As I mentioned above, there are cases, such as the Ben Lavi case, in which the Registrar of Non-Profit Organizations operates, and obligates the association to prepare a recovery plan, otherwise a request for liquidation will be filed. His ability to do so in principle is significant when the alternative means of supervision are examined. The authority granted to the Registrar of Non-Profit Organizations creates deterrence, which may lead officers of the association to accept the proposed recovery plan, when such a plan is proposed.
- The conclusion from the above is that there is a similarity between the authority of the Registrar of Non-Profit Organizations to present the amuta with a choice between healing the distortions and liquidation, and the authority of the Attorney General to file a claim on behalf of the Health Fund. In both cases, this is an external mechanism for the corporation that creates a deterrent to the officers from violating the law. Even if the Registrar of Associations is not authorized to file a claim himself, the choice he presents to the officers of the association and the fear of liquidation proceedings place the officers at risk that they will be required to be held accountable for their actions in connection with the association. Their awareness of this risk contributes to deterring officers of non-profit organizations from violating the law.
- It should be recalled once again that in this case, actions were indeed taken by the Association and the Leagues Administration in cooperation with the Ministry of Finance, the Ministry of Culture and Sports, and the Toto – first and foremost the appointment of Alkalai, a state-funded CPA, an appointment intended for the purpose of conducting an investigative examination in the Association (according to the state's announcement dated October 29, 2017, the appointment was made in connection with the reform in the football industry in general, but with an emphasis on the issue of prohibited transfers); And then – the appointment of Adv. Sol by the Association, in response to the demand of the Ministry of Culture and Sport to present it with a work plan for dealing with the findings of the Alkalai Report. Even if these actions did not benefit the association in its entirety (and this is the applicants' approach), they were done in an attempt to deal with the issue of prohibited transfers, in order to improve the mechanisms of operation, decision-making and reporting in the association, and they testify to the fact that there is no supervisory "vacuum" in cases of violations of the law by officers of the association – not in the concrete case before us, and not in general.
- The interpretive conclusion in terms of the objective purpose of the law is that it is difficult to determine whether the lack of regularization of the possibility of filing a derivative action on behalf of an association is a "buyer" or whether it is a negative arrangement. There are good reasons to justify the possibility of filing a derivative claim on behalf of an association as well; On the other hand, there are other factors that supervise the activities of associations in general and the association in particular, which can deter officers of the association. The Judgment's Proceedings In the matter of priesthood It can be concluded that the existence of such mechanisms has implications for the interpretation of the law and the question of whether the arrangement in it is a "negative arrangement" or for the buyer, even when there are good reasons to determine that a derivative claim mechanism is desirable. Thus, it is interesting to note that when such mechanisms exist, this may lead to an interpretation that excludes the possibility of filing derivative claims on behalf of corporations (where this is not explicitly regulated by law), even if such claims are likely to improve the property situation of these corporations. In light of the above, we will further examine the interpretation of the legislation in light of its subjective purpose.
The Subjective Purpose of the Law
- Examining the interpretive question with respect to the possibility of filing a derivative claim on behalf of the association also requires tracing the subjective purpose of the law, which concerns the intention of the legislature. The subjective purpose is in fact the solution that the legislature sought to provide to a given problem. Tracing the legislature's intention can be done, inter alia, in light of the legislature's words in the legislative process, the possibilities it faced at the time, legislation enacted by it in similar cases, and developments in legislation over the years. The subjective purpose of the law is not "fixed" for a specific date, and tracing the legislature's intention is a dynamic task. As will be detailed, the implementation of the legislature's intention in this context shows that according to its subjective purpose, the law establishes a negative arrangement with respect to the possibility of filing a derivative action on behalf of an association.
- In the Kahani case, the court based its conclusion that it is not possible to file a derivative claim on behalf of the health plans based on the legislator's intention, as can be learned from the wording of the National Health Law, from the explanatory notes to the bill and from the minutes of a hearing in the Knesset Finance Committee. The discussion in the Knesset Finance Committee included a reference to the legislator's position that "The mechanism of a derivative claim does not apply to the health plans" (ר' Priestly Matter, in paragraphs 38-42 of the judgment of Justice Y. Amit). The court also noted there that there is "explicit evidence" that the legislature intended to establish the unique arrangement with respect to the health plans as an alternative arrangement to the derivative claim mechanism. This is in light of what is stated in the minutes of the Knesset Finance Committee, which states that "As a replacement for this option [of a derivative claim, R.R.] It is proposed to allow the Attorney General to file a lawsuit" (ר' Priestly Matter, in paragraph 42 of the judgment of Justice Y. Amit).
- In examining the intention of the legislature with respect to the possibility of filing a derivative action on behalf of an association, a comparison can be made between the explicit arrangement established by the legislature in the Companies Law, which was enacted in 1999 (see the Companies Law, S.H. 5759-1999 1711, p. 189 (of May 27, 1999)), and the absence of a similar arrangement in the Associations Law. Is it possible to conclude from the positive arrangement in the Companies Law that the legislature intended to deny the possibility of filing a derivative action on behalf of an association, in light of the fact that a similar arrangement was not enacted in the framework of the The Non-Profit Organizations Law?
At the outset, it should be noted that extra caution must be exercised in the attempt to deduce from the "they" prescribed in the law to the "no" in another law. As has been determined more than once in case law, the use of this inference rule in order to trace the legislator's intention must also be done with caution. The Supreme Court (Justice Y. Sussman) has already discussed this in other municipal applications 73/50 Deuel v. Petrzelka, IsrSC 6 599 (1952), at p. 605: