This provision simply states that Traffic Devices undertakes not to take advantage of the information it has received from direct imports, as a result of the business cooperation between the two, for the purpose of maintaining competing activity or activity that deviates from the framework of the joint employment. After all, there is no clearer case of a breach of the undertaking not to conduct competing activity, than the attempt by Traffic Devices to acquire not only the franchise of the China Israel Company for the Marketing of Trucks and Heavy Vehicles, but also the franchise for the marketing of private vehicles, which is held by Direct Import alone (a franchise that was not transferred to China Israel, but remains at all times the exclusive ownership of Direct Import).
Clause 12 of the letter of undertaking also stipulated that "this undertaking to maintain confidentiality will be valid for five years after the date of the end of the examination process as aforesaid."The examination procedure relates to the information that the transfer will be imported directly to traffic devices prior to the contractual engagement between the two, which is mentioned in the introduction to the letter of undertaking. In other words, even if the Sino-Israel company had not been established, traffic devices were still prohibited from taking advantage of the information it received and from competing in the business of direct imports for five years. The contacts that Traffic Devices conducted with the manufacturer, with the aim of obtaining both a concession for the marketing of trucks and a concession for the marketing of private vehicles, therefore stand not only in contravention of the provisions of clause 16.3 of the agreement (with respect to trucks and heavy vehicles), but also in contravention of the letter of undertaking that it signed even earlier (where the undertaking is sweeping and does not distinguish between private vehicles and trucks and heavy vehicles). In view of this, there is no reason to suffice with the consent of Traffic Devices to refrain from attempts to obtain a franchise to market private vehicles for only three months (as it stated in the completion of its argument).
- It should also be noted that throughout his testimony, Givton reiterated that Traffic Devices did not contact the trustees on her own initiative, since, according to him, it was the trustees who should have approached Traffic Devices earlier in all matters relating to the rescue of the agreement (p. 11, verses 10-13; p. 12, verses 3-12; p. 13, verses 14-16 of the transcript). It should be answered that a trustee who is appointed to an insolvent corporation is naturally at a clear informative disadvantage (Civil Appeal 7606/19 Mega Retail in Tax Appeal v. Hellman-Aldubi Pension and Provident Funds Ltd., at paragraph 45 and the references therein (Nevo, August 8, 2022)). Therefore, the trustees, who have recently been appointed to their positions in relation to a long list of companies in the Automax Group, should not be expected to turn on their own initiative to traffic devices regarding the agreement of which they were not even aware of its existence and the timetables set out therein. It was precisely Traffic Instruments, which is well involved in the intricacies of the agreement and the steps taken by virtue of it throughout the period of its existence, that had the knowledge and means to approach the trustees and involve them in the actions required for the fulfillment of the conditions suspended in the agreement.
- Therefore, there is room to issue a permanent injunction against traffic devices as requested by the trustees.
- It remains to discuss the trustees' request to compel Traffic Devices to produce the correspondence exchanged between its representatives and JAC, including via the WeChat application.
- In its response to the request, Traffic Devices clarified that it had provided the trustees with some of the documents related to the agreement. However, in Gavton's testimony, it became clear that during the months of November 2025 and January 2026, messages were exchanged between representatives of traffic devices and representatives of the manufacturer through the WeChat application that were not disclosed to the trustees.
And to be precise. Clause 16.3 of the Agreement, which, as stated above, is valid and exists and binds the parties even now, states in its conclusion that "it is further agreed that as long as both parties hold shares in the Company, representatives of both parties will be invited to participate in any meeting held with the Manufacturer, and will be written to the notice for any correspondence with the Manufacturer, without prejudice to the powers granted to the Company's CEO and the decisions of the Board of Directors." Given that Direct Import still holds shares of China-Israel, it has the right to be a correspondent in any correspondence of traffic devices with JAC. This right is currently available to trustees who come in the shoes of direct imports, since a trustee of an insolvent corporation is entitled to demand that any person transfer an asset or document in his possession, as well as to demand any information relating to the affairs of the debtor corporation that the corporation is entitled to receive (see sections 47 and 49 of the Insolvency Law). In fact, it appears that Traffic Devices does not dispute this, because in the completion of the argument on its behalf, no explicit objection was raised to the production of those correspondences.
- In this context, I will also note that I do not accept the argument raised in the hearing that the provision of clause 16.3 of the agreement does not apply to correspondence via the WeChat application. The language of the section is clear and speaks for itself. It does not limit itself to correspondence in one format or another. Therefore, it is not possible to circumvent this provision by way of correspondence through an application as opposed to "formal" correspondence via e-mail. Nor is the question of whether this correspondence is "important" or "substantial" because the provision of clause 16.3 of the agreement does not make such a distinction at all.
- In the margins, it should be noted that Traffic Devices sought to obligate the trustees to deposit a self-commitment in the name of the forfeiture fund to insure its damages to the extent that an order is issued as requested by the trustees. Indeed, the trustees are not exempt from the provisions of the Civil Procedure Regulations and from the obligation to attach in the first place to the application for temporary relief a self-commitment in order to secure damages to the other party. However, since the trustees' request for a permanent (and not only temporary) injunction against traffic devices was granted, the need to deposit a self-undertaking is superfluous.
- As part of their original request, the trustees petitioned to extend the deadline for filing a request for the continued existence of the agreement under section 71(b) of the Law, as it is an "existing contract" as defined in section 66 of the Insolvency Law. However, at the end of the hearing, they waived this remedy. Therefore, there is no need to decide the important question of whether where a contract is cancelled not because of its breach but because of the non-fulfillment of a suspension condition, the trustee is still entitled to request to order the continued existence of the contract, and it can be left to be examined.
Conclusion
- In conclusion, the trustees' request is granted. A permanent injunction is hereby issued prohibiting traffic devices from contacting the manufacturer regarding the marketing of private vehicles for a period of five years from the date of signing the letter of undertaking. Regarding the marketing of trucks and heavy vehicles - traffic devices are hereby prohibited from contacting the manufacturer without coordination and cooperation with the trustees.
- In addition, an order is hereby issued instructing Traffic Devices to provide the trustees with all the correspondence exchanged between it and the manufacturer as requested in section 31 to complete the argument on behalf of the trustees.
- Despite the acceptance of the application, there will be no order for costs because during the course of the hearing it became clear that the trustees had negotiated with the manufacturer regarding the concession of trucks and heavy vehicles, without coordination with traffic devices, so that they themselves did not comply with the provision of clause 16.3 of the agreement. Admittedly, there is nothing to prevent the trustees from approaching the manufacturer alone with regard to the private vehicle franchise that was and remains owned by Direct Import, but with regard to trucks and heavy vehicles, the trustees are subject to the same restrictions as those that apply to traffic devices.
- The Secretariat will send the decision to the parties.
| Granted today, February 18, 2026, in the absence of the parties. |
| Hagai Brenner, Senior Judge |