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Civil Case (Tel Aviv) 58538-05-19 Michael Benz and 52 others v. Appeal of the Financial Case – Supreme Court Guy Nof - part 34

May 29, 2026
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And second, the entire complex is uncertain - neither the one in Lot 104 nor the one in Lot 102.  Therefore, paragraph 22.4 of the sharing agreement comes and explicitly states that "it is hereby clarified that there is no obligation that the building plans that will be submitted will be approved." In other words, there is a possibility that the construction of the project in Lot 102 will also encounter planning difficulties, and there is no guarantee that it will be realized.  More than that.  In clause 3.2 of the joining form, it was noted that "we are aware that an application for a change in the zoning plan on the land and a building permit for the construction of the building and the construction of the housing units in the building has not yet been submitted, and a building permit has not yet been issued for the construction of the project, and final plans have not yet been completed and final plans have been prepared in this regard." The significance of this is clear, according to which there is a risk that the plans on the agenda will encounter planning difficulties, and the main effort in this regard will be to increase the construction potential by combining the forces of Lot 104 with Lot 102.

In other words, the agreement explicitly states that there is no obligation that the planning authorities will approve the change in the zoning plan in Plot 102, in a way that will allow the construction of additional housing units in the building, beyond the construction options on the site in accordance with the plan in force.

  1. To this, it should be added that the agreements do not contain a commitment to any number of housing units; and there is also an "emission mechanism" in accordance with the provisions of paragraph 5.8 of the sharing agreement. This mechanism takes into account that the number of housing units that can be built on the site will be less than the number of units sold, and then there will be room to remove a number of members from the group, in exchange for a refund of the consideration they paid. This contractual component shows that no commitment was given that it would be possible to build 57 housing units in Plot 102 alone.  On the contrary; It shows that there is a real chance that not all members of the group will be able to get the housing opportunity they desire.

In order to complete the picture in this matter, it should be noted from the evidence that Mr. Yehoshua Geva (plaintiff 52) requested approval regarding the planning status of the matter, and against this background he was given a letter from the Municipality's Engineering Department (Appendix 8 to his affidavit) stating that in the existing planning situation, there are building rights in the lot that allow the construction of 8 floors.  In addition, he received approval from Greeny City that following an inspection carried out by architect Parnas, it was possible to construct an 8-story building on the site in the current planning state (Appendix 188 to the defendants' appendices).

  1. This state of affairs - according to which all efforts were devoted to promoting a joint plan for the two lots - stems from the background to the formation of Team 102 in the first place. As may be recalled, at the time the team was formed, the rights in Lot 104 had already been purchased by the Or Group, and the organization of Group 104 had already progressed. Or was of the opinion that joint planning for the two lots would increase the building rights that could be exploited, and this was the reason why the establishment of Group 102 was organized following the purchase of the adjacent lot (see paragraphs 24-25 of the defendants' affidavits).  Against this background, Ms. Or defined to Adv. Nof how to build the contractual system of Group 102, so that it would be clear that cooperation between the two lots was on the agenda, after the basis for the agreements was formulated by the previous law firm that handled the matter (p.  711, Q.15 onwards).

In any event, and from a practical point of view, no attempt was made to promote the construction of the residential building in Lot 102 alone.  No such planning was presented by the professionals who accompanied the project.  And the team's organizers devoted an effort to promote the joint plan for the two courts.  These efforts encountered a significant obstacle when the Ramat Gan Municipality and the local planning authorities changed their policy regarding such plans, and reduced the number of housing units that could be promoted through them.  The change in policy shuffled the cards and required additional and increased efforts to try and convince the planning authorities that it would be possible to establish a joint project.  In fact, the attempts to establish it continued until the Or Group found itself in a crisis and a spiral, following the arrest of Ms. Or.

  1. The question of whether it was possible to build the project on Lot 102 alone has become largely theoretical. It was not promoted in practice, nor from the point of view of the purchasing group committee.

Thus, already at the first general meeting of Group 102 (dated May 29, 2014; Appendix 38 to Adv. Nof's affidavit), Ms. Or was asked "Does Project 102 belong to 104" and her answer was in the affirmative.  Immediately afterwards, the architect presented the joint design of the two lots (ibid., p.  2).  He added, "It is possible that the committee will say that floors should be lowered.  The flexibility is ours, and when we know the committee's requirements, we will be able to disperse the units in an optimal manner so that the tenants will not be harmed" (ibid., at p.  3).  It was found that the motivation to promote the joint plan was not hidden, and was presented very sharply to the members of the group from the very beginning.

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