ISRAEL Law and Practice Contributed by: Joseph (Yossi) Ashkenazi, Haim Machluf and Roy Schondorf, Herzog Fox & Neeman
Attachment order It is possible to obtain an attachment order whereby the defendant cannot make any transactions relating to assets owned by him/her that are subject to the order (eg, real estate assets) or whereby a third party has to maintain within its possession (ie, not transfer to the defendant) assets that are held by that third party but belong to the defendant or are owed to the defendant from that third party. An attachment may apply to funds or assets indebt - ed to a defendant (a potential future judgment debt - or) held by third parties, or to assets owned by the defendant, whether they are held by third parties or by the defendant. Also, the attachment can remain in force until a judgment is rendered, and may later allow the court or execution authorities to order the sale of the attached assets to secure the performance of the judgment. This is achieved by filing a motion, during the pro - ceeding (or even before filing the claim), to impose an attachment on the defendant’s assets, including those held by third parties, such as banks, insurance companies including the Israeli National Insurance Institute, and other financial institutions, as well as any other third party which may hold any assets in which the defendant has any rights or claims. The applicant is not required to prove that any of the third parties named in the motion do in fact hold any assets belonging to the defendant (but with regard to third parties which are not financial institutions, the applicant is required to specify the nature of assets that they believe are in their possession), and may file the motion based on the possibility and belief that the third party in question may hold any such assets. The attachment order is given ex parte and served on the relevant third party, which is then required to state whether it indeed holds any assets, towards which the defendant may have any rights. If the order is granted, an attachment is imposed on the monies or assets held by the third party and they may not be paid or transferred to the defendant with - out the court’s permission.
In cases where the attachment is imposed upon any movable or non-movable assets, the third party will not be allowed to transfer the assets to the defendant, and the defendant must not sell or otherwise grant rights to a third party with regard to those assets, until the judgment is satisfied and the attachment is removed. If the asset at issue is also subject to any government registry regarding ownership of assets (eg, cars or real estate), the existence of an attach - ment will be registered in the appropriate registry. In cases where the attachment is imposed upon funds, the defendant will not be entitled to receive them as long as the attachment is in place. After a judgment is rendered, the attachment contin - ues to apply to the relevant asset/monies until the judgment is satisfied. Also, once a judgment is ren - dered, the execution procedure applies (see “Judg - ment execution proceedings” further in this section). This means that the asset may be sold and the returns used to satisfy the judgment. Receivership A plaintiff may be able to apply to the court seeking the appointment of a receiver over the defendant’s assets. This application may be on an interim basis, therefore assisting to safeguard the asset in question as long as the proceedings take place. Such an order may be considered if an attachment is deemed insufficient to safeguard the defendant’s assets and funds until they may be used to satisfy a later judgment (for example, if the court deems it probable that the defendant may attempt to dissipate their assets, thus becoming judgment-proof, before a judgment is rendered). If the motion is granted, the court will appoint and authorise a receiver to perform specific actions (such as to enter the defendant’s premises or to seize, hold and manage the defendant’s assets). After a judgment has been rendered and the defend - ant has been found liable, the court may authorise the receiver to sell the assets and to use the returns to pay off the judgment debtor’s debts.
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