Legal Updates

A contractor who did not explicitly state a date to which delivery of apartment will be postponed due to requested changes will compensate in case of delay

May 11, 2023

A contractor delivered an apartment to the purchasers after 3 months of delay and refused to compensate them because they asked to make changes to the apartment.

The Court accepted the claim and the contractor was ordered to compensate the purchasers due to the late delivery. Under Israeli law a contractor must compensate if delivery of a built apartment was delayed beyond 60 days from the delivery date specified in the contract. When amending the contractual delivery date due to changes demanded by the purchaser, a specific new date must be specified, in order to allow the purchasers to plan ahead accordingly. Here, the purchasers requested to make changes in the apartment and signed a document in vague wording in which they acknowledged that "ordering the changes may result in the extension of the construction period by up to 8 weeks as a justified delay...". The contractor was obliged to explicitly state a date to which the delivery of the apartment would be postponed, but instead it kept an 'option' for itself without informing the purchasers about it. The purchasers learned about the delay in delivery only in hindsight which did not allow them to plan their steps in advance therefore. Therefore, the contractor was obligated to compensate the purchasers.