The Israel Lands Authority canceled the winning bid of the tender for the purchase of lease rights in a lot located in Ofakim due to failure to meet the financial obligations on the date set in the tender.
The Court annulled the decision of the Israel Lands Authority and held that the Israel Lands Authority contributed to the delay and the delay should not be attributed to the winner of the tender. Late payment by a tender winner constitutes a fundamental breach of the tender terms, which cannot be corrected as its correction will change the tender terms retrospectively. The one and only exception is when a certain failure to complete the transaction by the deadline set in the tender is also due to fault of the authority holding the tender. The duty to act in good faith applies to the authority in all its actions and in some cases a late action by a tender winner may be deemed as an action performed on time. Here, the tender instructions included commitments by the winner to pay the consideration and development expenses, including to the developing company, within 90 days from the date of winning. The entrepreneurial company asked to pay the required consideration, but the Israel Land Authority refused to accept the payment because the deadline had passed. The Israel Lands Authority defaults, which were not under the control of the winner, including: Delay in delivery of winning notification; Publication of incorrect details of the developer company, in which the winner is ought to contact for settling its obligations; and Failure to specify the details required for the required guarantee, are some of the factors that led to the fact that out of 90 days, the actual winner had less than 30 days left to complete its obligations. Therefore, in view of the authority defaults, the late action of the winner must be demed an action performed on time.