seq.). As he sees it, the Rabbinical Court might acquire jurisdiction by virtue of the parties' agreement in matters outside its jurisdiction in accordance with the Rabbinical Courts Jurisdiction Law by virtue of section 15(d)(4) of the Basic Law: the Judiciary, thereby acquiring jurisdiction as an arbitrator. According to that Law, which defines the High Court of Justice's power to review religious courts, the question of a religious court's jurisdiction can only be referred to this instance when it was raised at the first opportunity. The author infers from this that where there is prior agreement between the parties to vest subject matter jurisdiction in the religious court, a party who has so agreed may not later dispute jurisdiction. By virtue of that preclusion the religious court acquires subject matter jurisdiction, and the High Court of Justice is itself precluded from intervening therein. According to this approach, such an agreement vests subject matter jurisdiction and is not limited solely to matters of personal status. It might encompass numerous spheres that are beyond the subject matter jurisdiction of the religious court, as defined in the Rabbinical Courts Jurisdiction Law.

I cannot agree with this position. The interpretation expressed by Prof. Shochatman assumes that it is possible to recognize the existence of subject matter jurisdiction of an Israel state judicial instance by means of the parties' consent, combined with the doctrine of preclusion and estoppel that prevents someone who has agreed to jurisdiction from later disputing it. That approach is fundamentally inconsistent with the principle of legality that obligates judicial instances, including the religious courts. It is not consistent with the starting point whereby subject matter jurisdiction is vested in a judicial instance by a positive arrangement, and its existence is not to be inferred by an indirect interpretation of provisions of law concerning estoppel and preclusion. The Rabbinical Court's powers are granted to it by virtue of the Rabbinical Courts Jurisdiction Law and they cannot be added to by an indirect interpretation of statutory provisions, the purpose of which is not the vesting of power. Moreover, it has already been held (in Sima Levy Case, ibid, p. 618-19) that the element of preclusion emerging from section 15(d)(4) of the Basic Law: the Judiciary was not intended to vest in the Rabbinical Court subject matter jurisdiction that is not vested in it by virtue of the Rabbinical Courts Jurisdiction Law. The said preclusion is based on the assumption that the matter being adjudicated by the Rabbinical Court is of the type that are within the parallel jurisdiction of the civil court and Rabbinical Court, and regarding the latter, jurisdiction is conclusively consummated if both parties have agreed to it. In those circumstances, and only in them, a party's prior agreement or silence, or subsequent denial of jurisdiction, might lead to preclusion with respect to a lack of jurisdiction argument in the High Court of Justice - that and nothing more. An interpretation that takes the doctrine of preclusion out of context, and assumes the existence of a potentially unlimited Rabbinical Court subject matter jurisdiction, the final consummation of which is dependent only upon the parties' agreement, is directly opposed to the principle of legality, upon which the concept of democratic government is based. It is inconsistent with the subject matter jurisdictions vested by statute in the arms of government, including the judicial system.

Alternative Decision-Making Systems

20.       The need of various different circles in the religious world to entertain alternative systems for the resolution of disputes is proper and recognized. Indeed, alternative rabbinical judicial systems that are not associated with the state rabbinical judicial system, which decide disputes between litigants in the community, are recognized. They can be granted powers to act as arbitrators by agreement of the parties. The need of different communities for alternative dispute resolution systems specific to them can be met by reference to internal arbitration frameworks that are not part of the state judicial system, within which disputes can be settled by virtue of the parties' agreement. This alternative course to litigation in the state judicial instances can be developed and strengthened in accordance with the different needs and preferences of the communities. This was considered by Justice Zamir in the Katz Case (ibid, p. 606), who stated:

"As is known, there are still observant Jews who prefer to litigate in matters of property according to religious law before a religious court rather than the state court. The state's law does not preclude that, if both parties to the dispute so desire, and it is even willing to give the force of arbitration to such litigation, if the litigants fulfil the provisions of the Arbitration Law. Indeed, in practice, such courts exist in various communities around Israel, not by virtue of state law or as official institutions but as private entities. That is, for example, the case of the rabbinical court of the Edah Chareidis [the Haredi Community] in Jerusalem. However… in these cases we are not dealing with a private entity but a state court, and the law applies to it just as any other of the state's courts. Like any court, in fact, like any government agency, the Rabbinical Court is also subject to the principle of legality, meaning that it has nothing other than what was granted to it by the law… In this respect, the Rabbinical Court in Jerusalem is distinguished from the rabbinical court of the Edah Chareidis in Jerusalem. The Israeli Rabbinical Court, which has jurisdiction in accordance with the Basic Law: the Judiciary, is not like one of the rabbinical courts of the Jewish communities in the Diaspora. Unlike them, it has the power and authority of a government institution. So too, unlike them, it is also subject to the restrictions that apply to any government institution".

Consensual Resolution – Looking to the Future and to the Past

21.       The scope of the Rabbinical Courts' subject matter jurisdiction to decide a dispute by virtue of the parties' agreement outside the framework of the law looks to the past and the future. It calls into question the validity of the Court's rulings based on the parties' agreement outside the scope of the statute, not merely henceforth, looking to the future, but also with respect to the past. The outlook to the future seeks to find a binding definition of the limits of the Rabbinical Court's jurisdiction and to strictly observe those limits hereafter. However, the outlook to the past calls into question the binding legal validity of the Rabbinical Court's decisions that have been made over the years by virtue of the parties' agreement as aforesaid. That issue is far from simple; there is no need to decide it here, and it will wait until its time comes.

From the General to the Particular

22.       Let us return to the respondent's suit against the petitioner in the Rabbinical Court and examine whether it is within the subject matter jurisdiction of the Rabbinical Court; the test of jurisdiction depends on the nature of the cause of action, and whether the cause falls within the jurisdiction of the Rabbinical Court.

The Cause of Action – Enforcement of a Contractual Indemnity Clause

23.       The respondent's cause of action in the Rabbinical Court is the enforcement of a contractual clause concerning property, which is contained in the divorce agreement that was made between the couple for the purpose of the divorce proceedings. It provided that if the respondent were sued for an increase in child support and the satisfaction of any of the children's needs or if a stay of exit order was granted at the initiative of the wife, then the petitioner would compensate him, in the language of clause 4(e) of the agreement, with half the property. That provision is also mentioned in clause 5 of the agreement, which is headed "Indemnification", and according to the substance of the provision, and also its location and wording, it is an indemnity clause. The respondent sues for the enforcement of a property condition for his indemnification due to a breach of contract by the wife, and he gave expression thereto by heading his claim as one for "specific performance". That is to say, we have here a property claim for the enforcement of the contractual indemnity clause in a divorce agreement that received the effect of a judgement of the Rabbinical Court and further to which the parties' divorce was completed.

The Rabbinical Court's Jurisdiction to Adjudicate a Property Claim for the Breach of a Contractual Indemnity Clause in a Divorce Agreement after the Parties' Divorce

Does the respondent's suit, according to its cause, fall within the scope of one of the sources of the Rabbinical Court's jurisdiction? Because of the great similarity between the instant matter and the case of Sima Levy, we shall draw guidance and direction from that case.

 

 

Original – Primary Jurisdiction

24.       The source of the Rabbinical Court's exclusive jurisdiction in matters of marriage and divorce, as provided in section 1 of the Rabbinical Courts Jurisdiction Law, does not apply in the instant case because the subject of the suit is a property matter after the dissolution of the parties' marriage and a matter of "marriage and divorce" is, no longer involved. Nor is it a matter "connected with a divorce suit", including support for the wife and children, within the meaning of section 3 of the Law. After divorce, a property claim in respect of the breach of an indemnity clause is not connected with the divorce suit, which has ended and no longer exists. The respondent's cause of action is a new one, the subject of which is the enforcement of a divorce agreement or an application for the enforcement of a divorce judgment, based on a divorce agreement. The cause is based on the breach of a divorce agreement after the award of the divorce and completion of the couple's divorce, and such a new cause is naturally not to be bound up with the matters that were in the past connected with the divorce suit.

With regard to the property cause of action, which surrounds the breach of an indemnity clause of a divorce agreement, the Rabbinical Court does not have jurisdiction by virtue of the parties' agreement pursuant to section 9 of the Law, which deals with the Rabbinical Court's parallel jurisdiction that is vested by virtue of the parties' agreement in matters of personal status according to article 51 of the Palestine Orders in Council and the Succession Ordinance. Section 9 of the Rabbinical Courts Jurisdiction Law raises the question of whether jurisdiction can be vested in the Rabbinical Court by consent in a matter included in its parallel jurisdiction after completion of the divorce, or whether its jurisdiction pursuant to that provision is limited solely to matters within its parallel subject matter jurisdiction that arise in connection with, and until, the divorce and its completion, but not afterwards. Whatever the answer to this question, it is in any event clear that the subject matter jurisdiction pursuant to section 9 is limited solely to the matters mentioned therein, that is, matters of "personal status" as defined in the Palestine Orders in Council and the Succession Ordinance. In a dispute that is not within the bounds of those matters, even the parties' agreement cannot vest jurisdiction in the Rabbinical Court (Schiffman, ibid, vol. I, p. 37; Jane Doe Case, ibid, p. 812). The power of the parties' stipulation is restricted solely to the matters defined by the statute (MF 358/89 Zalotti v. Zalotti PD 43(4) 41, 42; Porat, ibid, p. 510).

Clause 11 of the divorce agreement in this matter looks to the future, and provides that if differences arise between the couple after the divorce, then they undertake to bring their claims solely in the Rabbinical Courts. That agreement is effective only to vest jurisdiction in the Rabbinical Court pursuant to section 9 of the Law in respect of matters of personal status according to article 51 of the Palestine Orders in Council or the Succession Ordinance. A property claim for the enforcement of a contractual indemnity clause in a divorce agreement is not a matter of personal status within the meaning of the Palestine Orders in Council or the Succession Ordinance, and thus, the parties' contractual agreement in respect of such a dispute cannot vest jurisdiction in the Rabbinical Court pursuant to section 9 of the Law.

The Rabbinical Court therefore does not have original jurisdiction to adjudicate the respondent's claim.

"Ancillary" Inherent Jurisdiction

25.       Does the Rabbinical Court have "ancillary" inherent jurisdiction to adjudicate the respondent's claim? The answer is in the negative.

            In the instant case, the Rabbinical Court's ancillary jurisdiction is irrelevant insofar as it relates to the revocation of a divorce award because of a defect in the making of the divorce agreement. It is not a defect of fraud, mistake, deceit, duress or similar that occurred in the making of the agreement and that might have given the Rabbinical Court ancillary jurisdiction to consider its revocation.

            Similarly, the Rabbinical Court has not acquired ancillary jurisdiction by virtue of a material change in circumstances after granting the divorce judgment that allegedly justifies revoking the divorce agreement and the divorce judgment in order to achieve a just result. On the contrary, the respondent's suit is for the specific performance and enforcement of the divorce agreement, not its revocation. Although, in the Great Rabbinical Court, the respondent pleaded that his suit was to revoke the divorce agreement because, according to him, the Get had been given by mistake (the Great Rabbinical Court's decision of May 4, 2003). These arguments were made as an "embellishment" at a late stage of the trial and do not reflect the real cause of action; the motion to revoke the divorce agreement and the act of divorce is inconsistent with the respondent's claim in his suit to compensate him with half the property (the apartment, the contents and the gold), which is nothing other than a claim for the enforcement of the divorce agreement (cf. CA 105/83 Menashe v. Menashe PD 38(4) 635; Yadin, The Contracts (Remedies for Breach of Contract) Law 5731-1970, Second Edition, 5739, p. 44).

            Again, the Rabbinical Court's ancillary jurisdiction to retain jurisdiction in a matter pending before it until the proceedings conducted before it are concluded will not vest it with jurisdiction in this case. The Regional Rabbinical Court had granted a final and unconditional judgment and awarded the effect of judgement to the divorce agreement. Indeed, the divorce agreement does contain an indemnification provision, which by its nature looks to the future, but this fact cannot transform a judgement that gave effect to a divorce agreement into a judgment that is not final, leaving the Rabbinical Court with jurisdiction that has not yet been exhausted to continue adjudicating with respect to the divorce agreement's future performance in this property matter. A financial-property dispute that has arisen between the parties after the award of judgement gives rise to a new cause of action and necessitates the institution of new proceedings in accordance with the jurisdictional framework prescribed by law (see Sima Levy Case, pp. 607-608; CA 468/85 Dondushanski v. Don PD 40(2) 609; D. Bar Ofir, Execution - Proceedings and Law (Sixth Edition, 2005, pp. 164-5)).

            Nor has the Rabbinical Court acquired jurisdiction to hear this matter by virtue of the doctrine of "continuing jurisdiction". It should be kept in mind, that continuing jurisdiction is vested where an instance has tried a particular matter in the past and, in special circumstances, a need has arisen to vacate or modify an earlier decision due to a material change that has occurred in the circumstances upon which the original decision was based such, for example, in matters of child support and custody. The instant case is fundamentally different. The motion does not seek to modify or revoke the divorce agreement made between the parties. On the contrary, it seeks to enforce the agreement, and such a claim has no place within the continuing jurisdiction vested in the Rabbinical Court. A decision on property matters is a final one and not a matter for continuing jurisdiction, as the Court stated in Sima Levy (Justice Cheshin, ibid, p. 611):

                        "As distinct from decisions concerning the payment of support or child custody – which by their nature are not final and the doctrine of continuing jurisdiction applies to them – a decision on a property matter is in principle a final one" (emphasis added).

            The property aspect of the divorce agreement, including the indemnification clause, and the divorce judgment that gave it effect, are therefore not within the Rabbinical Court's continuing jurisdiction.

            And finally, the Rabbinical Court does not have ancillary jurisdiction to adjudicate the new cause that arose following the divorce agreement in order to interpret the agreement. Firstly, the Rabbinical Court, having completed and exhausted its power to rule on the matter of divorce, no longer has ancillary power to interpret the divorce agreement or the divorce judgment (cf. HCJ 897/78 Yigal v. The National Labour Court, PD 33(2) 6, 7; CA 5403/90 The State of Israel v. RAM Revhiat Ibrahim PD 46(3) 459). Moreover, in the instant case, the question of the agreement’s interpretation hasn’t risen as such, but a claim for its enforcement has been brought instead. Hence, the Rabbinical Court does not have ancillary jurisdiction in this respect either.

            In conclusion: the Rabbinical Court does not have primary original jurisdiction, or ancillary inherent jurisdiction, to adjudicate a property claim for enforcement of a contractual indemnification clause in a divorce agreement that has given the effect of judgement, once the couple's divorce has been completed.

The Rabbinical Court's Jurisdiction by Virtue of Consent

26.       As can be recalled, clause 11 of the divorce agreement provides that differences between the couple after the divorce are to be adjudicated solely in the Rabbinical Courts. The couple's agreement as such cannot vest the Rabbinical Court with jurisdiction where there is no legal source for it. The agreement in this case concerns something that is not a matter of personal status according to section 9 of the Rabbinical Courts Jurisdiction Law, and it was therefore given for this purpose outside the scope of the law, and is ineffective.

            Indeed,

                        "where the subject of the litigation is not within the jurisdiction of a particular judicial entity, no agreement in the world has power to grant the entity jurisdiction that the statute has not given it; it is the statute that gives and it is the statute that takes away" (Sima Levy, p. 617).

            The Regional Rabbinical Court's decision of June 18, 2002 and the Great Rabbinical Court's decision of May 4, 2003, according to which the Rabbinical Courts have jurisdiction in principle to try the claim by virtue of the law, are inconsistent with its provisions.

The Rabbinical Court's Jurisdiction by Virtue of an Arbitration Arrangement

27.       It was further argued that clause 11 of the divorce agreement is an arbitration provision that vests the Rabbinical Court with power as an arbitrator to adjudicate the respondent's claim of a breach of the agreement's indemnification provision. Although not strictly necessary, we have considered the question in principle of whether a Rabbinical Court can be empowered to decide a dispute between litigants in arbitration, in a matter that is not within its subject matter jurisdiction according to the statute. We have answered that question in the negative and the answer is applicable to the case herein.

            In the instant case, the conclusion that the Rabbinical Court lacks jurisdiction to try the matter as an arbitrator is also reinforced by another reason. Studying the contents of clause 11 of the divorce agreement shows that it cannot be construed as an arbitration clause, equal to an "arbitration agreement" between the parties. It is well known that the power of an arbitrator to decide a dispute between parties derives from an arbitration agreement. Without an arbitration agreement, no arbitration arises. An "arbitration agreement", according to the Arbitration Law, is "a written agreement (between parties) to refer to arbitration a dispute that arises between them in the future, whether an arbitrator is named in the agreement or not" (section 1 of the Arbitration Law). The condition precedent for arbitration is therefore the existence of an agreement to refer a dispute to arbitration. If parties have agreed to refer disputes between them to the decision of some entity but it is not clear that a decision in arbitration is involved, then there is no arbitration agreement (ALA 4928/92 Aziz Ezra Haj v. Tel Mond Local Council PD 47(5) 94; Ottolenghi, ibid, pp 9-41).

            In this case, the parties undertook to refer any disputes arising between them after the divorce solely to the Rabbinical Courts. No intention can be inferred from that agreement to refer such disputes to the Rabbinical Court qua arbitrator. In Jane Doe (para. 6 of Justice Barak's opinion), as in the case herein, the couple mistakenly believed that their consent to the Rabbinical Court's adjudicating disputes connected with the divorce agreement could vest it with power to decide as a state judicial instance, rather than as an arbitrator. Indeed, the wording and contents of clause 11 of the divorce agreement do not demonstrate the parties' intention to treat it as an arbitration clause purporting to empower the Rabbinical Court to act as arbitrator. Consequently, even if we assumed that the Rabbinical Court could be empowered to act as an arbitrator in matters in which it has no original or ancillary jurisdiction by virtue of the law, there is still no effective arbitration agreement, as pleaded.

A Note before Closing

28.       The issue of the Rabbinical Court's power to adjudicate by virtue of the parties' agreement, outside the scope of the law, has arisen in earlier contexts in the past, and although different opinions have been expressed in such respect by the courts, no binding decision has been necessary in connection therewith. This absence of a ruling has permitted the continuation of a procedural practice that is inconsistent with the organizational structure of the courts and the division of powers between them in accordance with state law. This custom has enabled a judicial practice that is inconsistent with the principle of the administration's legality and the legality of the judicial system. The time has come to move from the stage of expressing an opinion to the stage of making a ruling, which is necessary to ensure the proper function of the judicial system within the scope of its powers, and thereby to protect the basic foundation that defines the boundaries of its activity based on the principle of legality and the rule of law. This will not harm, in a any way, the need and ability of various social groups to entertain alternative resolution systems outside the state judicial instances, based on the principles of arbitration regulated by law or on the basis of other agreed and recognized rules of procedure. However, at the same time, it is necessary to safeguard, and protect against blurring the boundaries between the state judicial systems and alternative resolution systems that are built on the parties' agreement, in order to protect the proper operation of the different arms of the judicial system and the public's confidence in the way in which its powers are exercised and its judgments.

Conclusion

29.       By deciding the respondent's lawsuit against the petitioner for the enforcement of a contractual indemnification clause in the divorce agreement, the Rabbinical Courts exceeded the power vested in them by law. Consequently, the decisions of the Regional Rabbinical Court and the Great Rabbinical Court in the respondent's claim are void. The result is that the order nisi that has been awarded should be made absolute. The respondent shall bear the petitioner's professional fees in the sum of NIS 12,000.

 

Vice President (Ret.) M. Cheshin

 

            I concur.

 

Justice S. Joubran

            I concur.

Therefore, held as stated in the opinion of Justice Procaccia.

Awarded today, this eighth day of Nissan, 5766 (April 6, 2006).

 

___________________

___________________

___________________

Vice President (Ret.)

