Caselaw

Additional Civil Hearing 2045/05 Vegetable Growers Association Cooperative Agricultural Association in v. State of Israel - part 25

May 11, 2006
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The (final) purpose of the contract is formulated on the basis of the subjective purposes ("the intentions of the parties") and the objective purposes of the contract.  However, in the clash between them, the subjective purpose ("the intention of the parties") has the upper hand...  Moreover, within the framework of the subjective purpose, normative preference is given to the intention that arises from the ordinary and natural language of the contract, over the intention that arises from its unusual language or external circumstances...  Thus, it is not a two-stage test in which the clear or unclear language of the contract serves as an evidentiary melting point, but rather a one-stage test, in which there is a constant movement from the language of the contract to its external circumstances, while creating a contradictory presumption that the purpose of the contract is that which arises from the ordinary language of the contract.  This presumption can be contradicted by the totality of the circumstances."

  1. The "Apropim" ruling stands brilliantly on a machine, solid and true then, as it is today. It has become, since it was given, an interpretive anchor for understanding the intentions of the parties to the contract. In its complexity and refinement, it penetrates into the depths of human dynamics and gives the written words their proper weight against the background of the circumstances surrounding the engagement between the parties.  It connects a harmonious connection between the spoken and written word and the behavior and the external background to the meeting of the parties' desires; It seeks to trace the true will of the parties by examining their human behavior in its integration with the verbal expression given to it, into a complete harmonious whole.  It seeks to give a deep and true meaning to the experience of life called "the meeting of desires" and "the intentions of the parties", and to translate it into legal conceptualization.  Thus, in the examination of the "intentions" of the parties to the contract, data that comes from within and outside the document to be interpreted are used in a mix.  The examination of the parties' intention to the document is done in two circles that move within each other in a two-way process: an internal circle that deals with examining the body of the text, and an external circle that deals with tracing the external circumstances, which supersede the meaning of the text and illuminate the goals, objectives and interests that the parties sought to realize (Civil Appeal 6726/98 Ariav v. Cohen, [published in Nevo]; Civil Appeal 6518/98 Hod Aviv v. Israel Lands Administration, IsrSC 55(4) 28, para. 7).

When it is not possible to determine the subjective intentions, the objective purpose of the contract will be examined from the nature and essence of the transaction that was entered into between the parties.

