Civil Appeal Authority 10720/07 Victor Yona v. S.A.D.R. Building Works Company Ltd.

On behalf of the applicant:       Adv. Z.  Shilo

1. I have before me an application for leave to appeal against the decision of the Jerusalem District Court (the Honorable Judge M. Drori), which was read in the courtroom on June 28, 2007 and was given in writing on July 9, 2007, in which an arbitration award given by the President (ret.) Judge V.  Ziller was approved and the applicant's claim to approve an arbitration award given by retired Judge Y.  Bezalel was rejected.

The Factual Background

2. The subject of the dispute between the parties is the ownership and management of the Hapoel Jerusalem football team (hereinafter: The Group or Football Team), as well as financial claims arising from this dispute.
3. Respondent 1, S.A.D.R. Building Works Company Ltd., a company owned by Respondent No.  2, Mr. Yosef Sassi (hereinafter: Mr. Sassi), acquired all the ownership and management rights in the group from the group's then-liquidator in 1995.  Respondents 3 and 4 are partially owned companies of Respondent 2 and are also engaged in the operation and management of the soccer team (hereinafter referred to as the Respondents together): Sassi Group).
4. On November 7, 1996, a contract was signed between the 1st respondent and the applicant, Mr. Victor Yona (hereinafter: Mr. Yona or The Applicant), a management agreement whereby Mr. Yona received the day-to-day management of the soccer team (hereinafter: Management Agreement). Among other things, Mr. Yona undertook under the management agreement to repay the group's past debts in full.  Mr. Yona also undertook according to the management agreement, to cause the team to end the 1997/98 season with a budgetary balance.  Subject to Mr. Yona's compliance with this condition, respondent 1 undertook to transfer to him 50% of the share capital of respondent 1 at the end of the relevant year.
5. In the years following the management agreement, disputes arose between the parties, and on March 28, 2003, an agreement was signed between Mr. Sassi, Mr. Yona and the group (hereinafter: The Arbitration Agreement), in which the parties agreed to transfer both the financial disputes between them and the disputes regarding rights in the class, to an arbitrator's decision.
6. Retired Judge Y. Bezalel (hereinafter: Arbitrator Bezalel) was appointed as an arbitrator in accordance with the arbitration agreement.  On June 22, 2003, Arbitrator Bezalel issued a decision known as the "Arbitrator's Judgment", in which he ruled that Mr. Yona had succeeded in achieving a budgetary balance as defined in the management agreement, and that according to the provisions of this agreement, he was entitled to consideration by way of receiving 50% of the shares of Respondent 1.  Subsequently, the arbitrator ruled that the ownership of the soccer team was in the hands of Mr. Yona alone.
7. Following the decision of the arbitrator Bezalel, the respondents applied to the Jerusalem District Court to order the cancellation of the arbitrator's award, while the applicant filed a motion to order the approval of the arbitrator's award. In a decision of November 10, 2003, the Honorable Justice B.  Okun (as he was then called) rejected both the motion to annul the arbitrator's award and the motion to certify the arbitrator's award.  The reason for which Judge Okun reached this double conclusion is following an analysis of the arbitrator's decision in Bezalel and the conclusion that this is an "interim decision" as opposed to an "arbitration award", due to the fact that the arbitrator did not rule on all the disputes before him.
8. Against Judge Okun's decision, the Sassi Group filed an application for leave to appeal to the Supreme Court. However, during a hearing before Judge Okun, the parties agreed to transfer their disputes to arbitration before the Honorable President (hereinafter: Arbitrator Ziller).  Among other things, the parties authorized Arbitrator Ziller "to rule onRequest for Leave to Appeal which was submitted to the Supreme Court."
9. In the framework of the first arbitration hearing before Arbitrator Ziller, the parties agreed as follows:

"If the final result of theapplication for leave to appeal is the hearing of an appeal and the acceptance of this appeal, the decision of the Honorable Justice B.  Okun, and the parties will act as they see fit, insofar as it stems from the cancellation of the decision.