Parties to a real estate transaction did not sign a written agreement but only a notarized general power of attorney.
The Court held that section 8 of the Israeli Land Law requires the existence of a written document for a valid real estate transaction. The meaning of this provision is that without a written document no valid transaction exists. However, the good faith principal will trump the writing requirement in exceptional circumstances.
In this case the "cry of fairness" exists, because it was proven that the consideration orally agreed was paid, possession was transferred and the purchaser used the property as an owner including leasing it out and mainly by taking a mortgage and paying it for seven years. The sellers acted fraudulently and entered the apartment years after execution of the power of attorney and after receiving the agreed consideration and took advantage of the fact that the apartment was still registered under their names to argue that it belongs to them. Thus, the good faith requirement will trump the writing requirement