A purchaser of an apartment who did not sign the purchase agreement (but it was signed by the seller) requested the Court to recognize its rights in the apartment despite the fact that at the time of the sale agreement the apartment was mortgaged and later sold to the recipient of the mortgage but the transaction has not yet been recorded at the Land Registry.
The Court held that when a person obligates to a real estate transaction and before the transaction was finalized such person resold the property in a contradicting transaction, the right of the first purchaser is preferable, unless the second purchaser purchased in bone fide and for consideration and the second transaction was recorded before the first transaction.
The Court accepted the claim and held that the first agreement is a binding agreement despite the fact that it was not signed by the purchaser because it contained all the terms and conditions required in order to create contractual relationship, especially when in fact the only one who did not sign it is the one who claims that the agreement is enforceable. The law does not negate the validity of a real estate transaction that was performed after holding the pledge and the transaction is subject to the registered pledge and its limitations, but without this preventing the sale of the asset. As for the second transaction, the first transaction will trump because the second transaction was not finalized by recording.