(b) An evacuation and construction transaction did not include the provision of an alternative permanent apartment as stated in subparagraph (a) – the transaction does not include consideration due to the value of the adjustments, insofar as they existed in the apartment in which the rights are transferred."
- As for an unreasonable refusal, in the Schwarzberger case it was held that the refusal of an apartment owner will be considered unreasonable only if a privileged majority of the apartment owners agreed to the Pinui-Binui transaction, and it was also found that this is an economic transaction that includes appropriate collateral, that the recalcitrant tenant was offered proper alternative accommodation, which includes, if necessary, adjustments to the special conditions required by him, taking into account his personal and unique circumstances, to the extent that the following are met:
"It should be noted that in the framework of evacuation and construction projects, the ownership of the apartment owners in their property is transferred for a fair consideration, or maintained, while usually instead of their small, outdated apartment, the apartment owners receive a larger, more modern apartment. Therefore, at the end of the day, the value of the real estate property they own will exceed the value of the old apartment that they vacated. In addition, according to the Evacuation and Construction Law, the refusal of an apartment owner in a condominium will appear unreasonable only if a privileged majority of the apartment owners have agreed to the transaction at hand, and it has also been found that it is an economically worthwhile transaction that includes appropriate collateral; In addition, in the framework of the proposal that was offered to the recalcitrant tenant, he was offered suitable alternative accommodation, which includes, if necessary, adjustments to the special conditions required by him, all taking into account his unique personal circumstances, to the extent that they exist. In addition, consideration must be given to the fact that the right of all apartment owners to refuse to join the project is equally limited, and that these projects have both a public and private purpose" (at para. 25).
- Against the background of the above, I will turn to examine the legal questions described above.
Question 1: Is there a privileged majority of the apartment owners in the Pinui-Binui cluster who have entered into a Pinui-Binui transaction?
- As stated above, "a privileged majority of the apartment owners in the Pinui-Binui Cluster" was defined in Section 1 of the Pinui-Binui Law, in such a way that it will be fulfilled given three cumulative conditions:
- the apartment owners in the cluster who own at least two-thirds of all the apartments in the cluster;
- The same two-thirds of the aforementioned owners, at least three-fifths of the apartments in each condominium in the same cluster...;
- Adjacent to the apartments of the same two-thirds, more than half of the common property in each condominium in the same cluster.
- In our case, the apartment owners who signed the agreement meet all three conditions:
- They own 91.6% of the apartments in the cluster (22 out of 24 apartments), more than two-thirds;
- in the Katznelson 2 condominium, they own 87.5% of the apartments (7 out of 8 apartments); in the Katznelson 4 condominium, they own 93.75% (15 out of 16 apartments) – more than three-fifths;
- The plaintiffs own more than half of the common property in each condominium in the cluster.
- This also emerges from Adv. Farbman's affidavit that all the plaintiffs mentioned in the statement of claim and specified in the power of attorney attached to the statement of claim, who constitute a privileged majority of the apartment owners in the cluster, signed the agreement and powers of attorney in front of him or an attorney from his office (including a general power of attorney, a power of attorney for legal proceedings and an irrevocable notarized power of attorney).
- As for the defendants' claim that Amidar did not sign the agreement and therefore there is no privileged majority, after examining the claim, I have reached the conclusion that it should be rejected. Amidar signed an addendum to the agreement, in which it unequivocally indicates that it agrees to the provisions of the agreement, so that signing the addendum is tantamount to signing the agreement itself.
- In the aforesaid circumstances, I have reached the conclusion that a privileged majority of the apartment owners in the cluster are committed to concluding an evacuation-reconstruction agreement. I will now turn to examine whether the defendants' refusal to sign the agreement is reasonable.
Second question: Is the defendants' refusal an unreasonable refusal?
- Since it was found that there is a majority of the apartment owners in the cluster for the conclusion of the agreement, it is necessary to examine whether the defendants' refusal to join the project is a reasonable refusal in the circumstances of the case within the meaning of the Pinui-Binui Law. Among other things, it is necessary to examine whether the defendants' objection stems from honest and proper reasons that must be taken into account, as well as whether their objection is unreasonable under the law. If the answer is negative, the claim against them will be accepted (Schwartzberg, para. 29):
"When it comes to hearing a claim filed under the Pinui-Binui Law, the main question before the court, after examining and finding that this is a condominium that has been declared an evacuation and construction complex and that the required privileged majority of the apartment owners in it has already joined the project, is therefore the question of when an apartment owner who refuses to join an evacuation and evacuation project, or conditions his joining on conditions, will be considered a recalcitrant tenant, whose refusal is unreasonable in the circumstances of the case. In the framework of its decision, the court must distinguish between the apartment owner whose objection stems from honest and proper reasons that must be taken into account, and the apartment owner whose objection stems from reasons that should not be taken into account in the circumstances of the case, and the apartment owner whose objection is extortionate – to take advantage of his position as the last obstacle to the start of the project, for the purpose of obtaining financial gain or other favorable conditions that the other apartment owners do not enjoy. If the landlord's refusal is found to be unreasonable, the court will determine what part of the damage caused by the other apartment owners will be borne by the recalcitrant tenant, in accordance with section 3 of the law and subject to proof of the damage and a causal connection between him and the refusal."
- In terms of the defendants' claims in the pleadings, it appears that there are four main reasons for their objection to signing the agreement and joining the project: (1) the lack of economic viability of the project; (2) unequal considerations for apartment owners; (3) the conduct of the developer; (4) Defendant 2's claim that the apartment in consideration it will receive will be without three air directions.
- Below I will examine these reasons and whether they are reasonable or not.
Lack of economic viability