Justice

Justice

 

Salomon v. Yaasin

Case/docket number: 
CA 563/11
Date Decided: 
Monday, August 27, 2012
Decision Type: 
Appellate
Abstract: 

 

The Appellant is a corporation operating in the field of sporting goods, clothing and shoes, and holds trademarks in many countries around the world. Three of its trademarks are registered in Israel and they include a logo of three parallel and diagonal stripes that appears on the side of sneakers, comfortable shoes, athletic shoes and shoes for daily wear. The Respondent imports shoes into the Palestinian Authority. In 2005, the Respondent imported sneakers from a factory located in China. As per his order, the shoes were marked with four diagonal stripes and labeled with the name “SYDNEY”, which appeared in three different spots on the shoes. The shipment of these shoes arrived at the Ashdod Port, and the Appellant was notified by the Department of Customs and VAT that the shipment would be held because, from the appearance of the shoes, the Respondent seemed to have violated the Appellant’s intellectual property rights. Officers of the Department of Customs and VAT gave the Appellant’s lawyer the Respondent’s information and a sample shoe, against the deposit of a bank guarantee. The Appellant believed the appearance of the shoes is indeed sufficiently similar to the shoes it manufactures as to be misleading and that the shoes infringe its trademark. The Respondent, for his part, argues that the shoes he imported did not infringe the Appellant’s registered trademark, but in order to reach an agreement with the Appellant, he proposed to make a certain change to the shoes’ design. The Appellant rejected the proposal, and therefore the Department of Customs continued to hold the shipment. The Appellant filed suit against the Respondent in the District Court for trademark infringement, passing off, harm to reputation, and unjust enrichment. The claims were rejected, and hence this appeal.

 

The Supreme Court rejected the appeal (and in terms of the unjust enrichment cause of action – in a majority) ruling that:

 

Justice Hayut –

 

Infringement of a trademark: A trademark is intended to assist the consumer to distinguish between products made by competing manufacturers. Therefore, to be eligible for registration, the product must be of “distinctive character”. Such distinctive character may be inherent distinctiveness or acquired distinctiveness. There is no dispute that the Appellant’s trademark – three diagonal stripes identically wide and spread out on the side of the shoe – is currently absolutely associated with the Appellant corporation all around the world and constitutes a distinct sign for identifying its shoes. Therefore, it seems that there is no question regarding the existence of acquired distinctiveness for this mark. However, and as the lower court held, the inherent distinctiveness of the product is weak.

 

The weakness of its inherent distinctiveness influences the scope of the protection the mark ought to be given. The fact that the mark has acquired a highly strong distinctive meaning warrants maximum protection. However, its weak acquired distinctiveness warrants protection that is generally limited only to the trademark itself and to extremely similar designs. In other words, allowing the Appellant to additionally monopolize two or four stripes (or any other number of stripes), is problematic as we thus exclude a stripes design from the public domain and prohibit other manufacturers from using this design for their shoes. This is not to say that the Appellant’s investment in advertizing and marketing has not led to the stripe design being popular and desirable, but this cannot lead to a conclusion that any use of stripes by a competitor is prohibited use.

 

Section 1 of the Trademark Ordinance stipulates that an “infringement” is, among others, the use of a registered trademark or a similar mark, for the purpose of goods or related goods for whom the trademark had been registered, by someone who is not entitled to do so. The section does not detail the extent of similarity required between the marks for the use to constitute an infringement. However, the case law found that in this context the test in section 9(11) of the Ordinance – which sets the method of examining the mark for the purposes of registration, and that a mark is sufficiently similar to a registered trademark as to be misleading is ineligible for registration – should apply. Therefore, when concerning the use of a similar mark (as opposed to the use of an identical mark) the party claiming infringement must show that the other mark resembles its mark as to mislead the public. The acceptable test for examining the existence of a misleading similarity is a triple test that includes the sight and sound test, the type of product and consumers test, and the circumstances test.

 

While applying these tests, one must remember that the marks as a whole must be compared, rather than specific parts of them, and that the examination must focus on the existence of a misleading similarity between the marks themselves. In our case, however, it is impossible to examine the marks completely separately from the goods upon which they appear. First, even if the consumer does not have the two products in their hands and compares the marks’ details, we cannot assume that the consumer disconnects the marks from the shoes themselves and examines them separately from the shoes. Second, the rule that the marks themselves should be compared was established in cases concerning verbal, rather than visual, marks. This distinction is important because complete separation between a visual trademark from the product upon which it appears, particularly when the mark may be interpreted as a decorative element, is an artificial and problematic separation. The application of the infringement tests must fit the unique circumstances of the case. Considering the circumstances here, it seems the shoe must be examined in its entirety.

 

In the current case, the parties agree that the Respondent’s shoes are the same type of product for which the Appellant’s trademark was registered – sneakers – or sadly the same category of goods, that is the same commercial family. It is also agreed that the shoes do not carry the same design as the registered trademark, and thus this is not an attempt at counterfeiting goods. We should examine the similarity between the marks and decide whether indeed this similarity is misleading. Applying the sub tests, while accounting for normative findings regarding the scope of protection appropriate for the mark, lead to a conclusion that the Respondent’s shoes do not cause concern for misleading the public and therefore do not infringe the Appellant’s trademark.

 

Passing off: This tort has two elements, which the party claiming the tort (plaintiff) must prove: reputation acquired through goods or services this party offers, and concern for misleading the public to believe that the goods offered by the defendant offers actually belongs to the plaintiff. There is no disputing the Appellant and its trademarks’ reputation in the field of sports shoes in Israel and around the world. Therefore, the first element is met and we must focus on the second – the concern for misleading. In order to explore the existence of this element we must examine the entirety of the defendant’s actions and conduct. This examination does not lead to a different conclusion than that which we have reached about the lack of concern for misleading in terms of the trademark. This is because the Respondent’s actions, such as attaching to the shoes a label spelling out the name “SYDNEY” in capital letters or packaging the product in a box also clearly marked with that same name, further reduce the concern from misleading. It seems in this case there is no concern for misleading the public.

 

Reputation dilution: The doctrine of reputation dilution does not require proving a concern for misleading consumers. However, it seems that the cases where it is appropriate to find a reputation dilution exists even in the absence of misleading, are extraordinary cases where the lack of misleading was a result, for instance, of the product belonging to an entirely different category of products. In any event, even when proving misleading is unnecessary for claiming reputation dilution, this does not negate the requirement to show erosion and distorting the reputation acquired by the registered trademark because of the use made of the other mark. When we are concerned with marks on products in the same category, and in the absence of misleading similarity between the products or the marks that are largely differentiated, the claim that the reputation of the trademark’s owner would be diluted should seemingly be rejected. In this case, in light of our finding that it was not proven that the average consumer would be misled to think that the Respondent’s shoes were made by the Appellant, there is no concern that the consumer would indeed link the quality of the Respondent’s shoes to the Appellant, and in any event the cause of action of dilution does not exist.

 

Unjust enrichment: It seems that the rule that possibly derives from the A.S.I.R case was fully reflected in Justice Strasberg-Cohen’s opinion that the individual’s interest that a creative work they produced and invested time, effort, thought, talent and resources into, is principally worthy of protection within the law of unjust enrichment, and this interest should not a-priori be excluded merely because it is not a cognizable right under intellectual property law. Still, it was decided that the scope and application of unjust enrichment law depends on the extent that the existing law is comprehensive in that it excludes the application of external law; that a requirement for finding in favor of the claim is that enrichment is not “by a lawful right”, that is that the copy or forfeiture consist of an “additional element” of negative value; that there must not be double remedies or compensation; and that when necessary a variety of remedies – which include restraining orders – may be granted under unjust enrichment law, though they are not detailed explicitly in statute.

 

The Appellant holds a registered trademark and it essentially established its suit in terms of infringing this trademark. The issue is whether, where a court found that the intellectual property law elements that warrant protecting the holder of a trademark do not exist, and the court additionally found that under the circumstances there was no passing off, a plaintiff may be permitted to raise claims regarding unjust enrichment as an alternative cause of action. The majority justices in A.S.I.R. chose not to decide the issue of whether a plaintiff may simultaneously and alternatively file claims under intellectual property law and under unjust enrichment law. In other matters that came before this Court after that decision, the Court found that once the plaintiff failed to show the infringement of a registered trademark and the plaintiff is no longer entitled to protections of property under this “cognizable right”, there is no room to grant remedies under the alternative unjust enrichment claim.

 

Even where we assume, for discussion’s sake, that rejecting the claim of infringing a registered trademark does not negate at all an alternative cause of action under unjust enrichment, it seems there is no dispute that this rejection carries significant weight in examining the existence of the four elements of the alternative claim, particularly in terms of finding against misleading. In this case, the Respondent used the mark of four stripes on the side of the shoe, as well as – and this is most important – the labeling of the word “SYDNEY”. Under these circumstances we must emphasize this case’s distinction from A.S.I.R., where there was a perfect replica of the product through reverse engineering. There, it was also a product that resulted from invention and development (as opposed to the use of the stripes design element, which has weak distinctiveness.)

 

Justice Rubinstein joins the opinion by Justice Hayut. At the core of his opinion sits Justice Hayut’s premise that, insofar as the weak distinctiveness of the trademark is concerned, and her estimate that one would be hard pressed to argue that had the Appellant not chosen this mark, the shoes would not have been manufactured with stripes on the side. Thus even though Justice Rubinstein cannot say that the Respondent’s choice to use stripes was meaningless. In this context, recall Justice Netanyhu’s opinion in Kalil, that though Kalil’s registered trademarks (stripes on samples used for identification) are limited to three stripes, but a monopoly over any and every number of stripes would prevent many others from using stripes because of the restriction on the number of possible stripes as dictated by the width of the side. We must exercise caution when attaching absolute exclusive use in this context, the type of exclusivity that might, inadvertently, harm the delicate balance between protecting intellectual property and protecting freedom of occupation and freedom of competition.

 

As for the issue of unjust enrichment (and having read the opinion by Deputy President, Justice Rivlin): the A.S.I.R precedent is relevant where the extent of intellectual property law is too limited, not substantively but for lack of registration, and thus some protection is provided under unjust enrichment law. However, is the Court granting “quasi-intellectual property” protection where intellectual property law was examined and found not to have been violated, as in this case? Normatively, at heart Justice Rubinstein would follow the President, but he remains uncertain as to whether the unjust enrichment claim could supplement intellectual property law where it does not apply for internal, substantive reasons, rather than merely external procedural ones.

 

Deputy President Rivlin joins Justice Hayut’s position regarding the trademark infringement claim, but had his position prevailed, he would have found in favor of the petitioner in terms of the unjust enrichment claim. In A.S.I.R. the Court decided that generally there is no reason not to recognize an unjust enrichment cause of action where the law of intellectual property applies as well. Under the rules set in that case, it is appropriate to recognize the cause of action in this case, too, both because trademark law does not exclude doing so in the issue at hand, and because the right under “the internal law” of unjust enrichment exists here.

 

One wishes to use a trademark that resembles a trademark registered to another, which undisputedly has acquired a significant and substantial reputation. The consumer prefers the product bearing the similar mark over the product bearing the registered trademark, due to the latter’s higher cost (among others, because of its reputation). In other words, the consumer is aware that the product purchased is a copy, and is interested in the product precisely because of this. The copying manufacturer and the consumer both benefit from this reality. This harms the manufacturer and the reputation it acquired. Currently, trademark law does not regulate this issue of copies that the consumer purchases with intent rather than by mistake.

 

And note – the lack of application of trademark infringement claims to obvious copies (that is, products that are clearly a copy, and that even the consumer is aware of their being a copy) does not reflect a decision toward a policy that the “market of copies” is desirable in the eyes of the legislature. At most, this is a gap in trademark law. Bear in mind also that this gap is a result of court-made jurisprudence. It seems the time has come that Israeli law granted remedies against copies, insofar that they are copies of a registered trademark with the sole purpose of benefiting from a reputation of another – another who had taken lawful steps to register the reputable trademark.

 

It seems there is no reason, in terms of intellectual property law, not to recognize an unjust enrichment cause of action as applied to copies of registered trademarks where there is no misleading similarity because the consumer is aware that the product is a copy. In the next step, we must examine whether the Appellant has a claim under unjust enrichment law per se. This claim has three elements: the first requirement is the existence of an enrichment, the second requirement is that the enriched party’s enrichment resulted from the enriching party, and the third condition is that the enrichment to the enriched party was not “through a lawful entitlement or right”.

 

In A.S.I.R. we decided that an enrichment that is not “through a lawful entitlement or right”, in that context, is an enrichment that carries an “additional element” of improper conduct. The majority’s position was that conduct that is in bad faith or constitutes unfair competition is sufficient for the purposes of an “additional element”. It seems that where one wishes to copy a registered trademark associated with a reputation that holds economic value, with the purpose to benefit from this reputation in selling its products, and where the original manufacturer invested resources and effort in developing the reputation associated with that trademark while the copying manufacturer benefits from it without having to invest similarly, this would be a case of unfair competition and bad faith.

 

The negative aspect of a perfect copy of a registered trademark continues also where the mark has been slightly, but insignificantly, modified. Such is the case at hand: the addition of a single stripe, while maintaining the registered trademark’s colors, the use of only one color for the stripes, using the stripes’ same direction and location on the shoe as well as the width of stripes and the width between them – amounts to a real similarity to the Appellant’s registered trademark and is in bad faith.

 

The existence of the two first elements is primarily a factual question. In the case at hand, the Respondent’s profits from selling the shoes (those for which he had the opportunity to do so) would have caused an enrichment. This enrichment was at the expense of the Appellant. The Respondent wished to benefit from the market that the Appellant developed and the reputation it created for its trademark. Therefore, when the conclusion is that the Appellant indeed has an unjust enrichment claim, the question of remedy arises. Had the Court taken the opinion of Justice Rivlin, he would have proposed a permanent injunction against the Respondent prohibiting him from marketing or distributing the shoes with their current design. This injunction would stand until one of the changes proposed by the Respondent was executed. 

Voting Justices: 
Primary Author
majority opinion
Author
concurrence
Author
dissent
Full text of the opinion: 

CA 563/11

ADIDAS SALOMON AG

 

v.

 

1.    Galal Yaasin

 

2.    State of Israel – Customs and V.A.T. Branch  - Formal

 

 

The Supreme Court Sitting as the Court of Civil Appeals

[15 February 2012]

 

Before Vice President (Ret) E. Rivlin, Justices E. Hayut, E. Rubinstein

 

Appeal of the judgment the Tel-Aviv Jaffa District Court of 13.12.2010 in CF 2177/05 handed down by Hon. Judge M. Agmon-Gonen.

 

Israeli Legislature Cited

Trademarks Ordinance, s.1

Commercial Torts Law 5759-1999, s. 1

Unjust Enrichment Law 5739-1979

 

 

Israel Supreme Court Cases Cited  

 [1]  LCA 5768/94 ASHIR  Import, Export and Distribution v. Forum for Fixtures and Consumption Products Ltd [1998] IsrSC 52 (4) 289.

[2]  (LCA 9307/10 Adidas Salomon A.G. v. Yaasin (not yet reported,21.12.2010).

[3]  C.A. 715/68 Pro-Pro Biscuit v Promine Ltd [1969], IsrSC 23 (2) 43.

[4]  CA 3559/02 Center for Toto Zahav Subscribors v. Council for Regulation of Gambling in Sport [2004] IsrSC 59 (1) 873.              

[5]  CA 9191/03 [2004] V & section Vin Spirt Aktiebolag v. Absolute Shoes, IsrSC 58 (6) 869

[6]  CA 18/86 Israel Glass Factories Venice Ltd v. Les Verrcies De Saint Gobain, IsrSC 45 (3)  224

[7] CA 11487/03 August Storck v.  Alfa Intuit Food Products Ltd. (not reported, 23.3.2008);

[8]. CA 5792/99 Tikshoret Religious-Jewish Education Family (1997) Ltd "Family" Newspaper v. S.B.C Publication, Marketing and Sales Ltd - Mishpacha Tova Newspaper[2001] IsrSC 55 (3) 933. 

[9] CA 3581/05 Shehana'al Mat'ima Ltd v. ADIDAS-SALOMON (not reported – 7.7.2005).

[10]  LCA  3217/07 Brill Footwear Industries Ltd v.  ADIDAS SALOMON A.G. (not reported, 16.8.2007).

[11] HCJ 144/85 Kalil Non-Metallic Steel Industries  Ltd. v. Registrar for Patents and Designs and Trademarks[1988] IsrSC 42 (1) 309.

[12]    LCA 5454/02 Ta'am Teva (1988)  Ltd v. Ambrozia Sofharb Ltd [2003] IsrSC 57 (2) 438, 450 (2003), IsrSC 57 (2) 438,

[13]  C.A. 9070 Tali Dadon Yifrach v. A.T. Snap Ltd  (not yet reported, 12.3.2012).

[14]  CA 261/64 Pro-Pro Biscuit v. Promine Ltd [1964] IsrSC 18 (3) 275.

[15] CA 4116/06 Gateway Inc. v. Pascul Advanced Technology Ltd  (not reported, 20.6.2007) 

[16] CA 10959 Tea Board India v. Delta Lingerie, S.A. OF Cachan (not reported, 7.12.2006).

[17] CA 8441/04 Unilever P v Segev (not reported, 23.8.2006)

[18] LCA 2960/91 Wizzotzky Tea and Co. (Israel) Ltd v. Matok (not reported, 16.1.1992).

[19]  LCA 6658/09 Moltilock ltd v. Rav Bariah(08) (not  yet reported, 12.1.2010).

[20] LCA 1400/97 Picanti Food Industries  (Israel) Ltd v. Osem Food Industries Ltd [199]] IsrSC 51 (1) 310.

[21] CA 8981/04 Avi Malka - Avazei Hazahav Restaurant v. Avazei Shechunat HaTikva (1997) Restaurant Management Ltd (not reported, 27.9.2006).

[22] 210/65 Iggud Bank Ltd v. Agudat Yisrael Bank Ltd [1965] IsrSC 19 (2) 673.

[23] CA 3975/10  Phillip MORRIS PRODUCTS S.A נ' AKISIONERNO DROUJESTVO (not yet reported 21.10.2011)

[24] CA 6181/96 Kardi v. Bacardi and Company Limited [24], IsrSC 52 (3) at p. 276.

[25] LCA 10804/04 Prefetti Van Melle Benelux B.V. v. Alfa Intuit Food Products Ltd  (2005) IsrSC 59 (4) 461.

[26] 6025/05 Merck and consideration. Inc v, Teva Ta’asiot v. Teva Pharmaceutical Industries Ltd (not yet reported, 19.5.2011).

[27] (CA 945/06 General Mills Inc. v. Meshubah Food Industries Ltd (not yet reported, 1.10.2009)

[28] LCA 371/89 Leibovitz v. Etti Eliyahu Ltd [1990] IsrSC 44 (2) 309.

[29]  CA 588/87 Cohen v. Zvi Shemesh [1991] IsrSC 45 (5) 297.

[30]  FHC 10901/08 Beizman Investments Ltd v. Mishkan Bank Hapoalim Mortgages Ltd (not yet reported 17.7.2011)

[31] CA 2287/00 Shoham Machines and Dies Ltd v. Shmuel Harar (not reported, 5.12.2005)

[32] see CA 347/90 Soda Gal Ltd v Spielman [1993] IsrSC 47 (3) 450.

 

For the appellant — Adv. Eitan Shaulski; Adv. Inbal Nabot-Eizenthal.

For the respondent — Adv. Israel Sadeh; Adv. Amir Freedman

 

JUDGMENT

Justice E. Hayut

       This is an appeal against the decision of the Tel-Aviv Jaffa District Court (Hon. Judge M. Agmon – Gonen) of 13 December 2010 which dismissed the action filed by the Appellant against Respondent 1 for a violation of trademark, passing off, damage to good will, and unjust enrichment.

