"It is a well-known rule that a commercial contract must be interpreted in a manner that suits the commercial purpose of the transaction, and the court must give such a contract reasonable validity, as business people would do according to the circumstances of the case..."
See also the words of Justice Bach, Other Municipal Applications 552/85 Agassi v. H.I.L.N. Israeli Company to Work Data in a Tax Appeal [13], at p. 245:
"According to the aforementioned section 25(a), we are ordered to interpret a contract... 'According to the intentions of the parties, as it is implied in the contract, and to the extent not implied by it – from the circumstances', and in order to comply with this directive we must take into account the nature and essence of the transaction that was entered into between the parties and the objectives of the parties
to the contract, both from the economic aspect and from the professional, social and other aspects.
In the absence of direct evidence of the aforementioned purposes, we must ask ourselves, based on the totality of the circumstances, what could have motivated the ordinary reasonable person to enter into an engagement of the type in question and to try to interpret the contract in the most appropriate way to bring about the achievement of those desired results."
It was further stated that in this regard, other Municipality Applications 345/89 Neot Dovrat v. Israellift Elevators Y.M.S. Ilan Management and Investments in Tax Appeal and Counter-Appeal [14], at p. 355 by Justice Cheshin:
"Our concern now is the interpretation of an agreement, and it is our duty to try to get to the bottom of the agreement as reasonable business people who seek to achieve a common commercial goal."
- As explained above, the main purpose and purpose of the program contract in question was to accelerate the construction processes in Israel and to enrich the stock of apartments in Israel, with an emphasis on doing so in the shortest possible time. In light of this general purpose, the illogic of the absence of any sanction for delay in the execution of construction is further sharpened, especially in the case of projects in which the contractors have no real interest in completing the construction on time, after they have already received purchase commitments from the government.
Therefore, the proper interpretation that is also consistent with the purpose of the contract is that the aforementioned clause 6(h)(3) establishes a sanction for delay in completing construction in respect of projects of the second type. In other words, in the case of companies that build in development zones, which have received purchase commitments at a rate of 100% and the date of realization is at stage 18, if they do not complete the construction of the apartments on time, 5% of the price of the apartment will be deducted for each month of delay in execution of the construction.