Disguised pledge
- 58. When the special manager's argument that the back-to-back transactions and engineering transactions should be canceled according to Sections 281 and256(III) Law The Friendship; The argument that the back-to-back transactions are an invalid contract was also rejected; It remains to be considered the alternative argument, according to which the transactions made with Mizrahi Bank are void in the absence of the registration of a "disguised pledge". It should be said at once that this argument is also liable to be rejected.
According to the special manager and receiver's version, the letter of guarantee and the deed of offset signed by Hefziba Investments in the framework of Transaction BTB Mizrahi served as collateral for a loan provided by Mizrahi Bank to Heftzibah Housing, and as such they were obligated to register. The Special Director emphasizes that a lien requires publicity; This is all the more valid where we are dealing with a lien intended to secure a debt of a third party (Hefziba Housing) and not of the bank's customer himself (Hefziba Investments) as in the present case, and in particular taking into account the enormous scope of the debt (ILS 75 million). In the absence of registration, it is alleged that the lien is void vis-à-vis the creditors and the liquidator. In reference toEngineering Deal - According to the Special Manager, the entire purpose of the financial deposit deposited in Hefziba Investments' account was to serve as collateral for Hefziba Shikun's obligation to the bank and as an object of offset at the end of the transaction; Therefore, the special administrator is of the opinion that a lien of this kind requires publicity, and since it was not registered, it had a defect that led to its nullity vis-à-vis the creditors and the special administrator. (It should be noted that as part of an engineering transaction, Hefziba Engineering also pledged a securities portfolio in favor of Mizrahi Bank, but this lien was registered in the Companies Register).