Court Orders Developer to Pay Compensation for Unusable Parking Systems
The Tel Aviv Magistrate's Court has ordered a developer to pay approximately 300,000 shekels to apartment buyers in Herzliya. The parking facilities were found to be smaller than promised and failed to meet building permit requirements, making them unsuitable for standard family vehicles.
Buyers of new apartments in Herzliya have discovered that their assigned parking spaces are effectively unusable. The Tel Aviv Magistrate's Court recently awarded compensation totaling approximately 300,000 shekels to residents of a TAMA 38 project after it was revealed that the installed mechanical parking systems were significantly smaller than promised, did not comply with building permits, and could not accommodate standard family vehicles.
The dispute began when three apartment owners in a building on Malkei Israel Street realized they could not reasonably utilize the mechanical parking facilities attached to their units. One plaintiff found that her system was restricted to vehicles no taller than 1.55 meters, with a width that prevented doors from opening. Another couple, who purchased a 5-room apartment, reported that their Mazda CX5 could not fit into the space. A professional appraisal confirmed that the installed equipment differed from the specifications in the building permit, rendering it unfit for its intended purpose.
The developer, Boni Ir Be-Israel Ltd., and its shareholders argued that the systems were built according to local authority approvals and that the sales agreements did not explicitly state dimensions for the systems themselves. Judge Maya Roizman-Eldor rejected these arguments, ruling that the developer had breached the sales contracts.
In her ruling, the judge emphasized:
"I am convinced that the parking facilities provided to the plaintiffs stood in contradiction to the reasonable expectations of the plaintiffs, as buyers of new apartments by virtue of the Sales Law, where they were not presented in advance with all possible limitations on the use of the parking facilities attached to the apartments they purchased."
The court found that the actual height of the parking cells ranged from 1.58 to 1.60 meters, well below the 2.05-meter minimum required by the traffic consultant in the building permit. No approval for this deviation was ever obtained from planning authorities.
The court decided to "pierce the corporate veil," holding both the developer and its shareholder company, M.N. Atid 2012 Ltd., jointly and severally liable. While the judge acknowledged that the systems were not entirely useless, she determined that the buyers were entitled to compensation for the resulting decrease in property value.
In conclusion, the court ordered payments of 96,000 shekels to the first plaintiff and 160,000 shekels to the couple. Additionally, the defendants were ordered to pay 100,000 shekels for breaching a previous mediation agreement, plus 45,000 shekels in legal fees and court costs.
