The following is a detailed description of the circumstances of the Omarta tender, on which the company relies as a basis for proving the municipality's lack of good faith and its deception towards it.
"Omertta" Tender - Amarta Bat Yam Ltd.
- During the month of June 2016 (i.e., about three months after the signing of the development agreement in our case), the Bat Yam Municipality published a tender for the purchase of a public plot whose designation was to be changed, so that it would be designated for construction. Similar to the tender in our case, three conditions were set in the tender for the execution of the sale transaction: the first condition - the change in the zoning plan - the approval of two city building plans: Plan B/684/Mac/1 for changing the zoning of the land, and Plan B/684/Mac/1 for increasing the scope of housing units allocated for construction after the change of designation; the second condition - obtaining the approval of the Municipal Council; and the third condition - obtaining the approval of the Minister of the Interior for the transaction, as required by law.
- Amarta won the tender, and accordingly a sale agreement was signed between the parties. The sale agreement was approved by the municipality on November 2,2016, and was transferred by the municipality for approval by the Minister of the Interior on December 26,2016, which is a parallel case to our case.
As noted, on February 1,2017, the Ministry of Interior sent a letter to the municipality (to Adv. Hannah Cohen), in which the Ministry of Interior rejected the request and wrote as follows:
"Further to your request for approval of an agreement between the Bat Yam Municipality and Amarta Bat Yam Ltd., in Lot 501, parts of Plots 10,24,31 in Block 5027, and after its examination by the professional bodies... I hereby reply to you as follows:
- The purpose of the agreement is the sale of rights in land designated for a residential building.
- The land that is the subject of the transaction is part of plots 10,24 and 31 in block 5027.
- The approved plan in B/Mac/1/410 applies in the area. According to the approved plan, the above land is designated for public buildings and institutions for education.
- Regarding this, the planning examination shows that given the provisions of the applicable plan, it is not possible to construct a residential structure on the aforementioned land.
- It should be emphasized that as stated in the agreement, Plan B/684/Mac is still invalid. It was approved for validation by the Bat Yam Planning and Building Subcommittee on January 29,2017. The plan was determined by the chairman of the district committee as requiring the approval of the Minister of Finance, and therefore it will have to be examined by the Planning Bureau before the chairman of the district committee decides whether to approve or reject the plan. It should also be emphasized that according to the agreement, plan B/1/684/MAC is only in the initiation stages, so it is not expected to be approved soon. In light of this, it is not possible to approve the aforementioned agreement."
- It appears from the aforesaid that similar to the letter received by the Municipality regarding the company in question, it received another letter in which the Minister of the Interior once again insisted that at the time of publication of the tender, the designation of the land did not correspond to the applicable plan. Therefore, the Ministry of the Interior announced that it was not possible to approve the sale agreement of land intended for residential, while it is not.
Despite the above, the municipality signed the first addendum with the company, without disclosing to the company the contents of the Ministry of Interior's letter, and without saying anything about any problem with the Ministry of the Interior.