Factual Background

The Appellant, ADIDAS-SALOMON A.G. (hereinafter: Adidas or the Appellant) is a company engaged in sport products, footwear and clothing and the owner of a trade symbol registered in numerous states around the world, including Israel. Adidas owns three trademarks in Israel that are relevant to this appeal: Trademark No. 45237, Trademark No. 33479 and Trademark No. 118277, all of them in category 25, consisting of three parallel diagonal stripes on the sides of sports shoes, simple comfortable shoes, athletic shoes and every day shoes (hereinafter – “Three Stripes Ossiman trademark”).

Respondent 1, Mr. Galal Yaasin (hereinafter: the Respondent) deals in the importing of shoes to the area of the Palestinian Authority.  In 2005 the Respondent imported sports shoes from a factory in China and  per his order the shoes featured four stripes with the name “SYDNEY” embossed on them in three different places (hereinafter: the shoes, or the Respondent’s shoes). The consignment of shoes arrived in the Ashdod port and at the end of August 2005 a notification was sent to Adidas by Respondent  2 – the Customs and V.A.T. Authority (hereinafter: the Customs Authority) stating that it was delaying the consignment because according to the appearance of the shoes, the Respondent was prima facie infringing its intellectual property rights.  As against the deposit of a bank guarantee the Authority personnel gave the Adidas attorney the details of the Respondent and one sample shoe from the consignment (in his cross examination the Respondent confirmed that the shoe is representative of the other shoes in the same consignment).  Adidas was of the opinion the appearance of the shoes was similar to the extent of being misleading to the shoes that it produced, and that it therefore constitutes an infringement of its trademark. The Respondent on the other hand, claimed that the shoes he had imported did not infringe the registered trademark of Adidas, but for the sake of compromise he proposed to Adidas to make a certain change in the design of the shoe so that a fifth stripe or the mark X would be added to the four stripes, and that this addition would be made at in the precincts of the port.

Adidas rejected the Respondent’s proposals, and the Authority therefore continued to delay the shoes in its storerooms. Moreover, on 4 September 2005 Adidas filed an action against the Respondent in the Tel-Aviv Jaffa District Court, petitioning for a permanent injunction that would prohibit the Respondent from making any use of the shoes that without authorization featured its trademark or a mark that was similar to it, including upon shoes featuring four parallel, diagonal marks on the sides. In addition, Adidas petitioned for an order to destroy the Respondent’s shoes and for a remedy of damages, and for a detailed accounting regarding the actions and transactions that had been done in relation to these shoes and similar products. It bears mention that in the wake of the application filed by the Customs Authority concerning the matter, the parties agreed that the storage costs and the responsibility and cost of destroying, to the extent that the court gave an order to that effect, would be born by Adidas or by the Respondent, in accordance with the results of the action, and the Customs Authority was also added as a formal respondent to these proceedings.

The Decision of the Trial Court

2.    On 13 December 2010 the Trial Court rejected the action and ordered the Customs Authority to release the shoes from its storerooms and to deliver them to the Respondent, and that the latter would be permitted to sell them. The court likewise ordered Adidas to bear all of the costs occasioned by the delaying of the shoes and their storage in the storerooms of the Customs Authority.

First, the Trial Court considered the analytical basis and the purposes of trademarks law, as well as their development over the years. The court ruled that the principal purpose of these laws was the prevention of unfair competition that stems from the misleading of consumers with respect to the source of the product they had chosen to purchase. Accordingly, in the absence of any misleading, it could not be ruled that there had been an infringement of a trademark.

In the case at hand, the Trial Court rejected Adidas principled claim that the mere use of an emblem comprising four diagonal stripes, even though the shoes did not feature any other sign or elements that resembled those of Adidas or an embossment mentioning its name, constitutes an infringement of the three stripes trademark. In this context the court ruled that the decision on whether there was a “confusing resemblance” was a normative (and not an empiric) decision, and its purpose was to  identify cases which posed a threat to fair competition and an attempt to benefit from the good will of others.  In our examination of whether there is a "confusing resemblance" as stated, between the Adidas trademark and the design of the Respondent's shoes, the Court applied the "three way test" established in case law in this context: the test of appearance and phonetic sound, the test of the class of merchandise and circle of customers, and the test of the remaining circumstances.  For purposes of the application of the first test, of appearance and sound, the Court examined in shoes in its entirety and determined that in view of the embossment of the name "SYDNEY" on three different places on the shoe, and given the use of four stripes (and not three) there was no fear in the current case of the misleading of the consumer public.  In this context the court rejected Adidas' claim that the comparison should only be between the "signs" that appear on the shoe and that the shoe should not be related to as a whole. In applying the second secondary test that relates to the class of merchandise and of clients, the Court gave consideration to the class and brand of the product, and ruled that since Adidas shoes are marketed as an expensive brand name whereas the Respondent's shoes are sold at a minimal price in the markets, there is no danger of confusing between the products on the consumers’ part. The Court further ruled that the fact that the three stripes sign is so well known and identified with Adidas removes any concern that consumers will make a connection between it and a shoe with a different number of stripes. As such, the Court ruled that a person who purchased the Respondent's shoes at all events had no intention of purchasing an Adidas shoe and even had he wanted to purchase a shoe resembling that of Adidas, this in itself attests to the fact that there was no misleading.   The Court further ruled that there were no grounds for protecting the proprietary and commercial interest of the owner of the trademark - Adidas- at the expense of the freedom of occupation of the principal business competitors, in the absence of any attempt to benefit from Adidas good will and in the absence of misleading.  This is especially so given that even if the business of the Respondent disturbs the Adidas business; it constitutes regular business competition and not unfair competition.  Accordingly, the Trial Court ruled that there had been no infringement and emphasized that for as long as the consumer is not deceived with respect to the product that he is purchasing there are no grounds for the limitation of his freedom of choice and his freedom of expression, while extending the protection of trademarks, and in its own words: 

'The public should be allowed the choice of purchasing a cheaper product, even though, or perhaps even because of the fact that there is certain similarity between it and the brand name product, provided that it is not deceived regarding the origin or the class of the product that he is buying”

3.         The Trial Court further rejected the Appellant's claims that the importing of the shoes constitutes the civil tort of passing off, in accordance with section 1 (a) of the Commercial Torts Law, 5759 (hereinafter - Commercial Torts Law). The Court noted that the tort of passing off has two foundations: good will, and the reasonable concern about misleading, and that it is intended to prevent unfair competition.  The Court further ruled that it is undisputed that Adidas has extensive good will in the area of sports footwear in Israel and around the world, and that accordingly the question to be examined in our case is whether there are reasonable grounds for the fear of misleading consumers.  The Court answered this question in the negative, pointing out that the tests for whether there is a “confusing resemblance” as far as it concerns passing off, are identical to the tests applicable in this context to the infringement of trademark.  However, whereas with respect to the infringement of trademark the examination relates to whether there is deceptive resemblance between the marks, regarding the tort of passing off, the question is whether the person’s actions in their entirety caused misleading in relation to the origin of the product.  In the case at hand, it was ruled that there is no fear of misleading regarding the origin of the product even in accordance with the tests applicable to the tort of passing off and the Appellant’s claims in this respect were likewise rejected.

The Court further rejected the alternative claims of the Adidas to the effect that the Respondent, in attempting to benefit from its own good will had become unjustly enriched at its expense, even were it to be ruled that he did not infringe the trademark registered in its possession. Regarding this, the court ruled that in LCA 5768/94 ASHIR  Import, Export and Distribution v. Forum for Fixtures and Consumption Products Ltd [1]  at p. 289 (hereinafter: ASHIR ) did establish a narrow opening for establishing the grounds of unjust enrichment in cases in which there was no infringement of the laws of intellectual property, but noted that the rule did not apply in this case, because even within the framework of unjust enrichment there must be an examination of the conflicting values in the concrete case. In that context the court’s view was that the use of the four stripes mark does not harm Adidas and the Respondent’s acts are not irregular, outrageous or such as give rise to unfair competition. The Court further noted that under the circumstances it was actually the filing of an action by Adidas that was outrageous, and that expanding the protection granted to Adidas under the grounds of unjust enrichment would damage competition and have a “chilling effect” upon manufacturers and merchants.

Finally, the Trial Court rejected Adidas’ claims concerning theft and the dilution of good will. In this context, the Court ruled that the Respondent had not made any unfair use of Adidas’ reputation, and that the central reason for the use of the four stripes could be the “creation of a market for designer sports shoes for a population that lacks the means of buying brand name sports shoes”. The Court noted that there was no tort of unfair exploitation of good will and hence any remedy under those grounds could only be given by force of unjust enrichment, and regarding that grounds that the Court had already concluded that Adidas cannot claim it. The Court further ruled that there can only be dilution of good will when there was use of a registered trademark other than in a field of the same “description” (within the meaning s.1 of the Commercial Trademarks Ordinance [New Version], and since it is undisputed that the Respondent did not use the registered trademark (three stripes) or that he used a name or another recognized feature of Adidas, then this grounds too was not proved.

It was for all of these reasons that the District Court concluded that no proof had been brought for misleading and unfair competition on the Respondent’s part, or an attempt on his part to benefit from Adidas’ good will. The Court further held that given the aforementioned situation, whatever is not considered to be included in the trademark should remain within the class of a public asset, and in its own words:

‘In order to ensure a competitive market with products from the entire range of prices and qualities, those with brand-names and without brand-names, in order to prevent harm to consumers that stems from costs related to trademarks and from the chilling effect as it touches upon manufacturers and small tradesmen, and in order to ensure the public assets, protection should be given by way of the trademarks law in accordance with their original purposes, which is the prevention of unfair competition, No protection in excess thereof should be given’

Accordingly, the Court dismissed the claim, and ruled that the shoes were to be released from the storerooms of the Customs Authority and that the Respondent should receive the shoes and be allowed to sell them “and in doing so to maintain a market of designer, non-brand name sports shoes, at a price payable by all of its consumers”. The Court further ruled that Adidas would bear the costs stemming from the delay and the storage of the shoes and it was also ordered to pay for the Respondent’s costs and legal expenses, for the sum of NIS 85,000 + V.A.T. 

4.  Adidas refuses to accept this result, and hence the appeal.

Notably, before filing the appeal, Adidas filed an application to stay the execution of the decision, arguing that the release of the shoes from the Customs Authority storerooms would irreversibly impair the right of appeal granted to it by the decision. The Court initially refused to rule on the application, inter alia in view of Adidas’ failure to pay the court costs imposed upon it under the ruling, and against that background, Adidas filed an application for leave to appeal to this Court (LCA 9307/10 Adidas Salomon A.G. v. Yaasin [2]. On 21.12.2010 the Court ruled (Justice Hendel) that the execution of the decision would be temporarily stayed until the Trial Court’s decision on the application to stay execution, and he further added an order to pay the legal costs to the respondent (it bears note that the payments were not finally paid by Adidas until 9 January 3022, and only after additional decisions that the Trial Court was forced to give regarding the matter). On 2 February 2011 the Trial Court ruled on the application for a stay of execution, ordering the attorney for Adidas to receive the shoes in trust, and that Adidas alone should bear the storage costs, including with respect to the period in which they were stored in the Customs storerooms, but that this sum would be returned to it by the Respondent should it win the appeal.

The Claims of the Parties

       5.         Adidas claims that the Trial Court failed to apply the rules determined by this Court with respect to the manner of examining an infringement of a trademark and passing off, and that its examination in this respect was novel and mistaken. It further claims that the decision of the Trial Court has far reaching implications for the trademarks law in Israel and that it creates uncertainty with respect to the scope of rights vesting in owners of such a mark.  Adidas maintains that contrary to the ruling of the Trial Court, the comparison should be drawn between the registered trademark and the mark appearing on the allegedly infringing mark, and not the overall appearance of the products on which the marks appear, in accordance with the initial impression that they evoke. Its claim is that the Trial Court applied these tests mistakenly when comparing its own trademark with the overall appearance of the respondent’s shoes, and it stresses that as distinct from its determination, the marks should be compared separately from the product.  Adidas claims that application of the current test - that was determined as the central test in this context and which stresses the test of appearance and phonetic tone - leaves no room for doubt that the infringing mark is confusingly similar to its own mark and it claims that in the past courts in the world and in Israel have ruled in that vein. Adidas further rules that the Trial Court conducted a particularly specific comparison between the products, placing one next to the other, and accordingly ruled that there was no confusing similarity based on the fact that the respondents’ shoes had four stripes and not three. According to its approach the sample of the Respondent’s shoes contains the Adidas trademark in its entirety with the addition of one stripe and that infringing mark should have been viewed in that manner, given that the consumer does not “count stripes” but rather will identify any number of diagonal stripes on the side of the shoe with its own shoes. Adidas further claims that the Trial Court applied the test of the class of clients in a mistaken manner and that its ruling that there is a distinction between the public that purchases Adidas shoes and the public that purchases the Respondent’s shoes is unfounded and mistaken.

Adidas further claims that the Trial Court ignored the proprietary protection conferred by the Trademarks Ordinance and in case law to a registered trademark against the use of marks resembling a registered mark. As such, it claims, preventing the use of a four stripe mark is not a matter of policy or of an extension of a vested protection, as determined by the Trial Court, but rather a simple application of the statutorily determined protection. Adidas stresses that it is not attempting to entirely prevent any marking of shoe products with a stripe, but rather their marking with stripes, number and style that are confusingly similar to its own trademark.  Likewise it claims that its trademark does not consist of a simple geometric shape, being rather a combination of marks, of which an exact copy was made by the Respondent, but with the addition of one more stripe, and as such these are not weak marks that merit less protection. In this context Adidas stresses that even a mark which the consumer is liable to view as a variation of an existing trademark, infringes a protected trademark.

6. In addition, Adidas claims that the Trial Court erred in its examination of the tort of passing off.   It argues that the examination should be of the overall appearance of the products, with emphasis on the faulty memory of the client, as distinct from making an exact comparison. It adds that insofar as the tort of passing off confers broad protection, it suffices if the consumer is liable to think that there is some kind of connection between the product and Adidas, or that no justified reason was given for the use of a design that resembles a trademark, in order to establish the concern for misleading required for the proving of this tort. Furthermore, Adidas alleged unjust enrichment on the part of the Respondent stressing that as opposed to the decision of the Trial Court, the acts of the Respondent are outrageous and constitute unfair competition.

With respect to stealing and dilution of good will, Adidas claims that the Court erred in ruling that the Respondent did not attempt to build itself on the basis of its good will despite its additional holding which acknowledged the possibility of the shoes having been designed in a manner that would make them somewhat similar to its own shoes. The Appellant especially emphasizes that the Trial Court’s holding to the effect that the purchasers of the Respondent’s shoes “would be able experience the feeling of wearing shoes with four stripes which are somewhat reminiscent of Adidas shoes” demonstrates that this is case of exploitation of good will, impairing and dilution of good will, and it claims that the marketing of shoes that provide an experience of Adidas shoes is illegitimate.  Furthermore, Adidas claims that the Respondent’s shoes were marked with four stripes purely out of economic considerations, and that the Respondent knows that the consumer’s eyes would be attracted to shoes that resemble the general appearance of its own shoes, without investing in advertising.  Adidas also claims that there are also grounds for dilution of good will, because it suffices that there was use of a trademark or a mark similar to it in order to establish grounds, without having to prove the foundation of misleading, Finally, Adidas claims that it was denied the right to present its claims in the Trial Court because the latter devoted considerable parts of its judgment to issues that were not even raised by the parties and in respect of which no claims had been made, while establishing factual findings for which no evidence had been presented and in areas that were not in purview of its judicial knowledge.

7.    The Respondent, on the other hand, affirms the decision of the Trial Court and argues that the decision is based on a firm factual foundation and upon   reasoned and detailed legal analysis that leaves no grounds for intervention. The Respondent claims that Adidas did not present any evidence for the alleged fear of misleading, and argues that there is no justification for interfering with the Court’s ruling that no grounds can be laid for similarity between the footwear imported by the Respondent and Adidas shoes.  The Respondent adds that it was proven in the Trial Court that one can easily find footwear of other companies which feature varying numbers of stripes and accordingly it cannot be argued that he attempted to benefit from the goodwill of Adidas or that a reasonable consumer would mistakenly think that he was actually marketing Adidas footwear. The Respondent claims that Adidas widespread fame and its three stripe mark does indeed it confer it with an absolute protection of that mark, but it is precisely for that reason that no consumer would think that the Respondent’s footwear was produced by Adidas. This is especially so given that the footwear is sold in shops or stands located in the markets of the Palestinian Authority and not in the shops that sell Adidas footwear, and also in view of the numerous visual differences, such as the commercial name “SYDNEY”, and the element of the four stripes.  The Respondent further   argues that the claim that the mark should be compared directly against another mark for purposes of examining the question of the trademark infringement is only correct for purposes of registration of the mark in a registration record and not when the mark appears on a product, where the mark should not be removed from its context. Furthermore, the Respondent claims that the four stripe mark is not confusingly similar to the three stripe mark, even if when directly comparing one mark to another, especially due to the extensive advertising of the three stripe sign, as stated. 

The Respondent further claims, affirming the Trial Court’s decision, that absent the fear of unfair competition or an attempt to benefit from the goodwill of Adidas, he cannot be said to have infringed its trademark, and he emphasizes that Adidas only has a proprietary right with respect to a three stripe mark, and that the protection conferred to this mark should not be extended.  Furthermore, the Respondent claims that Adidas is attempting to attain a monopoly over the actual use of stripes. In this context he notes that given that our concern is with a decorative mark, it is a “weak mark” with a limited protective scope and which does not cover the use of a different number of stripes.  Furthermore, the Respondent claims that Adidas’s claim concerning passing off should likewise be rejected, arguing that the according to the Court's factual finding there was not, nor could there be any mistake concerning the identity and the origin of the footwear that he was attempting to market, and that there is no confusing similarity between a mark consisting of three stripes and a mark consisting of four stripes. The Respondent further claimed that the Adidas claim regarding stealing or dilution of goodwill should likewise be rejected and in this context he stresses that his footwear intentionally distinguishes itself from any other footwear by way of his trade name “SYDNEY” which appears on the shoe itself in three places, as well as on the box in which the shoe is sold. Moreover, the Respondent claims that as opposed to Adidas's claim, it acted in absolute good faith, and hence its claim regarding unjust enrichment should likewise be rejected.

Deliberation

8.    The central question for our deliberation is whether the registered trademark of Adidas - the three stripes mark – was infringed in this case, by reason of use of an embossment of four stripes on the sides of the footwear that the Respondent seeks to market, and whether in this context his act establishes actionable grounds under any of the laws intended to protect Adidas’ intellectual property.  By way of introduction I will say that like the Trial Court, I too am of the opinion that the Respondent’s shoes do not infringe the three stripes mark and that the action should likewise be rejected with respect to the other grounds argued for by Adidas. All the same, I do not think that the reasons of the Trial Court should be endorsed and in what follows I will explain the reasons for my conclusion. 

 

 

Trademark

 

The principal legislative arrangements relevant for our purposes and treating the issue of trademarks are unified in the Trademarks Ordinance,  s.1 of which defines the following terms:

 

      “mark” means letters, numerals, words, figures, or other signs, or the combination thereof, whether two dimensional or three dimensional;

“trademark”  means a mark used, or intended to be used by a person in relation to the goods he manufactures or trades;

“registered trademark” means a trademark registered in the Register of Trademarks under the provisions of this Ordinance, and which is a national trademark or an international trademark registered in Israel;

The institution of trademarks originated in the need to distinguish between the products of one trader and those of his competitor, and in this context, to protect the interests of both the trader and the consumer. The trader enjoys the protection of his good will and reduces the fear that the consumer will confuse his product with that of another trader.  The consumer will have an easier time in identifying the particular products that he wishes to purchase and is protected from misleading with respect to the source of the goods. To attain these goals, s.46 of the Ordinance confers the proprietor of the registered trademark “the right to exclusive use” to use the mark in every matter relating to the good in respect of which his mark is registered” (see C.A. 715/68 Pro-Pro Biscuit v Promine Ltd [3] (hereinafter: (Pro - Pro ) at p. 48; CA 3559/02 Center for Toto Zahav Subscribors v. Council for Regulation of Gambling in Sport [4] (hereinafter – Toto ruling) at p. 888 .

