Rent Reimbursement
- Once the agreement is lawfully cancelled, and in accordance with the provisions of section 9 of the Contracts and Remedies Law, the plaintiff is entitled to a refund of the rent that she paid to the defendant without receiving a proper hairdresser. This is a rent of ILS 2,340 for five and a half months (mid-May to November), for a total of ILS 12,870.
Loss of revenue
- Section 10 of the Contracts and Remedies Law states that "an injured party is entitled to compensation for the damage caused to him as a result of the breach and its consequences, and that the violator saw him or should have seen him in advance, at the time of the conclusion of the contract, as a probable result of the breach." Section 1 of the Pharmaceutical Contracts Law states that damage also includes the prevention of profit. These are subsistence damages, the purpose of which is to place the injured party where he would have been had the infringement not been for the infringement (Civil Appeal 4232/13 Anglo-Saxon Property Agency v. Eli Blum [Nevo] (January 29, 2015)). The court awards the injured party compensation based on an estimate of the financial profit he was expected to make from the agreement, a profit that he was denied as a result of the breach of contract.
- The duty to prove the extent of the damage is on the injured party, who must bring the data that could have been reasonably brought in order to prove his damage:
"Just as the extent of the damage is not a matter determined according to an estimate of a dayina, so the matter of compensation is not determined according to an estimate of a judge... All that is required is that the defendant-plaintiff prove his damage and the compensation to which he is entitled with a reasonable degree of certainty... In other words, with the same degree of certainty that is required by the circumstances of the case... In those cases, in which - in light of the nature and nature of the damage - it is possible to bring accurate data, the injured party must do so, and once he fails to meet this burden, he will not be awarded compensation. On the other hand, in those cases in which - in light of the nature and nature of the damage - it is difficult to prove with accuracy and certainty the extent of the damage and the amount of compensation, this does not preclude the claim of the injured party, and it is sufficient for him to bring the same data, which can reasonably be brought, while giving appropriate discretion to the court to prepare an estimate to make up for the shortfall" (Civil Appeal 355/80 Anisimov v. Tirat Bat Sheva Hotel, IsrSC 35(2) 800 808-809 (9.3.1981).
- As has been ruled more than once, damage caused by loss of damage is damage that is particularly difficult to assess, since it requires assessments and hypotheses in relation to a reality that did not exist at the end of the day. However, compensation can still be awarded, where the defendant-plaintiff will bring data that can be reasonably brought when the court makes an estimate to fill in the gap.
- The plaintiff claims that the defendant must compensate her for the loss of her income from the barbershop for the period from mid-May 2022 to November 2022 in the amount of ILS 8,474 per month (and with the exception of the month of June, which she waived in the framework of the preliminary hearing between the parties; paragraph 53 of the plaintiff's summaries). In order to substantiate the alleged monthly income amount, the plaintiff attached receipts that she issued from the beginning of her employment until the end of May 2022 (Appendix G to the plaintiff's evidence). The plaintiff also based this estimate on the testimony of Shilon, who testified that another hairdresser in the defendant's Rishon LeZion branch brought in a sum of ILS 70,000 per month and that the earning potential of good hairdressers is about ILS 60,000 per month (pp. 75, paras. 28-37; paragraphs 48-51 of the plaintiff's summaries).
- I found it difficult to accept the calculation of the monthly amount of income claimed by the plaintiff. First, apart from the receipts that were attached by the plaintiff, no additional evidence was attached. The plaintiff did not attach a notebook, accounting documents, economic opinion or accounting calculation to support the head of this damage. Accordingly, it is not possible to determine on the basis of receipts alone whether it is a loss of income in net terms, or whether various amounts should be deducted from the amount of income as expenses. The receipts that were attached are also not complete receipts and it is not possible to learn the details of the recipient from them, so they have little evidentiary weight.
Second, it is not possible to derive a base of earnings on the basis of only one month of work, but rather it must be examined over a period of time in order to see whether it is a stable income, or whether it is subject to volatility. The data required to establish the plaintiff's earning potential are in her possession (such as the plaintiff's work diary, which was attached as Appendix 28 to Shilon's affidavit) and the burden is on the plaintiff to prove this component.
