The plaintiff's arguments
- The plaintiff argues that the defendant's conduct constitutes discrimination against the minority, which requires a remedy to remove discrimination by the court.
- According to the plaintiff, Gazit created a debt of the company towards him as a "related party" unlawfully and contrary to what was written in the agreement between the parties. The plaintiff insists that in the financial statements for 2018, a debt to Gazit was recorded as a "related party" in the amount of ILS 310,181. This, according to the company, is without a detailed description of the debt and without any reference to the agreement with the company that underlies it.
Moreover, in the financial statements for 2019, the amount of the debt to the "related party" increased to ILS 494,490, with a description according to which the debt is "in accordance with an agreement with a related party, the company owes him management fees as of 2007 and ongoing consulting since 2010" [Appendix F to Gazit's main witness affidavit, at p. 73]. The plaintiff argues that the increase in the debt is not based on any evidence, and therefore constitutes "debt inflation" on the part of Gazit in his favor.
According to her, the debt registered in favor of Gazit constitutes a "fictitious" record intended to illegally transfer funds to Gazit's private pocket. In addition, the plaintiff insists that the lack of disclosure regarding the existence of an agreement between Gazit and the company amounts to fraud and deception.
- The plaintiff claims that Gazit prevents her from taking part in the preparation of the company's financial statements, and that Gazit did not inform her "in real time" of the company's intention to file an appeal in the previous legal proceedings that were conducted as aforesaid.
Moreover, the plaintiff claims that the delivery of the financial statements for the years 2019 and 2020 to her was done with considerable delay without any justification, which, in her opinion, constitutes a violation of her legitimate expectations. According to Gazit, the aforementioned statements were deliberately done by Gazit in order to "dictate" the reports himself and in order to increase the company's debts for his personal benefit.
- The plaintiff insists that Gazit is demanding that she bear the financing of legal proceedings conducted by the company against the controlling shareholders of defendant 2. This, according to her, is contrary to what is agreed upon in clause 4.4 of the agreement, which regulates the liability of the company's shareholders for its current expenses and the manner in which the burden is distributed. According to the plaintiff, Gazit undertook in the agreement not to obligate the plaintiff to bear the financing of legal proceedings in the company.
In addition, the plaintiff claims that the existing debt was imposed on the company in violation of clause 4.5 of the agreement, according to which the plaintiff will not be required to "guarantee the company's existing debts to the extent that there are any." According to her, the agreement exempts her from bearing responsibility for the company's existing debts to Gazit.
- The plaintiff claims that at the time of filing the original statement of claim, Gazit had not yet submitted an annual report for 2021 on behalf of the company. In addition, the plaintiff claims that Gazit does not pay the company's annual fee to the Registrar of Companies, contrary to his undertaking to bear expenses related to the Registrar's fee in accordance with clause 4.4 of the agreement.
- The plaintiff is of the opinion that Gazit is acting against the controlling shareholders of defendant 2 while compartmentalizing the plaintiff, out of extraneous and personal considerations. The plaintiff denies the need for an appeal filed by the company to the Supreme Court and its basis. The plaintiff insists on the tension between Gazit and the controlling shareholders of defendant 2 and claims that Gazit is waging an 'all-out war' against the controlling shareholders of defendant 2 against its involvement.
- The plaintiff claims that Gazit deliberately acted in order to "thwart" offers received by the plaintiff to sell its shares in the company. According to her, the response letter that Gazit sent to her attorney on August 14, 2022, deterred the potential purchaser from completing the transaction with the plaintiff, in order to prevent the plaintiff from selling her shares and leaving the company. The plaintiff is of the opinion that its exclusion from the company's activities, on the one hand, and the prevention of its exit from the company, on the other hand, constitutes an attempt to hold the plaintiff "hostage," and amounts to discriminatory conduct on Gazit's part.
- The plaintiff seeks to order the enforcement of clause 4.3. According to the Claimant, the exercise of the option was carried out as required even before its expiration date, and the defendant is unable to prevent the exercise of its contractual right. According to the plaintiff, Gazit illegally refused to exercise the terms of the option to which she was entitled by virtue of the agreement. This, according to her, was because she had taken the time to exercise the aforementioned option. This is an improper attempt to prevent the plaintiff from leaving the company. As a result, the plaintiff is of the opinion that the defendant's refusal to exercise the option amounts to deprivation of the minority, and even amounts to a breach of the duty of good faith in the performance of a contract under section 39 of the Contracts Law (General Part), 5733-1973 (hereinafter: "the Contracts Law") [section 60 of the plaintiff's summaries].
- The plaintiff further argues that a remedy of separation of powers between the parties should be ordered on the basis of the "impasse" they have reached and on the basis of the loss of trust between them as shareholders in the company. This, according to her, was due to the defendant's alleged deprivation conduct, which led to a rupture in the relationship between the parties. According to her, the company is a "quasi-partnership", which entitles it to remedies, including separation relief, for loss of trust or for a deadlock between the shareholders [the plaintiff refers to Civil Appeal 6290/17 Gabriel Magenzi v. Yoav Levy (Nevo, February 11, 2018) (hereinafter: "the Magenzi case")]. This, she argues, even if it has not been proven that she was actually deprived by the defendant.
This argument, according to her, is strengthened in light of what is written in clause 5.1 of the agreement, according to which "the parties undertake to assist in the advancement and prosperity of the company to the extent possible and that they will act towards each other in everything related to the management of the company's affairs in good faith, transparency, cleanliness and loyalty, and will provide a full and accurate report on every action relating to the company and its matter." According to her, the wording of the agreement attests to a joint and mutual intention of the parties to jointly manage the company's affairs.