Afterwards, a "Zoom" meeting was held with the participation of Attorney V Equity, the Municipality's Legal Advisor, the Mayor, and Mr. Dean Wachter. At this meeting, it was agreed that the Municipality would refund the usage fees without the need for an affidavit canceling the transaction.
On October 25,2021, the company's director, Mr. Dean Wechter (Plaintiff No. 2), contacted the Municipality's legal advisor by email to clarify the status of the refund of the usage fees.
On October 26,2021, the Attorney General replied that she was waiting for an opinion in the field of taxes and that signing an affidavit canceling a transaction would "make it very easy for me", despite the previous agreement.
On December 14,2021, the Municipality announced that it intends to refund the usage fees, subject to the approval of the accompanying accountant, the approval of the Ministry of the Interior, and the approval of the NGO (Extraordinary Budget) (see P/43).
In July 2022, the municipality approached the Ministry of Interior for approval of the NRE (No. 4432) in order to refund the usage fees.
- On July 14,2022, the lawsuit was filed.
On April 3,2023, the Municipality refunded the company the sum of ILS 5,075,635.79 for the usage fees. This includes the addition of linkage differences to the Consumer Price Index from the date of payment until February 18,2021 (the date on which the Ministry of Interior's response was received, which signed this transaction).
The plaintiffs were not satisfied with this restitution and argued that linkage and interest differentials should be added to the restitution amount from the date the payment was made, including the payment of the VAT paid, as well as reimbursement of expenses incurred as well as compensation given the violations, misrepresentations and deliberate deception on the part of the defendants.
In August 2024 and then in June 2025, the company contacted the municipality regarding the refund of the VAT amount paid by it.
In September 2025 , a joint application was made to the tax authorities for VAT refund, with the addition of linkage differences to the Consumer Price Index from the date of payment until the date of restitution.
- On April 18,2023, the company contacted the municipality and demanded payment of approximately ILS 1.5 million, reflecting the payment of VAT and linkage differentials until the actual date of restitution, but the municipality did not do so.
The Company's Claims
- According to the company, following its exposure to a letter from the Ministry of Interior's legal office dated January 13,2021, recalling a previous letter sent to the municipality in November 2016, it came to the understanding that the municipality had made false representations to it, deliberately concealed this material information from it, and misled it all along to believe that the transaction would be carried out and that obtaining the approval of the Minister of the Interior for the transaction was a purely technical matter that would be settled after the change in the zoning plan. However, it is clear from the letters that the Municipality received from the Ministry of the Interior that for years (during 2016,2017, and 2018) the Municipality knew very well that even after the change in the zoning plan, to the extent that it succeeded, the approval of the Minister of the Interior would not be granted, given similar tenders published by the Municipality in contravention of the Zoning Plan and which were on the agenda at the same time, in which the Municipality's requests to approve these transactions were rejected (see the case of the Omreta Company and the Supramatist case - details below).
According to the company, it was clear to the municipality at the time that even after the change in the zoning plan, the Minister of the Interior's approval would not be given regarding agreements that did not match the zoning of the land, and therefore it was aware that the agreement that was signed was not enforceable and that there was no point in continuing to exist.