The law of the trademarks and the protection it provides to the owner of a registered trademark is one branch of a broader field of law – the laws of intellectual property – that confer protection to an intellectual product that may be of economic value. It is similarly important to mention that the right to intellectual property, like any other property right, is one of the "privileged" rights enjoying constitutional protection in the law and Basic Law: Human Liberty and Dignity instructs as not to violate it (s.3 of the Law).  However, the protection of intellectual property, by its very nature clashes with another constitutional right – the freedom of occupation and the right to free competition deriving therefrom.  (see CA 9191/03 V & S Vin Spirt Aktiebolag v. Absolute Shoes [5] at p. 877 (hereinafter: the Absolute ruling). Similarly, granting a broad monopoly to the owner of intellectual property to makes exclusive use of his property may impede the existence of a free and varied market of products which assists in the development of the economy and commercial life. In sketching the borders of the protection of a trademark, an effort must be made, to strive wherever possible to strike a balance between the protection required for the registered trademark and the “abrogation” of any other mark, irrespective of the level of resemblance between them, from the public realm.

The Unique Nature of the Three Stripes Mark

9.    As mentioned, the trademark is intended to aid the consumer in distinguishing between the products of one merchant and those of competing merchants.  To that effect, in order for it to be eligible for registration, it must have a "distinctive nature".  In other words, it must be ascertained that the mark does in fact enable the desirable differentiation from the goods of the mark owner of the mark and the goods of his competitors (regarding the requirement of a distinctive nature see s. 8 of the Ordinance). The distinctive nature may consist of the inherently distinctive nature of the product from the time of its creation. In most cases, the concern in this context is with marks that are the product of imagination and as such are unique, original, or non-foreseeable, and bearing no natural connection to the type of product which  it marks, so that the connection between the mark and the product is arbitrary. An example of this is the arbitrary use of the mark "Apple" as the mark of the computer company. However, even in cases in which the mark does not possess any inherently distinctive character the mark may also acquire secondary significance by dint of its extensive use, so that the consumer public will associate it with goods from a particular source. This is known as a mark with an acquired distinctive nature (this distinctive nature was also defined by case law in other contexts as "secondary" as opposed to "principal" meaning.  See CA 18/85 Israel Glass Factories Venice Ltd v. Les Verrcies De Saint Gobain [6] at pp. 234-235  (hereinafter - Venice) ;  CA 11487/03 August Storck v.  Alfa Intuit Food Products Ltd [7]. par.8 (hereinafter - Alfa  Intuit).  As for the distinctive nature of names, see CA 5792/99 Tikshoret Religious-Jewish Education Family (1997) Ltd "Family" Newspaper v. S.B.C Publication, Marketing and Sales Ltd - Mishpacha Tova Newspaper [8] at pp. 943-946  (hereinafter - Family ). Thus for example, the marks of Office Depot or General are marks with an inherently weak distinctive nature because they are descriptive signs that are neither arbitrary nor imaginative and their connection to the cars manufacturer or the shop selling office products is a natural one.  Even so, over the years these marks acquired a distinctive character to the extent that today that there is almost not a single consumer in the world who would come across then and not connect them to those particular companies (on the distinction between inherent distinctive nature  and acquired distinctive nature see also in the  Alfa Intuit [7] matter, para. 8). Even more precisely, the acquired  meaning supplements the inherent meaning of the mark and does not replace it, and their combination establishes the extent of the protection given to the trademark against its infringement (see  Amir Friedman, Trademarks - Law, Case Law, and Comparative Law, 211, 214) (third edition, 2010) (hereinafter:  Friedman).

10.  The acquired distinctive character attests to the demand and the popularity of the merchandise and to the good will that it accumulated from the day of its "birth" as a result of marketing and advertising efforts made by and on behalf of the patent owner.  For our purposes it is undisputable that the Adidas trademark - three diagonal stripes of identical breadths and spaces between them on the side of the shoe - is today absolutely identified with the company all over the world and constitutes a distinctive sign by which its footwear is identified.  Accordingly, there is no question of whether this trademark has an acquired distinctive character. However, in my view the decision is not as simple regarding the inherent distinctive nature of the mark.  This mark, which Adidas chose as one of the trademarks that identifies it with its products, consists as mentioned, of three stripes but  for a person not previously familiar with it might be viewed exclusively as one of the shoe’s design components (as distinct from a trademark).  It seems difficult to claim that if not for Adidas’s choice of this mark, no other shoes would have been manufactured with stripes on their sides (compare to the trademarks identified with the competing footwear companies such as "Reebok", "Nike", "Puma" and others. A comparison should also be made to the Patent Registrar Decision No. 129015 Nike v. Shai Mecher Sachar (1996) (26.8.2008)). Accordingly, I accept the Trial Court's decision according to which the inherent nature of the three stripe mark is weak (regarding the appropriate scope of protection in a request to register a three dimensional trademark with aesthetic value, compare to Alfa Intuit  [7], paras, 10 - 12.

It bears mention in this context that this is not the first time  that Adidas has filed a claim in Israel for an alleged infringement of the three stripe mark, following the use of a similar mark, two or four stripes (see CA 3581/05 Shehana'al Mat'ima v. ADIDAS-SALOMON [9] (hereinafter -Shehana'al Mat'ima); LCA  3217/07 Brill Footwear Industries Ltd v.  ADIDAS SALOMON A.G. [10] (hereinafter – Brill) and in the District Courts see e.g. Civ.App (District, Tel-Aviv) 15544/05 ADIDAS SALOMON v. Sh.I. Klipp Import and Trade Ltd. Proceedings in these  cases all ended without any decision on the merits)  (See also C.A (District - Tel-Aviv - Jaffa) 2326/07 ADIDAS SALOMON v. Gentom Shoes Ltd,  in which Adidas’s claim was accepted following the Defendant's failure to submit evidence on its behalf). In other states too Adidas filed suits concerning the infringement of its three stripe trademark, in view of manufacturers' use of two or four stripes on their products and a quick search shows that dozens of suits have been brought in courts at various levels all over the world. A large portion of Adidas’s claims all over the world ended without a decision on the merits, similar to those in Israel, but in the proceedings that were decided on the merits, Adidas' position  was for the most part accepted (see for example, in the decision of the District Court in Oregon, U.S. (No. CV 01 – 1665-KL) Adidas America, Inc. v. Payless ShoeSource, Inc and also adidas-Salomon A.G. v. Target   Corp.,228F Supp. 2d 1192 (D. Or. 2002) as well as the decision in Corp and the decision of the Court of Appeal in Athens, Greece, Decision Number 5749/2009 Adidas Salomon A.G. v. Alysida A.E.B.E . On the other hand, see the references in the matter of Shehan'al Mat'ima [8[ para. 3. But see also  in  the decision of the High Court in Capetown South Africa,: adidas A.G. v. Pepkor Retail Ltd (1 A11 SA 636 (WCC) (5 December 2011);  the decisions of the -European Court of Justice: adidas-Salomon AG V. Fitnessworld Trading LTD., Case C-408/01 (23 October 2003); adidas AG v. Marca Mode CV, Case C-102/07 (10 April 2008).   All the same, it is important to remember that that each case is different and hence any attempt to draw analogy should be done with the requisite caution. 

11.  The weak nature of the inherent distinctive character of the three stripe mark affects the scope of the protection that it should be awarded.  On the one hand, the fact that the three stripe mark has, as noted, attained a powerful distinguishing nature points to the need for maximum protection (see s. 46A of the Ordinance which relates to “well known trademark” and see and compare to the matter of Absolute [5] which relates to the scope of protection for such a mark). However, the weakness of the inherent distinctive nature justifies protection that will be limited to the trademark itself and to its derivates that are particularly similar to it. In other words, granting a monopoly to Adidas to two stripes and to four stripes (or, naturally, to any different number of stripes) would be problematic because it would mean the removing the designing of stripes from the public realm and would prevent other manufacturers from using this kind of design for their footwear. Our intention is not that Adidas' investment in advertising and in marketing did not create a situation in which the design of stripes became popular and in demand, but one cannot infer from that fact that any use of stripes by an Adidas competitor is a prohibited use (compare to HCJ 144/85 Kalil Non-Metallic Steel Industries  Ltd. v. Registrar for Patents and Designs and Trademarks [11],  

Having considered the nature of trademarks in general, and having examined the nature of the trademark forming the subject of the appeal specifically and the appropriate scope of protection deriving therefrom, we will proceed to examine whether the trademark of ADIDAS was actually infringed.

Infringement of a Trademark

"infringement means the use by a person not entitled thereto

 (1)  of a registered trademark or of a mark resembling such a trademark in relation to goods in respect of which the trademark is registered or to goods of the same description .... (addition added).

     12.  Section 1 does not explain the nature of the similarity between the marks required for it to be regarded as an infringement of a registered trademark. However, case law has noted on more than on occasion that in this context the test to be applied is the one appearing in s. 11 (9) of the Ordinance that sets forth the manner of examining the mark for purposes of its registration, and according to which a mark "identical with .....or so resembling such a mark as to be calculated to deceive" is not eligible for registration.  The consideration of two factors are at work here: protection of the public from misleading and protection of individual title and his acquired goodwill (see e.g. LCA 5454/02 Ta'am Teva (1988)  Ltd v. Ambrozia Sofharb Ltd [12] (hereinafter - Ta'am Teva). Accordingly, where it concerns use made of a similar mark as opposed to a use made of an identical trademark, a plaintiff claiming infringement must prove that one mark resembles the other to a degree that may confuse the public, and the examination in that context   relates to "people with regular common sense, who conduct themselves with reasonable caution"). (See Ta'am Teva[12], at p. 450). The requirement for resemblance between the two products is at a threshold that exceeds that of a "connection" alone (compare to s. 46 A(b) of the Ordinance and the matter of Absolute [5], at p. 885).  It has already been held that the act of copying as such does not necessarily attest to the intention to mislead clients and that even the intention to mislead does not does not dictate the conclusion that there is a fear of actual misleading (see C.A. 9070 Tali Dadon Yifrach v. A.T. Snap Ltd [13] para. 11which concerns the tort of passing off). 

The accepted test for the existing of a confusing resemblance is the "three part test" which was discussed by the Trial Court, consisting of the test of visual and phonetic similarity; the test of the type of customer and class of goods; and test of the other relevant circumstances (see CA 261/64 Pro-Pro Biscuit v. Promine Ltd [14], at p. 278). The manner of implementing these tests in each case is not a function of uniform standards and is influenced by the distinctive character of the registered mark and the appropriate degree of protection it merits (see CA 4116/06 Gateway Inc. v. Pascul Advanced Technology Ltd [15] para.16). The weight to be given to each of the tests is similarly not uniform, changing in accordance with the circumstances (see CA 10959 Tea Board India v. Delta Lingerie, S.A. OF Cachan [16] (hereinafter:  Tea Board).  It bears note that along with the three part test, there cases in which case law also applies the "common sense test" particularly when it is necessary to examine whether the trademarks have a shared ideological message (see CA 8441/04 Unilever P v Segev [17] at para. 9 (hereinafter Unilever ); Ta'am Teva [12] at p. 453 and Tea Board [16] at para. 10).  It further bears mention that in most of the cases involving the determination of confusing similarity the trial court has no particular advantage over the appellant forum because the appellant instances, in general has at its disposal the same tools as the clarifying instance (see LCA 2960/91 Wizzotzky Tea and Co. (Israel) Ltd v. Matok [18].

13.  In our case, both parties agree that the Respondents' shoes are the same kind of goods in respect of which the Adidas trademark was registered- sports shoes, or at least they are goods of the same description, in other words, from the same "commercial family" (for elaboration on the meaning of the word "description" in the Ordinance, see Toto [4] at pp. 894-895). Furthermore, all are agreed that in our case the issue does not concern footwear designed with a mark that is identical to a registered trademark. As such, there has been no attempt at the forging of shoes and hence there must be an examination of the similarity between the shoes, and a determination on whether there is indeed a "confusing resemblance" between them. As mentioned, the acquired distinctive character even when particularly powerful as in the case before us, does not obviate the need for an inherently distinctive character. As such, even if the strong distinctive nature acquired by the three stripes compensates to a certain extent for its weak inherent nature, given that the consumer public today is aware of the connection between the trademark and Adidas, one cannot ignore the weakness of the inherent distinctive nature when applying the three  part test.

14.   At the stage of applying these tests, it should be remembered that the comparison must be between the trademarks in their entirety and not between specific parts thereof  (See Ta'am VaTeva [12] , at p. 451; LCA 6658/09 Moltilock Ltd v. Rav Bariah [19] at para. 8 (hereinafter: Moltilock), and the examination should focus on the existence of a confusing resemblance between the trademarks themselves, as opposed, for example, to the tort of passing off, in which all of the particular acts of the infringer are examined (see LCA 1400/97 Picanti Food Industries  (Israel) Ltd v. Osem Food Industries Ltd [20] at p. 313 (hereinafter: Picanti). Hence it was held., for example, that when verifying the infringement of a registered trademark, "lesser weight should be ascribed, or in certain cases no weight at all, to the degree of resemblance in the appearance of the goods or their packaging” (the case of Teva Ta'am [12] pp. 450 - 451). In the case at hand, however, it seems that one cannot examine the trademarks - the three stripe sign of Adidas as opposed to the four stripe sign of the Respondent -  in absolute isolation from the goods on which they appear.  First, even if the consumer doesn't stand with both products in his hand, making a comparison between them in all their details, it cannot be presumed that he disassociates the marks from the shoes themselves  and examines the marks in isolation from the shoes  (for a similar approach in American law, see for example, Filipino Yellow Pages, Inc. v. Asian Journal Publications, Inc., 198 F.3d 1143, 1150 (9th Cir. 1999); ; Goto.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1206 (9th Cir. 2000)Entrepreneur Media, Inc., v. Smith, 279 F.3d 1135, 1144 (9th Cir.2002). Second,  the rule whereby the comparison should be restricted to the marks themselves was articulated in decisions that were concerned with verbal and not visual signs, such as in the case before us,  (see also CA 8981/04 Avi Malka - Avazei Hazahav Restaurant v. Avazei Shechunat HaTikva (1997) Restaurant Management Ltd [21], para. 28  (hereinafter - Avazei).  This distinction is important since whereas it is easier and even more reasonable to separate phonetic trademarks from the product they  mark, especially where it concerns phonetic marks used for purposes of advertising and marketing the product (for example the mark of "bamba" that was used in Picanti [20]), the absolute severance of the visual trademark from the product upon which it is imprinted, especially when it can be construed as decorative element, as in the case before us, is both an artificial and a problematic severance.   Accordingly, the manner of applying these tests must be adjusted to the unique circumstances of the case at hand, and having consideration for the circumstances of this case, it seems that even though "the entirety of the defendant's acts" are not to be examined, as is the case with the tort of passing off, the shoe itself must be examined in its entirety.

I will preface by saying that it has not escaped me that in applications for leave to appeal on decisions for temporary relief (in the cases of Shehana'al Mat'ima [9] and Brill [10]his Court (Justice A. Grunis, as per his former title) accepted the prima facie conclusions of the hearing forum regarding the similarity to the point of confusion between shoes with four parallel stripes and the shoes of Adidas, following a comparison of the two marks conducted in isolation from the shoes on which these signs appeared. However, as the Trial Court noted, those decisions were given in applications for temporary relief and at that stage, as opposed to our case, the court was only required to be convinced of the existence of a prima facie similarity, without conducting, in the framework of those proceedings, a thorough hearing  of the various claims of the parties. And at all events, given the reasons I mentioned above, my view is that in our case the trademarks should be examined together with the shoes on which they appear and not in detachment therefrom, as was the case in the intermediary proceedings mentioned above.

15.  The required examination will be conducted, as mentioned, in accordance with the three sub-tests that I referred to above, that were determined for purposes of locating a confusing similarity

       (a)          The test of appearance and sound.  This is the most central of the three sub-tests (see Ta’am Teva [11] at p. 451 and at this stage of the examination the appearance and the sound – when relevant – of the two marks should be examined in order to determine the degree of similarity between them.  In this test the emphasis is on the initial impression gained from a comparison of the marks, having consideration for the fact that the average consumer’s memory is not perfect.

Apart from the clear difference between the Respondent’s shoes and Adidas shoes, which stems from the fact that the Respondent’s shoes feature four and not three stripes, the comparison also indicates other clear and blatant differences. The name “SYDNEY” appears on Respondent’s shoes in two prominent places – at the back of the shoe and on its tongue.  In addition, the name “SYDNEY” appears on the inner tongue of the shoe, and this name bears no similarity, neither in design nor in sound to the name Adidas or to any trademark registered in its name. To a large extent this removes the concern of misleading the consumer public, as correctly held by the Trial Court (see and compare to CF (DIS-Tel-Aviv) 2554/01 Buffalo Boots v. Naalei Loxie 2000 Import and Marketing Ltd,  at  para. 3 (b) (hereinafter – Buffalo). 

    (b) Test of the type of customer and class of goods. This test is concerned with the influence of the class of goods on the danger of confusing consumers.  Regarding the test of the class of goods, it has been held in the past that where it concerns expensive products or particularly important services, it may  reasonably be presumed that the consumers would conduct a more thorough scrutiny prior to executing the transaction which would lessen the chances of confusion (see Ta’am Teva[12] at p.453; CA 210/65 Iggud Bank Ltd v. Agudat Yisrael Bank Ltd,[22]at p. 676. The test of the type of customers examines two complementary matters. The first is whether the same type of customer would take an interest in both of the products; and the second is how the particular characteristics of the relevant type of client influence the chances of confusion. Hence for example it was held that where there is a difference between the prices of the products, but the difference is not great, it will not lead to the conclusion that each one of the products has its own distinct circle of clients in a manner that prevents the chance of confusion, especially insofar as the allegedly infringing product is only slightly cheaper than the second product, in which case it may reasonably be presumed that the client will prefer to pay the lower price without enquiring into the nature of this price (see: CA 3975/10 Philip Morris Products v. Akisionerno Droujestvo [23]para. 8)

A comparison of the two categories of merchandise in this case shows that indeed both cases concern sports shoes, but belonging to entirely different price categories (the difference in prices being significant). Adidas shoes are marketed as a successful brand at prices ranging between medium to high in select sports shops all over the country, whereas the Respondents’ shoes are intended for marketing at low prices and primarily in the stands at the markets, as determined by the Trial Court in its ruling. I find no reason for interfering with these factual determinations, and this difference in the price and the manner of marketing, in my eyes, significantly reduces the danger of confusion among clients, not because the Adidas consumer is a “specific consumer” but rather because it is unlikely that a consumer seeking to purchase a simple, cheap shoe would mistakenly think that the shoes sold at a low price in the market are Adidas shoes. On the other hand, it may be presumed that the consumer seeking to purchase high quality shoes from a reputed company and who is prepared to pay a price accordingly, would examine the shoe before buying it.

(c) The Test of the Remaining Circumstances.  This test accompanies the previous tests and takes the specific circumstances of the case into account, to the extent that they were not examined in the framework of the two previous tests (see Ta’am Teva[12]  at p. 453. In this case no special circumstances were presented which might have been relevant.

