ISRAEL Law and Practice Contributed by: Yitzhak Yaari, Chen, Yaari, Vaki & Co.
the court has discretion not to order restitution when the restitution is unjust, but only when the claim is not a proprietary claim. Thus, for example, if A stole an asset from B and sold it to C in conditions that do not constitute market overt, A can sue for the asset, and the court cannot exempt C from restitution. However, if A stole an asset from B, sold it and gave the sale proceeds to C, here too A can sue C for the money, but the court can exempt C from restitution if it is found to be unjust. Unlike in tort law, which focuses on the damage suf - fered by the plaintiff, unjust enrichment law focuses on the benefit received by the defendant and provides that it should be returned to the plaintiff. Therefore, in so far as profits accrued from the stolen property before it was returned to the plaintiff, the plaintiff will also be entitled to those profits. 1.6 Rules of Pre-Action Conduct There is no obligation in Israel to conduct preliminary proceedings before filing a fraud claim. 1.7 Prevention of Defendants Dissipating or Secreting Assets In a fraud claim filed in court, as in any other civil law - suit, the plaintiff may petition the court for temporary orders that will preserve the status quo. As a rule, a motion for a temporary order should be filed after a statement of claim has been filed (or at the same time that it is filed), but in urgent cases, this can be done even before the lawsuit is filed, provided that the lawsuit is filed within seven days of the date on which the order is given or within any other period ordered by the court. The customary order for seizing assets is an order for a temporary lien on the defendant’s assets held by them or by a third party. Beyond that, it is possible to obtain: • a temporary injunction (including a Mareva order); • a temporary receivership order (in which it is pos - sible to obtain powers to enter premises, seize assets, search computers, etc); • an order to seize evidence in the defendant’s pos - session or control; and
• an order preventing the defendant from leaving the country. Most of these orders do not require the defendant’s co-operation, but if a defendant violates an order made against them, contempt of court proceedings can be filed against them, which allows the imposition of sanctions including a fine or imprisonment. The application of interim orders is territorial. How - ever, a Mareva order effectively also allows for the seizure of assets outside the jurisdiction, because it is a personal order that prohibits the debtor, who is within the jurisdiction, from disposing of their assets, irrespective of their location. No fee is payable for filing a motion for a temporary order, but a fee is payable for filing a lawsuit in court. In the case of a pecuniary claim, a fee of 2.5% of the amount claimed (up to approximately NIS28.5 million, and 1% of the amount claimed above that) is payable; half the fee is payable upon filing the claim, and the other half is payable before the trial hearings begin. A motion for temporary relief filed in court should be accompanied by the applicant’s undertaking to com - pensate the person against whom the temporary order is made for any damage caused by the granting of the temporary relief if the relief will expire or will be limited in scope, as well as surety at the court’s discretion. Interim orders can also be obtained in arbitration proceedings, but in this regard, a distinction should be made between ordinary arbitrations and interna- tional commercial arbitrations. In ordinary arbitra - tions, which are litigated under the Arbitration Law, 5728-1968, the court must be petitioned under Sec - tion 16 of the Arbitration Law to obtain interim relief. By contrast, international commercial arbitrations are not governed by the general Arbitration Law, but by the International Commercial Arbitration Law, 5784- 2024, which authorises the panel of arbitrators to grant interim relief without requiring a petition to the court. This law adopted the model law formulated by the United Nations Commission on International Trade Law (UNCITRAL).
199 CHAMBERS.COM
Powered by FlippingBook