The duty of disclosure is intended to disclose information where the knowledge of this information is not within the knowledge of the party to whom disclosure is obligated. On the other hand, when the information is open, and when both parties know it, there is no point in applying a "procedural" disclosure duty that is detached from the actual knowledge of the parties. However, in our case, no such knowledge was proven on the part of the respondent." [My emphasis is L.B.]
From here, the Supreme Court turned and examined the significance of signing the mortgage deed in front of a lawyer and ruled (in paragraph 43 of the judgment):
"This procedure is of great importance, the reason and purpose of which are not prejudiced by the aforesaid. According to the Real Estate Regulations, the lawyer before whom the deed was signed has a very important role. The lawyer, as did Attorney Tulchinsky in our case, testifies that a certain mortgagee appeared before him and that after the lawyer identified him and explained to him the nature of the transaction he was about to execute and the legal consequences deriving from it, and after he was convinced that this was properly understood to the mortgagee, the mortgagee signed the mortgage deed voluntarily before him. The explanation regarding the nature of the transaction and its legal consequences is very valuable. However, it was rightly held that signing in front of a lawyer does not exempt the bank from its own obligations. The bank wishes to rely on the Real Estate Regulations as exempting it from liability for the mortgagee's knowledge of the existence of a previous debt, whenever the signature procedure detailed in the Regulations has been fulfilled. However, the Real Estate Regulations regulate the process of registering a transaction with regard to signing before a lawyer and before the Land Registrar. The Real Estate Regulations, whether they were fulfilled or not, do not exempt other parties from their own obligation (inter alia, according to other legislation). It seems that the present case illustrates the reason for this very well: Attorney Tulchinsky fulfilled his duty and approved the signature of the respondent and her husband on the mortgage deed before him, only after he gave them the explanation necessary for their signature. However, as he was an external lawyer, Attorney Tulchinsky could not provide the Respondent with any information regarding the extent of the credit taken by the husband prior to signing the mortgage. The bank should have filled the aforesaid gap with the respondent's knowledge. To be precise: the bank claimed that there was no reason to attribute weight to the identity of Adv. Tulchinsky as an external lawyer to the bank. In this regard, it should be clarified that the fact that he is an external lawyer has no significance in itself. At the heart of the judgment was the question of whether the bank would inform the respondent of the amount of the debt. In this regard, if the bank had proved that the issue of the amount of the debt was brought to the attention of the respondent in one way or another, the question of whether the lawyer before whom the note was signed would not have been of any importance. Even a lawyer who works for a bank who does not know that there is a debt will not discharge the bank's obligation. "