- At the same time, the defendant's evidence shows that the average monthly income generated from the hairdresser in the months of April 2023 - June 2023 was ILS 5,406 (Appendix 27 to Shilon's affidavit). Therefore, I see fit to determine the monthly income loss by way of an estimate so that it will be based on the average monthly income produced by the barbershop that was operated by the defendant. Accordingly, the loss of income during the months in which the plaintiff was prevented from operating the barbershop in accordance with the agreement, amounts to ILS 24,330.
Mental anguish
- Section 13 of the Contracts and Remedies Law grants the court the authority to award damages for non-pecuniary damages to the extent that it deems fit in the circumstances of the case. The award of compensation for non-pecuniary damages does not obligate the plaintiff to prove the extent of his non-pecuniary damage, and this is at the discretion of the court, which will take into account, inter alia, the nature of the injury and the type of interest that was harmed, the intensity of the injury, its scope and duration, the identity of the parties and the existence of a relationship of trust between them, and the extent of the pecuniary damage caused to the victim by the breach of contract (Civil Appeal 1094/23 Cooper v. Israel Land Authority[Nevo] (9.10.2024) ibid., paragraph 47). The courts in Israel have taken a restrictive approach with regard to their authority to award compensation for mental anguish in contractual claims (see Gabriela Shalev, Yehuda Adar, Contract Law - Remedies (2009), pp. 303-304; as well as Civil Appeal 8588/06 Deljo v. Development Authority in a Tax Appeal [Nevo] (November 11, 2010)). In our case, we are dealing with the plaintiff's occupation, which was damaged for a period of about five months, which is not a long period. I also considered the pecuniary damage that was awarded, which amounts to ILS 37,200. At the same time, the plaintiff was an employee of the defendant, so there was a relationship of trust between the parties, and the agreement that is the subject of this lawsuit was also born as a result of claims of violation of the plaintiff's rights. I found that the defendant's representatives acted at least indifferently with respect to the plaintiff's injury, both during the period of the agreement and during the course of the proceeding. Accordingly, in the circumstances of our case, I found to award for the mental anguish caused to the plaintiff an amount of 10% of the total pecuniary damage, and a total of ILS 3,720 for the mental anguish.
Offset and the Defendant's Claim
- Since I have come to the conclusion that the cancellation of the agreement was done lawfully, the defendant's claim to pay the rent for the remainder of the period should be rejected.
- As to the defendants' claim for deduction of the sum of ILS 384,000 for the theft of the defendant's customers (paragraph 44 of the statement of defense), this was abandoned in the defendant's summaries and in any event I did not find that it was proven. Shilon testified in his affidavit that the plaintiff "took work privately behind the defendant's back, inter alia with the defendant's customers and while she was not operating the barbershop" (paragraph 73 of Shilon's affidavit). Apart from this mere claim, it was not stated who the defendant's customers were whom the plaintiff "stole"; The defendant's client list was not attached; No testimony was brought from a client who was allegedly stolen by the plaintiff; Nor can anything be learned from the plaintiff's work diary, which was attached as Appendix H to Shilon's affidavit, since it is not possible to learn from it whether they are customers of the defendant.
- To this, I will add that there is also no contractual restriction on the plaintiff's private work outside the barbershop, since the agreement does not include a non-compete clause, or any restriction on the plaintiff in this matter. As it appears from the agreement, it was agreed that the plaintiff would not sell products for her own benefit or personal pleasure as part of her work at the barbershop. It was also agreed that the parties would cooperate with each other, the plaintiff would evacuate her customers to the store, while the defendant would take her customers to the barbershop. However, there is no definition of the defendant's customers or any restriction on the plaintiff's work outside the framework of the barbershop. Thus, the law of the counterclaim is to be dismissed, with all its components.
In conclusion:
- The plaintiff's claim is partially accepted. The defendant's claim is dismissed. Therefore, the defendant must pay the plaintiff the following payments:
Rent refund - ILS 12,870.