16. The conclusion flowing from application of the aforementioned tests, having consideration for the preliminary normative determinations with regard to the appropriate scope of protection for the triple stripe mark, is that the Respondent’s shoes do not give rise to the fear of deceiving the public and as such do not infringe the Adidas trademark. To be even more precise, our ruling that there is not fear of misleading does not mean that there is no similarity between the shoes of the Respondent and the shoes of Adidas (compare to Yifrach [13], but rather that as a matter of the policy to be applied in this case the similarity is of a kind that does not constitute an infringement of the trademark,

Passing of

17,  The tort of passing off in s. 1 of the Commercial Torts Law, states as follows:

(a)        A dealer shall not cause the asset he sells or the service he offers to be mistaken for the asset or service of another dealer or related to another dealer.                                                            

       The tort of passing off has two foundations, the proof of which rests with the party claiming the commission of the tort against him. The good will that he has acquired in the asset or the service that he offers, and the fear of misleading the public into thinking that the asset being offered by defendant belongs to the plaintiff (see Avazi [21], para. 12, Mishpaha [8] p. 942; Venice [6] at pp. 232 – 233). The requirement for the simultaneous proof of both foundations balances the trader's proprietary interest with other interests such as freedom of occupation of competing manufacturers and the desire to encourage free competition and to prevent the creation of a monopoly that is harmful to the market.   Regarding this it has been held that “misleading concerning an asset or service in respect of which the  plaintiff has not proved that he acquired good will in respect thereof does not come within the purview of the tort of passing off…. similarly, an imitation of an asset with good will where it was not proven that there was a chance of confusion, is likewise not within the purview of the tort (Yifrah [13], para. 8). Notably, despite the similarity between the tests for establishing an infringement of a trademark and those for the tort of passing off, this does not dictate an identical result in all  cases. Occasionally the ruling must be that a trademark was infringed but that the tort of passing off was not proven. For example, when a manufacturer uses a mark that is identical to a registered trademark, but where there are other features of the product that distinguish it from the products of the trademark owner (see Buffalo [ ]).  And vice versa too - occasionally the entirety of the manufacturer's acts lead to the conclusion that he committed the tort of passing off, even if he did not infringe the registered trademark relating to that matter.

18.  There is no dispute over Adidas' reputation and its trademarks in the areas of sport shoes in Israel and around the world. In our case the first foundation exists and the focus must be on the second foundation of the tort, the fear of misleading. In examining the existence of this foundation with respect to the tort of passing off, as mentioned, there must an examination of the entirety of the defendant's actions and conduct. This examination does not yield a conclusion that differs from our conclusion regarding the absence of any fear of confusion in relation to the trademark. The reason for this is that the Respondent's actions in our case further reduce the fear of confusion, including the attachment of a label to the shoe, featuring the name "SYDNEY" in large letters, and the packaging of the product in a box on which that name also appears quite clearly. It therefore seems that under these circumstances there is no fear of confusion. The matter of Yifrah [13], which was handed down recently, concerned a perfect replica of a product that was sold cheaply alongside the original product, and it was held that it does not establish grounds under the tort of passing off because a label was attached bearing a different name, the products were presented separately in the shop and when the sellers were asked about the price difference they explained that it was an imitation (paras. 11- 12). In that case the good will the was proven was actually far weaker than that of Adidas, but on the other hand the circumstances of the case were more extreme given that unlike the case at hand, the similarity of the products was absolute (see also in the Buffalo [  ]case, where it was held that almost identical shoes at a lower price and with another trade name does not deceive the public and the plaintiff does not have any grounds under passing off. Accordingly, I accept the conclusion of the Trial Court according to which in the case before us it has not been proved that the Respondent committed the tort of passing off against Adidas.

Dilution of Good Will

19.  As noted by the Trial Court, the doctrine of dilution of good will is relevant to a situation  in which:

"A powerful trademark is used without the consent of its owner and without creating confusion, leading to the erosion and blurring of the unique, quality image that the mark conveyed to its clients.... the erosion of the image of the mark among the consumer public also diminishes the commercial value of the trademark, in wake of the decrease of its selling capacity (or power)" (Yaakov and Hana Kalderon Commercial Imitations in Israel 189 (1996). On the adoption of the doctrine according to this definition, see CA 6181/96 Kardi v. Bacardi and Company Limited [24],.

This description indicates that the doctrine of dilution of good will does not require proof of the fear of misleading consumers. However, it seems to me that the cases in which it may be appropriate to determine a dilution of good will even when no misleading is proved are the exceptional cases in which the absence of confusion was the result of the fact that the product is of an entirely different description (as was the case when this doctrine was applied for the first time in Eastman Photographic Materials Co. v. John Griffith Cycle Corp 15 R.P.C. 105 (Eng. 1898), (hereinafter - Kodak), and at all events, this doctrine should not be applied as a default option for every case in which confusion of consumers was not proved  - as in the case before us.

As mentioned, the doctrine has its source in the  Kodak case, where it was held that when a bicycle company uses the name of  the Kodak photography company it does not confuse the consumers but does dilute the company's good will (see also in the matter of Tea Board [16]). The conclusion is that the doctrine seeks to protect the positive good will and image attaching to a well known trademark and provides a quasi proprietary protection to the good will itself against unlawful attempts of traders to build themselves up on the good will of the mark owner by creating a misrepresentation of having supposedly acquired a license, authorization, sponsorship, promotion or any other connection between the product with the good will and their own product (Friedman, p. 121- 127). Indeed, as claimed by Adidas and as mentioned above, to establish grounds based on dilution of good will it is not necessary to prove confusion. However, this does not obviate the need to prove the erosion and blurring of the good will acquired by the registered mark as a result of  the use of the other mark, by reason of creating some kind of link between the allegedly infringing product and the product of the party claiming damage. This conception also receives expression in section 46A (b) of the Ordinance, which establishes the unique use of “well known” trademark which is a registered trademark, also for products not of the same description. Concededly, the section does not require proof of confusion and suffices with use that "may indicate a connection between the goods" alone, but it makes this protection contingent upon it being proved that the "owner of the registered mark may be harmed as a result of the said use" (see regarding this the application of the doctrine in the matter of Absolute [5] pp. 878-879, 887). On the other hand, where our concern is with the use of a mark for products of the same description and to the extent that there is no confusing similarity between the products or  the marks and there is a distinction between them, it would seem that it cannot be claimed the mark owner’s good will, will be diluted (see Civ. App. (District - T.A) 35447/99 Super Farm  v. Blue Square Network [  ] where it was held that there was a likelihood of confusion, and further on it was held that there was a dilution of goodwill, and see also in Unilever [17] at para. 24). In our case, in view of the holding that it was not proven that the average consumer would be confused into thinking that the Respondent's shoes were manufactured by Adidas, there is no likelihood that the consumer would link the quality of the Respondent's shoes to the Adidas company, and by extension, there are no grounds for the claim of dilution. It bears note that in the absence of the likelihood of confusion, there is  likewise no grounds for Adidas' claim regarding the theft of its good will or harm to it (see LCA 10804/04 Prefetti Van Melle Benelux B.V. v. Alfa Intuit Food Products Ltd [25] at  p 466 (hereinafter  Prefetti).

 Unjust Enrichment

20      The leading decision on the issue of the relations between the laws of intellectual property and unjust enrichment is the decision in the matter of ASHIR [1].  That case concerned three instances in which the respondents had not registered a patent or sample for the disputed product.  Likewise, the Trial Court rejected the claims made by those respondents concerning the tort of passing off, and the common question in the appeal forum was whether under those circumstances there were grounds for granting the respondents relief in accordance with the Unjust Enrichment  Law, 5739-1979 (hereinafter - Unjust Enrichment Law). In two of the three cases considered in the ASHIR [1] matter it was decided unanimously to overrule the decisions of the district court and the remedies given by it on the grounds of unjust enrichment, and in the third case the court decided, by majority, to reject the appeal and to leave intact the decision rendered by the district court. The path taken by the four majority justices (Justice T. Strasbourg-Cohen, President A. Barak, Justice T.Or and Justice Y. Zamir) in reaching their conclusion was not uniform, but it seems that the rule deriving from the  ASHIR [1] case received exhaustive expression in the ruling of Justice T. Strasbourg-Cohen, who stated that “the individual’s interest in the non-copying of a work that he created and in which he invested his time, his energy, his thoughts and his resources is in principle worthy of protection within the framework of the laws of unjust enrichment and the application of such an interest cannot be ruled out a priori just because it is not an “established right” under the laws of intellectual property” (ibid, at p. 417).  All the same, in the ASHIR [1]  case it was held that applicatory scope of the laws of unjust enrichment was dependent upon the question of the extent to which the specific law that applied constitutes a comprehensive arrangement that negates the intervention of any law external to it; that the condition for grounds under the Unjust Enrichment Law is that the enrichment of the beneficiary be “by unlawful cause”. In other words, that the copying or imitation must be supplemented by another foundation of a negative nature; and that prior to awarding compensation by force of the laws of unjust enrichment, it must be ascertained that there is no double compensation, and that by force of unjust enrichment it is possible to grant, when necessary, remedies that also include injunctions, despite the fact that these remedies are not mentioned in the Unjust Enrichment Law (ASHIR [1], at pp. 337, 363-365, 417, 486; LCA 6025/05 Merck and consideration. Inc v, Teva Ta’asiot v. Teva Pharmaceutical Industries Ltd [26] para. 30)(hereinafter;  Merck  case)). As mentioned in one of the three cases heard in ASHIR [1] (LCA 5614/95) the majority view was that the respondents indeed had grounds for claim under the Unjust Enrichment Law, given that the applicants in that case had executed a “complete imitation” of the product by way of “Reverse Engineering” and given that the respondents had invested a protracted effort in the development of the product, which was not a simple, standard product.

21. The current case differs in a number of aspects. First, Adidas owns a registered trademark and its action is based primarily on the infringement of that trademark, notwithstanding that in addition to that ground it also raised other grounds, including passing off and unjust enrichment. The question which arises is whether in a case in which it was held that the foundations that confer protection to the owner of a mark under the laws of intellectual property were not established,  and where it was further established that under the circumstances there were no grounds for the tort of passing off, the plaintiff should be allowed to raise alternative grounds of unjust enrichment. The majority judges chose to leave open the question of whether in a case in which the plaintiff was entitled to sue on the basis of intellectual property he should also have he option of suing simultaneously or alternatively on the basis of unjust enrichment (see ibid [1]  at pp. 418, and 455). In other cases that came before this Court after the handing down of the ASHIR [1] ruling, the court opined that where the plaintiff had failed to prove the infringement of a registered trademark and not being entitled to proprietary protection in the form of an “institutionalized right”, he should not be given a remedy under an alternative grounds in reliance on the Unjust Enrichment Law, and in the words of the court in the Absolute [5]   case “In the case of  registered trademark, the appellants were able to take the high road of the laws of intellectual property, whereas in that decision ASHIR [1], there were no registered rights of intellectual property, Once the high road had not been successful,  the side roads too would not be successful “ (ibid [4], p. 888; see also Prefetti [25], at p,466; Friedman, 1989 -1090; Miguel Deutch, Commercial Torts and Trade Secrets pp. 50 – 51 (2002). However, even if we assumed for argument’s sake that the dismissal of the claim concerning the infringement of a trademark does not ipso facto preclude the alternative grounds of unjust enrichment, it seems indisputable that such a dismissal should carry significant weight in determining whether there are foundations for the alternative grounds, especially in view of the holding concerning the absence of misleading. In our case the Respondent used the sign of four stripes on the sided of the shoe (as distinct from the three stripes of Adidas), and, most importantly, the word SYDNEY was embossment in two prominent places in the shoe, as well as in the inner sole). In my view these data make this case significantly different from the case considered in ASHIR [1] which concerned, as mentioned, a “complete imitation” of the product, by way of “Reverse Engineering” and a product comprising development and invention, (as opposed to the use of the element of the stripes, which as mentioned,  is weak in terms of inherent distinction).

This Court reached a similar conclusion in rejecting a claim of unjust enrichment (even in the absence of claims concerning the infringement of intellectual property laws, apart from the tort of passing off) in another case in which it did not find that there had been a “complete imitation” of the Apropo snack. In that regard the court stated further that:

‘[G]ranting protection against partial copying of the product may spread the protective umbrella of the laws of unjust enrichment over a large number of cases. Hence, for example, acceptance of the appellant’s position could lead to an almost blanket prohibition on the use of a hollow cone in the designing of snacks. Protection of this kind involves a grave impingement on the freedom of competition and this carries significance in the balancing of the considerations (CA 945/06 General Mills Inc. v. Meshubah Food Industries Ltd [26], para. 20

For all of the reasons set forth above, my view is that Adidas’s claims regarding unjust enrichment were rightly dismissed.

22.  After writing my opinion, I read the opinion of my colleague, the Deputy President (Ret.) E. Rivlin, and notwithstanding my argument with his conclusion on the matter of unjust enrichment, I wish to note that I too do not concur with the District Court’s approach to the effect that it is a “legitimate goal” to enable a person lacking sufficient means to “experience the feeling of wearing shoes with four stripes which are somewhat reminiscent of Adidas shoes”  However, as opposed to my colleague I think that our case does not concern the giving of such an experience, by reason of the significant differences between the shoes, chief among them being the specification of the word “SYDNEY” in no less than three places on the shoe.

Final Word

23.  In view of which I propose to my colleagues to dismiss the appeal and to order Adidas to give the Respondent the shoes that he imported, and which are in its possession. For the removal of all doubt, it will be clarified that Adidas will bear all of the costs involved in the storage of the shoes in Customs, and in its own possession, as per the decision of the Trial Court and its decision in the application for a stay of the execution of the decision. Likewise, I propose to my colleagues to obligate Adidas to pay to the Respondent attorneys fees in the appeal for the sum of NIS 25000.  The suggested sum of expenses has taken into account the significant sums of expenses that were already awarded against Adidas in the Trial Court.

 

JUSTICE

 

Justice E. Rubinstein

            A.                    After consideration, I concur with the decision of my colleague Justice Hayut. I confess, that I consented after some hesitation, which also found expression in the hearing before us, and having read the decisions of Justice (former title) Grunis in LCA 3217/07 Brill  v. Adidas [ 10  and his decision in LCA 3581/05 Shehana'al Mat'ima v. ADIDAS-SALOMON [9] (not reported).  At a first blush, the shoe produced by Respondent 1 may remind one of the Appellant’s shoes in accordance with a comparison of the pictures in the file. This is the case even without having consideration for the decisions of courts around the world with respect to the Appellant’s trademark. Furthermore, in the matter of Shehana'al Mat'ima [9], Justice Grunis stated that “when examining the existence of a resemblance for purposes infringement of a registered trademark, the comparison must be conducted between the registered mark and the mark alleged to be infringing, and not between the products on which the mark appears” (para. 3).

B.    However, at the end of the day I accept my colleague’s approach, that in our case “one cannot examine the trademarks…. in absolute detachment from the goods on which they appear” (para. 14). However, it would not be amiss to mention (further to the comments of my colleague (ibid), that even the decision in Ta’am Teva [12], which is relied upon in the decision in Shehana'al Mat'ima [9], deals with a phonetic trademark, regarding which there is almost no escape from examining it in detachment from the product to which it relates.

C. In examining the shoe itself, from close up, even though as stated it may be reminiscent of the Appellant’s shoes, it seems doubtful whether anyone would mistakenly think that he was actually holding an “Adidas” shoe, even though it bears a connection of some kind to the Appellant. Indeed, our concern is with stripes, but both on the surface of the shoe in the back and on its tongue, there appears the inscription of “SYDNEY” and inside it too. Furthermore, the price of the shoe is not in the same categories of that of the Appellant’s shoes, and they are evidently intended for a different public, even without giving consideration to broader societal observations, which, with all due respect, I do not agree with in their current form, and which emerged from the decision of the Trial Court.  Against this background, the use of the four stripes pattern would not cause clients coming to buy the shoe, upon taking a second look at the shoe as it is, to mistakenly think that it was one of the Appellant’s shoes (and hence it does not answer the requirement of passing off). There would seem to be no reason for thinking that these clients would think that the Respondent’s shoes, even though featuring stripes, are connected to Appellant (and hence there is no dilution of good will), in as much as the word SYDNEY is embossed on them.

D.   My approach is also based on my colleague’s point of departure with respect to the weak inherent character of the trademark, and her assessment, which I accept, that “It seems difficult to claim that had Adidas not chosen this mark, that no other shoes would have been manufactured with stripes on their sides” (para. 10). This is my position even though I cannot but mention that my assumption is that the respondent did not chose the stripes in vein. In this context one should remember that words of Justice Nethanyahu in the Kalil[11] case:

The registered marks of Kalil (ibid – the stripes on the samples that serve for identification – E.R) are indeed limited to three stripes, but a monopoly on any particular number of stripes would prevent many others from using stripes because of the restriction on the possible number of stripes dictated by the breadth of the profile” (HCJ 144/85 Kalil No-Steal Metals Ltd v. Registrar of Patents and Samples and Trademarks [11] at p. 323)

       This is the rule even though the metal stripes industries is not the same as stripes on shoes in terms of their frequency and their visibility. Examples of stripes on pieces of clothing are at least as old as the Bible, “Now Israel loved Joseph more than all his children, because he was the son of his old age; and he made him a coat of many stripes” (Genesis 37:3. The same is true of Tamar the daughter of David, who, as the practice for daughters of kings, wore a striped coat (11 Samuel 13, 18). Extreme care is therefore required in conferring absolute exclusivity in this context, which may, unintentionally disrupt the delicate balance between the protection of intellectual property and the protection of freedom of occupation and free competition (see my comments in the matter of CA 9191/03 V & section Vin Spirt Aktiebolag v. Absolute Shoes [5]  , at  pp, 877, 884)

E.  After all this, we received the judgment of my colleague, the Deputy President (Ret) Justice E. Rivlin, in which he seeks, in a manner which, undeniably, possesses a certain charm, to broaden the protection in the field of trademarks, by enlisting the grounds of unjust enrichment. In his view, there should be a broadening of the rule determined in ASHIR [1], according to which in a case in which the rules of intellectual property do not apply given the absence of registration, it should be possible to recognize the grounds of unjust enrichment. According to my colleague, in our case the consumer is purchasing an imitation those benefits from the good will of the manufacturer – Adidas, for a cheap price, and the imitator (Respondent 1) benefits from the manufacturer’s efforts without giving consideration. My colleague’s view is that this subject is not adequately regulated in the trademarks law, and a remedy should therefore be granted against the imitation of a registered trade mark. and contrary to the view of the Trial Court enabling the cheap purchase of shoes “that are somewhat reminiscent of Adidas shoes” should not be regarded as a legitimate goal. As mentioned, I am not a partner to the societal conceptions to the extent that they work at Adidas’s expense. However, I am doubtful as to whether the ASHIR [1] rule can be of assistance in the case at hand. The rule is intended for cases in which the laws of intellectual property are inadequate, not because matters of substance but rather because of the absence of registration, and hence a certain protection is offered based on the laws of unjust enrichment. The question however is whether the law provides a protection to a quasi-intellectual property for cases in which the laws of intellectual property were indeed examined, but not infringed, as in the case before us, and where it was unanimously decided that Adidas does not have trademark protection, notwithstanding its registered mark?  In the ASHIR [1]case the imitation was complete and the question was whether the laws of unjust enrichment should apply. However, this did not happen in the case before us. On the level of the desirable law, my heart is with my colleague, the Deputy President. But is this the existing law?  Indeed, the case is not similar to the aforementioned ruling in Absolute [5], which concerned the differentiation between shoes and vodka, whereas our case concerns the difference between one shoe and another. However, my colleague seeks to construct a protection for cases in which the law gives no protection, and in this sense differs from the ASHIR [1] rule, and even, so it would seem, from the minority opinion in that case. Summing up, I am not certain that the grounds of unjust enrichment can supplement the laws of intellectual property in cases in which they do not apply by reason of an internal, substantive reason, and not just because of an external procedural one, such as the absence of registration,  as was the case ASHIR [1]. Even if the notion that my colleague has attempted to develop was commendable on its merits, and even were we to adopt the path of my colleague, is it sufficient to "assume" that Adidas was harmed by the "enrichment".  Perhaps such a case would be governed by what is referred to in Jewish law as "He benefits and he does not lose" (Talmud Bavli, Bava Kamma, 20a). Isn't there a need for a firmer evidentiary basis, showing that the person who purchases a cheaper product of the Respondent would have purchased “Adidas” shoes had he not come across  the Respondent's shoes, or that the good will built up by Adidas is what caused the consumer to buy the Respondent's shoes, even though one look at the name "SYDNEY" suffices to make it clear that that it is not the same shoe.  And at all events, the question is whether, in order to come within the purview of the ASHIR  [1] rule, it is sufficient to prove – assuming that it was actually proved - that the association with the Appellant's shoes is what caught the eye of the consumer.  I am not certain that this is the case. Indeed the question of the slippery slope may arise here, but at the end of the day the solution provided in the domain of trademarks is generally expected to provide the answer, without locking the door upon future development of the law in accordance with the circumstances.

