Civil Case (Tel Aviv) 1199-11-18 Doron Zaruk v. A.R.A.B. Bonus Ltd.

Partial Judgment

A company, which assists local authorities and water corporations in enforcing development levies, contracted with the plaintiff to act with it and on its behalf.  And he learned the work and realized it.  The agreement between the parties included a non-disclosure clause and a non-compete clause.  The years passed and the disputes multiplied.  The time has come for separation, and the time has come for a proper reckoning between them.  No agreement was reached.  The plaintiff stopped working with the company, began independent activity, and even joined a law firm that engages, inter alia, in representing local authorities in the fields of municipal taxation.

Did the plaintiff violate the confidentiality clause and violate the company's trade secrets? Did he improperly solicit employees and customers to leave the company and join forces to work with him and the law firm with which he contracted? Is there any justification for the non-compete clause that was made, or should it be disqualified because it contradicts public policy? How should the accounting between the parties be conducted, and should the law firm be held responsible? that the plaintiff contracted with him?

All of these and more must be decided in the framework of the hearing on the claim filed by the plaintiff and the counterclaim filed by the company.

Background

1. Arie Goldian, CPA, defendant 2 (hereinafter: Goldian or the defendant( is a shareholder in A.R.A.B. Bonus Ltd., defendant 1 (hereinafter: a bonus company, the company, the defendant or the counter-plaintiff( (for the exact registration of the company's shareholders, see Appendix 1 to the claim).  Mr. Goldian also serves as its director and CEO.
2. Established in 1994, Bonus specializes in providing economic and accounting advice to local authorities and water and sewage corporations. Among other things, it was engaged in the establishment and issuance of proactive charges of development levy assessments (paving, channeling, sewage, water and sewage( on behalf of its clients.  These charges were issued to companies and entities that built and held real estate assets in the areas of the various municipal authorities, and which turned out after an examination conducted by the company that they had underpaid.  The company entered into agreements with the authorities and the water corporations, and its rent was collected on the basis of success - that is, in accordance with agreed percentages of the amounts collected as a result of its activity.

The Ottoman Settlement [Old Version] 1916The normal work process included issuing an initial assessment after various examinations of the property in the authority's records and databases; examining the property from the outside, including measurements; issuing a billing notice to the property owner; conducting negotiations for a settlement, and, if necessary, accompanying the management of external legal proceedings for the purpose of collecting the debt.

3. 12-34-56-78 Chekhov v. State of Israel, P.D.  51 (2( In 2007, Mr. Goldian met the construction engineer, Mr. Doron Zaruk - the plaintiff in the main suit (hereinafter: Zaruk or the plaintiff), who at that time was engaged in the supervision of construction projects, and hired his services as a supervisor of the construction of his private home.  Afterwards, Mr. Goldian suggested that Mr. Zaruk manage and concentrate the files of collecting development levies on behalf of the company.

The First Agreement

4. On September 9, 2008, the first agreement was signed between Mr. Goldian and Mr. Zaruk, which regulated the engagement between them (hereinafter: the first agreement; Appendix 2 to Mr. Zaruk's affidavit in the main claim). It stipulates that the latter will coordinate the implementation of the agreement with the Jerusalem Municipality, as well as other projects that will be transferred to it from a bonus company.  It was noted that "Doron's responsibility will be to locate all the Administration's obligations and to substantiate them with facts, references, data from the construction files, from a field tour, photographing the site, measurement, preparing materials for the claim, preparing billing requirements and accompanying them until they are actually collected" (first paragraph of the agreement; which does not carry the number of paragraphs).

The agreement stipulated that until August 30, 2008, Mr. Zaruk would work part-time, and from that date on a full-time basis.  At the same time, on the first page of the agreement, it was stated that there would be no employee-employer relationship between the parties, and that Mr. Zaruk's salary included all the contributions he was obligated to make by law (managers' insurance, provident fund and annual leave (see the appendix to the commitment to the agreement).