")4) The claim is in connection with a contract, and one of the following cases exists:
(a) The contract, in whole or in part, was made or breached within the boundaries of the State or the possibility of performing it within its boundaries was denied;..."
As appears from the defendants' version, the initial contact between the parties took place in September 2023, when defendant 1 was in Israel, and a meeting was held with the participation of the plaintiff, Ms. Jenny on his behalf and defendant 1, in which it was agreed to establish the business venture. Subsequently, after disputes arose between the plaintiff and defendant 1, also according to defendant 1, he authorized defendant 2 - who is an Israeli resident - to meet with the plaintiff on his behalf, as his proxy for the purpose of locating solutions to the disputes that arose.
Thus, since the initial engagement between the plaintiff and defendant 1 took place in Israel, as well as the undisputed fact that defendant 1 referred the plaintiff to negotiate with defendant 2, who is a resident of Israel, in order to try to settle the disputes that arose regarding the engagement between them, the aforesaid is sufficient to determine that there is a cause of action in our case.
- With regard to the examination of the cause of action, it was ruled that the court must "ensure that the claim is not nuisance or a frivolous claim. This is a lower standard than a 'claim worthy of argument'... There is no reason for the court to conduct a lengthy hearing regarding the cause of action itself, and there is no reason for it to impose a heavy burden on the applicant, at the stage of this preliminary proceeding... In other words, the hearing of the invention permit should not be turned into a full and comprehensive discussion of the cause of action, as will still be done within the scope of the main proceeding, if the invention permit is in place" (Civil Appeal 9725/04 Ashburn Agency and Trading Company inTax Appeal v. CAE Electroics Ltd., 7 [Nevo] (September 4, 2007)).
In our case, the plaintiff supported his claim with a series of documents, including documents showing that the engagement between the parties was reflected in the establishment of the foreign company, correspondence (between the plaintiff and defendant 1 and between defendant 2 and the supplier in China) and tables in which the plaintiff gathered his claims regarding alleged damages. All of these, together with factual arguments that still need to be discussed and clarified, are sufficient, at this preliminary stage, to meet the low threshold required at this stage for the cause of action.
- In summary, the plaintiff met the conditions required both for the cause of action and for the cause of action. Hence, the Israeli court acquired international jurisdiction with respect to the defendants.
The proper forum question
- I will now address the question of the appropriateness of the Israeli forum. In this regard, I will mention "that even if there is a cause of action outside the boundaries, the court is always left with the discretion as to whether to exercise its jurisdiction over the foreign defendant. Among other considerations taken into account, it is necessary to examine whether the court in Israel is the appropriate forum for hearing the proceeding" (Insolvency Court (Tel Aviv District) 15599-05-21 Ben-Ari v. Commissioner of Insolvency and Economic Rehabilitation Proceedings, para. 33 [Nevo] (October 27, 2022)).
- Regulation 168 of the Constitution provides as follows:
"If a party is provided with a statement of claim outside the boundaries of the state, he may deny the court's authority to hear the action or claim that the Israeli forum is not the proper forum to hear the action; If the defendant wishes to deny or claim as aforesaid, he shall file a written request no later than the date set for the filing of the statement of defense; If you do so, the date for filing a statement of defense will be counted from the date of the decision in the application."
- In our case, since the court acquired jurisdiction by virtue of the invention, this does not detract from the defendants' ability to claim that the Israeli forum is not the proper forum to hear the claim, but the burden is on the defendants who claim the impropriety of the Israeli forum to persuade that a foreign forum (which has the authority to hear the claim) is the proper and "natural" forum to hear the claim (see Civil Appeal 4601/02 Rada Electronic Industries inTax Appeal v. BODSTRAY COMPANY LTD, IsrSC 58(2) 465, 472; Civil Appeal 3908/08 Draw B TaxAppeal v. FOREM BAGCO INC [NEVO] (AUGUST 26, 2010), para. 17; Regarding the applicability of these rulings regarding the burden of proof even after the enactment of the new Regulations, see also the hearing in the case of Office Textiles, para. 16).
In this regard, it should be clarified that the test for determining that an Israeli court is an "improper forum" is not merely a normal balance of convenience, and that the person who claims an "improper forum" must convince the Israeli court that the balance is clearly and clearly tilted toward the foreign forum (see Civil Appeal 45/90 Shimon Abada v. Tikva Abada, 48(2) 77, 83; Civil Appeal 3299/06 Jubiner v. Sklar, para. 18 [Nevo] (April 26, 2009)).
- In examining the proper forum, it is customary to require three main tests: the "maximum affinity" test; the test of the reasonable expectations of the parties regarding the venue of the litigation and the test of public considerations (Civil Appeal Authority 7342/11 Clal Insurance Company inTax Appeal v. Incomacs Ltd., paragraph 5 [Nevo] (August 2, 2012) (hereinafter: "Clal Matter"); Civil Appeal Authority 1785/15 Alison Transport Inc. Cosco Container Lines Co Ltd [Nevo] (July 15, 2015)).
- Regarding the "maximum connections" test, it was held in Civil Appeal 8066/22 Veslin Piovich v . Lior Dagan, Trustee of the Debtor's Assets [Nevo] (March 5, 2023), paragraph 41, as follows:
"As part of the 'maximum affinity' test, which has been established in case law as the main test for identifying the proper forum, the foreign litigants' affiliations to the Israeli forum must also be examined. However, the court required in the matter has broad discretion, and it is entitled to examine a variety of factors relating to the connection of the claim in question to the forum to be examined, the efficiency of the conduct of the proceeding, and the interests that the forums themselves have in discussing the proceeding."