 

JUDGE

 

Deputy President (Ret) E. Rivlin

1.    I have read the judgment of my colleague Justice E. Hayut in depth, and while I share her position regarding the grounds of the infringement of trademark, were my opinion to be heard, we would accept the appeal with respect to the grounds of unjust enrichment.

2.    Trademark law has a dual objective: On the one hand, protection of the consumer against a mistake in the identification and purchase of a product that differs from his original intention; and on the other hand, protection of the manufacturer’s good will and title in the trademark (see for example, LCA 5454/02 Ta'am Teva (1988)  Ltd v. Ambrozia Sofharb Ltd [12] at p. 450). It bears emphasis that the protection of the manufacturer’s property does not just consist of the indirect protection granted to him by the very fact that the consumer seeking to purchase his goods will be able to identify them. The protection of the manufacturer’s interest in the trademark is also a direct one, stemming from its being an independent purpose of the law (and not just a means of protecting the consumer). This direct protection finds expression, for example, in the fact that misleading is not a necessary foundation of the infringement. For example, an infringement under s. 1 (1) of the Trademarks Ordinance [New Version] 5732-1972 is defined as follows:

"infringement means the use by a person not entitled thereto -

(1)  of a registered trademark or of a mark resembling such a trademark in relation to goods in respect of which the trademark is registered or to goods of the same description .... (addition added).

In other words, when use is made of a mark that is identical to a registered trademark (for purposes of goods defined in the aforementioned s. 1 (1)) an infringement occurs even if the infringing use does not mislead the consumers. For example - were shoes to be sold with a trademark identical to the Appellant’s registered trademark, we would not even consider the question of whether there was a danger of misleading potential consumers,  even in the absence of such a danger, i.e. where the consumer had received precise information regarding the identity of the manufacturer on the packaging,  It may be presumed that if the trademark rule was intended exclusively for the protection of the consumers, then the element of misleading would be required as one of the foundations of the grounds of action. In fact, in certain cases protection is given to a trademark even in the absence of misleading, and in such a case the grounds serves primarily for protection of the manufacturer’s title and his goodwill.  In this way, inter alia, the grounds of trademark infringement is distinguished from the tort of passing off. Whereas misleading is one of foundations of the tort of passing off, in the framework of the grounds of trademark infringement, misleading is only relevant for purposes of determining what constitutes a “mark resembling" a registered trademark.   

3.    The examination of the existence of the danger of misleading both in the framework of the grounds of infringement of trademarks and in the framework of the tort of passing off, is done by way the "three part test" expounded upon at length by my colleague, Justice Hayut.   Even so, it was held in the past that the subject to be examined for each of these grounds is different. In the framework of the tort of passing off, the misleading is examined in relation to the entirety of the defendant's acts, whereas with respect to the ground of trademark infringement, the subject of the examination is the marks themselves (see Ta'am Teva [12], at p. 450).  My colleague, Justice E. Hayut opined that in the case before us, the marks should not examined in isolation from the shoes on which they appear, also having consideration for fact that the law according to which the comparison should be between the marks themselves, was formulated in the framework of decisions that concerned phonetic trademarks as opposed to visual ones. I concur with this position, and in fact it flows naturally from the nature of the "three part test". Two of the secondary tests included therein are the test of the "type of customer and class of goods"; and test of the "other relevant circumstances". These tests, as indicated by their names, instruct us to examine the circumstances accompanying the use of the mark. For example, in the matter of Ta'am Teva [12] it was written that:

'Is the phonetic resemblance sufficient to satisfy the requirement of resemblance specified in the definition of "infringement"? This depends on the individual circumstances of each particular case, and the degree of concern about misleading and confusion among the consumers notwithstanding the different appearance of the marks... For this purpose consideration should be given to the methods of marketing, and advertising of the products for  which the trademarks are intended. In this context there must also be an examination of the possible results of the confusion (ibid pp. 455- 456).

       The additional circumstances to be examined are for example: the costs of the products: capacity for discernment on the part of potential customers; and the degree of overlap between the circles of customers for both products.  Indeed, the types of circumstances to be taken into account in the framework of the "three part test" are numerous, a factor which may also be derived from the very existence of a secondary test referred to as "all the other circumstances of the matter").   In practice, this leads to a situation in which within  the framework of the infringement of trademark too, just like in the tort of passing off, the assessment relates to the defendants' conduct in the broad sense, and is not limited to the comparison of the marks themselves (even though the comparison between them continues to be a relevant consideration). It is difficult to say that the entire complex of circumstances is relevant but that the general appearance of the product upon which the mark appears cannot be taken into account. The appearance of the product on which the mark is embedded is certainly closer to the "mark itself " and more influential upon the way it is perceived than, for example, the price of the product or the manner in which it is marketed.  Naturally, the weight attaching to the appearance of the product will change from case to case, and there are cases - for sample in Ta’am Teva [12] in which its importance is minor. All the same, one cannot rule out having reference to general appearance of the product in cases in which such attention is inevitable, such as in the case before us. Accordingly, I concur with the conclusion of my colleague, that in the case before us the marks should not be examined in isolation from the shoes upon which they appear and that the "three way test" leads to the conclusion that there is no confusing similarity (in terms of consumers) between the Respondent's shoes and the registered trademark of the Appellant, and it cannot sue on the grounds of trademark infringement.

4.    Matters differ however with respect to the grounds of unjust enrichment, for which the Appellant has grounds.

In the decision in LCA 5768/94 - ASHIR [1] it was held that there is no impediment in principle to recognition of the grounds of unjust enrichment (which will be hereinafter be referred to for the sake of brevity as: enrichment) in a case in which the laws of intellectual property are also applicable.  In accordance with the criteria outlined there, recognition of these grounds is possible in our case both because the law of trademarks does not establish a negative arrangement in this particular subject and because a right arises under the “internal law” of enrichment.

5.    The matter before us is this. A person wishes to use a mark that resembles (in the regular sense of the word )the registered trademark of another person, in respect of whom it is not disputed that he acquired extensive and significant goodwill.  The consumer prefers the resemblant product over the product that carries the registered trademark. because of the high price of the latter (inter alia due to the good will that he has acquired). In other words: The consumer is aware of the fact that the product that he is purchasing is a copy, and precisely because of that he prefers this product. The imitator and the consumer both benefit from this situation. The imitator benefits from the advantage of selling a product that resembles a well known product in demand and with a brand name, while benefitting from the good will built up by the manufacturer by the investment of effort and resources.  The consumer benefits from an experience that closely resembles that of purchasing a well known product that is in demand, without having to pay a high price for it.  In such a case harm is caused to the manufacturer and to the good will that he created for himself. This harm may take various forms: The imitator enjoys the investment made by the manufacturer in the development and the advertising of the brand-name (one of its expressions being the registered trade mark); the consumers (or at least some of them) would not have been interested in the copy and would not have derived the same amount of pleasure from it were it not for the efforts invested by the manufacturer in the promotion of the original product, but at the same time they pay no consideration to the manufacturer. Presumably at least some of the consumers would have been prepared to purchase the original product for a high price had they not had the possibility of purchasing an imitation at a cheapened price. And finally, the existence of an "imitations market" may, in some of the cases, harm the prestige of the original product and the commercial value of the registered trademark.

6.    Trademarks law today does not regulate this subject -  of imitations purchased by the consumer intentionally and not mistakenly – insofar as it protects against  harm suffered jointly by the manufacturer and the consumer, and not just against harm suffered by the manufacturer, and which the consumer is a party to.   Even more precisely, this is not the regular case in which there are no grounds for trademark infringement given that the resemblance between the products does not reach the level of "confusing similarity". One could argue that indeed there is a confusing similarity, but not with respect to the consumer but rather with respect to third parties who perceive the consumer as having purchased the original product.  The non-applicability of the grounds of trademark infringement in relation to cases of "classic" imitation (in other words products that are clearly an imitation, where even the consumer is aware of their being an imitation) does not reflect a policy decision in accordance with which the "imitations market" is desirable in the legislator’s eyes.   Were this the case it is clear that a complete imitation as well of a trademark would be permitted, provided that it did not involve the misleading of the consumer (this situation can transpire when "external circumstances" such as packaging, price and manner of marketing, indicate that it is an imitation). Our concern is therefore, at the very most, with a lacuna in the law of trademarks. It should further be remembered that this lacuna is the product of the formulation of the law by the courts, who applied the "three part test" for defining an infringement of a trademark by way of a "similar" mark, and it is not necessarily dictated by the language of the law.  The formulation of the law in this manner was not intended in the first place for protection against the "imitations market". Hence for example, the following words were written in relation to this context already about twenty years ago.

'the imitation of a product by another, as such, is not prohibited in Israel for as long as it does not constitute the offense of passing off, or is not contrary to the statutory provisions that protect intellectual property, such as the laws of copyright, trademarks, patents and designs, or any other law.

A separate question is whether the imitation of a product is desirable.... regardless of our position on that question, for as long as the plaintiff has not proved that he has a legal right  that allows him to prevent the copying of his product by another person, this court will not offer him any remedy (comments of Deputy President M. Elon, in CA 18/86 Israel Glass Factories Venice Ltd v. Les Verrcies De Saint Gobain [6 ] at pp. 253-254 ) .

I think that the time has come, following the establishment of the law in the ASHIR [1] case, for the Israeli law to offer a remedy against imitation, at least where it concerns the imitation of a registered trademark, the entire purpose of which is to benefit from the good will of another, when the latter even took the trouble to legally register the trademark that is bearer of good will. I am not a partner to the approach expressed by the District Court, according to which it is a "legitimate goal" to enable one who cannot afford it to purchase Adidas shoes and to  “be able experience the feeling of wearing shoes with four stripes which are somewhat reminiscent of Adidas shoes". This goal is totally illegitimate. The experience of wearing Adidas shoes has no independent value or social benefit other than the value conferred to it by Adidas, and accordingly I do not think that the existence of an imitations market is a positive phenomenon.  It will be clarified that there can be no doubt regarding the tremendous value of competition in the footwear market, so that potential consumers are offered a variety of shoes of a variety of qualities and prices. However, free competition can exist without the abuse of another's person's good will.

7.    It further bears mention that the comments made in C.A. 9191/03 V &S v. Absolute  [5] and which were cited by my colleague in para. 21 of her opinion, do not lead to a different conclusion. In that case the owners of the registered trademark named "absolute" (a category of alcoholic drinks - Vodka and a category of bar-restaurant services) attempted to prevent a network of shoe stores from using the name "absolute shoes".  Their suit was dismissed, primarily due to the fact that the word "absolute" is a descriptive, dictionary word, the use of which cannot be excessively restricted, and its confusion potential when combined with a word from a totally different realm from that of beverages, is particularly low. Accordingly, in that case there were substantive policy considerations that negated the protection of the laws of intellectual property and hence it was not an appropriate case for applying the enrichment laws.  It cannot be argued that the laws of intellectual property did not regulate the subject of using descriptive terms, whether in framework of the same category or other categories, and in that sense "the appellants were able to take the high road of the laws of intellectual property" which if not successful - then "the side road too would not be successful" (ibid at p. 888). The matter before us, on the other hand, has not been substantively regulated in the framework of the laws of intellectual property, and hence it cannot be said that the high road of the laws of intellectual property was open to the Appellants before us.

To sum up: In terms of the laws of intellectual property there is no impediment to the recognition of a grounds of claim based on enrichment in relation to the imitation of a registered trademark regarding which there is no "confusing similarity" insofar as the consumer is aware of its being an imitation.

8.    The next stage is the examination of whether the Appellant has grounds for claim under the laws of enrichment themselves. It is known that this ground has three foundations: the first condition is the existence of enrichment; the second condition is that the enrichment came to the beneficiary from the benefactor; and the third condition is that the enrichment was received by the beneficiary "without legal cause" (see LCA 371/89 Leibovitz v. Etti Eliyahu Ltd  [28] (hereinafter Leibovitz) at p. 321; CA 588/87 Cohen v. Zvi Shemesh [29] at p. 320; FHC 10901/08 Beizman Investments Ltd v. Mishkan Bank Hapoalim Mortgages Ltd [30] para. 34 of Justice  Naor's decision. In the matter of ASHIR [1] it was held that enrichment “without legal cause” for our purposes means enrichment which has "an additional foundation" of inappropriate conduct.  The majority judges were disputed regarding the essence of this foundation but still,  the majority opinion was  that conduct in bad faith or unfair competition would constitute “an additional foundation”  and there were those who were even prepared to suffice with a lower threshold. For a review of the various positions, see ASHIR[1] , at p. 431 (the judgment of Justice Strasbourg-Cohen), at pp. 450, 473-480 (judgment of President A. Barak), at p. 488 (judgment of Justice T.Or), at p. 493 (judgment of Justice Y. Zamir) and p. 499 – 500 judgment of the Deputy President S. Levin).  In CA 2287/11 Shoham Machines and Dies Ltd v. Shmuel Hadar [31] (hereinafter = Hadar)I dwelt on the more specific criteria that had crystallized in relation to the subject considered in ASHIR [1], which concerned the imitation and design of a product that was not registered as a patent or design.  Where a person attempts to copy a trademark that enjoys good will with economic value, with the aim of benefitting from that good will in order to sell his products, following the original manufacturer’s investment of resources and effort in the development of his good will in that mark, while the imitator benefits from them without having been compelled to invest a similar effort – it becomes unfair competition, and in bad faith. I find it difficult to locate a real difference between use of the  trade mark that is actually registered,  regarding which it was explicitly declared that it is an imitation (so that the owner of the registered trademark will merit protection) and the use of a trademark which is highly similar to it, while declaring that it is an imitation (in which case the owner of the registered mark will not be protected by the  trademark rule). The negative element of a complete imitation of a trademark continues to exist even where a minor change was made in that mark).

This is the case before us. The addition of one stripe,  retaining the colors of the registered trademark and using only one color for the stripes, while placing them in the same direction, in the same location on the surface of the shoes and with an identical breadth and distance between them – all amount to a substantial and bad faith resemblance to the registered trademark of the Appellant.  And in fact, the District Court also held that purchasing the Respondent’s shoes serve the consumers’ goal of having “the experience” of wearing shoes similar to those of the Appellant. The shoes in their current form were clearly designed so that they would resemble the Adidas shoes of the Appellant in order to enhance their attractiveness in the eyes of consumers.

9.    The existence of the first two foundations is essentially a question of fact, which must be proved in each and every case. In the case before us the Respondent’s profits from the sale of the shoes (had he been given the opportunity to do so) would have generated enrichment. This enrichment would have been “at the expense” of the Appellant, because presumably the sales of shoes resembling Adidas shoes would be higher than the sales of shoes that are not similar to any known brand. Likewise, it may be presumed that at least some of the consumers of the Respondent’s shoes would have purchased original Adidas shoes had they not had the possibility of purchasing a cheap imitation. The case is similar to the case discussed in the matter of Leibovitz [29], concerning the adjudication of an action brought by a pens distributor against someone who imported the same pens in “parallel import”. In that case it was held that the first two foundations of the grounds of unjust enrichment were satisfied (even though the third foundation was not satisfied):

‘In the circumstances of this case, it may prima facie be presumed that the appellant received a benefit that came to him from the respondents. The benefit consisted of the profits derived by the appellant from the sales of the products under discussion here. By these sales the appellant benefitted from the market created by the respondents for the said products. In that sense, the respondents were the source of the benefit and it can be argued that it “came” from them (see Leibovitz [29], at p. 321).

This is also applicable to the case before us, in which the Respondent is attempting to benefit from the market developed by the Appellant and the good will created for its trademark.

10.  Having reached the conclusion that the Appellant can make a claim on the grounds of unjust enrichment, the question arises regarding the relief to which he is entitled in that framework. It is known that the court has the authority to grant  injunctive relief in the framework of the grounds of unjust enrichment (see CA 347/90 Soda Gal Ltd v Spielman [32], IsrSC 47 (3) at p. 479; ASHIR[1] at p. 484; Harar [31] para. 27 of decision).  In the case before us, the Respondent suggested that the Adidas make certain changes in the shoes by adding a fifth stripe, or adding an X sign on the four stripes.   The introduction of such a change would diminish the resemblance between the mark on the shoe and the trademark of the Appellant. Accordingly, were my opinion to be accepted I would propose the issuing of a permanent injunction that would prohibit the Respondent from marketing or distributing the shoes in dispute, in their current design.  This order will remain in place until one of the changes suggested by the Respondent is done, in which case the shoes will be given to the Respondents. As mentioned, the parties agreed that the storage costs would be imposed upon one of the parties according to the results of the suit, and so, in accordance with my position, it would be proper for these to be imposed on the Respondent. Under these circumstances I would also recommend not making an order for expenses.

                                                                                                       Deputy President (Ret)

It was decided in accordance with the decision of Justice E. Hayut.

Handed down this day, 9th Elul  5772 (27.8.2012)

 

 

Full opinion: 

Doe v. Ministry of Health

Case/docket number: 
HCJ 4077/12
Date Decided: 
Tuesday, February 5, 2013
Decision Type: 
Original
Abstract: 

[This abstract is not part of the Court's opinion and is provided for the reader's convenience. It has been translated from a Hebrew version prepared by Nevo Press Ltd. and is used with its kind permission.]

 

This is a petition against the First and Second Respondents’ decision not to permit the Petitioner (a single woman, born in 1974) to use sperm donations by an anonymous donor (the Third Respondent), which were preserved for her (for a fee). The Petitioner had her first daughter from the Third Respondent’s donation. She is now interested in undergoing an additional insemination process with that same donation in order to ensure a full genetic match between her children. The Respondents’ decision was made in light of the donor’s decision to withdraw his consent and his donation due to changes in his worldview – becoming a “Ba’al Tshuva”, i.e. an observant Jew – so that sperm donations he had made in the past would no longer be used. It should be noted that the consent form sperm donors (currently) sign is silent on a donor’s right to change his mind. The Petitioner argues that the Respondents’ decision to prevent her from using the sperm donations that were preserved for her violates both her constitutional and contractual rights, is unreasonable, and must be overturned. Generally, the Petitioner’s arguments may be divided into two categories – the first, is on the public law level, primarily in terms of violating her right to parent. The second are arguments on the civil law level, including claims stemming from contracts between the parties, property rights and others. The donor claims he has autonomy rights in terms of deciding whether his sperm can be used.

