Supreme Court Upholds 9 Million Shekel Penalty for Kiryat Shmona Delays
The Supreme Court dismissed an appeal by a housing developer, upholding a ruling requiring it to pay 9 million shekels to buyers over severe delays in Kiryat Shmona.
The Supreme Court dismissed an appeal filed by Yuvalim Mechir LeMishtaken Ltd., upholding a lower court ruling that orders the company to pay approximately 9 million shekels in compensation to more than 200 apartment buyers in Kiryat Shmona due to severe construction delays.
During a hearing, Supreme Court Justices Yael Wilner, Alex Stein, and Yechiel Kasher recommended that the company withdraw its appeal. The firm accepted the recommendation, leading the court to officially dismiss the case and order the company to cover an additional 25,000 shekels in legal costs for the respondents.
The legal battle stems from a subsidized housing project in Kiryat Shmona involving 210 apartments across seven plots. Buyers faced delays ranging from several months to over a year. The developer argued that the setbacks were caused by external factors beyond its control, including the COVID-19 pandemic, military operations targeting tunnels, and severe winter storms.
However, Nazareth District Court Judge Arafat Taha rejected these arguments, ruling that the company failed to prove a direct causal link between the cited events and the construction delays. The District Court ordered the firm to pay about 9 million shekels in compensation alongside 636,000 shekels in legal fees, while dismissing claims for emotional distress and personal liability against company owner Yoram Cohen.
Despite the Supreme Court ruling, the legal saga is not entirely over. Representatives for the buyers report that the full compensation amounts have not yet been transferred, and enforcement proceedings remain ongoing to collect the funds awarded by the judiciary.
