The defendants presented a representation to the plaintiffs according to which it is possible to construct a residential building on Lot 102, detached from Lot 104 and without connection to it. But in fact, they were constantly planning to build a building that extends over the two lots, creating a dependence of Group 102 on Group 104. It was not revealed to them that in order to build the project on Lot 102, it was necessary to obtain building rights fromLot 104. They also concealed the fact that Ms. Or or the members of Group 104 are not obligated to them either contractually or proprietarily. The defendants were also negligent in not anchoring the obligation to transfer rights from Lot 104 in favor of the members of the 102 group.
- According to the plaintiffs, the set of agreements is not clear enough. Against this background, in the framework of the disputes regarding their interpretation, external circumstances should be preferred to Scripture. In addition, the collateral must be applied to the project in accordance with the Sale Law (Apartments) (Securing Investments of Apartment Buyers), 5735-1974 (hereinafter: the Apartment Sale Law). This is because, in the circumstances of the case, we are dealing with a purchasing group that is only for appearances.
- The defendants were negligent in misleading the plaintiffs as to the timetable for the possibility of starting construction. They believed that the new zoning plan could be passed by the local committee, and in the end it turned out that it needed to be passed by the district committee. The defendants should have anticipated such delays and warned the class members. In practice, the defendants acted in the opposite manner. Thus, Adv. Aharonson admitted in his testimony that he used to point out to potential buyers that the expected date for receiving a building permit was "within a year, a year and a half," and that these words had no basis.
- As may be recalled, some of the plaintiffs were required by Ms. Or to advance the payment they owed for the land component, despite the fact that they should have done so only after signing an agreement with an executing contractor, or entering a lending bank, whichever is earlier. The defendants were aware of this demand, and that it was illegal. They should have stopped Ms. Or's attempt to receive funds to which she was not entitled, and informed the relevant plaintiffs, which they did not do. Contrary to what was claimed by the defendants, this component of the claim has not become statute of limitations.
- The defendants misled the plaintiffs in the manner in which the letter of undertaking on behalf of Green-City was drafted. It was supposed to set aside funds to serve as collateral, but this depended on preconditions, and it was clear to the defendants that these would never actually exist.
In addition, the defendants were negligent in not establishing in the agreements a mechanism for depositing part of the consideration money that the plaintiffs paid in trust. This is until the completion of the purchase of the land from Campbell. They had to ensure that even afterwards, funds would remain in trust until a building permit was issued for the project, which was not issued until Ms. Or's companies collapsed.
- The exemption and waiver clauses that the defendants placed in the agreements signed by the plaintiffs are invalid.
- The defendants were negligent in not taking care to register a warning note that would "lock" the group at the end of 2012, in a way that would prevent the sale of the six housing units that had already been sold by Ms. Or to six new buyers in 2014. They could also have stated the details of the unit in question, when the warning notes were taken, and then the later purchasers would have refrained from buying those units. This failure led to the plaintiffs having no choice but to compromise in the liquidation proceeding with the six late purchasers, in light of the comments made by the Honorable President Orenstein during the hearing of the liquidation case, who recommended a compromise with them.
- The defendants were negligent in handling the issue of payment of the purchase tax, even though they received funds for the payment from the plaintiffs. Their negligence led to the imposition of fines, interest charges, and the imposition of foreclosures on the accounts of some of the plaintiffs.
- Instead of accepting responsibility for their actions, the tables were turned. The defendants accused the plaintiffs of not carrying out the project, since they had decided not to build it with another organizer incontinuation of the receivership proceedings. This accusation has no basis. It was the members of Group 104 who refused to continue building the project with another organizer, and the members of Group 102 could not enforce its implementation, since there was no undertaking by Ms. Or or the members of Group 104 to grant them building rights in order to enable them to act as aforesaid.
- In general, the plaintiffs' factual version should be preferred to that of the defendants. Thus, for example, Adv. Aharonson noted in many cases that he did not remember the details of the interaction with the various plaintiffs, and on the other hand, the plaintiffs presented a consistent and uniform version, and against this background, the amount of testimonies supporting each other, makes their version probable, which should be adopted.
- The defendants must return to the plaintiffs the fees they received, in an amount to be determined by the court by way of an estimate. It was argued that the value of the many legal actions that were not carried out by the defendants, and will not be carried out due to the sale of the land, significantly exceeds half of the legal work. Even if the defendants were forced to invest hard work in the transaction due to the realization of the risks, this was due to their own negligence.
- In summary, the plaintiffs petitioned for the full refund of the sums invested by them as part of the purchase group, in the total sum of ILS 12,784,061, together with interest differentials and linkage to the construction inputs index, from the date of the filing of the amended statement of claim. From this amount, the additional funds received from the liquidation fund must be deducted.
Alternatively, it was argued that if the court decides that the plaintiffs are not entitled to a full return on their investment, then they are at least petitioning to receive compensation for negligence for the following components of damage: compensation for the deception that Lot 102 can independently contain all the units sold to the class members; compensation in the amount of ILS 5,206,000 due to the failure to bind Lots 102 and 104 while guaranteeing the rights of the members of the group 102; compensation in the amount of ILS 2,066,000 for failure to deposit trust funds according to the letter of undertaking; compensation in the amount of ILS 507,000 for the addition of purchasers late in 2014; compensation in the amount of ILS 763,540 for the unlawful advance payment of the completion of the land component to some of the members of the class; and compensation for negligence in handling the purchase tax and reimbursement of legal fees.