 

The High Court of Justice (in a decision authored by Justice Rubinstein, with Justices Barak-Erez and Amit, concurring) rejected the Petition for the following reasons:

 

Needless to say that the High Court of Justice – as well as the attorney for the Respondents and even the anonymous donor himself – sympathizes with the Petitioner, who wishes that her children, conceived with the help of sperm donations, will carry the same genetic code. However, the donor’s position and his personal autonomy must prevail. As much as we understand the Petitioner’s arguments in terms of civil law, contract law, even in terms of administrative law, and her reliance interest – as values, these cannot dominate over personal autonomy in these circumstances. The donor formed his position as a “Ba’al Tshuva” and it seems his position has a religious aspect. But even absent the religious aspect, one’s position reached thoughtfully – although it did not occur to him in the past when he decided based on whatever considerations to donate sperm – that he does not wish for there to be any additional children in the world whom he did not choose and whose mother he did not choose, with whom he would have no relationship, and whom he would not raise is understandable. This is even if he owes them no duty under existing law (and incidentally, it is possible that under Jewish law, even if they have no right to his support, they may have a right to his estate). The autonomy aspect eclipses other considerations.

 

The right to parent is seemingly a significant value in and of itself, it is natural and primal and holds a top spot on the human list of priorities. This is joined by the autonomy reflected in the personal choices that come along with the right to parent. The right not to parent, on the other hand, does not include a protected independent value, but is designed to protect one’s personal autonomy in electing it (that is, electing not to parent, or not to co-parent with a particular man or woman). It should be noted that even those who support defining this right as merely an interest apparently still view it as one that must be legally protected.

 

However, limiting the Petitioner’s right to be impregnated by a particular person, or her right to a child with a particular genetic background is not a violation of the right to parent. This limit does not reach the core of the right to parent – the actual ability to enter the class of parents – and to bear a child. At most, and this is highly doubtful, this is a limitation at the periphery protected by the right to autonomy (without addressing, at this point, the issue of the scope of this protection, and whether indeed the right was infringed and whether under proper balancing it is worthy of protection).

 

Still, and if presumably according to existing law the donor owes no financial, social or other duties to the child, it is clear that the harm to the donor in terms of genetically parenting additional children against his will constitutes a violation of his autonomy. In this context, it has been pointed out, among others, that the harm to the donor is not merely in inability to choose not to be a father, but also includes his autonomy to decide about his status as a father. In other words, a man who sees his genetic-biological parenthood, or “blood ties”, as creating his moral obligations as a father, suffers injuries to his autonomy both in terms of lack of choice and in terms of failing to fulfill his duties according to his conscience or religious beliefs.

 

This is not to say that in any event a sperm donor’s request not to use his sperm would prevail. The stage in which the request is made is relevant, even crucial. There may be good and weighty reasons not to permit a donor to change his mind and the Court lists these potential considerations (this is not an exhaustive list). Such was the situation in Nachmani, let alone when a pregnancy has already occurred. But outside of such circumstances, the right to change his mind and the violation of his right are weighty and tip the scale in his favor. Indeed, the donor gave consent and accepted payment, but it is not a regular “transaction”, rather an issue that holds strong emotional aspects. The donor’s conscience and feelings are a matter of values and cannot be quantified in the simple legal sense.

 

Even had we assumed that the issue is a violation of the Petitioner’s autonomy to choose whom to parent with, she cannot prevail. This is a choice that needs the cooperation of two (whether within a marriage or other family unit, including – even if with significantly mitigated force – a same-sex family unit requiring a sperm donation) or some third party as a sperm bank, in order to be realized. Of course, these situations may be distinguished, and may under certain circumstances change the outcome, but in this matter there is no justification for the donor’s interest to yield to that of the Petitioner’s.

 

Protection for the Petitioner’s right to have children of the same genetic code ends where it clearly conflicts with the donor’s rights. In a regime of relative rights, there is no right that affords its holder absolute supremacy in its exercise. Therefore, the obvious interests at the basis of the Petitioner’s claims succumb to the donor’s right to autonomy.

 

Even had we assumed, for argument’s sake, that the Petitioner’s right to autonomy is violated, and Justice Rubinstein does not believe it was – in any event, not to a great extent – as distinguished from Nachmani, the conflict and determination here concerns the Petitioner’s right to autonomy in the face of the donor’s right to autonomy. In the conflict between these two autonomy rights is seems the donor should prevail because, from his perspective, we are dealing with “active” law – a use of his sperm, while for the Petitioner this is “passive” law – preventing the use of the donor’s sperm.

 

Before concluding, Justice Rubinstein briefly adds Jewish law’s perspective on the issue of sperm donation and the status of the donor. This analysis demonstrates that applying the law and principles mentioned above lead to the same outcome under contract law as well. Among others, Justice Rubinstein emphasized that the option of withdrawing a donation does not constitute a donor’s “veto right” at every point in the process. The point of no return, where the balance of rights and interests shifts and the donor loses the legal possibility of terminating the contract and withdraw his donation, may change according to various considerations. In our case, several considerations lead to accepting the donor’s withdrawal of consent, particularly a lack of any physiological link between the donation and the Petitioner at this stage.

 

The primary concern arising from this matter is the harm to the stability of sperm banks in Israel by permitting carte blanche to donors who may wish to pull their donations. The concern is that beneficiaries of donations, such as the Petitioner, who have requested that a specific sperm bank preserve additional donations for them, would discover this option is no longer guaranteed. The stability of this institution is a human and public interest of the highest order. The uncertainty that exists as a result of the tenuous statutory regulation, harms, from the outset, the public’s possibility to rely on sperm donations. The cure for this is in the legislature’s hands.

 

In the interim, and as a temporary measure, the Petitioners ought to amend donors’ and beneficiaries’ consent forms to ensure that all the parties involved know and understand their rights. As long as legislation that regulates and defines the possibility of a donor to withdraw consent is lacking, sperm banks must accurately present to beneficiaries the legal context in order not to guarantee what may not be realized.

 

Finally, the decision to donate sperm must be a result of deep thought and consideration. Donors must know that their informed consent to give sperm to another is relied upon by others who seek to plan their lives and produce offspring. This however, is not a decision that can be taken back easily, and the ability of withdrawing consent is in any event not guaranteed. It is contingent upon the stage of the process, that in the absent of a comprehensive statutory regime, is subject to the considerations detailed in the opinion.

 

Justice Barak-Erez joins the crux of the conclusions, and adds her position regarding some of the rationales behind them. Justice Amit also joins the outcome, though in his opinion, in the conflict between the Petitioner and the donor through the lens of civil law alone, the Petitioner must presumably prevail. (The choice whether to opt for applying only civil law depends on the value-based issue of the weight we are willing to attribute to the sperm’s uniqueness as “property”.)

 

Voting Justices: 
Primary Author
majority opinion
Author
concurrence
Author
concurrence
Full text of the opinion: 

At the Supreme Court sitting as the High Court of Justice

 

HCJ 4077/12

                       

Before:                                                            The Honorable Justice E. Rubinstein

The Honorable Justice I. Amit

The Honorable Justice D. Barak-Erez

 

The Petitioner:                                     Jane Doe

                                               

V e r s u s

 

The Respondents:                               1. The Ministry of Health

2. The Sperm Bank – In Vitro Fertilization Unit Rambam Medical Center

3. John Doe

 

Petition to grant an order nisi and an interim order

 

Date of Hearing:                                  Heshvan 29, 5773       (November 14, 2012)

 

On behalf of the Petitioner:                Adv. Gali Nagdai

 

On behalf of the Respondents:           Adv. Danna Bricksman

 

Judgment

 

Justice E. Rubinstein:

 

  1. The petition before us concerns an apparently precedential case of the request of a sperm donor, John Doe (Respondent 3), to retract his consent and donation due to changes that have occurred in his world view; such being subsequent to the Petitioner having her first-born daughter by his sperm donation, and being presently interested in undergoing another insemination procedure by the same donation, in order to maintain full identity of the genetic constitution of her children. The Petitioner seeks to receive the donor's additional sperm donation, which is stored at the sperm bank. The position of Respondents 1-2 is that there is no justification to allow this. We are concerned with an issue of a sort unimagined by our forefathers, which was impossible several decades ago, and which developments in medicine and technology have created.

 

  1. The "genetic era" and the increasing use in recent decades of artificial reproductive techniques, have brought a real blessing to many who would have remained childless "in the old world"; reality has changed immeasurably, and technology presently enables many of those whose path to parenthood was previously blocked, to bring children into the world and have a family. This is one of the dramatic developments, which creates a new social and legal reality, and gives rise to complex and sensitive human questions. The

 

legal world has not yet had the time to properly address these issues, and it falters behind them, as it does following the other dramas of the superior technology era. This was described nearly two decades ago by author Y. Green (In Vitro Fertilization through the Prism of Consent (1995)):

 

"The longing for a child is common knowledge that requires no proof. Spouses, who experience difficulties in having children, make and will make any effort in order to be blessed with children: emotional, physical and financial. They are also willing to 'sign' any undertaking, provided that their heart's desire is fulfilled. Medical technology in the fertility field has developed at an incredible pace in recent years. Solutions, which were considered science fiction only a few years ago, are slowly becoming an almost daily reality. There is a great blessing alongside this development, which grants more and more couples of various degrees of infertility a chance to expand the family. However, as chances increase and the potential of being blessed with children increases, so increases the risk involved in the various stages of the process, both to those born (sic.) and to the infant to be born in this way" (ibid, p. 9).

 

Before us is a chapter in this complex whole, on an unfinished road, and we will clearly not attempt – nor need we in this case – to encompass the full human issue, nor the legal one, relating to parenthood in the modern era; as we shall hereinafter see, this issue may be reviewed through the prism of more than one family of law, but none is exhaustive. As President Shamgar (Retired) stressed already at the outset:

 

"Any conversation with respect to issues of birth affairs is, by nature, pretentious and stirs oversensitivity. It is pretentious – since before us are complex and multifaceted issues, the legal aspect of which is unable to exhaust their nature and description. There is a kaleidoscope of elements here, which are anchored in various disciplines, medical, philosophical, theological and social, which do not fit within the standard legal compartmentalization and are not fully exhausted by the employment of legal criteria alone. Thus, in such areas, cautious legal treading is suitable… These issues evoke oversensitivity, because they directly touch on the exposed nerve of existence. Although the vast majority of legal issues of various types are taken, by mere nature, from life, there are issues that attack the problematic nature of our human existence head-on, at the core, rather than indirectly…" (President Meir Shamgar "Issues on Matters of Fertilization and Birth" 39(a) HaPraklit 21 (1989).

 

  1. This is also the case before us, and therefore we shall guide ourselves with this advice before we embark on the journey. This is the order of the discussion: firstly, we shall briefly address the normative framework concerned, the factual background of the case and the parties' claims; we shall examine the nature of the right to parenthood, and we shall examine the standing of the Petitioner vis-à-vis the standing of the donor, who asserts autonomy in deciding the use of his sperm, in view of this right. We shall thereafter briefly address additional aspects of the issue, and mainly the contractual regulation of sperm donation. Finally, we shall articulate the evident need, in this case, for the in-principle regulation of the entire field by the legislator.

 

  1. We shall forerun and state the principal part of our ruling. Needless to say, we feel – as does the attorney for the Respondents and even the anonymous donor himself – human sympathy for the Petitioner, who requests that her children by a sperm donation carry an identical genetic constitution, which apparently proved successful – thank God – with her first-born daughter. However, we have come to the conclusion that precedence should be afforded to the donor's position and to his personal autonomy. With all due understanding of the Petitioner's claims in the field of private law, contract law and even in the field of administrative law, with respect to the reliance interest – these do not amount in value to the dominancy of the aspect of personal autonomy under the circumstances of the case. The donor has formed his position, according to what he stated orally (his written response is more general) as a penitent (Chozer B'Tshuva), and it appears that there is also a religious facet to his position. However, even without such facet, one can understand the position of a person who, after reflection, reached the conclusion – which had not occurred to him in the past, when deciding to donate sperm for such or other considerations – that he no longer wants there to be children by his sperm in the world, whom he did not choose and whose mother [he did not choose], with whom he has no relation and who will not be raised by him; it being [the case] even if he is not liable to them under the presently practiced law (and incidentally, there is a possibility that under Hebrew law, even if they are not entitled to child support from him, they are entitled to inherit him). In our opinion, the autonomy aspect overshadows the other considerations, as we shall explain below.

 

The Normative Framework

 

  1. Sperm donation and the management of sperm banks in Israel are currently not regulated by primary legislation, but rather by the Public Health  (Sperm Bank) Regulations, 5739-1979 (the "Regulations") and circulars of the Director General of the Ministry of Health, which are issued thereunder (these regulations were promulgated by the Minister of Health by virtue of the Consumer Services Act (Sperm Bank and Artificial Insemination), 5739-1979; for criticism, see Pinhas Shifman "Determination of the Paternity of a Child Born by Artificial Insemination", 10 Mishpatim 63, 85 (1980); further see (in respect of the status of administrative directives) Yoav Dotan Administrative Directives (1996), 27-39). The last Director General Circular, of May 22, 2008, entered into effect on January 1, 2009, and is the principal part of the normative basis, on the administrative directives' level, for our discussion at this point. The Director General Circular mainly regulates the conditions for recognition of a sperm bank and prescribes rules with respect to the retention of information regarding sperm units and donors – a problematic issue in and of itself, as we shall briefly mention hereinafter. The Director General Circular also defines the procedure required both of the donor and of the recipient of the donation.

 

  1. The donor, alongside whose donation there is a certain financial benefit, fills out a "Donor Card" form (Exhibit B to the Respondents' response), which requires general details, including name, identity number, a general description of appearance, and data regarding physical examinations, which are intended to negate the existence of illnesses in his body. The donor also fills-out a "Consent of a Sperm Donor" form (Exhibit C to the Respondents' response), in which he declares by his signature as follows:

 

"I agree to donate of my sperm for use thereof for the artificial insemination of women or for research purposes, according to the considerations of the sperm bank. I hereby agree and declare that I will not be entitled to receive any details of the identity of the women, and their identity shall remain confidential. Furthermore, my name and my identity or any detail about me will not be provided to any person and will also remain confidential, except for a cross-check of these data with a center for national donor registration and national registration of persons ineligible to marry".

 

This statement is required under Section 25(e) of the Director General Circular, which determines that "[T]he sperm of a donor shall not be taken nor received nor used for artificial insemination, unless the donor shall have given his consent to the use of the sperm" (emphasis added - E.R.). The donor also states that he is willing to undergo medical examinations and that to the best of his knowledge he is not suffering from an illness or family history, which might disqualify his donation. The forms do not address the issue of consent withdrawal or additional issues such as a quantitative limit of the possible amount of inseminations by the donation (such as inseminations that produced a pregnancy, as distinguished from unsuccessful attempts).

 

  1. A similar personal data card is filled-out by the recipient of the donation (Exhibit D of the Respondents' response), which one of two consent forms is added to, in accordance with her family status: one consent form for spouses, and another consent form for a single mother [who is] a "single woman" (Exhibit E-1 and Exhibit E-2 to the Respondents' response). The second form, which is the one relevant to the case at hand, mainly includes a statement as to the explanation the recipient of the donation received with respect to complications and side effects (and a waiver of future claims in respect of such matters), and as to the practical prospects of impregnation as a result of the insemination. As pertains to the sperm and the donor, the recipient of the donation states as follows:

 

"I consent that the donor or donors of the sperm that will be used in the insemination, or the sperm itself, be chosen by the physician and according to his discretion and with his consent and I will not be allowed to know the identity of the person whose sperm is used, or his attributes, or any other detail related to him or to his family" (emphasis added – E.R.).

 

  1. As we can see, the only documents that include the parties' consent, each separately, do not address the issue of donation withdrawal at all. These matters were presented somewhat in length, since, in the situation before us – a ruling on which is "the lesser of two evils", and involves a measure of harm to one of the parties – it is appropriate to examine how to avoid such situations in the future, rather than merely how the current situation will be resolved.

 

The Case At Bar

 

  1. The Petitioner is a single woman, born in 1974, holding Israeli and American citizenships, and a resident of the Unites States for the past 17 years. In 2010, the Petitioner's first-born daughter was born via fertilization treatments, during which use was made of the sperm donation of an anonymous unknown donor (Respondent 3, hereinafter the "Donor"), which the Petitioner received from the sperm bank at the Rambam Medical Center in Haifa (Respondent 2, hereinafter: the "Sperm Bank"), which is under the supervision of Respondent 1 (hereinafter: the "State"). Following the birth of her first daughter, the Petitioner purchased - apparently at the first opportunity she had – the option to use five additional sperm units of the Donor, to be kept at the Sperm Bank for an annual fee. For this purpose, the Petitioner filled out a sperm reservation form and paid the required amount. It was stated on this form that:

 

"The sperm bank undertakes to use its best efforts to keep these sperm units, but will not be responsible in any manner for a loss, harm or other use of these sperm units" (emphasis added – E.R.; Res/3).

 

  1. On December 1, 2011, the Sperm Bank received a letter from the Donor, in which he stated his wish that use of the sperm donation that he had made in the past be discontinued, among other things, in view of a change in his lifestyle (Res/4); following is his letter verbatim:

 

"My name is ________, in the past I was a sperm provider to the sperm bank managed by you and I ceased this activity several years ago.

Due to a change in my lifestyle, use of my sperm by the sperm bank at the present and future time raises a problem for me. I approached you several months ago with a request to cease use of my sperm. At first I was told that I had no right or say on the matter, and afterwards it was said that in any event the use of my sperm had already been discontinued, so that there was no problem.

After a medical-legal inquiry, it was clarified to me that I have a veto right on the matter, despite the contract between us.

My request to you is a formal letter of statement that no use is presently made nor will it be made in the future by the entity managed by you (the sperm bank)".

 

Following this letter, the Bank notified the Petitioner (on January 10, 2012), that she would no longer be able to use this sperm donation. Subsequently and in view of the Petitioner's appeals to the Bank's manager, the Bank's manager contacted the legal advisor to the Ministry of Health and forwarded the reply of the legal office to the Petitioner, whereby "[A] consent which is unlimited in time is not "everlasting" and the sperm donor who previously agreed to donate his sperm may recant at any time [so long] as "irreversible reality" has not been created". It was stated that under the facts of the case, such a reality had not been created, and it was assured that the money that had been paid for reservation of the sperm units would be refunded (letter of January 11, 2012 by Dr. A. Leitman, Manager of the Sperm Bank; Res/5). The Petitioner requested not to destroy the donation and to allow her to exhaust the legal avenues; the Sperm Bank's manager accepted her request.

 

The Petition

 

  1. On May 22, 2012, the present petition was filed claiming that the Respondents' decision to prevent the Petitioner from using the sperm units that had been saved for her infringes upon her constitutional and contractual rights, is unreasonable and should be annulled. The Petitioner's claims may be separated, in general and for the sake of discussion, into two levels. The first, claims on the level of public law, and mainly the impingement on her right to parenthood. The second, on the level of civil law, rights by virtue of a contract between the parties, by virtue of proprietary ownership and more.

 

First Level – the Right to Parenthood

 

  1. The Petitioner claims that there is presently no dispute as to the standing and importance of the right to parenthood, a "fundamental human right which every person is entitled to", a natural right which is established in Basic Law: Human Dignity and Liberty; hence, this right may be limited – as argued – only under the conditions of the Limitation Clause (to substantiate her position, the Petitioner referred to the rulings of this court in CA 451/88 John Does vs. the State of Israel, IsrSC 44(1), 337 (1990); in CFH 2401/95 Nachmani vs. Nachmani, IsrSC 50(4) 661 (1996); in HCJ 2458/01 New Family vs. the Committee for Approval of Embryo Carrying Agreements, the Ministry of Health, IsrSC 57(1) 419 (2002)). The Respondents' decision impinges – so it is mentioned – on her right, since following the birth of her first-born daughter it may "seal the Petitioner's fate, remaining a mother of a single child only, and forgoing her wish to have the family she was hoping to have" (Paragraph 21 of the Petition).

