An examination by an accounting firm appointed by the Ministry of Finance for the Israeli Handball Association raised serious suspicions of corruption and led to several arrests in a case known to the public as the "Faina Kirschenbaum" case. Following the arrest of the association's chairman, a new chairman was elected who replaced many people in the association. After about a year, the association's general assembly decided to dismiss the chairman.
The Court held that the chairman's dismissal was unlawful. Associations, non-profits and sport associations have been recognized in case law as dual entities, to which the duties and rules of administrative law apply. The General Assembly is the supreme authority of an association and it may decide on any matter within its goals and powers. The decisions of the assembly can be examined on three levels - the substantive, the procedural and the normative. The decision to dismiss the chairman was taken in bad faith and deviated from the required administrative reasonableness, ignoring relevant considerations, mainly the best interests of the association and the accelerated treatment required for deficiencies, as a derivative of that best interest, and is thus not proper.