  1. The Apropim ruling took deep roots in the theory of contract interpretation.  It expanded to contracts of a special nature, such as collective agreements (Business 26/99  The Association of Professional Firefighters in Israel – Haifa Firefighters' Committee v. Association of Haifa Area Cities (Fire Services), PD 38 289, at pp. 298-301); It was applied to close parties to the notes (Civil Appeal 4294/90 Estate of the late Rinsky v. Rahmani & Co. Finance Ltd., PD 50(1) 453, at p. 474; it was applied to a uniform contract (Civil Appeal Authority 1185/97 Estate of the late Milgrom Hinda v. Merkaz Mishaan, PD 52(4) 145, at pp. 157-9); its roots deepened and spread towards the interpretation of other legal documents,  These include wills (Civil Appeal 1900/96 Talmacchio v. Custodian General, PD 55(2) 817; Hammer (Jerusalem) 24172/95 Estate of Sigmund Locker v. Custodian General [published in Nevo]; Barak, Interpretation in Law, Interpretation of the Will, Volume Five, p. 252); It has penetrated into the realm of interpretation of unilateral documents, including unilateral undertakings (Civil Appeal 6567/99 Sternschein v. Fischer, [published in Nevo] (para. 8); it has gained a break in the interpretation of the scope of a patent, which, according to its definition, delimits in the patent "claim" the right of the patent owner according to his intentions (Cell (Jerusalem) 613/93 "Tivall", Plant Food Products v. Shamir, Food Industries Ltd.,  [Published in Nevo]).  It goes on, takes root, and expands towards the interpretation of documents wherever they may be, whenever it is necessary to trace the intentions of the author of the document.
  2. Since the creation of the Apropim rule, it has lived, breathed, and is implemented daily in various courts. It is one of those few laws that influenced the law and created new patterns of thought and action.  It has become a part of the body of law, assimilating the idea of the "one-stage" interpretation of documents, interchangeably, in broad branches of law.  It has become an interpretive anchor around which the interpretive examination of the content of contracts and the methods of their implementation revolves.  It radiates to the interpretation of documents in other fields of law and is a focus for legal research writing and conceptual-theoretical and practical analysis.
  3. The complexity and refinement of the Apropim rule created, for its part, questions of application. The need to combine harmoniously, in unceasing motion, between the language of the contract and its external circumstances, and to properly weigh these elements in the process of tracing the intentions of the parties, requires the exhaustion of the understanding of the entire interpretation, in its full depth, and all its layers. It requires professional skill in applying it, while applying the necessary internal balances, which create its equilibrium.  In practice, the application of the rule of interpretation requires maintaining the proper balance between the writing and the external circumstances.  It requires careful and delicate analysis of the totality of the data in order to diagnose when the proper transition takes place in terms of the subjective intentions of the parties, to interpret the contract according to its objective purpose.  The relative weights that must be attributed to each of the relevant elements in the exegetical process are derived from the emphases that Halakha attributes to each of them, and from the hierarchy it creates between them, which is built into it.  The task of applying the Apropim rule  to the concrete situations that require interpretation is not always easy.  This is a complex task of interpretation, which requires analysis with a thin and delicate chisel, and the use of delicate weighing scales that weigh the relative weight of each and every given component in the data mixture, which requires attention.  The refinement of  the law of Apropim therefore requires great caution in its application and implementation, in practice, in everyday life.  It is not the challah that occurs in coarse stitch-stitched rough lines.  It is a delicate, intricate, and careful application, which sews small, hidden artistic stitches that require the investment of considerable interpretive effort.  Indeed, the manner in which  the Apropim rule  was applied to these and other individual cases has often given rise to controversy.  These objections usually focus on the way in which the halakha is applied to this or that case, as opposed to criticism of the exegetical principle inherent in it (cf. 4.  Friedman, For the Interpretation of the Term "Interpretation" and Comments to the Judgment "Apropim", Mishpat, Vol. 8, 5763-2003, 483, 488).
  4. The decision to hold an additional hearing on the Apropim rule should be understood against the background of its importance and its far-reaching impact on the theory of interpretation in private law, and against the background of the initiative to reevaluate it after more than a decade, despite the fact that a request for an additional hearing to examine the Apropim  rule was rejected at the time.  The additional hearing process is intended to give the Supreme Court a means of re-evaluating a legal principle that has been established, the fruit of case law, which bears special characteristics of importance, difficulty, novelty, or contradiction to previous law.  It is intended to examine the conceptual correctness of legal law, the degree to which it integrates into the principles of the system, and the extent to which it meets the test of practical life and the reality of life.  The accumulated experience of the past years makes it possible to examine the halakha from a three-dimensional perspective that is not always possible when the halakha is initially formulated.  The passage of time and accumulated experience illuminate halakha in a multidimensional light, against the background of the development of human needs that seek to be met, and in light of possible changes in basic perceptions and concepts of life of the individual and society.  Indeed, "with the change of times, the laws may also change...  Indeed, the passage of time brings with it the ability – even an inherent need – to re-examine past rulings, and to recognize mistakes made in the past" (Words of the Vice-President, Cheshin inAdditional Civil Hearing 3112/05 Hogla Kimberly Marketing in a Tax Appeal v. Badash, [published in Nevo]; (paragraph 8)); In appropriate situations, the changes in times, and with them a change in lifestyles and a change in public perceptions, may raise the need for a re-evaluation of the prelaw that has been given (Criminal Appeal 2251/90 Haj Yahya v. State of Israel, IsrSC 45(5) 221, 237; High Court of Justice 693/91 Dr. Michal Efrat v. Commissioner of the Population Registry, PD 47(1) 749; 795-6; and the case that became known as the "Colombo" case in  Civil Appeal Authority 1690/00 Northern Drilling in Tax Appeal v. Vered Gwili, Temporary Liquidator, IsrSC 57(4) 385 (see the judgment of the Vice-President, S.  Levin, paragraphs 11-12 and 15; and the judgment of Justice Turkel, ibid.) The passage of time and the importance of the rule may, in special circumstances, justify an additional hearing even where years earlier a request for a further hearing was rejected.
  5. The decision to hold an additional hearing on the matter before us is intended to put the "Apropim" rule for re-evaluation and to examine, in the words of my colleague, Deputy President Cheshin, the

"The ways in which a contract is interpreted is the language of a written contract; the circumstances of the conclusion of a contract and oral evidence on those circumstances; a subjective purpose and an objective purpose, all of these and everything in between, in general, and with regard to the interpretation of the contract in question."

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