 

  1. Moreover, per the Petitioner's position, there is a parallel infringement upon her right to a family, another derivative of the protection of human dignity and the autonomy of individual will. To her mind, this right has a higher status than the other constitutional human rights, such as the right to property and to freedom of occupation. Furthermore, beyond the infringement on her constitutional rights – so it is argued – the Respondents' decision is marred by unreasonableness, and is therefore void ab initio. It is further argued that the Respondents' decision impinges upon her daughter's rights to siblings in general, and to biological siblings in particular.

 

Second Level – Contractual and Other Causes

 

  1. The Petitioner also claims that the Donor gave his consent to use of his sperm – informed consent; and therefore his present request to prohibit the use of his sperm constitutes a breach of contract, both vis-à-vis the State and the Sperm Bank, and vis-à-vis herself, as a third party to the contract. Moreover, the State and the Bank are themselves in breach of the contract they entered with the Petitioner: the Petitioner fulfilled the procedure determined thereby as required; she gave financial consideration for the sperm units. As stated, at no stage of the proceedings was the possibility of the Donor withdrawing his consent raised before her. Since the Petitioner relied on this representation (in view of the manner of presentation of the sperm donation by the State and the Director General Circular) and chose to bring her first born daughter into the world from the Donor's donation, it may no longer be said, per her position, that an "irreversible reality" has not been created. It is difficult – so it is argued – to assume that the Petitioner would have consented to undergo the insemination process knowing that the Donor might change his mind at any time. It is further argued that the Donor sold his sperm, and therefore cannot retroactively demand that no use be made of the donation without cause under law, like any other sale contract that confers ownership upon the purchaser.

 

  1. The Petitioner also claimed that a change in the circumstances of the Donor's life may not serve as cause for his retraction of the consent, and the reversal of the Respondents' decision does not constitute an impingement on the best interests of the child or on public policy. It was further argued that the damage to be caused to the Petitioner as a result of the upholding of the Respondents' decision is disproportionate; it is argued that the Petitioner's time to undergo another fertilization is running out, beyond the fact that the mere impediment to having additional children who have the same genetic constitution, as aforesaid, might prevent her from having more children. Conversely – it is so claimed – the Donor "has finished his part", and no cooperation is required of him for the purpose of continuing the process; he is not the parent of the child to be born, and therefore this does not involve the coercion of parenthood; his right to personal autonomy is thus not violated.

 

  1. It is finally argued that upholding the Respondents' decision will have severe across-the-board implications on sperm recipients of donations in Israel. The donor's option to retract his consent at any time creates uncertainty in the planning of a future family, as it leaves the recipients of donations under the shadow of the "concern that the donor they chose will change his mind". This compromises the ability to plan a family according to the circumstances of every woman's life and wishes. This might – as asserted – lead to many donors withdrawing their consent, and gravely harm sperm banks in Israel and their stability. In order not to render the Petition redundant, an interim order has been sought to order the Respondents to prevent the disposal of the donation until the Petition is decided.

 

The Response of the Respondents and the Hearing before us

 

  1. On July 10, 2012, the State's response was filed, which argued that indeed it is undisputed that the core of the right to parenthood and the right to family gives rise to a protected constitutional right deriving from the right to dignity, and established in Basic Law: Human Dignity and Liberty. However, the case at bar does not concern the exercise of the right to parenthood, but rather the right to birth children who are full biological siblings, and the right of a child to a sibling or a full biological sibling; these rights do not exist in law, and therefore the Petitioner cannot point to an infringement on her constitutional rights. The State emphasizes that the Petitioner's aspiration is understandable in and of itself, yet under the circumstances of the matter – even if the Petitioner's position is accepted as to the infringement on the rights conferred upon her – her right is outweighed by the right of the Donor not to be a biological parent against his will. It is argued that, although in re Nachmani it was decided to hold the right to parenthood superior to the right not to be a parent, the factual situation in that case was such that Ms. Nachmani no longer had the option of being impregnated by other sperm, i.e., a situation of the absence of a possibility of biological parenthood other than by means of Mr. Nachmani's sperm. This is not – so it is argued – the situation at hand, and the Petitioner has other options for exercising her right to parenthood. Furthermore, the Petitioner has no "biological link" to the sperm contemplated in the Petition, as was the case in re Nachmani (which, as may be recalled, concerned fertilized ova) – and a fertilization process has not commenced in the case at hand.

 

  1. With respect to the second level of arguments, it is maintained that although the Sperm Bank offers recipients of donations a same-donor sperm storage service (for a fee), such storage, at most, creates "a priority" over other recipients of donations; such storage does not ensure use of the sperm, nor does it obligate the sperm donor or the bank to make use of the sperm in circumstances where this is impossible. It is further asserted that the Petitioner cannot claim that had she been aware that the Donor may retract his consent she would have used other sperm, because this right is available to each one of the sperm donors, whoever they are, so long as no irreversible reality has been created. It is emphasized that in the consent form that the Petitioner signed, it was clarified that the choice of sperm is ultimately entrusted to the physician according to his discretion; that is to say, the choice is subject to the discretion of the representative of the sperm bank from the outset, and is not guaranteed to the recipient of the donation in advance. On the contractual level, it is argued that a contract whose expiration date has not been determined is not in force and effect forever and ever, and after a reasonable time, in the framework of the duty of good faith, a party to the contract may – so it is claimed – notify the other party of his intention to be released from the contract; such – in view of the elapse of time and change of circumstance.

 

  1. To reinforce its position, the State sought to draw an analogy from the Ova Donation Law, 5770-2010, which expressly regulates the option of an ovum donor to withdraw her consent "at any time prior to the performance of the act, which she agreed to designate the ova retrieved from her body to, and in respect of consent to designate ova for implantation – at any time prior to the fertilization of the ova" (Section 44 of the Ova Donation Law). It is also claimed that a similar analogy may be drawn from the Patient's Rights Law, 5756-1996, which prescribes that the patient's consent is required not only at the medical treatment stage, but throughout the continued treatment in its entirety (Section 13(a) of the Patient's Rights Law). According to the State's position, it emerges from these two laws that the legislator adopted an approach whereby infringement upon a person's right to autonomy is only merited in rare events of concern of grave danger, or at the stage of "irreversible reality"; this is not the case in the matter at hand. It was agreed that an interim order be issued, which prevents the disposal of the sperm donation until the court rules on the Petition. It was also requested that the Donor be joined as a respondent in the Petition, as the person whose rights might be compromised as a result of the Petition.

 

  1. The Donor, who was joined in as a respondent, had been requested to provide his response to the Petition (the decision of Justice Solberg of July 13, 2012, in which the interim order in consent was issued, as well as aforesaid), and after numerous attempts and efforts by the Sperm Bank's manager his response was received. At first, the Donor had notified the Sperm Bank's manager that he was willing to meet outside hospital grounds, in order to refrain from exposure "due to his current situation as a penitent", but failed to hold the appointment (notice by the State of August 15, 2012). Following the decision of November 6, 2012 (toward the hearing), in which the Donor's position had been requested once more, and it had been stated that if such response is not presented, "the court may consider this conduct in his ruling, without, of course, expressing an opinion as of this time", the Donor provided his position. In a letter of November 13, 2012, the Donor noted that, at the time of the donation "I had considered the act an ideal thing for childless women, and I am not playing innocent here, the money given was also a motive, but the desire to do good was the main thing"; however, "Afterwards, I changed my lifestyle and beliefs. The aforesaid act is presently incompatible with my world view, and in my opinion, the damage it holds is greater than the benefit, both to me, to my relatives, and to the woman who is the recipient of the donation and her children who are born by the sperm of a stranger". The Donor expressed his sympathy for the Petitioner's wishes, he also explained that since providing the donation, he got married and had a son; he is not interested in adding injury to his wife and hurting his children by adding a terrible uncertainty to their lives, "in the knowledge that they have siblings they do not know"; and it was further stated: "I am not interested in having a child born by me, without me being able to give him love, and without me loving his mother". At the bottom line, the Donor requested that use no longer be made of his sperm and expressed his apologies to the Petitioner for all the sorrow he had caused her as a result of these proceedings.

 

  1. In the hearing before us, on November 14, 2012, the Petitioner's attorney reiterated her arguments with respect to the infringement on her right to parenthood and her reliance on the representation before her. At the same time, the State's attorney reiterated the difficulty in recognizing the Petitioner's right, and asserted the need to regulate the area through primary legislation.

 

 

Ruling

 

  1. We are not dealing with a binary decision between "good and bad", or between right and wrong – both of the parties before us are "right" from their subjective point of view; we are dealing with human emotions of the both of them, and as pertains to the Donor – also internal feelings that derive from a current viewpoint. I believe that our decision must reflect the weight of the values of the law in a proportionate manner; there is no illegitimate position before us, as stressed by Justice (his former title) Witkon a long time ago:

 

"As with most problems of law and of life in general, it is not the choice between good and bad that makes the decision difficult for us. The difficulty lies in the choice between various considerations, all of which are good and worthy of attention, yet in contradiction with one another, and we are required to determine the order of priority among them" (CA 461/62 Zim Israel Navigation Company Ltd. vs. Maziar, IsrSC 17(2)1319, 1337 (1963)).

 

Such is also the case before us. It does not concern the elimination of one of the interests that lie in the balance, but rather the relative preference of one over the other. As we have noted at the outset, this case raises questions of numerous fields of law. The issue may be looked at through the prism of contract law, property law, and, naturally, from the angle of administrative law. Each one of these perspectives may serve as fruitful grounds for a rich and innovative discussion. However, I believe that, at the end of the day, the most appropriate and correct perspective for a ruling on the issue is through the right to dignity and autonomy conferred upon any person to tell the story of his life, as we shall see below. Therefore, the discussion will principally revolve around this angle of the subject, yet, as aforesaid, we shall also address some of the claims raised by the parties on the other levels of discussion. We shall already state at this point that it is worthy to once more call upon the legislator to regulate the issue through primary legislation.

 

Preface – Of Interests and Rights

 

  1. Legal reality often summons a fundamental contest between various legitimate considerations and values; obviously, such cases raise uncertainties and the need for an objective outline, to the greatest possible extent, of the craft of ascribing priority among them. Not every interest is protected by the law, and it depends upon circumstances even where a fundamental legal right has been recognized by law (of the classification of interests as rights, see HCJ 1514/01 Gur Aryeh vs. Second Television and Radio Authority, IsrLR 267, 275 (2001), in the judgment of President Barak, and compare to the dissenting opinion of Justice Dorner, ibid, p. 284; HCJ 6126/94 Senesh vs. the Chairman of the Broadcasting Authority, IsrSC 53(3)817 (1994); Oren Gazal Ayal and Amnon Reichman, "Public Interests as Human Rights", 41 Mishpatim 97 (5771)). Thus – for example – freedom of speech, which is recognized as a fundamental right in our legal system (HCJ 806/88 Universal City Studios vs. Films and Plays Censorship Board, IsrSC43(2)22 (1989)), receives legal protection on the political level, as the core of the right, but will not necessarily receive a similar protection on the level at the distant periphery of the recognized right, which collides with other interests; the farther you go from the core of the recognized right, so it is possible that under certain circumstances a certain act will not fall within the protection of the law. The question is thus twofold: whether the act falls under the definition of the fundamental right, and whether, under the circumstances, it is protected by the law, after the balance against other interests and rights (see ibid, p. 33-34, President Barak). In order to complete the picture, we shall note that the classification of the considerations at stake as rights or as interests defines the formula of the balance between them, and the normative superiority of one value over the other or their equal value (see Re Gur Aryeh, p. 284); however, the mere classification and the balancing manner ("horizontal" or "vertical") do not necessarily decide the concrete question before the court, since a weighty interest in vertical balancing, such as the interest of the security of the State and the public, may prevail in certain cases over a fundamental right (see HCJ 7052/03 Adalah – the Legal Center for Arab Minority Rights in Israel vs. Minister of the Interior, [2006](1) IsrLR 202, 339 - President Barak; and compare with the position of former Deputy President Cheshin, p. 457-459, and the position of Justice (his former title) Rivlin, p. 555-559 (2006)).

 

  1. The tough question – which was raised in re Nachmani under the special circumstances thereof – with respect to the classification of the right to parenthood against the right not to be a parent and the normative status of the one against the other, is not raised in the case at bar; because, as we shall see, harm to the core of the right to parenthood has not been proven, and, in fact, if harm has taken place in the matter at hand, it pertains to the right to autonomy; in this situation again, at most the issue concerns the right of the Donor to autonomy against the right of the Petitioner to autonomy, all as shall be specified below.

 

Of the Right to Parenthood

 

  1. Indeed, on the one hand, the Petitioner stands before us with her heart's desire to bring into the world another child from the Donor's donation, having full genetic siblinghood with her daughter. On the other hand, there is the Donor, who asks to prevent further use of the sperm donation he made in the past, and prevent an insemination process, that would make him, against his will, a genetic father to at least one more child, even if without ties with the child and obligations to him. Justice Strasberg-Cohen described this in re Nachmani as two sides of the same coin (see re Nachmani, p. 682), yet, according to her statements as well, a mixture of interests lies at the balance, and even if these interests may be referred to under the general term of right to parenthood and the right no to be a parent, this matter is not thereby exhausted; see the essay of the scholar Daphne Barak-Erez, "Of Symmetry and Neutrality: Reflections on the Nachmani Case", Iyunei Mishpat, 20(1)197, 198 (5756). I shall note already at this point that I do not believe that this case requires legal innovation with respect to the right to parenthood and the right not to be a parent, since the Petitioner's right to parenthood is undisputed, and the question is whether one should recognize the interest of parenthood necessarily by the sperm of the specific donor, as protected under one of these rights.

 

  1. Indeed, despite the different reasoning in re Nachmani and the disagreement between the members of the panel, including among the justices of the majority, it appears that there is presently no longer a dispute with respect to the status in-principle of the right to parenthood – and this is true also in the case at bar. In other cases as well, the perception that the natural right to parenthood is conferred upon every person has been established, as emphasized in CFH 7015/94 the Attorney General vs. Jane Doe, IsrSC 50(1)48, 102:

 

"It is the law of nature that a mother and father will naturally hold their son, raise him, love him and see to his needs until he grows and becomes a man. This is the instinct of existence and survival in us – 'the call of blood', the ancient longing of a mother to her child – and it is common to man, beast and bird. 'Even sea-monsters [jackals – M.C.] offer their breast and nurse their young' (the Book of Lamentations, 4:3)…this tie is stronger than anything, and is beyond society, religion and state…the law of the state did not create the rights of parents toward their children and toward the entire world. The law of the state addresses something already made, it aims to protect an inborn instinct within us, and it transforms an 'interest' of parents to a 'right' under law, to the rights of parents to hold their children" (Justice (his former title) M. Cheshin).

 

            And elsewhere, Justice Cheshin emphasized:

 

"The State argues and maintains as follows: a woman does not have the "right" to surrogacy; it is as though the issue of surrogacy is 'off-limits' and therefore a discrimination argument is an unmerited argument. According to this claim, because a woman is not entitled, ex hypothesi, to need a surrogacy process, a woman's claim of discrimination will consequently not be heard …I have found this argument difficult to comprehend…undoubtedly, the argument of a 'right' under law is a misplaced argument, certainly after the Surrogacy Law, which regulates the issue of surrogacy as it does. Whereas prior to the Law (and the regulations that preceded it), and there being no prohibition on surrogacy, one might argue that a woman, any woman, did have, a 'right' to surrogacy. In any event, the argument of a right to surrogacy is not to the point, yet, the main thing is that the 'right' we speak of – the right to parenthood – is a right that nature brings to us; it is of this right that we speak, not of the right to surrogacy by law (HCJ New Family, p. 445; emphasis added – E.R.).

 

  1. These words are also relevant to the matter at hand (also see HCJ 2245/06 Dovrin vs. the Israel Prison Service (June 13, 2006): "Family and parenthood are the consummation of the natural urge for the continuity of generations and the self-fulfillment of the individual in society"; ibid, paragraph 12 – Justice Procaccia). It is only natural that we mention at this point, that one of the first and foremost commandments is "[B]e fruitful and multiply and fill the earth" (Genesis, 1:28). And this is a deep aspiration, not to be taken lightly. Rachel says to Jacob (Genesis, 30: 1) "[G]ive me children, or else I die". The longing of the mothers, Sara, Rebecca and Rachel, and Hanna, the mother of Samuel, as well as the mother of Samson, all of these are documented in the Bible. The divine promise is " [T]here shall be no male or female barren among you..." (Deuteronomy, 7:14). The visitation of barren women is entrusted to the Almighty and to the righteous (Genesis Rabbah, 77), but the key of birth ("key of life" – "Maftea'ch shel Haya") is not entrusted to an agent and remains in the hands of the Almighty (Babylonian Ta'anit 2, 1-2); see also the ethics book Messillat Yesharim [lit. "Path of the Upright"] by the RaMHaL (Rabbi Moshe Haim Luzzato), the Sanctity chapter. Indeed, in any situation in which the person claiming a right to parenthood requires the approval of use of a new technology in order to enter the world of parenthood, a claim may be voiced that such person does not "hold the right to a particular treatment", he does not hold the right to insemination treatments, to surrogacy and the like. However, the core of the right to parenthood is the practical ability to bring children into the world. Just as the State does not require a "parenting license", so it may not prejudice a person's right to parenthood without weighty pertinent reasons (see CA 413/80 Jane Doe vs. John Doe, IsrSC 35(3)57, 81-82 (1981)). In such situations, wherein a person requires a certain medical treatment in order to be included in the parent circle, non-administration of the treatment infringes upon his right. Naturally, the right to parenthood is also relative, but there can be no dispute that in such cases there is a concrete infringement on the protected interest.

 

  1. I shall briefly address the classification of the right to parenthood (also see the words of Justice Goldberg, re Nachmani, p. 723-724). This point was extensively articulated by Justice Strasberg-Cohen (in a dissenting opinion) in re Nachmani:

 

"The classification of norms that regulate activity in relationships between man and his fellowman has occupied more than a few legal scholars and academics of various fields…legal rights in their strictest sense are the interests that the law protects by imposing duties on others in respect thereof. Conversely, legal rights, in their broadest sense, also include interests that are recognized by the law, against which there is no legal duty. These are liberties…Where a person has a right, which is a liberty or permission, he is under no duty toward the State or toward another to refrain from committing the act, just as he is under no duty to commit the act, which he is at liberty not to commit. A right, which is a freedom or a liberty, does not hold the power to impose a duty on another and to demand that he commit an act, which he is free not to commit…

 

The right to be a parent is, by its very nature, essence and characteristics, a natural, innate right, inherent to human beings. It is a liberty against which there is no legal duty, neither in the relationship between the State and its citizens nor in the relationship between spouses. The right not to be a parent is also a liberty, it is the right of an individual to control and plan his life. Indeed, non-parenthood in and of itself is not the protected value. The protected value in non-parenthood is the liberty, privacy, free choice, self-fulfillment and the right to make intimate decisions..." (ibid, p. 681-682; emphasis added – E.R.).

 

            And like her, Justice Dorner in the same case:

 

"Liberty in its fullest sense is not merely the freedom from outside interference by the government or by others. It also includes a person's ability to direct his lifestyle, fulfill his basic wishes and choose from a variety of possibilities while exercising discretion. In human society, one of the strongest expressions of an aspiration, without which many would not consider themselves to be free in the full sense of the word, is the aspiration for parenthood. This is not merely a natural-biological need. It concerns a freedom, which, in human society symbolizes the uniqueness of man. 'Any man who has no children is as good as dead' said Rabbi Yehoshua Ben Levi (Nedarim, 64, B [19]). Indeed, whether man or woman, most people consider having children to be an existential necessity that gives their lives meaning. Against this basic right, w